Budgeting with Debit & Credit Cards
Are debit and credit cards responsible for putting us in debt? We should all take a serious look at our spending habits. Besides paying your monthly bills, have you been saving for retirement? Is there money put aside for your child’s college tuition? Have you saved for your next vacation? Are your credit cards at the limit? It’s never too late to sit down and prepare a budget.
When I was twelve years old, my father put me on a budget. He thought I was a spendthrift, so on Sunday he gave me $5. He explained that is was for all my expenses for the week, like trips to the Five & Dime, lunches out, and my favorite Friday night dances. The first week I was out of money by Wednesday – no dance that week. The second week I was broke on Thursday. No dancing that week, either. That was the last time I ran out of money. Going dancing was a priority for me so I quickly learned how to budget my $5.
Credit cards and debit cards can either be a great asset or a fast way to debt, depending how you use them. Remember, your debit card is a substitute for checks from your checking account. Every time you swipe that debit card, the money is automatically deducted from your checking account. And if you use your credit card for any purchases, pay the entire balance off every month – with no exceptions. Anything purchased with a credit or debit card should be in your budget before you spend the money.
My father’s lesson has carried me to the present, which for me is retirement if I choose. Financially I am free to make choices because I learned to budget. When my husband and I married, we decided to combine our incomes. Every pay period, which for us was weekly, we budgeted for our bills and paid them on time every month. Then we put aside an allotted amount for savings. Any money left over after that was for fun or special purchases we both agreed upon. To this day, we have never argued over money and we have enjoyed a good life. And yes, we still live by a budget.