by Melody wright
Cycles. A series of events that are regularly repeated in the same order. Have you ever thought about the cycles in your life that may deter you from achieving your goals? How many goals have you set aside because you can’t get out of your complacent mindset and break those cycles? Think about it, even some of the resolutions we make at the beginning of every year are breeding grounds for cycles. Negative cycles are the destroyers of our dreams.
Negative cycles often impact our personal finances. Whether these cycles are generational, or just bad habits, negative cycles that control our finances can become a major roadblock. A common cycle is incurring credit card debt, only to pay it off and gain it back again. Understandably, some people do have healthy relationships with their credit cards. Credit cards give us the ability to purchase items instantly without money leaving our physical wallets or bank account. Also, making a credit card purchase within your budget can help build credit-worthiness and cashback rewards.
For some, the constant cycle of incurring credit card debt can lead to major consequences.
I don’t stand alone here. The average American household constantly carries over $7,000 in credit card debt. And as a result of this, Americans pay hundreds and thousands in interest simply by using their credit cards for purchases they can’t afford to pay off, and only making the monthly minimum payment.
I spent many years in the credit card debt cycle because I was too busy trying to build a life based on trends from social media, and triggers from my immediate environment. Before I knew it, I racked up thousands of dollars in credit card debt, and I honestly had nothing to show for it.
I needed to break the cycle to live the life that my Creator prepared for me. I allowed my present debt to postpone my dreams for too long. How could I dream, if there was nothing in my future but a continuous cycle of debt?
First, I wanted to confront the compulsion I felt to swipe a credit card knowing good, and well I didn’t have the money to pay it off immediately. Why do I believe that my credit card is an option? How do I justify this behavior? I had to change my mindset. I thought about the things I can’t purchase because I could not pay for them with cash, and the things I was unable to do because I had to make several credit card payments. Is it worth it? No. Especially when I was still paying interest on things that I no longer use.
To pay off my credit cards, I used the debt snowball method.
I paid off the smallest balance first, and worked my way up to the largest balance. This method is great if you need small wins to help you stay motivated. If you have credit cards with high interest rates that are killing you, the debt avalanche method maybe be your best option. Simply list your debt from highest interest rate to the lowest interest rate. If it’s possible, you can transfer balances to the lowest interest credit cards. Start paying off your credit cards with the highest interest first to save more.
Now that the debt is gone, you want to keep it that way. I cut the cards up and removed myself from all email list where I had a credit card attached for convenience. I needed to detach from the very sources that were dragging me into to spend. In my last step of breaking this vicious cycle, I had to tell myself “I meant it!” We must remember that it doesn’t matter how bad we want it; breaking cycles doesn’t happen overnight. There were many occasions where I passed up events, shopping, and almost any activity that require spending money. To break the cycle, I had to be laser focused and with the help of my husband, I paid off over $12,000 of credit card debt in less than 5 months.
We broke that cycle!
Think about the negative cycles that may impact your finances.
What actions can you take to break free from the ones doing you the most harm?
Learn more at Broke On Purpose