Escape from Your Plastic Prison

Are you always at your maximum limit on your credit cards? Do you pay the monthly minimum on your statements—and never pay off the balance? Because credit cards are so easy and convenient to use, do you regularly overextend yourself?

If you answered yes to these questions, you may be over your head in consumer debt. Here are nine ways to help you get back in control.

1. Stop using your cards immediately. If you have the willpower, keep them to use for emergencies only; if you yield easily to temptation, get rid of them altogether. If you do keep your cards, make it inconvenient to use them. Leave them at home in your dresser drawer.

2. Change your lifestyle. Stay away from places where you use your credit cards.

   Deny yourself something that you want to buy on impulse. Incorporate more low- or no-cost pleasures into your life. Go for a walk in the park—instead of in the mall!

3. Remember that having credit cards doesn’t make you rich—eventually you will have to pay off the balance. Since credit cards charge substantial interest, don’t use them for borrowing money.

4. Use psychology to your advantage. Visualize yourself paying for things with cash. Imagine how good it feels to be out of debt.

5. Develop a plan to pay off your debts. Make a chart listing your credit cards and their outstanding balances. Decide when you will have the balances paid off. (Be realistic. You probably won’t be able to do it in a month.) Post the chart in a prominent place; then work at making your plan a reality. Once you have paid off your cards, keep them paid off.

6. Don’t count on future income (such as your anticipated tax refund) to solve your credit card problems. Most people plan ways to spend windfalls three or four times before they actually receive them.

7. Develop a budget. Be realistic and flexible. You won’t stay on a budget that is too restrictive and doesn’t allow for an occasional splurge. (Just don’t use a credit card for that splurge!)

8. If needs be, get professional help. See a financial counselor or contact your national foundation for consumer credit.

9. If you have found that you are able to manage and use credit cards to your advantage, shop around for credit card bargains. Look for the lowest annual costs and interest rates. They do vary!

Sound hard? Of course! But look at the benefits: You will be in control of your financial destiny. You will no longer be a slave to banks and credit card companies. No longer will you pay extremely high interest rates. And you will know that you are acting responsibly with your finances.—Sally R. Lester, financial planner, Lakewood, Colorado

Illustrated by Scott Greer