Today: Give your credit card a timeout
The first in a three-part series by John Moakler, BMath, CFP, CLU, CSC
With many people out of work, or with their income drastically reduced, the pandemic is the time to manage cash flow more carefully than ever. And, with our opportunities to spend so drastically reduced, new spending habits are taking shape – so this is the perfect opportunity to think about making them permanent. In the first post of this three-part series, John asks some tough questions about your credit cards.
When was the last time you put away your credit cards, and only used debit or cash to make your everyday purchases? If it’s been awhile, it’s something I strongly suggest you try. You’ll be amazed at how much more conscious you become of your spending. Because the truth is this: constantly using your credit card blurs the reality of what you can afford – versus what you simply want to purchase. It’s a question of what you want, versus what you actually need.
So, try putting away your credit card for just three weeks.
And then ask yourself, “What am I really buying?” Only using debit or cash provides you with an awareness of what you are actually spending on. Consider this statistic: according to Bailey Peterson, a research analyst at ValuePenguin, people are willing to spend as much as 83% more when they use a credit card versus cash or debit.
Just ask yourself: “How would I like to have 83% more money in my pocket right now?”
If you truly want to get a handle on your expenses during the pandemic – or at any time, for that matter – seek the advice of a professional Certified Financial Planner (CFP) or Chartered Life Underwriter (CLU), two crucial certifications I have earned. Get help with developing a monthly budget. Most financial planners have developed their own tools or templates to help you with the budgeting process.
BMath, CFP, CLU, CSC
President and Senior Executive Financial Planner
Moakler Wealth Management Inc.
1 416 840 8544