In addition to all of the personal debt I have, my business has a credit card as well. I finally stopped using it when I came to terms with the fact that I was treating it as a crutch. I had ceased my use of personal credit cards, but continued to use the business card. You can find more background on this here, and below you’ll find a small excerpt from what I initially wrote about the card.
So, the problem here is obvious, right? Though I almost eliminated my use of credit cards on the personal side, I continued to maintain my same old bad habits. I simply narrowed the playing field of stupidity. Instead of being stupid with the credit cards in both my personal and business lives, I just limited the credit card use to the business side.
Ah . . . but when you work for yourself and you are the key producer in the business, the business is integrally linked to the person. I make all of the decisions about what money will be spent, when and on what things. I control the credit card. Though I knew I couldn’t use a personal credit card to get certain things, I could find a way to make it a business expense. I could justify going to Capital Grill for a meeting on the business side. I could justify traveling to another state, staying in a nice hotel, and eating fine food for a business conference. Could the business afford it? No! Could the business pay for it? Absolutely. I had the business credit card.
Though I stopped using the card 5 months ago, and have made over $5,500 in payments since then, the balance is still about $22,000, which means it has only gone down by about $3,000. When I started this journey, the balance was a few hundred dollars short of the $25,000 credit limit. Each month, the minimum payment required is $635. I’ve been paying at least $1,000.
I’ll be able to pay off the high interest balance card and not pay any interest for 12 months.
~ Single Girl
I’m tired of not seeing the balance go down more. This week I applied for a couple of 0% business credit cards for the business so that the $1,000 per month payment can go farther. I ended up getting two cards – 1 from Capital One and another from American Express. I needed to get 2 cards because neither company would give me the full $22,000 that I needed to cover the full balance. Between the two of them, I’ll be able to pay off the high interest balance card and not pay any interest for 12 months.
The American Express card has a balance transfer fee of $300. The Capital One card has no fee. The $300 transfer fee makes great money sense to me because my finance fee for just 1 month with the current card is $493. Over the next 12 months, I should save several thousands of dollars in finance fees.
I’d love to be able to pay off the entire balance within the next 12 months. With my 2020 goal of increasing annual gross revenues in the business by over double, I believe it to be doable. I’m excited about getting this done so I can make more traction in getting that credit card paid off.