Living with credit, Protecting yourself

Tough times? Put credit card bills in perspective

Erica Sandberg

We are constantly making choices when it comes to our money. What should we spend on items and services, where can we cut back, when is it OK to splurge … it can get confusing!

As for credit card bills, where they exist in the great scheme of a budget is an interesting question. If you used the cards to pay for stuff, but are now having trouble getting out of debt — or even managing the minimum payment — you may be wondering where they fall into your bill-paying priority.

So here’s my quick guide.

When cash is tight, these are the top five critical expenses that always come before credit card payments. Why? Because not paying them will cause great harm. More, in fact, than if you sent your credit card payment late or even defaulted on the balance.

1. Housing. If you don’t send money to your lender or landlord, you will jeopardize having a roof over your head. You do not want to be homeless. This should be obvious, but you’d be surprised to know how many people neglected to pay their rent or mortgage, but paid their Victoria’s Secret card.

2. Groceries. You need to eat, of course. Purchase nutritious but not extravagant food. You know the difference. Doughnuts are a no; apples are a yes. And please reject the flavored liquids (soda, sweet juice, sports drinks) – they pad a supermarket bill and are nothing more than liquid sugar. Stick to water; it’s free and good for you.

3. Utilities. Keeping the heat, power and phone service on is critical. Call the companies to see if you can negotiate a better deal, though, if things are tight. Most offer special programs for people in need.

4. Vehicle expenses. Unless you can walk or take public transportation everywhere, a working car is a requirement. Aside from the monthly payment, fuel and upkeep are also priorities.

5. Medication. Never sacrifice prescribed medication. Do ask your doctor how you can get the drugs you need at a lower cost. You may even score some samples.

And here are five things that it may pain you to eschew, but if you stop spending on them, your financial situation should improve. Drop cash on the following only after you pay your credit card bill (ideally when you’re out of debt, but at the very least can send the minimum payment).

1. Entertainment. Movies, concerts, sporting events. … If you’re short on funds for your credit card bill, this kind of fun should be out of the picture. Take a walk, get together with friends at a park, window shop … you get the idea.

2. Restaurant/cafe fare. Sorry, that delicious beverage is not a necessity. Make your own at home, or drink the free office brew. The same goes for fast food and restaurants. Unless it costs the same price or less than what you can prepare in your kitchen, don’t eat out.

3. New clothes. Nope. Accessories, too. Steer clear of the stores, my fashionable friend, both online and in person.

4. Nonessential travel. This one kills me because I have a very hard time rejecting a trip, but the fact is, getting out of town is a luxury. Daydreaming about future vacations is free, however; so have fun planning for when your financial circumstances improve. Then you’ll be ready.

5. Electronic upgrades. Your old phone weighs as much as a brick? The screen on your tablet is cracked? Wait it out. You can deal with those electronics issues for a lot longer than you think.

Now it’s your turn. What comes before and after a credit card payment for you? Share! Email me at or tweet me at @EricaJSandberg.

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