Love it or lump it, the economic system is set up to make it appear as if you need credit cards to live. But the truth of the matter is that credit cards are more of a convenience than a necessity. It is entirely possible to go through modern life surviving without credit cards.
Here’s how to go about it.
Get a Debit Card
As long as a card has the Master Card or Visa logo, merchants everywhere will treat it just like a credit card. You can get a hotel room, book planes, trains and buses, rent cars and go on cruises. You can also do anything else you’d do with a credit card. You’ll pay as you go and never pay a cent in credit card interest. Do not let your bank tie overdraft protection to your debit card, as this basically converts it into a credit card.
Use a Prepaid Card
Backed by funds you deposit in advance to offset purchases made using the card, when the money’s gone, so is your spending power. This makes prepaid cards an outstanding tool for budgeting. They can also be linked to savings accounts, but this could get you into trouble. It’s best to deposit the amount of cash you’ll need to deal with your monthly expenses and stop spending when it’s gone.
Set Aside an Emergency Fund
One of the primary advantages of a credit card is ready access to spending power should you encounter an unforeseen circumstance. However, you won’t need a credit card for this either if you get into the habit of setting aside a set amount of cash each month to build up an emergency fund.
Frankly, this should be one of the building blocks of your financial plan anyway. Most experts recommend setting aside at least three months of living expenses to cover you in case of an unexpected interruption in your income stream.
Consider saving with an online bank. In addition to competitive interest rates, they offer low fees and a host of other options, all while making banking more convenient.
Use Lay-Away and Christmas Clubs
Before credit cards became popular, stores offered layaway plans and many still do. In exchange for a small down payment on an item, the store will hold it until you pay for it in full. Many stores will give you from six months to a year to pay, with no interest charges—only a modest layaway fee.
Meanwhile, banks offer Christmas clubs for holiday savings. Deposit a little bit each month, then when Black Friday rolls around, you’ll have accumulated the cash you need to purchase gifts for your loved ones without racking up credit card interest payments.
If you’ve never had a credit card and you’re thinking of getting one, reconsider that decision. If you’re already in trouble with credit cards and dreading living without them, let those fears go. You can totally live credit card free.
Meanwhile, if you need to resolve debilitating debts right now, consider working with a company like Freedom Debt Relief to eliminate fees, excess interest charges and sometimes even a portion of the principal amount to make clearing up obligations a lot easier. To find an effective partner, check out background materials like these Freedom Debt Relief reviews to get a feel for the reputation of the company you’re considering.
Surviving without credit cards is a lot easier than you might think. What’s more, when you make that choice, rather than wondering what’s in your wallet, you’ll know. It will be cash.