With great power, comes great responsibility.
Sorry, I couldn’t help it. Every time I think about credit cards I keep thinking about how they’re like knives. They’re powerful and can get the job done, but one wrong move and you’re in deep trouble.
I love credit cards, I really do. They can help you out with so many things like get rewards points and bump up your credit score. However, it’s also super scary because for spenders, you can get into trouble when you spend more than you have in your bank account. It’s makes sense why so many people recommend that you cut up your credit cards if you’re heavily in debt.
In my opinion, that’s just a temporary solution. You need to think about why you got yourself into deep credit card doo doo in the first place. There are actually some tools out there than can help you use your credit card wisely.
Note that these tools aren’t meant to tackle the mindset issues related to your credit card. Rather, they help you keep an eye on your credit card behavior so you can start working on your habits.
Debitize is like your accountability buddy when it comes to helping you be more responsible with your credit card.It’s a service that monitors your credit cards for transactions. It’ll make small transfers to your linked checking account to your Debitize account so you have enough to cover your credit card statement. Before your bill is due (usually one week), they’ll take that money and pay your bill for you!
If you’re worried about the security of this service, don’t. Your account is held through a secure ACH processor and your account is with an FDIC institution (which is insured for up to $250,000).
Even though this is a cool service, keep in mind that your card won’t be rejected at the register if you do end up spending more than what’s in your checking account. It’s a great way to keep you accountable for paying your bills, but you still have to manage your spending behaviors, which is crucial if you want to use your credit card wisely.
You’ve heard me rave about this product. It’s because I really believe in it and its ability to help you use your credit card wisely. How this works is that you link your bank account the app. You’ll get a Visa Debit card that only works when you use the app. Much like cash envelope budgeting, you create categories and set aside money for each one. When you head to the register, the app will pop up asking you which category you’re making the purchase from.
The cool thing about this card is can link to a credit card of your choice too (but you still need to use their Visa Debit card). You will get your card denied at the register if you fail to tell the app what the money is being spent on or if you don’t have enough money set aside.
So it’s like a stern mother who constantly questions you what you’re going to buy before you actually buy it. Keep in mind you can “cheat”, as in tell the app the wrong category and still spend money. So even though your card can get denied, you will need to get clear on your priorities before you go crazy spending.
A Spending Journal
You can literally use any notebook out there, though there are some cool ones like the Mindful Budgeting Planner that can help you.
All you do with a spending journal is write down what you spent and how you felt about it. The idea is that you reflect on your purchases, hence becoming more mindful in the process. For many, going into credit card debt is as a result of not really thinking about what they want in life or using spending as a way to mask their unhappiness. If you reflect on what you’re using your money for, you’ll quickly learn parts of yourself you may not have known before (or were in denial about ). I know when I started using a spending journal I realized I had a bunch of spending triggers I needed to work on. It was also a way to go back and remember amazing purchases, like presents for friends they loved or once in a lifetime trips.
Note: I actually cover this in my book “The Authentic Budget”. Check it out on Amazon!
Will you use any of these tools to help better your relationship with money and use your credit card wisely? Let me know in the comments!