Aimee sent in the following email that I thought would be an encouragement to some of you:
I just wanted to write in and let you know how much I appreciate your continued encouragement on your blog about using debit cards instead of credit cards. I have been a MoneySavingMom.com reader for several years now and prior to this year my husband and I always used credit cards for everything. We paid them off at the end of each month, but as a one-income household our finances began to get tighter and tighter.
One of our financial goals for the beginning of this year was to pay off the last month’s charges and stop using credit cards. I am so thankful that we have done this for several reasons.
1) I no longer have credit card bills to dread.
2) It has definitely changed the way I spend. I think more about each purchase because it is coming directly out of my bank account.
3) It has improved communication between my husband and me because we both have to know how we are doing each week and how much money is in the account.
4) We actually have a lower balance in our checking account, which has made me realize the need to stick to a budget.
Just so you know, it has taken me a very long time to transition to debit cards and get my husband on board, but it is such a relief now that we have. I feel like it is one big step in the right direction. Instead of hoping we will have money to pay for something when it is due next month, we are living on what we have right now, and that is a great feeling.
I know most people are happy to use their credit cards, and it’s a hard position to encourage people to use debit instead of credit. Just wanted to encourage you that it is worth it to “live like no one else”, as Dave Ramsey would say. -Aimee
We went from charging nearly everything and paying it off (even when it was painful!) monthly to a cash/debit card based system with a budget in place over the past two months. While we have a good family income, using CC so readily for everything (we have 3 young kids too) left us treading water or occasionally dipping into dwindling savings to pay it off every single month. Since switching and budgeting, we’ve been able to find nearly $1000 a MONTH the past two months – which we’re snowballing a la Dave Ramsey – into paying down our cars asap. It *is* scary to see how low our balance can get before paydays, but it’s a wonderful relief not to wonder just how big the bill will be next month – when the account is low, we take comfort in knowing all of our bills are paid!
We’re going through this process ourselves. We were using it for just emergencies, then started applying for a 0% interest card (and transferring over any emergency expenditures that couldn’t be paid off that month). Then we used our interest-bearing card for everything and paying it off every month, and still did the seperate no-interest cards for big purchases. But we bought our first home 3 years ago (a fixer-upper built 1960s), and about that time the economy tanked and there were very few no-interest credit offers. We put off the nice-to-have home repairs, but it took so much to just get the house livable. Then we had the unexpected (leak under our master bathtub that we had to gut half the bathroom just to stop the leak, ended up with water damage on all 3 floors), and really had to draw the line between “livable” and “sell-able”. For instance, we ended up just drying out the water damage, replacing the walls (since that was mostly our labor to fix), and left the master bathroom empty for over a year now. This meant we had to say “no” to a couple of job offers because we couldn’t sell the house in that condition, but we just couldn’t justify any more debt. In hindsight, the money we’d saved for the down payment and planned home repairs wasn’t nearly enough, even though we thought we’d planned well.
Anyway, after taking the last year or so off from home repairs, we can finally afford to start putting our master bath back together. We also have been moving from using credit card for regular expenses to cash (plus as many home repairs in cash as possible, even the big stuff). We paid for $2000 of plumbing work in cash, which also gave us the ability to withhold 1/2 of the money until the work was complete (which made us feel more at-ease when the work took a week or so longer to complete). It’s a lot trickier than I though moving back to the debit card, since I have to watch my cash flow more closely again (especially when we paid the plumber and the mortgage in the same week!). But this will allow us to pay off debt quicker. And we’re also “cash burns a hole in our pocket” people, so debit plus mint.com works best for us (although they seriously need to add a “cash flow” feature like Microsoft Money software did).
Lesson Learned: money management needs to evolve along with your life. And not all money management systems work for all people, just like some use coupon binders and others use acordian files or a coupon box or just shop at Costco.
I work at a bank and would like to provide a bit of advice. If you use debit cards be sure to use it as a credit and not a debit. Using it as a debit is same as cash and the Credit Card Company will not help if you have a dispute with a merchant. Also, the use of debit cards will not continue at this rate once the banks start charging monthly fees for using them. This will be happening soon. Horrible, I know but that is why they make the big bucks. You are actually better off using a Credit Card that earns you points and only charge what you can pay off at the end of each month.
I’m a banker….I don’t know how many times when I was in retail banking I had to explain to people about hotels, car rentals etc. putting a hold on your money just in case. Please use a credit card in these situations. You don’t want to be away from home, have the hotel authorize three nights stay and then realize all your money is tied up and you can’t use your debit card for anything else.
Also, the rules are the same if you experience fraud on either card; however, with your debit card it’s going to imediately affect you. For example, someone takes your card and goes shopping and spends $1,000. Meanwhile you have checks outstanding that start to bounce because the money is gone. Yes, the bank will likely refund the NSF charge; however, the store or whoever can still charge you their fee for presenting and a bad check and they WILL. Debit cards are great and I use them every day; however when making riskier type purchases (i.e. internet) or when dealing with hotels, etc. use a credit card. It is much safer.
I use a cash system and have a check book. I have all of my budgeted money in the bank in 6 different savings accounts (home, vehicles, extra/gifts, auto pay, debt/savings, and taxes). I deposit a speciifc budgeted amount each payday into each one.
When I need to buy something I transfer the money from the appropriate account to my checkbook, write the check and record the transfer and the check number/amt in my register. I do have a debit card for when I leave the checkbook at home, but save my receipt that I labeled at the store and record it as soon as I get home. I keep two envelopes each week, one for groceries and one for household items (like paper products). I keep the reciepts in the envelopes and record them in a mini notebook each week to see what is left and where the money was spent.
It really makes me think about spending something because if I did not transfer the money, I can’t get it and when the cash is gone, I am done for that week.
A Credit Card free life might help a family who already has credit established, a house, and a car, but for starting out, it’s really important to have a credit card. Debt makes me uncomfortable and I don’t like it. I even paid my car off in less than a year because I couldn’t stand it. I didn’t bother opening a credit card while I was in college, and now I really regret it. I used my debit card for everything and this meant I had no credit, and no one wants to give you a credit card as soon as you aren’t a student. I had to go home and beg my father to cosign for my car with me in order to get a line of credit (and then, my interest rate was a 7.5%). Then after I paid the car off, I realized that paying it off quickly resulted in very little credit information out there on me. I really had to work at investing my money and applying for every card that I could in order to convince someone to take a chance on me. I now pay off my credit card bills every month (I’m still not that comfortable with debt), but at least I have a history. I will have to really work to get to the point where I can have enough credit to buy a house. All of this could have been better if I just signed up for a card in college. Discouraging; but I’m getting there.
This, of course, would have been helped by student loans. But due to be a female in a male dominated field… I went through college on a full ride.
I have both credit and debit cards, but use them for different things. I use the credit card for hotels, flights and other travel expenses, for online purchases and for gasoline, since I get a few cents per gallon credited to my account. It’s a no-fee card and I always pay the total balance each month, so there’s no charge for the card itself. I use the debit card for most local shopping. It’s also a no-fee card. I generally use cash for dining out, entertainment, and smaller purchases. This system works for me (as long as I remember to record debit purchases in my check register).
For the first 8 years of our marriage we didn’t own a credit card, we had zero debt (even after seminary), and some money in the bank. We were shocked to learn however that we could not qualify for any kind of a loan to buy a home, simply because we had no credit rating. Today, your credit rating affects things other than loans as well–insurance rates, renter’s deposits, etc.
I highly recommend a system like Crown mvelopes–it allows your credit card purchases to be taken directly out of your virtual envelopes–just like the traditional cash system. I may be weird, but I acutally spend less when I’m NOT spending cash–it’s too easy for me to spend a few dollars here, a few dollars there–it’s the little things that add up for me.
I know it doesn’t work for everyone, but I put everything on a credit card that earns rewards and pay it off each month. Cash and receipts seem to evaporate out of my purse, but I can always check my CC statement online and download purchases to a spreadsheet. It makes quick work of figuring out where my money goes. I ignore the limit set by the credit card company and mentally lower it to the amount of money I have. I never put more on the card than I have cash in the bank. If I need to save up for something, I just trim the budget for a couple of months before I charge a bigger ticket item. It takes discipline, but my parents joke that I took the frugality they raised me with to a whole ‘nother level.
I also use my CC for the point and pay off monthly. One thing you can do if you are afraid of over spending, is call the CC company and lower your limit to you budget amount. That way you will not over spend.
We finally paid off our credit card 2 months ago. Took 8 years! And even though we are just a few months in to being credit card free–it’s amazing how freeing it is! We have a very tight budget so knowing that I either bounce a check or don’t get something has me really reigning in our purchases.
I also love my Discover Card and have paid it off each month for over 20 years with no problems. The key here is discipline to sticking to your budget… also make it a goal to be one month ahead in your bank account for those expenses you will charge, so the money will always be there. Having excellent credit let us refinance last month to a 15 year mortgage at a rate of 3.375% and saved us thousands of dollars! If you cannot discipline yourself however, I would go with the cash system.
I worked for Discover credit card for a while and in the week-long, intense training I was amazed at how much I learned. There are a lot of pitfalls (and debt traps that are quite legal) with credit, particularly if you are not extremely organized, but there are also a lot of benefits. We have online banking that allows us to monitor both debit and credit accounts simultaneously. We love the excellent cashback deal we have, and most of all the crucial good credit we are building for the future. If being rid of your credit cards gives you more control over expenses that is great, but I don’t think we’ll be cutting up our credit cards anytime soon!
For me its still best to use my Discover card for everything and get the Cashback Bonus, which earns me a couple of nice gift cards every year. I always pay the balance off every month and I dont overspend. If my balance is higher than I like one month, I am mindful to spend less the next month. I dont use any other credit cards and dont have any loans so using my Discover helps to keeps my credit active and my credit score high.
I use my credit card for everything BUT i make our monthly budget on an excel spreadsheet, and record all my purchases immediately. I ONLY spend what we made that week, usually less–just like using a debit card. I check my budget worksheet the way other people check their account balance. And I don’t wait til the end of the month to make payments, I often make them weekly (why keep the money in the account if you’ve already spent it?)
Credit cards aren’t the enemy. You just have to be disciplined enough to use them correctly. If you’re not, stick to the envelope system. If you are, enjoy the cashback bonus for paying your bills-I do!
We do the exact same thing, Brittany, and I love your last paragraph! So many people rant about the evils of credit cards, but it’s really an issue of personal discipline. Some people have the discipline to use credit cards and enjoy their benefits, and others don’t.
My husband and I have only been married for 4 years. In that time, we have gotten hundreds of dollars from the credit card company and have an awesome credit score. I don’t see any reason at all to quit using it as long as we’re getting such amazing benefits from it.
All we have is a debit card. We’ve never had credit cards. Our credit is atrocious; no one will loan money to us because we don’t have any positive credit on our account (no outstanding bad credit points, but no good credit points, either) and we can’t get any credit cards, either. There have been several, several times when having a credit card might have made the difference between a week of groceries and a day of groceries. I’m grateful to this blog because it helps me save so much money, so that we can afford that week’s worth of groceries without the credit cards, but even having one with a very low balance would be nice for an emergency 🙁
I absolutely agree. I am 25 and live alone and decided a few months ago that I was also dreading the credit card bill at the end of the month. And I would use it to buy random things (groceries here, greeting card there, dinner out with the girls more than I would like). So I put the credit card in my money jar and haven’t used it – well I do have a monthly $17 charge just to keep it activated. I hope my boyfriend/future husband appreciates this 🙂
Cancel your card and spend the $17 you save on a nice dinner out! You deserve it! I wish I was as smart at your age!!
Ouch! No reason to pay $17 a month for a credit card! Even if you have no credit history, you can get a prepaid credit card, use it once, pay it off immediately, then put in the jar. Most credit unions have no-fee credit cards with good interest rates, if you’re using it as a “just for emergencies” card (exactly how I used my credit card at your age).
I should have been more clear! I have one monthly charge (my weight watchers membership) that I keep on that credit card. So either way I would be spending that money. Though I very well may convert it to my debit card. Why not, right?
Several years ago we were scammed on a $100 online purchase on our credit card and in one phone call the money was credited to our account and we were never actually out that money like we would have been if we were using our debit card. For similar reasons I also don’t like having a lot of cash on me or in our home, if my purse were to be stolen there isn’t always a good chance of getting that money back. I know it seems like a negative way to think of things, but after being scammed even for a relatively small amount it makes you realize that it can happen to you even if you’re careful with your money.
Since we do use a credit card for most of our expenses, to help make sure we’re not getting carried away with our spending we use a website that records all our transactions from the credit card, bank account balance, etc. and also lets you set monthly budget categories (we use Mint but there are other sites that do the same). I log into the site daily review our transactions & look at where we are on our budgets. We’ve been using this method for about 2 years and I find that even though we’re using credit cards seeing the transactions every single day really helps us stick to each categories budget.
I use Mint, too, and it does help a lot. 🙂
The main reason that I use credit cards instead of debit cards is that you have more protection for incorrect charges or any problems with the product you purchase. I always pay them off at the end of each month, and I enjoy the refund I get from the points I earn on my purchases. My credit card does not have an annual fee.
I agree with you, Aimee. We switched from credit to debit a few years ago and have never looked back. We’ll still occasionally use a credit card for travel or for an internet purchase from a retailer we’re not used to dealing with. Other than that, however, it’s debit all the way.
Great testimonial!
I second Aimee’s point on it changing the way we spend. There’s just something psychological that controls what I spend when I use a debit vs. credit card. Even though we would pay our credit off at the end of each month- Knowing that it comes directly out of my checking account using my debit makes me spend less! Getting rid of credit has transformed our thinking and our family dynamics- for the better!
Isn’t one of the negatives of a debit card that a fee is charged whereas there is no fee for a credit card? Thank you.
Elaine, it depends on your bank and, sometimes, whether you run the debit card through as credit or debit. With my bank, there are no fees and we get 1% – 2% back on everything we buy with the debit card as long as it’s a signature (and not a PIN) transaction.
My debit card doesn’t have any fees associated with it. It’s with a credit union, if that makes a difference.
My debit card is with a bank and there’s no fee associated with it for me.
Congratulations on your success! I primarily use debit, but for certain things use my credit card. I just record that entry in my checkbook the same way I do debit entries (well, I designate them differently, but I enter them). That way I never get any sort of surprise over the credit card statement total, because the money has already been subtracted from my balance.
Good job on switching to debit, but now on to the next step: using cash only! We went through the seminars with Dave Ramsey. Our eyes were really opened on how much more people spend when using credit cards than debit and even more than when spending cash. It is much harder to hand over your hard-earned $100 or $20 bill than to just swipe a card (any card)! We do the cash in envelopes for most of our discretionary spending (dining out, groceries, etc) and things we have to “save up” for like car insurance that gets paid every 6 months. You will always have budget struggles, but the more things you plan for and pay cash for the more money you will have in the end and the less worries you have. Keep up the good work everyone! 😀
For me, the cash-only system wouldn’t work. I have a much harder time keeping track of my purchases with cash than I do with my debit card.
Kristine, cash only does work. You get a receipt with purchases the same with cash as you would a credit card. Your post doesn’t make sense. Yes, it requires discipline, but it does work…and sometimes you have to tell yourself that awful forbidden word….NO.
What works for you might not work for everyone. Each person needs to do what’s best for them.
Up until about 50 years ago, only cash worked because there were no credit cards. Yes, you could have an account with a store if they knew you, but other than that, it was cash only. It boils down to discipline, and you do what is best for you. The point I was making wasn’t a personal attack on anyone, it is just plain and simple that cash is king.
It may not make sense to you, but what works for you doesn’t work for everyone. We all have to do what works best for our families, and for me that’s not cash only. That doesn’t mean that I don’t have discipline when it comes to spending. For me, using a debit card and keeping track of my spending on mint.com works.
We did cash only for about 2 weeks. It did not work well at all. I find it is incredibly easy to spend $5 here and $5 there with cash. I prefer my debit card where I think much harder about my purchases. Cash burns a hole in my pocket. I can go days without using a debit card. Everyone is different.
I think what Kristine said was that _FOR_HER_, cash-only didn’t work (not that it wouldn’t work for anyone or that it doesn’t work at all) with the reason being that it’s easier for her to keep track of purchases online than it is to maintain receipts.
I’m the same way (as is my husband) – I can’t keep a receipt to save my life and cash that’s in my wallet gets spent. Constantly pulling cash out of our bank account would bankrupt my family. Using a credit card frugally works for us.
It’s not a matter of lacking discipline – it’s disciplining ourselves differently. We still track how much we have and how much we’re spending, we’re just not making it as available to us. When my husband or I get cash, that’s our “blow” money that we can spend on whatever we want without having to keep tabs on it.
I admire people who can do this but it’s never going to happen for us. We don’t use credit cards – except for “emergencies.” Problem is when you have emergency after emergency after emergency and have cleared out the emergency fun and borrowed money from parents only to have another emergency, you have to get money from somewhere. As far as debit card dangers, just like anything else – it’s all about paying attention. We check our bank accounts everyday and save receipts. If something is off, you notice and say something. The same isn’t true with a lot of people and credit.
We’re a mixture of debit card/credit card. We like to get the rewards gift cards from our credit cards but don’t carry a balance on the credit card. I actually pay my card every other week when we receive our paychecks. If I buy something large I’ll go in and make the payment immediately. I’m always afraid if I wait until the end of the month ‘something’ will come up that would prevent me from paying in full.
I would definitely suggest keeping a credit card for travel. Often there is a daily limit on a debit card (our bank limits to $1,000/day when utilizing the credit feature) so that your account can’t be wiped out. Large transactions (like airfare) can be a pain, also hotels will typically put a hold on funds potentially leaving you short of cash.
About the bank limits, we always tell our bank that we are going to be traveling and they temporarily raise the daily limit to whatever we need for the 1 or 2 weeks we are gone. They have always been more than helpful. Last year was our first year of paying for vacation with cash or debit only. WOW! We went to FIJI and it was a blast! We didn’t have the worry that when we get back we have to come up with what we spent. We already had it covered. This was the most relaxing vacation ever!!!
I love my debit card! I find it so much easier to stay on track when using strictly debit and/or cash. I just learned the hard way though, that when renting a car, you should probably use credit. If you use debit to rent a car, they can make a hard inquiry on your credit report, which can affect your score. I just finished writing about it on my blog, because I thought most people are probably unaware, like I was!
That is not a permissable use for a credit report. You are not applying for credit. I pull credit every day as a credit analyst…Plus, people get so caught up in the number of inquiry thing. The model is very complicated, but inquiries don’t really affect your score that much.
According to 10 major rental car companies, it is legal and permissible, and when you sign the agreement, you are agreeing to it as well. Here is an example of one policy – see letter G for “Debit Card Usage”. http://www.dollar.com/aboutus/generalpolicies.aspx
Also, to me, protecting my credit report from extra inquiries is akin to using coupons. The amount of any individual one may not have a huge impact, but I do what I can in every small area to make sure I’m making the most of my resources. Even if the affect is very small, it’s an affect I don’t need.
Also, in addition to my post above, I have read you should not use debit cards at gas pumps and also not hand them to waitresses (where they will be out of your sight). I am reluctant to use something that has so many dangers. Just my opinion.
On waiter and waitresses… I would say that a majority of the wait staff out there are honest, hard working people. However, my brother got taken to the cleaners with his debit card. A copy was made by a waiter and thousands (he’s a lawyer) were taken out of his account. Luckily, he has a profession that got him his money back but I have been cautious ever since. I try to use cash in those situations.
As a waitress I’m a little offended, but understanding if something like that has every happened. What is your suggestion on how to eat at a restaurant (with a card) without handing it over?
Also, I would have NO idea how to charge someone thousands of dollars more than their meal. And I certainly wouldn’t be able to put it in my pocket, it would go to the restaurant’s owner.
If you noticed, I said most waiters are honest. However, in my brothers case, they took the card, wrote down the information, gave him back his card and went home and shopped on the Internet. It’s that easy. It’s easier to stop by the ATM and get cash. Problem solved.
I think the previous poster’s point was that she would rather use a credit card instead of a debit, in case that were to happen in a restaurant.
My husband is a senior level IT professional, working in the banking/financial industry. You’d be saddened by how easy this is to do, and how often it occurs.
Again the same could happen with a credit card…it just doesn’t touch your checking account that way…but you will find with almost any case of fraud the bank gets it cleared very quickly. For the matter you cash can get stolen and so can your checks. Every choice carries inherent risk.
I am extremely reluctant to use a debit card. (We pay our credit card off every month). Some examples are listed on this link.
http://moneywatch.bnet.com/saving-money/blog/devil-details/5-reasons-using-a-debit-card-is-dangerous/3471/
I have worked for credit card companies and banks my whole life…much of this article is exaggerated or simply not true…every SINGLE risk listed is the same on a credit card. EXCEPT that any losses affect your checking balance.
In the comments there was a link to a blogpost from the bank I bank with that responded to all the claims…
I’m not stating that you are not entitled to your opinion…but the link is to a Financial Advisors website…a person that gets paid for selling you financial products. Nothing wrong with what she does (I work in the field!) just saying there is some bias there…
I use a credit card but pay the balance off each month. I’d like to switch to a debit card. I don’t know much about debit cards…would there ever be a reason to have a credit card account as a backup or have you found that you can pay by debit everywhere? For instance, purchases made online?
Thanks!
We use our only credit card for online purchases and hotel reservations. We personally did this in case it would ever get hacked, it wouldn’t tie up our checking account (even for a day).
But that is more for our personal peace of mind, than any other benefit (at least that I know of)
That’s what I was concerned about…thanks!!
I’ve found that it’s still handy to have a credit card when checking into a hotel. Even if you plan to pay in cash, the hotel will often put a “hold” on your card in case of incidentals. They can put this hold on a debit card as well, but it can be for as much as $300, which means any other shopping you do during your stay may be declined because if you’re like me, you may not have an extra few hundred dollars to have “on hold”.
Otherwise, I’ve found that I’ve been able to use my debit card everywhere. The only other reason I can think of is that some banks have a limit on the dollar amount of a single transaction. If you’re going to purchase a big ticket item, you might not be able to do that with your debit card.
We had this happen to us while traveling only with debit and cash. When we were at the car rental que, we were not told that a $500 hold was being placed on our card for 48 hours. At the hotel, another $300 hold was placed. Imagine our surprise when our debit card was declined the next day – AFTER we ordered breakfast! It was terrifically embarrassing in front of my family (who we were supposed to be treating to a nice meal) and not a great way to start a vacation.
Great article! I don’t have a CC, but I’m still young, so I use Debit for everything. It works for me!
My husband and I use credit cards (we like the rewards!), but treat them like debit cards. We only spend money that we have in our account, and as we keep track of our finances, we subtract our credit card payments from our checking account in our books, because in our minds, the money is already spent and gone. Of course we pay it off every month too.
It’s all in your view of the card. If you spend money now that you hope you’ll make next month to cover your spending, it’s going to be stressful. But if you spend money that you already have in your account, as long as you keep track of your spending and stay within your budget, it doesn’t matter what form of payment you use.
That’s awesome that you guys are able to pay the balance each month. If I started using cc’s again, I’d have good intentions, but I’d probably get carried away with the spending and my intentions would go down the drain!
Krysten, we like doing that too. We have a free rewards program on our card and we are constantly getting free gift cards to fix up the house, go out to eat, or free cash. However, we have been doing this for a long time and it’s second nature to us because we have been credit card debt free for awhile. I haven’t gone over in years but to a newbie, I probably would suggest a transition.
This is also how I (try to) keep a track of our credit card spending, I’d love to not have any credit cards at all but we’ve been told it’s the best way to build a credit score seeing as we’re from England and have a very low score at present. We currently have three credit cards, one which my husband uses for business expenses that he can claim back, one for his personal expenses (mainly gas) and one for my personal expenses (mainly groceries) and we pay them all off in full each month. I handle all of our finances but have discovered that it’s very important to sit down together a couple of times per month and review what’s being spent on those cards (my OH was getting a bit of a coffee habit and I had to try to deal with it in a sensitive way seeing as he’s the one with the job!) I didn’t need to say anything to him, just by reviewing what was spent was enough to show him that it was getting out of hand. My parents got divorced about 11 years ago, my Mum handled all the finances so when she left my Dad had no idea that they were in debt, if only my Mum had shared this with him they probably could have sorted it out together and taken a lot of pressure off their marriage. I now vow to always share my money worries or achievements with my OH. It’s our 1st wedding anniversary this weekend so fingers crossed we’re heading in the right direction!
We also use our credit card like a debit card. Anything purchased on our credit cards comes out of the same months budget. Our credit card is hooked up to mint.com, which allows us to track all spending and make sure we don’t go over for the month. We don’t even have a category on mint for our credit card payment because the money is already being shown as deducted from our accounts (as opposed to an extra payment in addition to monthly expenses). So far the best system for us.
As we made the transition to debit card instead of credit card, one of the hardest things for me to get past was the teeeeeny balance left at the end of the month. I still have to remind myself that all of the bills are paid and our cash is in our envelopes. We rarely use our debit card except for gas so it’s not a major deal to have a small balance, but it’s amazing how that number can have your stomach in knots!
I totally agree, Heather. That’s where we’re at right now. Things are paid but the checking account dwindles awfully fast each week. I’m glad we have that discipline not to fall back on the credit cards.
Awesome note to encourage us! We used to be like that, using CC then paying it off every month. Now we are in the “transition period” where we are using the debit card and have the CC as a back up. We have paid off and closed all but one CC which has a little bit of a balance still. But getting better every month at sticking to a budget and not using the CC at all!
That’s great, Aimee! Debit is definitely the way to go. If you don’t have it … you don’t spend it! 😉
We have never used credits cards for our daily purchases unless we had to. However, I think there are many people who are able to use credit cards for their purchases so they can get the “credit card rewards” that come with it. For example, one of our cards we get points so we definitely use it for large purchases and pay it off when get the bill so we can get the reward.
Luckily, if we run our debit card as credit, we earn points but the amount is still taken out immediately as it is with a debit card. Best of both worlds 🙂
I’m with Katie! Love my Perkstreet account!!
It’s such a great feeling to have that kind of control over your finances and your life. Very freeing:)