This is a guest post by Debbie Dragon she is a writer for Creditorweb.com, where she writes about credit cards and other financial topics for consumers.
If you’re having trouble keeping up with your monthly payments, the first thing most people will tell you is to stop using your credit cards. This is pretty good advice if the problem is you use credit cards because you don’t have the money to buy something and it causes you to spend more than you can afford. Obviously- people who are in this trap need to put a stop to their excessive spending and take control of their finances. If you think you are paying some of your bills late because it’s easy to forget to write the check and get the payment in the mail in time, particularly when you have multiple accounts and they’re all due at different times of the month, then you may want to try a different strategy that involves using a credit card… a lot!
People who are generally disciplined with their finances, but just find that their busy lifestyles make it difficult to keep up with their multiple payments and due dates can benefit greatly from using a credit card to pay for all of their monthly expenses. There are a few things that you will not be able to pay for with a credit card- typically, your mortgage or rent payment, and most loans can’t be paid with a credit card. What you’ll want to do first is make a list of everything you pay for on a monthly basis: get as detailed as possible and include your daily stop for coffee on the way to work, and whatever else you are in a routine of doing.
Next, take your list and determine which accounts will allow you to pay with a credit card and which accounts will require a check. For the accounts that will not allow you to pay with a credit card, see if you can schedule payments to automatically come out of your checking account, and once you set it up, make note of the date they’re scheduled to come out each month. For all other accounts, find out when they are due, and mark it on a calendar for an entire year in advance. Keep the calendar displayed in an area that you can’t help but see every day- like next to the coffee pot or bathroom sink. Once you get in the habit of looking at it everyday, you’ll see what date you need to mail out the few bills that can’t be paid via credit card and should be able to keep track of them now that there are only a couple!
For all accounts that can be paid via credit card, set them up so that they are paid automatically on the date they are due.
Throughout the month, whenever you stop at the store, put gas in your car, or make any kind of purchase, use that same credit card. By doing this, you shouldn’t need to carry much cash around with you, if any at all. If you feel better having some cash on you, just keep a small amount and only use it if for some reason you can’t use the credit card.
By using a credit card for all of your purchases and expenses, you’ll only have to make one payment each month to pay your credit card. You’ll also have an itemized list of everything you’ve paid for in a month, so that you can closely monitor what you’ve spent money on, and see where you can cut costs if necessary.
You can take it a step further and use a credit card that has a rewards program. That way, you’ll be gaining the most rewards possible by using the same card for all expenses all month long; and since you’re going to use your income to pay it all off at the end of each month, you’ll never carry a balance and save on interest and finance fees. It’s important to note that just because you’re using a credit card, you don’t have permission to buy more than you would if you were using cash all month!
The idea is the credit card statement gives you an at-a-glance look at your monthly expenses, and you only have to remember to make that one payment each month to simplify things.