Use Credit Cards

Ah, yes, credit cards. Instant money and instant gratification. Sure, you can use credit cards as a money-management tool for daily small purchases, as I do, but they're also a very tempting way to pay for things you can't really afford.

The average standard credit card carries an interest rate of 15.4 percent, and the average gold card has a rate of 17 percent, according to Bankrate.com. Not cheap. And some of my credit cards have even higher interest rates, but because I always pay my balance in full, higher rates have never cost me any money.

For argument's sake, let's say my custom bookcases will cost $5,000 (I want cherry!) and I charge them on a credit card that carries a 15.4 percent interest rate. If I want to pay off the balance in 12 months, my monthly payment would be $452.24, and, factoring in the $426.88 in interest charges, the total cost of the bookcases would be $5,426.88. If I want to pay it off in 24 months, my monthly payment would drop to $243.38, but the $842.12 in interest would bring the cost of the bookcases to $5,842.12.

I'm having a tough enough time coming up with the five grand for the project -- do I really want to pay hundreds more in interest charges? No. I hate keeping a balance on my cards. I don't do it for emergencies, so I certainly won't do it for a pleasure item.