Are you up to your ears in high-rate credit card debt? Don’t worry; there is a way out! Here are 7 smart tips for getting out of credit card debt fast.
Does the thought of checking out your credit score make you want to scream?
Credit cards are a great way to lessen that anxiety. Like all good things though, as quick as it can help, it can also destroy if you don’t pay on them.
Once you pile on the credit card debt, it can be a challenge to get out. Don’t let this discourage you. There are a few ways to save yourself from drowning in numbers.
Here are a few tips on getting rid of credit card debt and claiming your life back.
- Create a budget: Start by taking a look at your income and expenses. Calculate how much you can realistically allocate to paying off your credit card debt each month, and stick to that budget. Consider cutting back on unnecessary expenses until you’ve paid off your debt.
- Pay more than the minimum: Always aim to pay more than the minimum payment on your credit cards each month. Even a small increase in payments can make a big difference in the long run.
- Prioritize your debts: If you have multiple credit cards with outstanding balances, prioritize the ones with the highest interest rates. Make minimum payments on all your debts, but focus your efforts on paying off the highest-interest cards first.
- Consider balance transfers: If you have high-interest credit card debt, consider transferring the balance to a card with a lower interest rate. Many credit card companies offer promotional rates for balance transfers.
- Avoid using credit cards: While you’re paying off your credit card debt, try to avoid using credit cards altogether. If you do need to make a purchase, use cash or a debit card instead.
- Negotiate with your creditors: If you’re struggling to make your payments, reach out to your creditors and see if you can negotiate a lower interest rate or a payment plan that works better for you.
- Seek professional help: If you’re feeling overwhelmed by your debt, consider seeking the help of a credit counseling service. They can help you create a debt management plan and negotiate with your creditors on your behalf.
7 Bonus Ideas:
Table of Contents
1. Stop Using Your Card
If you know for a fact that you have terrible spending habits, hide your card from yourself before you sink too far into the pit.
You can cut it up, lock it in a safe and lose the code, package it in duct tape and bury it in the backyard, use a wood chipper, the options are endless as long as it is out of your hands.
If you’re using it to pay your bills then, try and set up a payment plan with your utility company. Or downgrade your house or car.
Fitting your bills into your budget will make you less likely to use your credit card and give you a little breathing room for managing credit card debt.
2. Make a List of All Your Debt
Studying your enemy is one of the key factors of defeating it. Tis means you should make a list of all the credit card debt you’ve currently got under your belt.
Making a list will help you figure out which one you should prioritize and pay off first. How do you determine this? Check out the standing of all the existing credit card debt you have and their interest rates.
3. Come up with a Strategy
Credit cards can do massive damage to your credit score so you want to pay the one with the highest interest off first. After you’ve paid off that one, go on to the next one.
Eventually, you will pay them all off as you go down the line. Make sure you continue making minimum payments on them after so you don’t find yourself drowning again.
4. Try to Get a Lower Interest Rate
Not all credit card companies will be agreeable about giving you a lower interest rate, but it never hurts to try for the sake of getting lower payments.
Sharpen up your negotiation skills by using any kind of leverage you can to get them to work with you. Bringing up how long you’ve been with them or your good standing up to this point might get them to budge a bit in your favor.
If they are completely unagreeable, then transferring your debt to a new, lower-rate card might be an option, or you can take out a personal loan.
Personal loans can be a little harder to get, but you’ll find that if you can get one to pay off your debt, the interest rate is usually way lower than your credit card one. Eventually, the loan will replace your credit card debt with an installment loan. Believe it or not, this will actually look better on your credit.
To find out more on personal loans you can visit this website.
5. Find a Payment Plan
If getting a lower interest rate still doesn’t work out for you, then it’s time to figure out some other options. The easiest thing you can do is either ask for a deferment or a new payment plan.
Credit card companies like money, so they will most likely work with you on this so they don’t have a non-paying account in their system.
6. Limit that Spending
If you limit your spending, you’ll have more money to put toward your credit cards each month. Just think: skipping out on that morning coffee could allow you to pay your debt faster and lower your interest rate.
If you want to make a little game out of it you can join spending challenges. This could mean going on a 14-day to a year-long spending ban depending on what’s best for you.
This is recommended if you just don’t trust yourself to stay on budget. If you have self-control, then it’s just a matter of keeping up with it and throwing these savings into your loan debt.
7. Put Any Extra Income Towards Credit Card Debt
Budgeting can only take you so far so on top of putting any extra savings toward your debt. You can take on little odd jobs for extra money.
There most likely a ton of options available for you in your area. You’ve just got to call around or surf the web to seek them out. Consider turning any kind of hobby into a money-making business.
For example, if you know you’re a great artist, then you can open yourself up to commissions. You might be surprised at how many people may pay.
A Guide to Getting Rid of Credit Card Debt
Just because you feel like you’ve dug your own grave, doesn’t mean you have to stay that way. There are ways of getting rid of credit card debt.
Come up with a foolproof plan to tackle it, try to find a lower interest rate, ask for a new payment plan, or just take on a few extra odd jobs. Put your credit cards back in your control.
If you’re new to the credit card world, you could make a lot of mistakes that will put you into debt without even realizing it. Visit our blog for a beginner’s guide to credit cards.