Money Myth 3: I Don’t Need Savings Because I Have a Credit Card
Americans don’t have savings but they have plenty of credit cards! How about you?
This week we revealed Money Myth #1 – “I don’t make enough money to have a budget!”
Money Myth #2 – “Buying is always better than renting.”
Today, we address Money Myth #3 – “I don’t need a savings account because I have a credit card.”
Woah! Did you know that a lack of savings is the #1 reason people accumulate debt? That’s right, #1 because when you don’t have cash you turn to your credit cards.
According to a survey, America’s debt load is resembling the situation prior to the Great Recession. The average American household carries $8,683 in credit card debt, up 8.6% from last year.
You need to say “no” to what you want today so you’ll have what you need tomorrow – when the unexpected happens or when the economy takes a downturn.
Proverbs 6:6-8 instructs: “Go to the ant, you sluggard; consider its ways and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest.”
Set a goal to accumulate $1,000 in an emergency fund. Use an automatic deduction from your paycheck into the savings account, somewhere between 1-10% of your total income. Even if you’re paying off debt, you’ve got to save something.
How? Cut your cable, trade your smartphone in for a flip phone, adjust your thermostat to reduce utility costs, and stop eating out. Research shows that when using cash only you’ll spend less. Try it!
Save your spare change and every $5 bill you encounter, then deposit it weekly. You’ll be surprised how disciplined you can be when your savings start to grow!
Stop depending on credit cards, and depend on God. He’ll give you the ability to resist temptation and the discipline to save!
And make a plan to pay off your credit card debt! If you’re in over your head, our partners at Christian Credit Counselors can help you. Learn more by calling us at 800-722-1976 or go online to crown.org/ccc