Credit Card Reduction
and the Art of Saying "No"

    credit card reduction

    Credit card reduction techniques should be used by card holders that want to take advantage of the benefits of the credit card but do not want to pay the high cost of the servicing debt in terms of penalties and interest payments.

    A few simple techniques listed below can help you in avoiding a debt crises.

      Establish Your Financial Goals
      The first step towards reduction of debt is to establish financial goals and set priorities within your budget.

      A budget should be set at the beginning of each month whereby you should list the necessary expenditures that cannot be avoided and also the expenditures that can be delayed till the next month. During that time period, learn to say ‘no’ to the items you can avoid until the next month and reduce your credit card debt for that month.

      Avoid Impulsive Shopping
      Impulsive shopping must be avoided. Before purchasing an item you must consider whether the item is absolutely necessary right now. A good plan is to make a list of items you will need before you go shopping. If the item is not on your list, then just say ‘no’. Learn to walk away. If this is a problem for you, then leave your credit card at home and only take along enough cash to cover the items on your list.

      Reducing Your Credit Card Limit
      Another method of credit card reduction is to reduce the credit limit of your existing card by contacting the credit card organization. Different credit card limits are offered by companies which vary according to annual charges and interest rates. By choosing a credit card with a lower limit you would also be able to save on annual charges and interest expenses.

      Although a credit card with a limit of $10000 may be incredibly tempting, say ‘no’ to that one and opt for the card with the $2000 limit instead. You’ll be glad you did in the long run.

      Limiting the Number of Credit Cards
      Access to several credit cards significantly increases the credit card limit that entices a person to spend on things that aren’t necessary.

      By limiting the number of credit cards, you can reduce your credit limit and thereby avoid spending above your income limits. By credit card reduction you would once again be able to save on annual charges and this can allow you to stretch your budget a little.

      So, if you get those credit card applications in the mail once a week, just say ‘no’. You only need one or two credit cards to your name in order to establish good credit and for use in an emergency. More than that is just asking for trouble.

      Emergency Fund
      It’s always a good idea to create an emergency fund that would act as a contingency plan in times of need. This savings account would allow you to withdraw money easily in times of an emergency instead of creating debt on your credit card.

      If you have a solid emergency fund (most financial experts recommend saving 3-4 months of expenses), then you would greatly reduce your reliance on credit cards.

    Credit cards provide numerous benefits but can also tempt a person to spend over and above the limit. Credit card reduction strategies include learning to say no and establishing priorities which can effectively reduce the chances of falling into a debt hole while also generating benefits of the credit card.


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