Here is a simple fun exercise you can do to work on improving your personal finances. It is credit card fasting and is exactly what the name implies and is no different than fasting to improve your physical health. There are countless reports and experts that promote the benefits of fasting for our physical health. Fasting for our physical health gives our bodies a rest, allows them to recover and can restore our health.
Our financial health is almost as important as our physical health and impacts many areas of our life. It can also impact our physical health if we are dealing with long term financial pressures or financial crisis in our lives. Stress can affect your physical health. Therefore, it may be beneficial to apply the principles of fasting to our credit cards. By abstaining from using our credit cards, we can reduce the monthly charges on our credit cards. We also minimize our interest expense by carrying smaller credit card balances. More importantly, a credit card fast gives us the opportunity to work on improving our financial habits by forcing us to pay cash. I am confident all of us will make different decisions if we limit our spending to cash only purchases.
There is an awareness that occurs when we have to make a conscious choice to pay cash for our purchases. Cash is a limited resource that must be managed to ensure we have enough money to last until our next paycheck. As a result, this awareness surrounding each purchasing decision will start to improve our financial habits. It provides us a new perspective on how we spend our hard earned money if we have to pay cash. A credit card fast can be a fun and rewarding challenge. Are you ready to get started? I suggest you start small and slowly work up to longer credit card fasts. This principle is no different than fasting for our physical health. Therefore, I suggest you start with a 1 day credit card fast and gradually work up to longer periods of time.
With any fast it is important to preplan your fast and make some changes before starting. Therefore, I suggest the same thing for your credit card fast. Start by selecting the specific day or timeframe for your credit card fast. Think about you normal living expenses that may occur during this time frame. Set aside some cash to be used during the credit card fast. I suggest you consider removing all of your credit cards except one for an emergency to reduce your temptation to use a credit card. If you get tempted, stop and think about what you trying to accomplish by changing or improving your spending habits. How would you feel if you were debt free? Stay focused and committed to achieving your goal. Lastly, have some fun with the credit card fast. Get creative. Make it a game.
Get your friends involved and challenge each other. Have a credit fast weekend or challenge each other who can credit fast the longest. You will be amazed at the results and how it will change your life and finances. Go for it.. Do you know someone that might benefit from this article? If so, please forward this article to them. I hope you will follow Fiscal Literacy on Twitter, Facebook or sign up for our free personal finance, news & updates. – See more at: http://www.fiscalliteracy.com/2011/04/credit-card-fasting/#sthash.k1MSkcdu.dpuf