Monday, May 11, 2015

Paper Or Plastic - Which Is A Better Way To Spend Money?


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When it comes to spending money, there is the consideration of whether you will buy using cash or a card, and this can actually be an important decision. After all, not only does each item function in a different way, but each person tends to have different spending habits depending on which item they are using. You need to make sure you are using the payment method that is best for you if you want to optimize your spending habits.

First off, when it comes to plastic, you need to make sure you understand the distinction between credit cards and debit cards. While money comes directly from your bank account when you purchase using a debit card, you are able to purchase "on credit" when you use a credit card. With a credit card, you will need to pay a minimum balance on the credit owed at the end of each month - and this is where so many people get into trouble!

For anyone who uses a credit card, it is absolutely vital to understand exactly how credit cards and credit work. And when it comes to credit cards and credit, the basic rule of thumb is that you should always pay off the entire balance on your credit card each month!

But just because someone is using a debit card does not mean that their spending habits are the same as cash. Some people find that they spend money more quickly (and more frivolously!) when they use cash, and others find that they spend more quickly when they use a card! The best way to find out which way works best for you is to alternate between the two, and track your spending with each. Whichever one you find you are using to purchase more frivolous, unnecessary items should be the one you aim to avoid using as much as possible.

Of course, these days, it is nearly impossible to function without a card of some sort, as anything you purchase or pay for online requires a card number. But once you have established which spending method is better for you, you can make it your goal to minimize your use of the other method as much as possible, which will help you neutralize its negative effects!

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