I remember making my last debt payment like it was yesterday. It felt like the shackles I had been wearing around my ankles for five years finally fell off. A funny thing happened though as I was done with the journey – I started getting more credit card offers. Crazy I know, but that’s the nature of the system. That said, I know many deal with not knowing when or if they should even get a credit card after paying off debt. If you’re in that situation, hopefully my experience helps.
Take it One Step at a Time After Paying Off Debt
Generally speaking, it’s likely not the wisest decision to go out and sign up for a credit card right after paying off debt. This is largely dependent on if it was credit card debt, but you get the point.
Part of your success at paying off debt likely was due to setting up some financial habits that you could live by. Assuming that’s the case, you want to make sure you continue to live out those habits and direct your money to the appropriate place it needs to go. You also want to deal with any spending triggers you notice so you can keep your spending in check. My encouragement, while conceding it’s going to be a personal decision, is to hold off getting a new credit card until you get those things in check.
Recognize Who Did the Spending
While it would be nice to be able to blame the credit card for the debt, trust me I’ve been there, the simple fact is that it did not do the spending. A credit card is a tool, just like any tool you use around your house. However, a credit card is a financial tool. This tool can be great when used right, but harmful (as you well know) when not used right.
If useless spending is a temptation for you then it’s likely best to hold off on getting another credit card after paying off debt. Assuming the temptation is under control then you should be ok proceeding but do it wisely.
Keep Yourself Accountable
One of the best aids for me when I was done paying off debt was having accountability with regards to my spending and use of a credit card. I’d love to say that I was accountable to myself, but we all know that we can talk ourselves into just about anything we want.
In light of that, if you do get a credit card after paying off debt then it’s likely best to find some ways to keep yourself accountable. There are numerous ways to do that, such as:
- Leave it at home when you’re out shopping
- Give it to a friend or family member when you’re out with them.
- Put a sticky note on your card showing how much you just finished paying off
I’m sure there are other ways to keep yourself accountable in this area, but the point is to keep yourself in check so you don’t fall into old habits.
How long did you wait to get a credit card after paying off debt? What did you use to keep yourself accountable?
Image by 401(k)calculator.org / Flickr
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