Cutting back on unnecessary credit card spending
Smart Money

Cutting back on unnecessary credit card spending

Last updated

When you have access to credit, it’s easy to let your spending get out of control. And while it’s extremely easy to overspend on a credit card, it can be extremely difficult to pay it off. Here are eight ways you can cut back on credit card spending and keep your credit card balance in check.

Find out more about your spending patterns

Finding out more about the way you use your credit card could help you cut back on unnecessary spending. Check your statements to find out what you are using your credit card for, and work out which purchases were necessary and which were unnecessary. Finding out exactly how much you are spending unnecessarily may help you recognise the unnecessary purchases in the future – and possibly avoid them.

Create a budget

Where would a list like this be without a mention of a budget? Unfortunately, creating a budget is important if you want to track your credit card spending and reign it in. Fortunately, there are heaps of tools that can make creating a budget much easier. Check out ASIC’s TrackMySpend app, and go online to find ASIC’s Budget Planner for help creating and maintaining your budget.

Close unnecessary accounts

If you have credit card accounts that you never use, you may want to consider closing them. Having credit cards with available credit can be too much temptation for some people, leading them to overspend. Think about what each of your credit cards offer, and keep the one (or ones) that give you what you need.

Set a limit

Once you have decided which credit cards to keep, you may want to consider lowering their credit limit. Think about how much credit you really need, and stick to that limit. You can also ask your credit card provider to refrain from asking you if you want to raise your credit limit in the future. This can be a good way of keeping temptation to a minimum.

Find another way to pay

When you pay for things online, check whether you are being charged a credit card surcharge – and whether that surcharge is reasonable. According to figures released recently by MasterCard, Australians have paid out more than $800 million in credit card surcharges in the past year. If you are paying for flights, tickets or accommodation, check the surcharge and whether there is a way to pay that avoids it.

Don’t save your details

While some websites make shopping ‘easier’ by letting you save your credit card details on file, it’s best to avoid taking this step. While it certainly is easier, it can make it far too easy to overspend. Removing the task of physically finding your credit card and inputting the data can make it all too simple to buy stuff you don’t need.

Question your purchases

Before you make a purchase on your credit card, it can be good to get into the habit of asking yourself some questions. Ask yourself whether you actually need the item, and whether you need it right now. Ask yourself whether you have real money in the bank to pay the purchase off, and ask yourself whether it’s worth the money. Ask yourself if you could buy the item elsewhere cheaper? Ask yourself if you comfort buying?

Freeze your account

While it might seem a little extreme, some people swear by freezing their credit card – literally putting it in a container of water and keeping it in the freezer. This can make them stop and think about any purchase they want to make, as they would need to defrost their credit card before they make the purchase. This can give them enough breathing time to decide whether the purchase is actually necessary. Another variation on this is giving your credit card to your partner or a family member. Explaining what you need the credit card for can make you rethink whether you actually need it.

Founder - Roland B Bleyer

Roland Bleyer

Founder of Roland has extensive knowledge about credit cards in Australia. Known as a credit card expert, he has been featured on tv and in various publications. Some popular offers on our site right now include the CUA Low Rate. Ever popular with no annual fee first year, low purchase rate and 0% balance transfer. If you are looking for a longer balance transfer period. Have a look at the 0% balance transfer HSBC offer with no balance transfer fee, plus an annual fee waiver each year you meet a spend criteria.

Featured Balance Transfer Credit Cards

ANZ Low Rate Credit Card – 0% Balance Transfer

60 reviews
$0 saved over 22 months

Westpac Low Rate Credit Card

304 reviews
$0 saved over 20 months

St.George Vertigo Credit Card

19 reviews
$0 saved over 22 months

Featured Rewards Credit Cards

10 reviews
points earned over 12 months

5 reviews
points earned over 12 months

8 reviews
points earned over 12 months
Help us improve

By submitting this feedback you agree to our privacy policy.

My credit card is not listed

By submitting this form you agree to our privacy policy.