Cutting my credit card bill

Better cut my credit card bill

Here’s my latest Monday Money post, part of the series I’m hosting with Emma at EmmaDrew.info and Lynn from Mrs Mummypenny. It’s a great way to share content about money, so do check the links at the end for other brilliant money posts! Plus, find out how to join in if you’re a blogger. We’d love you to add your posts.

Ever looked at a credit card statement and thought ‘ouch’?

Our latest credit card bill made expensive reading.

We use our credit card to pay for virtually everything, so we can earn cashback, and also so we can see everything on one handy statement. So long as we clear the bill in full every month, we get paid cashback once a year, without paying a penny in credit card interest.

When we first moved to the country, my youngest still hadn’t started school, so I wasn’t working much, and my husband was looking for a job locally. We had savings and money left after selling our old house, but there wasn’t much coming in each month. We therefore slashed as much spending as possible.

Since then, our finances are looking rosier. My husband enjoys his job fund raising for a local hospice. With both children now at school, I’ve been picking up more work. We also sorted out some of our money so we could earn passive income, as interest on savings and investments, and as rent on a little buy-to-let.

Trouble is, our spending, and therefore our credit card bills, have picked up too.

I’m glad we don’t have to watch our day-to-day spending quite so closely, but I’m also keen to avoid excessive ‘lifestyle inflation’. Lifestyle inflation happens when you spend more as you earn more. If they are fortunate enough to have the choice, few people stick to a penniless student lifestyle once they start earning a higher salary. But keeping a gap between money coming in and money going out is vital for anyone who wants to stash cash for the future.

So I’m keen to look at where we spent more, and how we might cut back.

Where did we spend more?

Staring at the statement, our credit card spending was bumped up by a whole combination of factors.

Occasional expenses

Our car was due for a five-year service, and as my husband relies on it to get him back and forth to work, we’re keen to keep those wheels on the road.

We’re also looking forward to our fortnight’s summer holiday in the Lake District – and the balance of the holiday cottage was due this month.

Regular expenses

The children go to swimming lessons every week in our local pool. The lessons are good value at £5.85 each. But when you pay once a quarter for two children, it does add up.

Work expenses

I can see that as I’ve picked up extra work, I’ve also picked up extra expenses. Additional train fares to London. The odd sandwich between meetings. A day’s holiday camp during school holidays. The income outweighs the expenses, but it all bumps up our credit card bill.

Out of the blue expenses

I wasn’t expecting to making a flying visit to Madeira, to see my step-dad in hospital, but it still involved air fares plus train tickets to the airport.

Related post on five frugal things when flying

Investing in replacements

When money was tight, we out everything apart from essential spending. But eventually, some things do wear out and need replacing. Now our income is higher, we chose to invest in more expensive (although hopefully long lasting) options.

I finally found my birthday and Christmas present handbag, to replace the eight-year-old version with a bust zip. Despite battery changes and repairs, my husband’s nine-year-old watch has ground to a halt and he replaced it with a Garmin running watch. In both cases we took advantage of any sales, discount and cashback on offer but they were still chunky payments.

My husband is trying to extend the life of his computer, so he also bought an external hard drive and adapator lead for extra storage. A sensible purchase that won’t be repeated, but an expense nonetheless.

Treats for the kids

Now that I haven’t been keeping such a tight rein on our spending, I can see some extra costs creeping in.

Full price tickets to see the new Star Wars film at the cinema, rather using vouchers or waiting till it showed up at cheaper early morning showings. McDonalds afterwards instead of a packed lunch. A takeaway when we fancied a treat and were too fed up to cook. The tickets for a long-awaited trip to Kidzania in London for the kids. In themselves, none of these costs are earth shattering, and none of them crop up every week. But they do add up.

The children also set their hearts on getting an Xbox. We’ve never had any computer games consoles before, but promised to match their savings if they could raise half. This was the month they finally did, scraping together Christmas money, birthday money, pocket money and handouts from generous grandparents. The delivery arrived just after I left for Madeira, which was great timing in keeping them occupied, if less good from a credit card perspective.

Frugal failures

Looking at the statement, much as it pains me to admit it, I can also see some frugal failures.

Ages ago I used a voucher to claim a free box of Hello Fresh food. It’s a subscription service, so since then I’ve been happily skipping weeks so I wouldn’t get charged. But then a couple of weeks ago, I must have forgotten, because out of the blue I got a text announcing a delivery the next day. We got hit for the full whack £63.99 for four family meals for four people, way more than I’d normally spend on our food. To make matters worse, I’d even had an email the week before offering a third off a future box – but of course that wasn’t applied.

Attempting to grasp at a silver lining, the Hello Fresh delivery did come in handy when I was called away to Madeira. It meant my husband had all the supplies and recipe cards for a couple of meals while I was away. But still – however tasty the recipes, that’s a lot of cash for a limited amount of food.

I also spotted an unexpected Apple subscription, which my husband reckons is for Apple music after a three month free trial finished.

How can we cut back?

Overall, our credit card bill for June was roughly double what we used to pay, when we locked down all our spending.

It’s all very well pointing at different expenses and saying: “that only happens once a year” or ” we won’t need to buy that again for ages”. But every month there are additional expense one way or another. There’s always another bill or birthday to replace the last one.

We’re very lucky that we do have income and savings to cover our credit card bill, without racking up interest or borrowing elsewhere. However, I’m keen this level of spending shouldn’t become the new normal.

Here’s what I plan to do so we can cut back or otherwise cover it:

Making the most of meal planning

I know that with a bit of extra effort, I can cut some of our food costs. We could use up some of the food in the freezer, and if I cook large quantities, I can freeze half to avoid takeaway temptation in future. I could do with slashing snacks anyway, so I’m not forced to buy bigger trousers!

Having fun on a budget

Cutting costs doesn’t have to mean staying indoors, being bored. My husband has already checked out Game for refurbished Xbox games, rather than buying brand new releases. I’m intending to track down our two remaining cinema vouchers, thanks to our Club Lloyds current account, so our next cinema trip doesn’t cost so much. Adults go free vouchers from cereal packets should also save money on visiting at least one attraction during the summer holidays.

Cancelling subscriptions

I don’t want to get caught out by Hello Fresh again, so I’ve cancelled the subscription rather than skipping weeks. My husband is also weighing up whether the Apple music subscription is worth £120 a year to him, or if he can find a cheaper alternative.

Chasing up outstanding invoices

I always say that making the most of your money isn’t just about spending less, but also earning extra. Extra income means the credit card bill isn’t quite so painful.

But while I’ve been working more, I haven’t been paid for everything I’ve done. I’ve therefore been following up on overdue invoices and chasing up on articles I’ve written that haven’t yet appeared in print. Hassling people for money owed is one of the less joyful parts of freelance life. Keep your fingers crossed for the extra cash!

Cashing in on the children’s accounts

I don’t actually mean swiping money from the kids!

However, the Xbox deal involved the children paying their half. Now I actually need to make that happen, by marching them down to our local building society. Once they withdraw their contribution from their saving accounts, it will help pay part of the credit card bill.

Adding up expenses

I can at least use expenses for work to shave some money off my tax bill. Train tickets to meetings, the odd sandwich when I’m away in London, and taxi fares back from my local station can all be submitted on the self-employment page of my tax return.

To make sure I don’t miss out, I use the 1Tap receipts app to snap photos of my receipts as I go along. I’ve even added receipts when waiting at train stations or in cafes. Here’s a referral link* if you’d like to try 1Tap receipts yourself, with a 20% discount on the subscription cost.

Claiming delay repay

After flying back from Madeira, my train trip was delayed. Someone anti-social decided to chuck a shopping trolley off a bridge onto the train below, smashing the overhead power cables. As I was held up for more than two hours, I’ve submitted a delay repay form to the train company, and hope to get part of my ticket refunded.

Now I feel encouraged that our credit card bill won’t be quite so huge next month, and we’ll be able to cover the current bill without a big dent in the family finances.

So over to you – any big expenses that take you by surprise? What are your top tips for cutting costs when needed? Do share in the comments, I’d love to hear!

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