So back to the credit card situation.
As I said in my previous post, I moved some money around. I transferred a large balance on one credit card to two cards with smaller limits. Numbers, numbers…
I transferred $5000 to a Discover card, offering 4.99% for 21 months, with no balance transfer fee. Another $5000 transferred to a Mastercard, at 0% interest for 12 months, and a $50 transfer fee. But I miscalculated the amount on the original card, and ended up leaving approximately $1400 on the account. I chose to focus on paying the card that held a 13.99% interest rate first and put a hold on my credit card charges until it was paid off.
Best laid plans.
I didn’t have cash to buy gas, and several of my monthly utilities are paid for using this card. My plan was to pay cash for everything, but I realized that by continuing to use the card for these budgeted expenses, I could continue to receive the cash back advantage it offered. My new plan: no unnecessary charges. But when I use the card for a necessary budgeted expense, I immediately make a payment to the credit card account. This has worked out well – it forces me to pay attention to the balance on the card, and the cash-back payments are like a Christmas Club for Financial Freedom.
I had budgeted $748 for credit card payments. Here is how the payment broke down (not including the expenses I paid right away):
Credit Card 3 – $1400 – after last cycle I had $1200 balance – paid $396.66
Credit Card 2 – $5050 – $51.34 minimum payment.
Credit Card 1 – $5000 – $300
I had to bite my lip to pay only the minimum payment on Credit Card 2 – it felt so insignificant. But this keeps the 0% card in a holding pattern until Credit Card 3 is paid off, and then only used for budgeted expenses.
I mentioned in my last post that I knew the balance transfers would knock down my FICO score a bit. But it didn’t – my score raised 30 points, bringing my score well into the 800s!
I was taught that money should not be discussed with strangers. I find blogging about my goal for Financial Freedom very difficult. But it is necessary, I think, to retrain my money blueprint. If I can learn more about money and how to invest it wisely, then I think I should share that information with you. I have always been able to use it up, wear it out, make it do, and do without. Now it’s time for me to “do with.” My new money mindset says I can be happy with wealth.
I would love for you to share your own special tips, money stories, or words of encouragement in the comments below! Tell your friends about Cash Crone – help me manifest a following!