Imagine a day without your credit card.
Don’t worry — most people would feel a bit unsettled. That’s because 93% of Canadians have credit cards, and most prefer them for larger transactions.
But your credit card behaviour could be stopping you from achieving your financial goals. Indeed, 41% of Canadians carry credit card balances from one month into the next.
One solution? A credit card fast — aka a set period of time where you commit to not using your credit card.
A credit card fast could be just the thing you need to reset your finances or achieve a goal you’ve been working toward.
Credit Canada’s CEO Bruce Sellery recently spoke with Lisa Samalonis, a New-Jersey writer, about her experience doing a credit card fast after divorce. Her credit card fast gave her the momentum she needed to eventually buy a house!
We’ll walk through some of the interview’s highlights, why we’re so reliant on credit cards, and how you can successfully complete a credit card fast.
The Allure of Credit Cards
Enjoy now, pay later — that’s the biggest appeal of a credit card. Even now, modern financial experts recommend you use your credit card frequently. You’ll build credit history, rack up points for cashback and travel, and enjoy fraud protection on purchases.
But is that why so many people use them? Not entirely. The big picture also comes down to our brain chemistry.
Two business professors at the Manhattan School of Technology (MIT) wrote an entire study about credit cards and brain activity titled “Neural mechanisms of credit card spending.”
The gist? Swiping your credit card actually awakens reward and pleasure centers in your brain. They caution consumers to practice restraint in the looming age of cashless spending, predicting something as simple as holding a phone could urge you to spend money.
So the allure isn’t just in travel points or convenience or even in the prospect of a shiny new gadget — it’s a feeling of pleasure activated in our brains.
This makes sense when you look at how many people struggle with credit card debt. Inflation is making everything expensive, prompting a 15% increase in consumer credit debt — especially for young people.
How a Credit Card Fast Can Help Your Finances
The benefits are pretty intuitive. One less credit card statement to worry about is enough to put anyone in a positive mood. But the true benefits of a credit card fast go beyond a few dollars in savings. You’ll feel more in control of your finances, which supports your mental health:
“I could look at what I was spending in real-time, and I felt like I had more control,” said Samalonis. “If I didn’t have the cash and I didn’t have it in my debit account, I just couldn’t use it.”
Regaining control sounds pretty nice, right? You’ll feel a little less worried about your finances, which is usually a top stressor for people.
Finally, you’ll have more space in your budget to achieve your financial goals. This could look like faster debt repayment, saving for retirement, compiling a down payment — you name it.
Tips for Managing Expenses Without Credit Cards
Don’t get us wrong — living without a credit card takes some adjusting.
But here are some tips to smooth out your experience:
Find low-cost alternatives to the things you like
“The irregular expenses are what trips people up,” says Samalonis. “They think, ‘Oh, I don’t have this money — I have to put it on my credit card.’”
Indeed, it’s those irregular expenses that almost always get paid for via credit. A shopping mall treat, a night out on the town. And for Samalonis, it’s take-out.
But there’s a low-cost alternative to pretty much every expense.
Do you have a soft spot for retail therapy? Swap the mall with Value Village.
Or maybe you have a soft spot for Uber Eats — watch a YouTube video and learn how to cook your favourite meals. Samalonis switched expensive take out with “breakfast for dinner,” which was super cost-effective.
And if you love wine dates with the girls? Invite them over and hit up the LCBO instead of going to a bar.
Give yourself grace
A credit card fast might not be easy for you. You’ll need to do some more planning, especially for high-spending events like Christmas and birthdays. And some days, you’ll feel discouraged and limited without your credit card.
It’s okay to feel overwhelmed. That’s where services like credit counselling come in handy — confidential, non-judgmental counselling from certified credit counsellors to discuss your finances.
Samalonis tells us not to focus on negative energy and give yourself grace:
“I’m a high achiever — I call myself a reformed perfectionist. And you know, I made some mistakes while married and on my own. So sometimes I’d be self-critical, and that doesn’t really help. We all make mistakes, but being self-critical is a negative energy. I try thinking about what I want my life to be, and from there, made some positive steps toward that.”
You’re going to make mistakes. Maybe you’ll make a cheeky exception for a big expense during your credit card fast, or forget to make a payment.
Use a budgeting app or method
Samalonis organized her budget with support from the budgeting app “You Need a Budget (YNAB).” This helps you visualize what’s coming in and out, and gives you a sense of control over your finances, which is especially helpful during a credit card fast.
You could also use Credit Canada’s Budget Planner + Expense Tracker to organize your top expenses and map out your obligations each month.
Here are a few more budget resources to consider during your fast:
- Budgeting tips for lower-income families: These are a few tips from our credit counsellors to help low-income Canadians stick to their budgets.
- Budget calculator: This free tool from Credit Canada helps you eliminate unnecessary expenses from your regular spending.
- How to create a monthly budget: Read our step-by-step guide on creating a monthly budget tailored to your needs.
Remember that it’s temporary
You don’t need to cancel your credit cards. But a month or two, or even a few weeks without access to your credit cards could give your finances the reset you need to feel more stable and secure.
“I didn’t cancel any of my credit cards,” explained Lisa. “I did this for a period of time — probably about three years — until I felt confident that I could make my bills, the payments, that I could plan ahead, that I had that discipline. Then I went back to credit cards.”
Credit Card Fast FAQs
1. How long should I stay on a credit card fast?
You should stay on a credit card fast for as long as you need to, but a suggestion is anywhere from six months to four years. Or, you might end the fast based on a financial milestone like saving up for a down payment or paying off a student loan.
2. Should I cancel my credit cards during a credit card fast?
No, you shouldn’t cancel your credit cards because you’ll miss out on the opportunity to demonstrate positive payment history to the credit bureaus, which improves your credit score. You should contact your credit card provider, however, to find out if they cancel unused credit cards after a certain time frame of not using them.
3. Can you live without a credit card?
Many Canadians rely on credit cards for everyday expenses, so living without them might cause some cash flow problems. However, people like Lisa Samalonis demonstrate that we can adapt our lifestyles and budgets to make ourselves less reliant on credit cards.
Let Credit Canada Support You Through Your Credit Card Fast
Your credit card fast might feel overwhelming at first, but the effects are 100% worth it. Samalonis noted a greater sense of control, gratitude, and security after her fast:
“I had a vision for what I wanted our family life to be — and that was secure and peaceful. And I felt these efforts were helping me get there.”
Just remember to take advantage of all the help available to you. A budget is a great start, but you might crave a little more support on your journey. That’s where Credit Canada’s certified credit counsellors come in.
We offer 100% free, non-judgmental, confidential counselling sessions to help you assess your debt relief options, manage your spending, and get back to doing the things you love.
Book a credit counselling session today!
