Spex-enomics: Bank On It

Spexy Lady follows the Kate Hepburn School of Thought: If you follow all the rules you miss all the fun...or something like that. And Spexy Lady has certainly lived that axiom to the fullest...could explain all those poor grades in conduct in grade school! (Yes, I've had ALOT of fun!)

When it comes to credit card debt, I have just a few rules I follow. (Well, we all have to grow up sometime!)

My No. 1 rule is...with the exception of emergencies...a typhoon hits Dallas and wipes out my neighborhood, or I develop the rarest form of typhoid fever and need to be airlifted to the nearest ER...I don't believe in incurring credit for more than you can write a check for within 24 hours. Slap my hands if I spend $500 on a handbag, and I don't have it somewhere else appreciating!

Credit is always leveraged with what's in the bank, under the mattress, in a fund, or in an asset, like a pair of hardly worn Manolos for posting on e-Bay. This of course begs the question, "Ok, so why would you have credit card debt if you could easily wipe it out the next day?"

Simple answer. It's all about cash flow and managing what goes in and what goes out. Even the best of budgets get blind-sided by an unexpected expense...and I don't mean a close-out sale on designer handbags. Like the time my sweet Sheltie took a bite out of the new Pit Bull puppy's face. Trips to the ER Vet are NOT cheap, friends!

Rather than blowing up her budget for the month by paying off the card at the end of the month, Spexy Lady makes the credit card payments, paying always more than the amount due...anywhere from 1% to 50% more depending on the expenses for that month.

Credit card debt is like any debt or IOU...it is managed to your benefit. Again...credit card debt is managed to your benefit.

For example, it benefits you to have $5000 in a bond fund that pays you dividends of 5%, and to use a credit card with a promotional interest rate of 0%. Why dear ones you ask? The $5000 is earning money for you while you use your credit card for something you NEED (we'll talk about that concept a little later) and pay it off in increments through the promotional period.

The other benefit of making these payments (gotta do it on time, fans, or else!!!) is that you build up a positive credit history with the Big 3...Experian, Transunion, and Equifax.

The basic idea in a chocolate nutshell? Manage credit to your advantage, stay above water, and enjoy life without someone we know (initials S.O.) giving you a guilt trip every time you plop down your plastic

Stay tuned for more Spex-enomics!


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