Using Credit Cards for all Monthly Expenses

By using credit cards to charge all of your expenses and purchases, the cards can assist you in managing your finances and making things simplified. If used carefully, this approach to paying your bills saves time, and can help you obtain the maximum amount of benefits from a credit card that offers rewards or cash back programs.

Create the Plan

The only way for this payment strategy to work without causing you to get in over your head in debt is to have a strict monthly budget created. If you start using your credit card to pay for everything all month long without keeping track of that spending, you’d be surprised how quickly those little purchases can add up and become more than what you can afford to pay at the end of the month. First, determine what your monthly expenses are. Include each of your bills that you pay- your mortgage, vehicle loans, utilities, other credit cards, etc. Then determine your non-fixed monthly expenses, like gasoline, groceries, entertainment costs, vehicle maintenance, etc. You need to set up limits for each of your expense categories by using your monthly income to determine how much money you have available for each expense.

Set up Payment Arrangements

Many of your bills can be set up to automatically bill right to your credit card on a monthly basis. For the expenses that cannot be paid automatically, you can check to see if you are able to pay for them online or over the phone. For the very few accounts that do not have online or phone payment options, you can almost always write in your credit card number on the statement and send it back that way for payment processing. For shopping, gasoline and other point of service type expenses, make sure you select a credit card that is selected in the stores and merchants that you do your shopping at.

Record Keeping

Using a credit card for your monthly expenses makes your record keeping easier. You won’t have to keep a detailed check register all month long, with a list of each deposit and write out checks individually- instead, you’ll have your income deposits and a single payment sent out to your credit card balance at the end of each month! Balancing your checkbook will become much easier and take far less time with the limited transactions you’ll have to keep track of, also. In addition, your credit card statement will detail a list of all of the bills you’ve paid each month, as well as your other expenditures so you can easily see that you are keeping on your budget (or if you’ve gone off it a bit and need to take in the reins on the spending!)

Taking Advantage of Credit Card Rewards

When you decide to pay for all of your expenses each month on a single credit card, you should select a card that offers a rewards program that you can take advantage of. Rewards programs offer more rewards for more money spent on the card. For cash back cards, a popular program is 1.5% cash back on all purchases made using the card. When you are paying for all expenses monthly, this is equivalent to saving 1.5% on your monthly bills! Other rewards programs include frequent flyer miles, store credit and travel benefits. Select your card carefully to take full advantage of the rewards program.