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The Golden Rule of Credit Cards

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I remember this day like it was yesterday. After many years without credit cards, there was finally a credit card company out there willing to take a chance on me. I was not completely out of debt yet (I was probably about halfway there). My old credit cards had long since been cut up. I was at a point where I still wasn’t allowed to have bank accounts and still owed my parents lots of money, but I had been making progress. Facing a mountain of about $20K in overall debt, I was somewhere around halfway home. Ten thousand paid off, ten thousand still to go.

Regardless, I received one of those little things in the mail telling me about some credit card offer by somebody. Of course, I take them for granted today when I see them and I have for years, but this one was kind of special. You see, living without ANY kind of credit card at all is quite a major inconvenience. I didn’t feel safe a lot of the time because I always had to carry cash with me. And since I still wasn’t allowed to have a bank account, I didn’t have a debit card either. If you think about that scenario, you’ll realize what I’m talking about.

Scared To Death

So, it was actually pretty crazy. I think my hands were actually shaking. The best way I can describe it is it was probably very similar to a drug addict, who just got out of rehab, going by the place he used to buy his drugs all the time. It really was. Credit cards were the death of me and the main reason why I fell so deeply in debt. I couldn’t believe that I was actually considering taking out another. Well, I was. It was more for convenience and safety than anything. Also, it was to begin repairing my shattered credit record.

It was then that I received probably the best single piece of advice I had ever received before. And it came from none other than my mother. I had just been approved for my first card in probably five years, and I was talking to her about it. We talked about how to handle it, how not to screw up so bad this time, and so on.

She said to me, “David, it’s simple. There is just one piece of advice I can give you regarding this card, and it’s the only piece of advice you’ll ever need…

“If you can’t afford to pay it off by the end of the month, then you can’t afford it. Period.”

I asked her what she meant by “it” and I think she almost started yelling. “What do you mean, what do I mean by ‘it'”? “It” is anything. Its clothes, it’s dinner at a nice restaurant, it’s going to a movie, it’s a lottery ticket, it’s a six pack of beer, it’s anything. If you can’t afford to get that balance down to zero by the end of the month, then you can’t afford it. Plain and simple.”

And she was right. I took that piece of advice to heart and I never looked back. I think I was scared to death the first few months using that card, but I sure did follow that rule.

Talk the Talk, Walk the Walk

If you’re talking about ways to pay down your credit card debt, there are lots of programs to put yourself on; I won’t go into all of them here. If you want one simple and easy method to stay out of credit card debt or to keep from getting deeper in credit card debt, then heed my mom’s advice. Of course, you can come up with the greatest ideas in the world to solve your debt problems, but if you don’t execute them, you will still be in the same situation.

When I hit rock bottom, and finally decided to do something about it, my spending stopped. And I mean stopped. People talk about distinguishing between wants and needs in your life to save money, but to me it was a no-brainer. Besides food and shelter, everything else was a “want” and I didn’t buy it. No new clothes, no new “toys,” no gifts to myself, nothing. That lasted for a few years, by the way. When I was finally able to get a credit card again, it was like I was dipping my toe in the water, afraid of how cold it might be. I was bound and determined not to screw it up a second time. Since that day about 15 years ago I have never missed paying a credit card balance in full and on time. That comes on the heels of not paying them in full or on time for probably about five years. So I know it can be done.

The Golden Rule of Credit Cards is a simple concept, but easier said than done to execute. However, if you break down the spending in your life with brutal honesty along with putting this new rule into place, you should easily be able to avoid any further debt, or avoid it altogether.

Oh, by the way, thanks Mom!

Editorial Note: The editorial content on this page is not provided by any bank, credit card issuer, airline, or hotel chain, and has not been reviewed, approved, or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone, not those of the bank, credit card issuer, airline, or hotel chain, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

David Bakke
David started his own personal finance blog, YourFinances101, in June of 2009 and published his first book on ways to save more and spend less called "Don't Be A Mule..." Since then he has been a regular contributor for Money Crashers. He lives just outside Atlanta, GA and most all of his free time is taken up by his amazing three year old son, Nicholas.

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