365 Days of Frugality Day 2: Pay off your credit cards in full.

This post is part of the 365 Days of Frugality Series. Every day, there will be a new tip on how to bring frugality into your day to day life. Check out the postings so far here.


080918-N-0659H-001

This cannot be said enough. As noted within my post 5 Factors To a Healthy Credit Score, carrying a balance does not indicate a healthy credit profile, thus will not benefit your credit score in the long run. Even though paying the minimum on credit cards may seem optimal as it frees up your cash flow over a longer time period, this will keep you in perpetual debt and you will pay longer on the purchases. I like to think of it this way. Would I want to pay a 15-20% markup on this purchase from the moment that I buy it? If not, I will reconsider the purchase and make sure that I have the funds necessary to pay off the balance IN FULL. It is as simple as that.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s