Credit card personal discovery

ReportInvestor

Thanks for the detailed reply.

I knew that Money Savers would be able to create and stick to a system to overcome obstacles thrown up by credit cards.

I guess I'm just too lazy and want to download everything in one go, readymade for my budget software .

_Andy_

I put everything on credit card that I can, to maximise air miles earning. To make sure I don't overspend, every time I make a transaction on the CC, I immediately make a bill payment online or via telebanking (using a non-0845 number, naturally ) for that amount. That way the amount is debited from my current account straight away. In this way it's actually better than using the debit card as I'm not waiting for the transaction to appear on my account.

lswwong

Good post, ReportInvestor. I think it is true that Money Savers should do what suits them best in order to balance their income and expenditure.

As for credit cards, my experience has been that one either uses them to one's advantage or be used to the lenders' advantage.

My spendaholic sister (who is really hopeless with money ... long story) goes as far as to count her credit limit (max-ed out, anyway) as an "asset"!!!!!

I recently paid for a high value office expenditure (that was claimed back within a week of purchase) shortly after the statement date of one of my credit cards and managed to have the cash thus reimbursed sitting in my savings account for a month; that is also on top of earning airmiles from the purchase with the card.

Rather chuffed with that!

However, it is easy to "dilute" the debt issue when ready credit sits on one's credit card(s). I guess using a "money manager" type approach, whether using the Egg/First Direct version or a spreadsheet at home will help bring the issue of "balancing one's books" back to the fore.

ReportInvestor

Thanks for that, Isww.

Well I did know that I was entering the lions' den with the first post

ejones999 wrote:

What a load of old rubbish.
I can check my credit card balances online at any time night or day and yes I'm on course to get £120 cashback by next year from putting my normal day to day shopping through Egg money card.
I have no problem in budgeting ...........................quote ''a clever scam by the banks'' - don't make me laugh!

I was careful to exclude most MSErs from victimhood in my original post.

What would a poll show if people were askes to guess the combined balance of their current account and credit card at any one time? How many would get within £300 of the right amount?

The problem is keeping track of two concurrent accounts/balances, especially given the time lag on the credit card account, so that you have to factor in what you owe and what you have spent subsequently. And it's compounded for many having a partner's credit card on the same account and money being a non-go discussion area for some couples.

The fact is the the average Jo(sephine) doesn't like to have to do any sums if (s)he can help it. The credit card / current account system requires her/him to do a few calculations each month to stay on top.

If people just spent on one account the early warning signals might arrive sooner (via the cash machine balance). I still suspect the whole process means that many ordinary people just lose track of where exactly they are. And I discovered that I was one of those ordinary people.

Well done to Hazza, ejones999 and the rest of you for being so well sorted .

Xbigman

ReportInvestor wrote:

What would a poll show if people were askes to guess the combined balance of their current account and credit card at any one time? How many would get within £300 of the right amount?

I wouldn't guess the combined balance. I'd look at the date, look at my spreadsheet and I'd tell you to within 6p what the balance was. The only reason I'd be within 6p is that I don't bother to work out my current account interest in advance. I just add it on when I get a statement.

However, I agree with some previous posters. Do what suits you best.
And it suits me to be anal :A
Regards



X

ReportInvestor

That's great but I wonder how many people, if asked in that poll, would say that they keep track of their finances on a spreadsheet or PF software?

It's important that these budgeting skills are taught at school - so that those who are motivated enough can have the last laugh - like ejones999 -, rather than the banks.

I was very interested in Andy's approach to get the 1% benefits, but without losing control of his "real life current account balance".

For me personally the time involved would probably outweigh the financial benefits. But I can see that how it would work for others.

Hazzanet

ReportInvestor wrote:

For me personally the time involved would probably outweigh the financial benefits. But I can see that how it would work for others.

I have to say that the major time input to setting something like MS Money up is in the initial stages - so setting up accounts, entering recurring bills, deciding the categories to use for purchases, and creating a budget. Once the groundwork has been done, it's pretty easy.

I keep receipts for everything and put them straight into my wallet. Every night when I get home, I put them into a paperclip on my desk. Usually on Wednesday and Saturday, I'll get MS Money fired up, and key the receipts - usually taking about 15 minutes or so.

I personally am willing to sacrifice the time to know exactly where I stand (financially) at any particular time. The thought of not knowing would seriously play on my mind.

On a personal note, I also couldn't bring myself to have someone else on my credit card account - I like to feel in control of my own finances

sicker

Use Egg Money. You can see all your balances (credi and debit) in one place. I myself pay all my statement bal nces by Alliance & Leicester home banking (accessed from Money Manager) on the 10th of each month which is at least 7 days clear of my shortest due by date.

John

DontDoDebtKids

Another idea:

Keep a spending diary - if you figure out how much you have to spend that month and total it up every day then you know exactly how much you have left that month regardless of whether you spent using your debit or credit cards or even cash.

e.g. You have £100 to last you a week:

Monday (£100)

Spend £10 on food
Spend £5 on coffee

Tuesday (£85)...etc.

ReportInvestor

DontDoDebtKids wrote:

Keep a spending diary - if you figure out how much you have to spend that month and total it up every day then you know exactly how much you have left that month regardless of whether you spent using your debit or credit cards or even cash.

Nice idea DDDK, especially for individuals.

You could take the combined balance of your credit card / current account at the date you pay off your cc balance and then deduct both cc & ca spending using a notebook. Cashpoint withdrawals would also go in that section.

Individual cash purchases might need a separate section, as they don't affect your combined account balance (until you have to withdraw some more ).

But I wonder how many people could make this work in practice with a partner?