New Year’s Resolution = Give Up Credit Card

plant with phone and notebook

By Ebony Van Hamburg, Paraplanner

Wow, what a year! I managed to travel to three different countries, attend multiple weddings, engagement parties, music festivals, and not to mention the road trips in between! I even managed to get myself one of those plastic things. You know, one of those great little plastic cards where if you have no money but found something you need you can just whip it out, put it on there and instantly you have what you want when you want no questions asked.

Yes, a credit card. They are great until the 9th of each month… when I get my bill from the bank outlining how much I now owe them but hey you only need to pay back the minimum right? Which isn’t bad if you put on a few hundred a month and then only need to pay back $100 for the month.

It all sounds good in theory until you realise you are putting more on the card than what you are paying back each month and the debt seems to be growing larger and larger. So at this rate with a $6,000 credit card debt and paying back the minimum each month, which is approximately $100, and then interest been charged at a rate of 17%,

I should have my nice little debt from 2013 paid back in 31 years and 8 months and $18,331 poorer, unless I find more things I want of course. I was quite shocked when I calculated this, so I strongly encourage you to check out the credit card calculator for yourself on and see how much your own credit card debt is going to cost you.

I hate it though, having to pay back the bank each month for nothing. I say nothing because I have already received the benefits of spending that money and now I can’t even remember what half of the debt was for. So what is my solution?

My New Year’s Resolution

Next year will be my year of paying off debt so I am debt free by the end of the year in order to achieve my larger financial goal of buying my own house or block of land. Then once paid off, instead of giving the bank my money for nothing each month I will instead save that money in my first home savings account where I can instead potentially earn a return of 17% on my money contributed each year (the effective rate you earn will depend on how much you deposit each year).

So what will I be doing on January 1st? Not only beginning my post-Christmas detox plan but cutting up that piece of plastic, transferring the balance to a 0% interest rate on balance transfers credit card account, without receiving a credit card for it, paying that debt from the previous year off as fast as I can and taking control. Now that’s got to be easier than giving up chocolate for a year!

Ebony Van Hamburg is an Associate at Blueprint Wealth.

Blueprint Planning Pty Ltd ABN 78 097 264 554 trading as Blueprint Wealth and Ebony Van Hamburg are Authorised Representatives and Credit Representatives of AMP Financial Planning Pty Limited ABN 89 051 208 327 Australian Financial Services Licence 232706 and Australian Credit Licence 232706

Disclaimer: This article contains general information only. It does not take into account your objectives, financial situation or needs. Please consider the appropriateness of the information in light of your personal circumstances. This example is illustrative only and is not an estimate of the interest or fees and costs you will incur. This example is based on the following assumptions (a) only the minimum payment will be credited to the account ; (b) the interest rate remains at 17%; and (c) no further purchases are made on the card.