tatjna (tatjna) wrote,

Plastic plastic lalala

It's only been a couple of years since I got a job that pays a salary that's even close to the national average. I think I'm now just over it, but count back 8 years and I was living below the poverty line. And my financial organisey stuff was still set up for back then. The arrival of the bill for my study this year was the catalyst I needed to get inspired to go to the bank and sort it out.

So what I had was a savings account and a 'cheque' account that I'd never bothered to get a book for, being mostly an internet banker.

In the interceding years, I'd picked up a third account to pay bills from, and had a payline split set up, sending money to each when I got paid, and dropping the leftovers in my cheque account for disposable income. My ass was relatively well covered, bill paying wise. The savings account was paying some crappy low interest and hadn't really built up because of the advent of the credit card, which is hell useful but also too freaking easy to get into debt with. I'd also picked up half of a valuable asset (a house), finished paying off my car, and had a sizeable credit card debt (in my terms anyway - other people might call it tiny but to me, anything over $500 is too much).

So, it'd been niggling in the back of my mind how to pay for my tuition without putting it on the credit card, and on Tuesday morning I woke up with a light bulb (UV, naturally) on in my head. I made an appointment with the bank and went in today.

Here are the steps I've taken:

    Got a loan that covers the tuition fees and is enough to pay off my credit card with a bit left over.
    Organised to have my credit card account closed as soon as the debt is paid.
    Set up a free 'utility' account with a DEBIT card attached to it.
    Changed the automatic payment that was going to the credit card to go into the debit card account.
    Changed my savings account for one that pays a reasonable amount of interest.

My loan repayments are exactly the same amount that I was paying on my car, so I won't notice that - it even disappears monthly on the same day that the car payment did. The money that's paylined into my savings account can now stay there, because I'm not having to power it into a credit card account to pay off debt. My disposable income will go up by about $200 a pay, and if I want I can shunt that into any one of the debit card, savings or loan payments. Paying off my loan early will not be penalised. Having money on the debit card means I'm sussed for internet purchases and unexpected impulse buying. And actual savings!

So, as of today, I'm no longer trying to stay afloat against the tide of credit - with a loan, you can only put in, not take out. The payline split is set up so that my regular bills (including loan payments) are covered without me having to think about them, and my savings gets automatically added to. The remainder is dropped in the cheque account for me to do with as I see fit - it's disposable income. I'll be saving $100 a fortnight in proper actual savings, and I still have all the useful stuff that a credit card brings, without the interest payments or the ability to spend beyond my means. I will no longer feel as though I have to power $800 a month in there - instead I have around $450 a month to come up with, of which $200 is savings for me. And the other $350? If I want I can put it on the debit card, if I want I can buy all my friends cappucinos.

Mostly, I won't be tempted to spend money I don't have. My advice to anyone who wants to feel secure with money is - cut up your credit card and get a debit card. All the same advantages, but it's YOUR money you're spending, and you can't go into debt with one.

For the first time in my life, I feel financially comfortable. In fact, I'm feeling rather pleased with myself.

*cue some smartass to come tell me i've done it all wrong*
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