how much PLASTIC do you have?

Just moved house and my word! I could not believe how much plastic I had accumulated over the months. I had this bag where I stashed all sorts of plastic bags – black ones, supermarket ones, duty free ones – and would pull out one each time I was in ‘need’. And believe it or not, I found it difficult tossing many of them into the trash can. My case, however, would be different if I were living in Rwanda because non-biodegradable* bags are an absolute no-no. Travellers into the country are also not allowed to proceed from the airport with such bags and may exchange them for a $4 clothing bag.

The argument for non-biodegradable plastics is that they are recyclable. There is a kind, however, that cannot be recycled – plastic money that is! Commonly referred to as credit cards, these electronic swipes have become increasingly popular amongst the Kenyan professionals. Frequent international travels, technological advancements and progressive lifestyle changes have made these cards appealing. Banking personnel have also not failed in doing their job well.

But the truth is many people are paying for unnecessary costs due to poor credit management. The other day I was with my JVC (Jamaa Very Classy) pal and he was writing out a cheque in part payment of his credit card debt which was at KES 300,000, about KES 50,000 was his interest charge! He had spent a part of it on the Christmas festivities and the rest was a running balance from previous months. I thought he would be happy to consider the following in keeping his costs at a minimum and possibly zero…

• Pay before time – Find out and take advantage of the grace period within which your financial institution charges zero interest for credit card purchases. It helps to work with a financial institution / bank that not only has systems in place to promptly process your payments but also has the capacity to offer you prompt assistance when you run into card trouble. If you are in a credit card debt situation, push yourself to pay off a certain amount each month and, believe you me, you will be ‘freed’ in no time. (I will talk about debt in one of my later posts)
• Plan before emergencies set in – I once failed to sit for some exams because a bankers draft reached my examiners way past the due date. Having a credit card has sorted out this problem.  Not only is it convenient (just a mouse click) but is also cheaper (excluding courier costs and exchange differences, the draft at that time cost me KES 2,500. For the card, the only real cost was in the exchange rates).  This became one of my arguments for keeping the card. The other one was / is wondering what to do (without THE card) in case of say a hospital emergency. Bob Lotich of Christian Personal Finance (Christian PF on Facebook) gives one of the main reasons for using plastic money as not having an emergency fund. And given my JVC’s story, an entertainment fund too! I hear Bob’s point…
• Put a limit to your spending – if the cap on your card is low (ridiculously low), you will find it very easy not only to pay it off but to manage it. It will be easy to track your expenditure, find errors and in no time you will find that you actually do not need THE card (which is the essence of this article). If you are entitled to a card at work, keep it strictly business! You will not like it when you get your pay slip and realize finance has deducted a hefty amount relating to the purchases you made 2 months earlier at some clothing store abroad!

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* Now you know why Rwanda is against non-biodegradable bags – it’s not only harmful to the environment but can also cause chocking!