I have one credit card that I use for its rewards. Since I want to make the most of my rewards, I use the card whenever my purchases qualify for the reward program. I also make sure that I pay off this credit card in full each month, since paying interest wouldn't be very much of a reward.I used to have trouble making sure that I didn't spend too much money each month by using my card. Let's face it - plastic just doesn't seem like you're spending "real" money. But then I started entering the credit card purchases in my checkbook register. Since I'm one of those people that still enters items in my checkbook register, I had no trouble remembering to keep my credit card purchases updated. I simply made sure that purchases made with the credit card were entered in a different color ink than all of my other entries in the register (I use red ink for my credit card), and then subtracted the amount that I placed on my card from my checking account balance. When it comes time for me to pay off my balance each month, I have the exact amount in my checking account already, "hiding" in the different color ink amounts.
In order to keep my payment to the credit card company throwing off my checking balance when I enter the check number for the check I wrote to the credit card, I simply draw a line through the balance portion of the register. Since I've already deducted the amount from my checking account balance through all of the small purchases I made using the card, my checking account balance (in my register) doesn't change by my writing a check that covers the total of all of the small purchases. I also highlight the space where I write the check, so I'll know which credit card transactions go with which bill.
When it comes time for me to balance my checkbook, I simply star the space in my register so that the blank spot doesn't throw me off when I'm looking for entries in my register that are on my bank statement.
Clear as mud? Here's an example:
| # | DT | TRANSACTION DESCRIPTION | PAYMENT AMOUNT | / | DEPOSIT AMOUNT | BALANCE 1115.00 |
|---|---|---|---|---|---|---|
| CC | 1/1 | Credit card purchase | 15.00 | * |
| 1100.00 |
| DB | 1/2 | Wal-Mart | 25.00 | / |
| 1025.00 |
| 111 | 1/3 | Water bill | 30.00 | / |
| 995.00 |
| CC | 1/4 | Credit card purchase | 50.00 | * |
| 945.00 |
| DB | 1/4 | Kroger | 20.00 | / |
| 925.00 |
| 112 | 1/5 | Credit card bill | 65.00 | / |
| ---------- |
| DB | 1/6 | Payless | 35.00 | / |
| 890.00 |
| 113 | 1/7 | Kroger | 50.00 | / |
| 840.00 |
For more tips (that hopefully aren't as long-winded as mine), check out Rocks in My Dryer every Wednesday for Works-for-Me-Wednesday!
What a great tip!
ReplyDeleteThis is a really good idea. I never thought of this, but it's a good way to avoid going into shock when your giant credit card bill comes in the mail. My first reaction is always, "HEY! Someone's been using my credit card!" Alas, it's always ME--I just forgot about half the stuff I bought!
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