9 Simple ways to avoid overspending on your credit card

This is a guest post from Andrew Wang who also publishes a blog on making money.

Purchasing a large number of different items on your credit card, as well as paying certain bills with a credit card can very quickly send your card up to the limit. Before long, many people quickly find themselves overspending on their credit card and incurring fees and charges that mount up quickly. To avoid overspending on a credit card, there are a number of practical steps you can take. This will help control your spending and keep you within your credit limit.
Here are 9 ways to reduce the chances of overspending on your credit card:

1. Know your credit limit, you can quickly assess if the item you wish to buy or the bill you wish to pay is going to make you exceed the credit limit set by the credit card company. You can then avoid the situation of using your card and exceeding your credit limit.

2. Keep your credit card receipts. Always keep your credit card receipts after you spend money on the card and keep a tally of what you spend. You can use this in conjunction with the previous step to make sure that you are always aware of your spending and spending limits, as to avoid credit card charges for going over your limit.

3. Establish on line bank account. Setting up an on-line bank account linked to your credit card will allow you to quickly transfer money onto your card if you are in danger of going over your limit.

4. Use for specific purchases. By using your credit card for specific purchases or specific bill payments, you are much more in control of what it is being used for, therefore you are less likely to overspend on unexpected items.

5. Pay with cash. Whenever you can, try and get into the habit of carrying cash. You know exactly how much cash you are carrying, which means that you are less inclined to make an impulsive purchase because you have your credit card with you.

6. Open with lower limit. When you first open a credit card account, insist on having a low spending limit on the card. Credit card companies are always keen to “bump up” your credit limit as they know you will use the extra credit and have a greater chance of going over your credit limit, thereby incurring charges and fees.

7. Know what you are purchasing. Before you go shopping with your credit card, look at the items you have previously purchased with your credit card and give them an “Objective Valuation Rating”. Rate each item on a scale of 10 and only consider further purchases on the item you wish to purchase if it scores over 8. This really helps you control your spending, and it also reduce the chances of overspending on your credit card.

8. Don’t take it with you. Keep your credit card at home. This means that your card is not available when you see something you are tempted to purchase. This also means you will be in a better place to keep a tight control of all spending on the card.

9. Pay it off. When paying your credit card bill, pay a little extra on the card. That way you are actually increasing your credit limit and reducing your chances of overspending and having to worry about fees and charges.


  1. Stephen (Saving from Scratch) says

    Great tips, Andrew. Before I got my act together, I was constantly going over and increasingly falling behind in my monthly payments. I then overcompensated and started paying for everything with interac. Once I realized how easy it is to rack up travel points, I changed my game plan and started using my credit card every time. I have my smartphone with me which constantly tells me my bank and VISA balances, so I’m always careful not to overspend. At the end of the month, I simply flip the money (that has been earning interest all month) from my savings into my VISA, and enjoy the points. Three free trips and counting!

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