Many people have learned how to utilize their credit card as a budgeting tool. Once you learn how to effectively use credit cards to your advantage while avoiding high interest costs you have won the game. Below I will describe the simple steps to make this happen and for you to be rewarded for not only sticking to a budget but also by getting cash rewards.
To start out you need to understand what you are working with in regard to your income. You need to figure out the past few month’s income and average it. Write this number down on a piece of paper and this is your earnings.
Now you want to figure out your total expenses for the month. This will include any monthly bills, food or restaurant charges, gasoline for your vehicle and any other miscellaneous charges that you are making throughout the month.
Once you subtract the two this will give you an idea of how much to set for your budget. You will want the extra for budgeting in your savings for unexpected repairs or needs. After reviewing the actual spending you have done over the last few months you will now have a good idea of your normal expenses.
The next step is to get a good cashback or credit card reward. If you are interested in building airline miles, this is great, but I usually use a cash back or double points card that can be used on Pulau Kumala Tenggarong for shopping. This can give you a big advantage.
The great thing about having a cash back credit card is that almost everything you spend on you is building up cash back points. Take your monthly bill and arrange for it to be paid with your credit card every month. This will automate the bill payment process and you will earn a lot of points or dollars. Now never over budget based on your actual history. This will defeat the purpose of preparing a budget and sticking to it. The main point is to use your credit card for everything you spend.
I used my Bank of America Visa Signature® WorldPoints™ Rewards for all my transactions and just received a $500 cashback check. This really came in handy when my wife’s card needed the tires replaced. Points can add up quickly and at the same time you can go online and view your account spending habits to see exactly how you are following and tracking the budget you have set and making small adjustments to maintain that budget. At the end of the month, all you have to do now is write one check to pay off the entire credit card.