A Better Way to Manage Your Everyday Money - Book - Page 100
Four-step method
PerNetFlow simplifies the management of credit cards by supporting a four-step approach for
handling credit card activity. The consistent advantages of this four-step method are:
● not paying any interest or fees;
● avoiding having to pay fraudulent charges;
● always knowing how your charging activity is affecting your net cashflow.
The four steps are:
1.
Remember what happened - Always get some kind of receipt for charges and refunds
that you authorize. When you buy or return something with a credit card, always get or
make a receipt. It doesn't matter what form a receipt might take: paper, email, hand
written note, a spreadsheet, etc. The point is that you have accurate reminders for all of
the activity on your credit card that you authorized.
2.
Update charging activity and scheduled payments - When convenient, add new
charging activity in PerNetFlow. After adding activity, adjust your scheduled credit card
payments to fully pay for new charges. Doing so will show you immediately how your
charging activity is affecting your net cashflow. Save receipts as they may be needed in
Step 3.
3.
Validate charging activity - In PerNetFlow, reconcile credit card statements as soon as
possible after receiving them each month. Dispute any fraudulent charges, via letter, that
appear on a statement within 60 days of the statement date to avoid having to pay the
bogus charges. Steps on how to contest charges are in the small print on the back of each
statement.
4.
Avoid paying late fees and interest - Pay the statement’s new balance each month in full
on or before the payment due date. The simplest way to always make payments on time is
to sign up for automatic payments of the statement’s new balance amount on a credit card
company’s website. With automatic payments of the new balance amount, you will never
be charged interest or late fees.
The key to making the four-step tep method work is to make it a habit. Lois and I have been
using this method so long we no longer have to think about it.
1. When we charge or return something in a store, we get a printed receipt. When a receipt
is not available, we make a note. When we are asked,
