Now that you are about to start, are currently in, or have just finished your bankruptcy you most likely know all about credit cards. They are magical pieces of plastic that allow you to purchase what you need now, and pay for it later unfortunately you really pay for it later. To actually reinvent your life, and embark on the voyage of financial stability, start living a life without credits cards.
Imagining life without plastic seems like a fairytale but it is a reality that most of us need to embrace. A “cash only” system is something beneficial to strive for. Some people call this reverting back to the golden ages, during the time when our great-grandparents and grandparents lived. These were the days when products were only received when they had been paid for in full. If you think about, it is hard to imagine being able to purchase a home, furnish it and then supply it with food, water, and electricity, much less cable and internet, without putting a dime on your credit card. But our grandparents managed to do it (minus the cable and internet), and we should try it out, because ultimately they were better off.
Our grandparents used a pretty primitive system that is effective and fairly easy to adopt: prioritize, prepare, and earn. The first is prioritizing; you must determine what you NEED to survive. Make a list of those items:
- Food/water– These are the real essentials to life, you can only go three days with out water and around five with out food.
- Shelter– Nothing material is more important than having a roof over your head.
- Income/Job– You need to make money to pay for food, water shelter, utilities and transportation.
- Utilities– power, water, and heat/air are not necessary, but pretty important to your well being, they are listed as number 4 because to be able to cook, bathe and operate well in your home, you need them.
- Transportation (gas & insurance)-getting to and from work is essential, there is always the option (though it maybe extreme) to walk or carpool to work. Those are free (or low cost) ways to get to and from your place of business. The bus, or your own vehicle are always an option, and do require a pretty regular fee for operation.
- Luxuries– all the other things in life fall under luxuries. This includes cable, internet, cell phones, home phones, clothes (other than the bare minimum) TV, radio, extra vehicles, vacations, games, meals out of the house, etc.
Now this list might not fit everyone’s essential needs, but be realistic in yours. Just because you feel like you can’t live with out the internet, doesn’t mean you have to have it. If the item is something you have to put on the credit card, ditch it, if it gets paid but you can’t meet the demand for your essentials ditch it; if you are forced to put more and more items on the credit cards, ditch it. Prioritizing your money is a great way to see how much money you are working with for saving for the luxury items.
Tune in tomorrow for the continuation of life without Credit Cards.