Does your Budget call for Credit Card Payments?
If you have a budget it needs to include every penny you earn, as well as all your debt. Believe it or not, some people do not include their credit card payments in their budget. As you can imagine, this will throw you a curve month in and month out. After all, a credit card payment can be quite big. This is particularly true if you have a large amount of debt. You need to include credit card debt in your budget under the category of variable expenses.
Why is credit card debt a variable expense? Simply put, the payment that you send each month can and will differ. For instance, if you only pay the minimum this number will decrease as your overall balance goes down. In turn, the amount of money you pay each month will change as well; this is known as a variable expense. Of course, you may want to add this as a fixed expense if you always pay the same amount no matter what you are asked for.
Generally speaking, it does not matter what type of expense you consider your credit card payment as long as you track it in one way or the next. If you have credit card debt and this is not a major part of your budget you are making a big money mistake.
Your budget should most definitely include any credit card payments that you make. This should be the case no matter how much you owe. Soon enough you will be able to pay off all of your credit card debt, and in turn knock this off of your budget once and for all.
If you have credit card debt and this expense is not currently in your budget you should make the necessary changes today.
