This weekend I had a phone call with a really good friend who I hadn’t spoken to properly in months – maybe even a year, or longer and it was SO GOOD to talk to her! I miss her so much. We live on opposite sides of the world, and that’s ok! We’ll always be friends.

We got talking about my Make $1000 in 30 Days Challenge, coming up on 1st March 2024, and we were talking credit card debt. I was telling her about a part of my challenge, to ring your credit card company and ask for a reduced APR and see what they might give you. They might say no, but they might offer you something else instead, like a month with zero interest, perhaps. (Inside the challenge there is a template that you can use as a script).

We were talking about her credit card statement and compound interest and she had a bill of a few thousand dollars, sitting on the card with a 15.5% APR. Whilst she is not paying too much in interest, because she balance low, the money she is paying in interest is dead money. It’s like taking the one hundred bucks in interest and burning it, quite literally and who wants to be burning money?! That one hundred dollars could be spent on something she really values and cares about, but it was unavailable to her because she had to pay it in interest.

It was really fascinating talking about the mindset around this stuff. It’s so important to have clarity around our money mindsets. We spoke about how comfortable she was with having the credit card and that when we are young and first introduced to credit cards, it can seem like “free money”, but the truth is, that’s not the case at all. It can be insidious and ends up controlling so many people’s lives.

So right on our call, she went into her account and paid off the balance. “Thank you Sarah!”, she said. I’m pleased that she made the payment! Who would think that our call would have such a good immediate result!

I have to say, having a credit card isn’t bad in itself. If you can clear your debt every month and rack up the travel points or whatever your credit card offers you for free, then use it, for that purpose – that is how to be smart with your money – but if you find it too tempting to stop using the card or can’t pay off your debt monthly, don’t use it. It’s not worth it the stress!

How do you feel about credit cards? How is your mindset around them? Do you think or have you thought of them as “free money”? Are they a cause of stress or anxiety in your life? Or do they play a more positive role? I’d love to know - really - let me know!