The Dangers of Mindless Spending On A Credit Card

When was the last time you took a close look at your credit card statement? The reality is, many people rarely check, and in my conversations, it’s apparent that this oversight is more common than we might think. I want to start by saying that I love credit cards. I use them daily. Credit cards offer convenience, but the danger lies in treating them like an endless source of free money, ignoring the the fact that are not, in fact free.

Sure, we all love the ease of tapping our credit cards or phones through platforms like Apple Pay and Google Play, but here’s the catch – it has a strange way of making us feel like we’re not spending real money. Call it ‘girl math’ or any other term, but this nonchalant approach to credit spending is, quite frankly, alarming.

Let’s talk numbers – the interest rates on credit cards in Canada usually start around 19.99%. And credit card interest compounds daily, so it’s no joke. The convenience comes at a price, and it’s vital to be aware of the financial implications.

If you find yourself caught in the habit of swiping that credit card without a second thought, consider a switching to debit cards for a while. The tangible nature of debiting directly from your account provides a clearer understanding of how your purchases impact your savings. In other words, spending your own money makes shit feel real again.

I know a lot of us are attached to our cards, the points and all the other perks of it, so we won’t actually switch, so whether you make the temporary switch to debit or not, cultivating awareness is key. Regularly checking your credit card statements ensures you stay connected with your spending habits, preventing the trap of mindless swiping. Also, using a budget and tracking your spending overall can help to get a more holistic view of your finances.

Have you ever fallen into the trap of overspending because credit cards felt detached from real money? It’s a common phenomenon. Share your experiences by leaving a comment below.

xo,
Reni