When was the last time you took a good look at the credit cards in your wallet? Declutter your life by cleaning out your cards – and making way for better ones.
As you usher in a brand new 2019, many of you would have done some spring-cleaning towards the end of 2018, throwing away or donating unwanted items from your home. While most of these items are likely to be bulky furniture, clothes, shoes, books, and magazines, there is one aspect of spring-cleaning that is often overlooked – your credit cards.
You may have noticed your wallet getter fuller and fuller, and not from having wads of cash, but simply because you have accumulated too many cards over the years.
Yes, while we focus on decluttering ‘big items’ at home, many of us do not realise that over time, our wallets also do ‘gain weight’ – and not the good kind. As we step into the first month of 2019, now is as good a time as any to declutter your life by cleaning up your credit cards.
Declutter Your Wallet Step #1: Detox
Begin your wallet ‘detox’ exercise by first emptying it out and laying the contents on a table. You might probably be shocked to find old receipts, notes with scribblings, business cards, membership cards, and credit cards issued by various banks.
It won’t be surprising to find yourself staring at your credit cards and realising that there may be a few you have never even used before.
“How did I end up with so many cards?”
Some of you might have already started using credit or debit cards when you were students at tertiary institutions. The beauty of owning credit cards is the convenience and safety it offers compared to carrying too much cash. You can also earn rebates by paying for things like your phone bills, allowing shave your expenses each month. Moreover, some credit cards can also double up as your EZ-link card.
But as you graduate and start working, your priorities and lifestyles change. There are so many credit card issuing banks offering all sorts of freebies and attractive perks out there. Some of you may be lured by the mouth-watering cashbacks, irresistible 2-for-1 dining promotions, and generous air miles, while others may have applied for cards they do not need just to get interesting freebies such as the Manchester United scarf offered by Maybank a few years back.
Declutter Your Wallet Step #2: Reflect
When it comes to decluttering your life, Marie Kondo says that “Tidying is a dialogue with oneself.”
Similarly with your wallet, this is the most challenging part. You really need to do some serious soul-searching about your needs. Do remember that credit cards charge annual fees even if you do not utilise them, although banks may be willing to waive them if you have a clean repayment record and are a long-time customer.
On top of that, if you do not pay your bills on time or if you choose to pay a minimum sum per month, the outstanding balance will snowball and the final incurred can be quite substantial. Most banks charge an interest of 25.9% per annum for outstanding balances.
Declutter Your Wallet Step #3: Prioritise
Knowing which cards to keep and which to discard requires a relook at your current lifestyle. What are your biggest expenditures? Do you have any specific financial goals? Do you have an adequate variety of card types? All these will help you decide the best collection of cards for you.
6 questions to help you prioritise your credit card needs
1. Are you currently using your credit card to pay off instalments for some big ticket items at 0% interest rate?
If you are, do note the number of months left on this instalment plan. Then consider if the card will still be useful for you once you have completed the payment plan.
2. Do you have a good combination of different credit card providers?
For example, ComfortDelGro taxis accept MasterCard but not Visa. MasterCard’s Masterpass digital wallet also offers certain perks like discount codes and rebates when used with certain merchants. In general, it is wise to carry one of each – MasterCard, Visa, and American Express. The American Express card, though not as widely accepted as the MasterCard or Visa, is fast gaining popularity in Singapore, and can be especially handy for overseas expenditure.
3. How much you spend on groceries and where do you normally do your shopping?
Some credit cards allow you to save more if you spend at selected supermarkets such as Fairprice, Cold Storage, or Sheng Shiong. Do some calculations and see which card gives you the most cashback for your groceries.
4. Do you own a car or drive regularly for work?
In this case, it may be worthwhile to hold onto a credit card that gives you the most rebates on petrol. On the other hand, if you take public transport, you might want to consider getting a credit card which can also double as your EZ-link card so that you can benefit from the rebates.
5. What sort of lifestyle or leisure activities do you enjoy?
Do you enjoy fine-dining on a weekly basis, or a chill out at a pub on Friday nights? Do you watch movies regularly, or subscribe to a streaming service? How often do you shop online for new clothes or big ticket items like electronics? Choose the credit card which gives you the most perks based on your choice of entertainment, so that you can indulge yourself to the fullest. If your current card doesn’t give you the best rebates, don’t be afraid to cancel it and apply for a different one.
6. Are you a jet-setter?
How often do you travel per year? If you're a travel bug, the credit card that earns you the most air miles will be your perfect companion. Points can be redeemed for different air miles to purchase tickets or upgrades – for free! On top of that, you can also get free or discounted travel insurance when you pay for your airfare using certain credit cards. Some cards even offer extra perks for overseas use, so it’s a worthwhile alternative to using a foreign currency (there’s always some pesky loose change you can never get rid of!). As an added bonus, some cards even give you free access to airport lounges.
Using the 6 guidelines above, you will get a clearer picture of what your needs are for 2019 and beyond. By clearing out cards you no longer use, you’ll save yourself from paying unnecessary annual fees or the hassle of calling up the credit card issuing banks for fee waivers (which are not always approved).
Decluttering your cards will also give you the extra wallet space you need to apply for the credit cards that will actually give you the better benefits you deserve.
As parting advice, these words by Marie Kondo could be your mantra for 2019:
“Discard everything that does not ‘spark joy’, after thanking the objects that are getting the heave-ho for their services.”
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A recipient of the Magnum Foundation Emergency Grant in 2014, my photos from the Middle East and Asia have also been published in Time Magazine and Le Monde etc. My written work ranges from travel, politics (Mid-East) to the environment and finance-related matters.