For those of you who are using credit cards for the first time, or are having difficulty in managing your expenses, budgets can be a bit tricky to devise. Your credit cards are charged one month, but typically don’t show up on your credit card statement for at least 2-5 weeks (sometimes more). This is long after you have enjoyed that meal, worn your new shoes or purchased a book! Perhaps you have even forgotten what you bought or why.

There are a couple of ways you can deal with this.

1. Instead of waiting for the bill, deduct the money from THIS month’s expenses as the expenses are incurred and place it in a ‘holding account’ where the money can gather some interest until the bill is due. This helps to keep the feeling that purchasing on a credit card actually involves REAL money. I try to do this, but sometimes I forget to separate the cash. Naturally, my cash gets spent, leaving a shortfall that has to be covered next month.

2. Use a special program like Quicken or MSMoney to track your expenses. Or use Credit Card Manager to help manage your credit card expenses.

One aspect that I forgot early on in my credit card ‘career’ was to take advantage of points. I saved up my points for quite a while and I ignored the ‘expiry’ notices each month, until the month after expiry when I realized that my hard-earned points had been knocked down a great deal. At that point, I was pretty upset because I had used that card a great deal up until that point, but hadn’t found much worth purchasing through their credit card rewards program. I just waited. After that, I retained the credit card, but I only use it for online purchases and emergencies. So I punished the bank. In reality, my other credit card also did the same, but this time I was more careful to use the points.

This post has been sponsored.