If you paid off your debt once, only to run up twice as much later, don’t be too hard on yourself. You can still learn from your mistakes.

3 minute read

About six years ago, I paid off $8,000 in credit card debt in 18 months. After I made that final credit card payment, I swore I’d never burden myself with a crushing credit card balance again.

I stayed at a zero balance for more than a year. However, my card’s balance crept up steadily again, with a stream of veterinary bills for Toby, my ancient Chow mix. Before long, I had $3,000 in credit card debt.

I paid it off just like the last time, with frugal living and a side hustle in addition to my full-time job. It took about a year to get to a zero balance that time. That’s it for me. No more credit card debt. Maybe you paid off your debt and feel the same way. However, you could end up in the same situation again unless you take some precautionary measures.

Here’s what I did to help keep myself from regretting another big credit card debt…

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1. Build an emergency savings

After I paid off my first round of credit card debt, I saved $1,000 for small-to-moderate emergencies. This account kept me from charging those first unexpected vet bills. However, I neglected to replenish my emergency fund as it dwindled. Once I was out of emergency money, I was back to using the credit card.

Find out: How to Pay Off Credit Card Debt.

What you can do

Think of every possible way to build an emergency savings of at least $1,000. Then keep adding to it, since you can blow through a thousand bucks quickly when it comes to things like dead laptops, lost phones, and car repairs. If you can save two or three times that amount (or more) that’s better. But $1,000 is a decent starter emergency fund.

2. Stick to a budget

I had a strict budget when I was paying off debt. However, once I paid everything off, my spending got a little looser. I stopped writing down my monthly budget and expenses consistently. Sometimes, I ran out of money and had to pay utilities with a credit card. Usually, I paid the balance off each month. Then one month I couldn’t pay the entire balance and even had to charge more stuff. Of course, the balance grew from there.

Find out: How to Create a Budget and Stick to it.

What you can do

Don’t get overly confident because you learned some good money management skills while hammering away at your last debt. You can ease your budget restrictions a little, since you don’t have all that debt anymore. However, make the budget a monthly habit and a priority so you always know where you stand with your income, expenses and any additional bills.

3. Pay cash for most things

One of the methods that helped me pay off my debt both times was using some form of a cash envelope system. I placed a budgeted amount of money in separate envelopes for things like groceries, toiletries, restaurants, prescriptions and whatever else I needed from week-to-week. That kept me from impulse buying and overspending with my debit card.

Find out: How to Make a Cash Envelope System.

What you can do

Set up a system where you fill envelopes with budgeted cash for each week. Keep using your debit card (not your credit card, unless you can pay it off the same week) at the gas pump and for utilities and other expenses you typically pay online.

4. Not paying off your credit card balance monthly

One way I got into credit card trouble again was by letting my balance slide here and there. If I owed $300, I’d pay half of it and plan to get the rest next time. Then I’d have to charge more because I had an emergency or failed to draw up a budget and ran out of money.

What you can do

Make sure you never carry a credit card balance. If you must charge $80 for a purchase because you didn’t have cash or your debit card with you, make that $80 payment to your credit card online as soon as it shows up.

You’ve already done your time in debt rehab once. Put these measures in place, and there’s a good chance you can stay out of debt for good.

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

Published by Debt.com, LLC