In November 2014, I cut up all my credit cards. That was almost three years ago and I’m still alive today to tell my story. I have lived every month without the need to use a credit card.
I changed my lifestyle. I changed my approach. I changed mindset. You don’t need credit cards. You think you need credit cards, because you can’t keep up with the Jones’. The funny thing is, most of the Jones that you see, at traffic lights, carrying bags and bags of new “things”; have probably not paid outright for those “things”. Its probably on credit. Now imagine their debt figure floating above their head, or car like a video game gauge system. Granted, there are a number of people fortunate enough to have the latest car, latest gadget and newest clothes, but when you look at the statistics and (UK) average wages; its not mathematically feasible.
If that’s the case and your renting or paying for a mortgage and not to mention everyday living expenses. How could you buy a brand new car? Without inheritance, lottery win or a pot of gold at the end of the rainbow.
Britons spend around £27,500 on a new car
It is not rocket science, the new car is more than the average salary. That salary is before tax. So then the car is bundled onto a lease. Why? Because you think the monthly payments make it affordable? cheap? in budget? That can’t be further from the truth.
A new car will break down. An old car will break down too. However a used car only cost you £5000? That’s a cheap breakdown compared to a £27,500 – right?
How have I survived a breakdown with no credit card’s? A £1000 emergency fund that’s how! Since having the fund it’s been used once and through small contribution’s over months and months of frugal living it’s now at £5247.00. Still no credit card’s or loans (I have a mortgage – that’s my only debt)
Its incredible the transformation of no monthly credit payments has made. That includes the car payment, which stood at £234.64 per month – back in 2013. That’s when it ended though. It had been for 36 months. A HUGE £8447.04 spent, but I did not own the car. Have I still got that brand new car? Nope.
Just live on less than you earn. It IS that simple.