Tip # 18 on Saving, Spending, and Savoring Money


Starting today, if you have two credit cards, and you cannot pay off the entire monthly balances on either, implement a two-card strategy:

1.  Reserve one card for major purchases that will last at least five years, furniture for instance.  At least the item you purchase will last as long as, or hopefully longer than, the time it will take you to pay for it.   You are now treating this card like a collateralized loan, one backed up by an asset of value.  Like a car loan.  It makes more sense to pay monthly for items that have longevity.

2.  Use the other card for purchases with a short shelf  life, dinner, or a pair of tennis shoes, for instance.  If you cannot pay the entire balance now, resolve to pay at least what you charged on the card that month.  You are now using this card only as a convenience, a cash substitute.  Not as a long term loan.  And you are not getting further behind.

Two strategies.  Always better than one!

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