It’s Possible to Avoid Credit Card Debt

April 4, 2019 by David Riedel

There was a time in the late 1990s when I got my first credit card (correction: first credit card not paid for by mom and dad). Amazon was new, my spending power was new, and before I knew it, I had about $5000 in debt. I earned about $25,000 a year at the time.

Ouch.

It took me years to pay that off, and I’m mildly ashamed to admit I took on more debt. I lived in New York and went out to concerts and restaurants a lot (way, way too much). Plus, I was determined to live without roommates; that’s one choice I don’t regret.

Back then, credit card bills—or at least my credit card bills—didn’t come with the handy information they do now about how to pay off your debt within a specific amount of time. For example, I now have a couple Bank of America credit cards, and each has a suggestion on how to pay off the debt you’ve accrued within three years. (It’s a simple calculation: You basically pay considerably more than the minimum.)

Sometimes debt is unavoidable: Your roof collapses, your kids have more cavities than you thought they would (ask me how many parents I know whose kids’ dental isn’t covered by any of their insurance plans), or your car dies and you need a new one tomorrow.

But often debt is a choice. I’ve mentioned before that I collect vinyl records. I’ve put that on pause for 2019 (that means no new Frank Zappa, which is a bummer). And in the past few months, I’ve also tried a new experiment: Carrying cash as if it’s 1999, not 2019. That means impulse buys, for me at least, are a thing of the past. If I can’t cover a purchase with the cash in my wallet, I’m not purchasing the thing.

None of these suggestions is revelatory. However, after talking with lots of friends about ways they cut costs to ease family financial burdens, about a third of them told me they switched back to cash and some even leave the debit cards at home. It’s hard to buy things you don’t necessarily want (let alone need) if you quite literally don’t have the means at your fingertips to do so.

We live in a consumer culture now, and each day it’s becoming easier and easier to consume. By going back to paper money, I’ve reduced a lot of unnecessary spending. Maybe it can work for you, too.

 

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