How Can I Reduce My Credit Card Debt?
There is a credit crisis in America. It was created
by credit and credit card companies and banks.
You probably have experienced this crisis at least
once. You have more debt than you have the ability
to pay it back. It is possible to get out of debt
but it takes, time and energy, willpower and discipline.
The Debt Counselors of America and the National
Consumer Law Center offer these credit card debt
How to stay out of debt;
- Know the Fees.
Know the annual fees, current interest rates,
finance charges, cash advance fees and any other
fees associated with your card. This knowledge
can help you make better decisions on how to
manage your card.
- Avoid Cash Advances.
You should only get cash advances when it is
absolutely necessary or never. The interest
for cash advances is higher than for purchases
and there are usually additional fees. Cash
advances make you think you have more money
than you do.
- Pay Cash
If you can’t afford to pay cash, you probably
shouldn’t pay credit. Remember you have
to pay it back and that becomes a greater debt
load. So if you are left with too much month
at the end of the money it’s time to check
your budget and spending habits, not borrow
How To Get Out of Debt
Go on Spending Diet Cut back
on your spending, make a budget, include everything,
and see where you can cut back with little or
no sense of deprivation. Decaf soy latte’s
cost $3.50 at specialty shops, if you get one
every work day that will cost you $77.00 per month,
make coffee at home. Spend the $77 on paying down
a credit card.
Look For Low Interest Rates.
If you still have a positive credit rating try
this. Find credit cards with low or no introductory
interest. Use a balance transfer to move your
balance to one of these. Pay more than minimum
monthly and pay off the entire balance before
the introductory rate expires. This can save you
hundreds of dollar in finance charges. But only
if you use the savings to pay down the cards.
Pay More Than Minimum Payments.
The minimum payment is a ploy by the credit
card companies to get your money. If you pay the
minimum only you could spend 15 years paying off
at $1,500 debt that will have cost you $45,000
by the time you pay it off. Always pay off your
account monthly, if not pay 1 and ½ times
the payment. Also make sure your card company
applies the extra to the principle not the next
months minimum or you will not get the benefit.
Pay More Than Once In a Month.
If you have the money, pay more than once a
month. Like the above hint it lowers your principle
which lowers your finance charges. However, some
cards will limit the amount of payments you can
make per month so make sure there aren’t
additional fees. Remember they are making money
on you and they don’t want to make less.
In addition it’s easier to pay $50 twice
a month than $100 per month even if it’s
the same amount.
If your debt runs out of control, seek
If you are still not making any headway, it
may be time to seek help from Credit Counseling