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How to Be Honest With Yourself About Credit Card Debt

Do you know your credit card debt balances or are you living in denial? Do you cringe at the thought of opening your credit card statements each month? Since it’s February and relationships are a hot topic, we wanted to take time to talk about an often- ignored relationship; the one between you and your money.

How to stop telling yourself those little white lies

No one likes being in debt, but when you are, it’s easy to fall into a pattern of rationalizing your behavior. Whether you’re overspending or you’re adding to debt via everyday purchases, you may start to tell yourself some little white lies in order to downplay the situation:

“I’ll pay it off on payday.”

“I should apply for a new credit card and collect those rewards.”

“Everyone is in debt. This is normal.”

“It’s on sale, so I’m technically saving money.”

“My debt isn’t THAT bad. I’ll deal with it eventually.”

Sound familiar? These excuses or any variation of them can be detrimental to your financial health. Here’s how you can face your reality and create a healthier relationship with your debt:

  1. Pay yourself first. Each payday, set aside a specific amount and add it to your savings account. Better yet, set up an automatic withdrawal so you won’t even have to think about it. Paying yourself ahead of all other expenses can help you build an emergency fund, which will keep you from turning to debt again and again when the unexpected happens.
  2. Say no to new credit. Applying for a new credit card is a one-way ticket to debt regret. Instead, stop using credit all together by sticking to a cash budget. Use a budgeting worksheet like ours to lay out all your monthly expenses. Once you’ve done this, withdraw only the cash you need when you shop to avoid overspending.
  3. Don’t get cozy with debt. While it’s true that 74 per cent of Canadians carry some type of debt, it’s also true that many feel depressed, worried and anxious because of it. If you’re feeling overwhelmed with your debt balances, speak with a Licensed Insolvency Trustee who can walk you through a variety of debt relief options. Or, compare them for yourself using our debt repayment calculator.
  4. A sale isn’t a sale if it’s on credit. Unless you’re paying your credit card balance in full each month, that stellar sale becomes null once those interest charges add up. For instance, a $2,000 balance at 18 per cent interest will take nearly 14 years to pay off if you’re paying just the minimum payments. And, you’ll have paid an extra $1,800 on that initial purchase.
  5. Only you know your debt situation. If you’re able to meet all your monthly expenses, repay your debts and save money each month, you may be managing your debt well. However, if you’re finding essentials hard to afford, find yourself skipping bills, paying late or unable to save money, your debt might be to blame. Take our financial health quiz to see how you’re managing, and if you need help, don’t be afraid to find it.


Are you ready to put your credit card debt behind you? Follow finance blogger Jordann at My Alternate Life for more ways to reduce debt and save money. And, while you’re at it, join us on Twitter to keep the conversation going #LeaveDebtBehind #DebtConfessions #DebtSolutions

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