How to Quit Using Your Credit Card | Richard Banks & Associates, P.C.

Having a credit card is something that seems to be a common practice in the United States.

In fact, according to a study by the American Banking Association, there were 364 million open credit card accounts in our country by the end of 2017. That could roughly be figured to mean that out of 249.5 million adults in the U.S. (per the Census Bureau), around 189 million have at least one credit card.

Debt comes along with those credit card accounts, with the majority of $1.03 trillion worth of revolving debt balances being carried by Americans in 2018 coming from credit card debt—to the tune of $830 billion.

If you are struggling with credit card debt, one of the best options is to eliminate the use of the plastic from your life.

How to Cut Ties With the Card

Some of these tips may seem a bit on the simple side, but if they truly were, wouldn’t fewer Americans have credit card debt? Be mindful that while it may seem easy to stop using a credit card, putting that decision into practice could be a bit more difficult than expected.

1. Out of sight, out of mind. Take the credit cards out of your wallet and stash them somewhere that will take effort to get them. You can even take a more drastic approach to “freezing” them, and put them in a bowl or bag of water and then stick them in the freezer. Not having your card readily available will make it harder for you to make additional charges.

2. Think about those interest rates. It can be easy to think of a credit card as “free money,” but have you considered how much extra you are paying once interest is factored in? If you have a $1,000 credit card balance and 14% interest rate, paying it off over 4.5 years at $25 per month would mean that you are paying an additional $347.55 in interest total.

3. Close them. Do you have some cards carrying a zero balance that you really don’t need? It may be the perfect time to close them. Keep in mind, closing a credit card can have a negative impact on your credit score, but it may be better to suffer a temporary setback and not go deeper into debt.

Are you worried that you have too much credit card debt and will be unable to pay it off? Contact Richard Banks & Associates to discuss how bankruptcy may be an option for you.