Four things I learned when we quit using our credit card

In getting uber-determined to plow through a couple thousand more bucks of medical bills before the end of the year, we’ve quit using our credit card.  We’ve never been big users, but we did pull it out for gas, for online purchases, and sometimes for medical bills. (With 6 kids at home, medical bills pop up like whack-a-moles, even when everyone’s relatively healthy. )

Always our intent was to pay it off at the end of the month, but every few months we’d carry a balance for a month or two or three.  And truthfully, it was a rare month that didn’t include paying for something we bought with plastic in a previous month.

No big deal, right?  After all, we haven’t had car payments since 1999, and except for the house, and a bit on the credit card now and then, we have no debt.  But deciding to stop using the card completely has been a real eye-opener, even for (mostly) frugal me.  I’ve come to realize that the credit card was actually my last bastion of overspending.

I have to confess– I almost didn’t write this post because I imagined folks shaking their heads at my silliness.  But I figured that if I was caught in the trap, other folks are also out there doing exactly the same thing.  So I thought I’d share four things I learned when we quit using our credit card.

1. Your purchases hurt more when they come from the account that holds your real actual money. You know, the account you can’t drain dry because your next house payment is coming soon.

2.  You’ll think harder about impulse purchases. Salmon on a hamburger budget?  A trip to the water park for 8?  A quick run to the store in the gas-guzzling van for three things when John’s economy car will be here tomorrow? Maybe we’ll wait.

3. You’ll suddenly FEEL more broke. This is painful. You won’t have any less money than usual– it’s just that you’re looking your true limits in the face, un-inflated by the false affluence of a credit card.  But here’s the good thing: that painful ‘broke’ feeling is exactly what will steer you toward better spending habits.

4. You’ll stop spending your future away.  Through the ‘convenience’ of credit, it’s completely possible to spend ALL  of next month’s paycheck before it ever hits your bank account.  We’ve quit doing that– hooray!

Sometimes we get sick of watching the money more carefully.  But the truth is,  we’ve got enough for ALL the basics AND a hefty payment on those medical bills every month. We’re moving towards a place of greater freedom than before, and making habits that will give us even more freedom in the future.  Will we be rich?  Nah– we’ve still got years of having 6 kids at home, and there’s always someone needing something.  But we’re on a good path, and we’re really happy about that.


PS- If you need more motivation towards wise financial choices, check out Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence. I’m planning to write more about it soon– it’s a great book.

PPS- About the slightly higher ad content around here lately —  it’s temporary, and it’s really helping us plow through those bills.  Thanks, as always, for your support and for your comments!


  1. As a Canadian, I truly feel for American families who face medical bills — and that is pretty much every family, no? It’s really peculiar to those of us north of the border! I admire your frugal approach, and learn a lot from you.

    • Too true. I don’t know if you pay less in taxes (our insurance is provincial, paid for through our taxes), and so it is offset…but I don’t know how you do it! 🙂

      We use our credit in a different way; we use it for everything that we can (except Costco, which won’t take VISA). Then, we pay it off in full every month (no exceptions). We have a card that gives us points toward free gas, and so we save hundreds on gas every year. Plus, I find that it gives me (along with the Costco receipts) a good picture of how much we are spending every month. We have done a budget, and have a sense of how much goes where, but I find it hard to track it all really closely. This helps us to do so. We have never had a problem paying it off in full, and don’t pay any interest, for that reason.

    • I wish Canadians would speak up more about the benefits of national healthcare. Special interests in the US seem to have convinced the middle class that national healthcare is the first step on a slippery slope to Soviet-style totalitarianism, and that healthcare will suddenly drop to developing world standards.

      I lived in Australia for about 4 years in the 1970s and experienced national healthcare there. Every doctor or dentist visit cost $10 – that’s all. Prescription costs were low, also, as well as hospital visits. People could buy private healthcare at a higher rate and go to private doctors and hospitals if they chose, but there was national healthcare for everyone. Yes, tax rates were a little higher, but the benefit of healthcare for all citizens, especially children, outweighs the costs. I’ve had too many relatives and friends who could not afford health insurance. They don’t get medical care when they need it and lose time at work because they’re sick. It becomes a vicious cycle – especially for the poor. Even worse, children don’t get the medical care they need because parents can’t afford it.

      IMHO, healthcare (especially for children)should be considered a public good, paid for by taxes, just like national defense and our roads.
      (End rant)

      • I couldn’t agree with you more, LAH. Canada has an excellent national health care system (ironically at a lower overall per capital cost and with better health outcomes than the US) and it hasn’t led to our economic ruin. In fact, Canada has fared far, far better than the US during the economic downturn the last few years (of course that’s due to a wide range of policies, but my point being that national healthcare is not something to fear). When I see people in the US losing their homes, their life savings and their lives because they don’t have coverage, it just really makes me sad. Ok, now I will stop my rant too!

        • I have to gently disagree.

          We are Canadian.

          But we now live in the USA and My husband is a medical care professional.

          He would not, under any circumstances work in the Canadian System.

          ALso, we have family members who all have suffered at the hands of such a system.

          Currently, our nephew, who hit a moose ten months ago is in such a sorry state with head injuries that he has trouble stringing a complete sentence together – he who has a masters degree in education, cannot get anyone to help him in Canada. We have worked very diligently to get him down to the US for medical care – and even then, the Canadian system tried to block him from coming for help. In the last month he has gotten people to take him seriously here. He is now getting the medical attention he needs. I have lots of stories like this. It’s sad.

  2. We have a Mastercard Debit, so we can still use it for online purchases etc but we can only spend what we’ve got in the account. Not having a “real” credit card has made a big difference around here.

  3. I have wondered if not using the credit card would change my spending. For me, it has been a good thing. We always always always pay the whole thing each month and have since my first credit card. I think the only time in my 26 yr marriage was when we put in new carpeting and even then it only took 2 months. We get frequent flyer miles which helps greatly since we are in the midwest and my husband’s family is on the east coast. We were all able to go to my nieces bat-mitzvah this year–and did not have to pay for luggage! The interesting thing is that, until recently, unless there is an unusual expense like a major car repair, our monthly bill has stayed about the same. Now it is the gas that is getting to us–we both have long commutes. Also, because we only use one credit card, it is easy to track and compare our expenses each month. I think I do less impulse buying because I have a record of what I spend.

    What I would never have, and I see so many people use all of the time, is a debit card. Those scare the daylights out of me.

  4. My parents raised my brother and me to never, ever use a credit card unless it was a dire emergency. I’m proud to say that because of this, my husband and I have been married six years and have never had a credit card. I don’t even fully understand how they work, and what I do understand makes me uneasy! We still don’t manage our money the best that we could, perhaps, but you are right that it certainly hurts more and makes you think twice when it is actual money coming from your actual account. I know a lot of our friends and family think we are crazy for not putting everything on credit, but I think we’ve got the better end of the deal 🙂

  5. Years ago, a friend suggested recording any credit card purchases just like a check or cash in the bank register. I implemented that right away and have found it very useful. Ever since, we have paid off our credit card bill every month without complications because the money was already recorded as “spent” and therefore available to pay the card balance. Since we like the buffer of safety that the credit card gives in some situations, such as online purchases, reoccurring payments, or spending during travel, we really like this approach. For the reoccurring payments, I have reminders set up in my computer, so they don’t get missed either.

    • Laura, That’s a great solution! And I guess we’ve also done that to a certain degree. John also likes to have the credit card for travel spending, which is why we haven’t cut our card up like some financial gurus suggest. On our spring break vacation we kept tally of the gas we’d bought and sent the CC payment off the day we got home. It was also the first time we’d literally paid OFF the rental house even before we arrived. It was a good feeling to have that money already set aside– made the vacation feel even better. Problem was, on that trip we also needed $400 of unexpected car repair. So that was a hit on the savings account when we didn’t expect it. There’s always something!

  6. Brooke Young says:

    The ads – if they are helping you, fantastic. They won’t keep me from stopping by. 🙂

  7. Way to go, Mary!! Erik and I took the Dave Ramsey course last fall and next week we will be celebrating a full year without swiping a credit card. We got sucked into thinking we needed it while we were both in college, each working part time, and had a surprise baby. While I am not sure if we would have survived monthly without it, I can say that we could have survived much sooner than we let ourselves! 🙂

    By the time our next little one arrives in six months, our goal is to have all credit card debt paid off (and we’re going to make it!). We are so excited! Being that we are on 1 income, it has made our priorities much different than they used to be, but the example we are setting for our children is worth every sacrifice!

  8. I think it’s wonderful how we’re all created uniquely! Different approaches work for diffent people. For my husband and me cash is more dangerous than using the credit card which we pay off in full every month. It’s much harder for us to swipe a card than to pay cash. I think what helps us to spend less is to see how low we can get our credit card bill each month and how much the balance in our saving accounts can grow. With the exception of our 15 year mortgage which will be paid off in a few years, we are completely debt free. Kudos to you for figuring out what works for you and your husband and what doesn’t!

  9. I have never had a credit card. I load a travel card for trips because hotels require a valid card for holding a room and don’t have to have large amounts of cash on hand. Travel cards have no interest and you can only spend how much you put on it.

  10. Timely post… Precisely the encouragement I needed as I move and start a new job all in the same week. My CC has mostly been for online purchases (less hassle if it’s compromised), and I always pay it off immediately. I did use my CC this week to buy some work clothes (which I needed, as I only had one professional outfit). Even that is adding stress though, in the midst of moving expenses and the delay between starting work and getting paid. I don’t have much furniture, and it’s tempting to check out the labor day sales. But, I think I’d rather have an empty apartment and no debt to worry about. The next few months of getting back on my feet are going to be tough… but your post is a BIG reminder to “do without” rather than borrow from my next month. Maybe there will be some great Veteran’s Days sales… or someone will have a “day after Thanksgiving” furniture deal 🙂

    • Vicky…there will always be another sale! LOL!

      When dh and I were first married the only furniture we really owned that was new was our bed. Lawn chairs and folding tables made do until we could afford to purchase more. “Less to dust”, was my happy mantra at the time. It was amazing what we slowly accumulated, however, via hand-me-downs, garage sales finds, etc. which we often refinished. Eventually we were able to purchase other, better quality furniture, but it is amazing what we can go without!
      Blessings to you as you start a new chapter in your life!

  11. Please don’t worry about the ads, Mary. I honestly never even noticed that they increased and I read you all the time. And if it helps you earn more money, great!

  12. As someone else said, it is interesting how what works for one is not what works for others. For me, I do better with my Costco AmEx card. I know what my spending limit is for the month – since I pay it off every month, this is my budget limit not the card’s limit – and I do try to play a game of seeing if I can keep it below the standard average each month. However, I charge everything I can onto it including the phone bill. If I have cash around, it gets spent and I don’t know where and have nothing to show for it. By putting it all on my card, I can easily download it into Quicken and track exactly where I’m spending money. Thus I can figure out better which areas can be trimmed further. The AmEx gets me cash back every Feb. Last year’s return was just shy of a mortgage payment, even after using it to pay for the next year’s membership!

    I have made sure to impress upon my offspring how important it is to only use it when you have the money to pay it off, however. Even just letting it ride one month causes huge fees. That’s something my parents were good about teaching me but my husband’s family was not. I inherited a lot of debt that took me years to get us out of. 🙁

    I’d rather have ads and get the full article in the RSS feed. Since you told us you get paid for the click thrus, I’ve clicked in on articles I don’t even care about just so it registers for you, but I really prefer to read them in my reader first.

  13. The ads aren’t bothering me – if they help, keep them!

  14. Mary, I did not notice the ads – you have such a great blog, they don’t bother me in the slightest!

    Another comment I have about credit cards – for those who use them like I do, paying it in full every month, this helps with building (or keeping) a good credit rating for yourself, in case there is a time in the future when a crisis (or otherwise) requires you to borrow money. If you have no credit, no one can see how responsible you are (or would be) with it. Just an FYI.

    I, too, appreciate the diversity of approaches mentioned on here – it can help people think beyond the “cc-no cc” dichotomy, to find what works for them.

    And about Canadian healthcare – yes, it is the way to go. I know that there is a huge fear in the US regarding national coverage. But if you follow Canadian politics or economics at all, you will know that it has not led to a totalitarian/socialist/communist country for us! What it does mean is that people do not have to worry if they, or their children, get sick. Period. (The cost of prescription drugs or dental care, if you don’t have a plan at work, is another matter. But at least you can be seen at the doctor’s office or hospital without worry, and without a tiered level of care).

    Blessings to everyone this day,

  15. I’m in Canada, and yesterday, 2 of my children had dr. visits … one for swimmer’s ear, one for a relapse in strep throat. No charge for either visit. In and out in 15 minutes. Then I walked across the hall and filled the prescription in under 5 minutes and it was covered by hubby’s plan at work. I never ever give a thought to the cost of taking a child to the dr. I never have to make a decision about whether or not we can afford to go to the dr. I’ve also had 2 children hospitalized briefly (2 nights) and again, no charge. And have never paid a cent to go the hospital and give birth to all of our children. I LOVE our healthcare system!

  16. Another good reason to keep a CC on hand … If you are buying an appliance, electronic item or something else that comes with a warranty, many cards will double your manufacturers warranty. Which in the long run can save you money. We rarely ever buy an extended warranty on anything. With the manufacturers warranty and then the extra time gained by using a certain CC is good enough for us. And we have had claims during that extended time. Don’t put it on the CC unless you know you can pay the bill as soon as it comes in though.

    We get hotel rewards points and pay off our card every month.

  17. We are trying to quit using ours too. We ALWAYS pay it in full, but sometimes it is a struggle and I feel like I lose track of spending when we use it a lot. This months bill was only $900 and $600 of that was gymnastics that will be on there every month regardless because it is an automatic thing. So we are making progress. My problem is internet purchases. I will NOT use my debit card for those. So I am trying to limit them completely and also pay with paypal whenever I can. I think it will help us in the long run for sure. Good luck with your goals!

  18. jennifer b says:

    Dont feel bad about the ads- I would expect tat as this is a business. I always found it interesting that after mcdonalds accepted cc’s- the average food bill went from 4 something to 7 something. Interesting that obesity has also gone up?

  19. Great post!

    PS. Keep the ads. I didn’t even notice them and if they help bring in more money to help attain some of your families goals, then why take them away.

  20. Angela Mayer says:

    We stopped using our credit cards this past winter after listening to Dave Ramsey’s seminar. We have been digging out of a debt hole and will be for some time. I was surprised by the emotional toll that credit cards were taking on me. I hadn’t really noticed it until we stopped charging! Last week we charged one small item that we will pay for on Friday when pay day comes and I was reminded instantly of that “pending doom” feeling I carried for years. Can’t wait to pay it off!

  21. Used our business to generate the extra income to pay down debt early. Unlike a ‘job’ self-employment allowed us to increase our earning when needed.

  22. Thanks for this-was reading a few posts and needed this encouragement today as we’re trying to plow through some medical bills ourselves (and selling current house to move)!

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