The Discipline of Using Credit

Bad, Great, Not Enough, and No Credit – Part 1

Banking is an action and not an institution!  I wish to shout this before I begin talking about credit cards.  Pamela and I, when in the worse financial shape of our lives, thought we needed a credit card to help improve our credit.  Don’t let others hang the “good” credit score over your head.  We’ve been there and with bad, great, not enough, and no credit, it’s never stopped us from being able to get the things we needed and desired.  We accomplished this because we’re surrounded by God’s favor and would be lost if we weren’t operating in it.  That’s a topic for another day, but don’t push me!  Back to the credit card we thought we needed.  Pamela and I were so excited to receive it in the mail.  We had a whopping $350 credit limit.  We thought we were on our way.  BTW – it doesn’t take long to reach a limit of $350 and we did just that.  Here’s the funny part and we still laugh at this today, we couldn’t pay off the $350 credit card and add that to what we already had, needless to say we ended up bankrupted.  Ouch, the credit card was just icing on the cake.

Through this experience, we realized two things: 1) we have a problem and 2) everyone doesn’t have this problem.

We have a problem.
We had a problem with money.  We didn’t know how to handle it.  We spent more than we made.  You might find yourself right where we were.  Just admit it, you have a problem with money.  And you are not alone.  Unlike others in this situation, when we don’t know something, we know it’s time to go to school.  We needed someone to teach us how to use what we so often think comes natural.  Money management isn’t a natural skill; it’s an uncommon skill.

Everyone doesn’t have this problem.
We noticed that not everyone has a money problem.  Could it be that we are not all created equal when it comes to knowing what to do with money; I think so.

We made the decision that we want to be those people – the people who know what they are doing with their money.  So how do they do it?  You won’t believe this.  Every person, book and podcast we studied led us to this conclusion.  They all have a plan.  They have a “Family Plan” and now so do we.

“Fools [common individuals] think their own way is right, but the wise [uncommon individuals] listen to others.” – ‭‭Proverbs

Discipline of Business and Travel
After we sent to school, we were determined to never ever have nor need a credit card.  That too was bad knowledge and thinking.  I had a career that required a lot of travel and there was no way for us to do this using our debit card.  So we had to do the unthinkable, get another credit card.  Pamela and I thought back to that $350 credit card and said, we’ll never repeat that cycle ever again and we haven’t.  You see a credit card is a catch-22.  It lets you spend without having the money in the first place.

The way travel works, it’s designed to have a credit card for use.  Just one example, rent a car and see how many charges are applied to your debit card as opposed to a credit card.  You’ll soon run out of available funds.

This time we used a technique called “discipline”.  This new card was only good for business travel.  The card could only have charges that we were guaranteed a company reimbursement.  We had learned our lesson.

With prayer and researching, we put our travel card into use.  This was ingenious.  We didn’t know it at the time, but this move paid off later.  You see we would incur all those expenses, get reimbursed and pay off the credit card.  Almost instantly we were building credit-good credit, not that we cared too much about that, but it made us feel better that we were finally getting control of the one thing that we too often take for granted, our money.

Have a card for business travel only.
We started with a card for business travel only.  This banking action helped us build confidence in our plan to get ahead.  It gave us confidence that having a plan works.  It ended our embarrassment.  It’s embarrassing trying to book all your travels using a debit card, especially when funds are tight.  What I want you to know is that with a plan, you can become disciplined and use this method of banking to your advantage.  More about that to come in our next post.  If you have trouble with discipline, get help.  Stop trying to do it alone.  A wise man knows how to ask for help when he needs it.

Today is Friday!
Today we have one card we use for all our travels.  Remember our life is our business, so we treat these expenses like any business does.  We must reimburse our expenses and pay our travel card.  We’re not going to make payments or borrow the money; we pay for it.  I feel for those who do life without a plan.  They’re like the mouse on that wheel, spinning in circles and never going anywhere.  Learn from your own mistakes, like Pamela and me.  Stop chasing life.

What challenges have you faced with using a credit card?  Leave us a comment below.