There is nothing quite so easy as swiping that card. If you’re like millions of Americans, you’re in over your head in credit card debt and don’t know where to turn.
According to Debt.org, “On average, each household with a credit cared carries $8,284 in credit card debt.” There are smart ways to handle credit card debt so continue reading to learn how to get out of the “hole”. We know you can do it!
How Credit Cards Work
Stated by a credit repair Dallas company, when you buy something with a credit card, you usually get a statement in the mail every month showing what you’ve purchased. We live in a digital world so you have to go into your app or log onto the computer to see your statement, which makes it easy to avoid.
Depending on the card:
You may have up to 25 days to pay off your balance. Statements give you a minimum payment amount that you need to make in order to keep your account in good standing.
However, if you don’t pay off the balance at the end of the 25 days, you accrue interest on the balance. Failing to pay the balance accrues more interest, and the next thing you know, you owe a lot more than what you charged, and the monthly payments keep getting higher.
Get Out Of Debt
Credit cards are known as revolving debt, which means your balance is meant to be paid off at the end of the month. However, too many people use credit cards as loans and pay off items over time. Depending upon how much you pay this could result in a high balance and only paying off your interest. With high-interest rates, it may take years to pay off your cards because you continue to accrue interest each month you fail to pay off the balance. If you’re stuck with a lot of credit card debt, you must begin paying off the balances now to get out of debt quickly. If you can’t pay off the entire balance, consider paying larger sums to get that balance down.
Get A Handle On Interest
The best way to get a handle on your credit cards is to choose the card with the highest interest rate and focus on eliminating that debt first. The key to quickly paying this debt off is to pay more than the minimum payment. Now is the time to pool your resources and tighten your belt to throw as much money towards paying off that high-interest rate card first. For some, it may be tapping into their savings, and for others, it may be selling off some high-value items for quick cash Also, consider canceling some unnecessary subscriptions and start cooking at home more; especially if you are a big fan of food deliveries and eating out.
Transfer Balance
Another way to pay off those high-interest rate credit cards quickly is to apply for a 0% balance credit card and transfer the high-interest rate to the new card. Now, with 0% interest, you can work hard at paying it off so long as you do so within the time frame specified by the card issuer.
Consolidate
Getting another credit card isn’t always the best idea. However, many banks offer personal loans at decent rates that will allow you to pay off your credit cards and only have the one payment, which you can have come right out of your checking account.
Call Your Card Issuer
As a last resort, call your card issuer and explain that you’re in over your head and see if they offer an alternative payment plan to keep you in good standing. Most would prefer to help than see you in default.
Getting out of debt isn’t as easy as getting into it. But with diligence and sacrifice, you can get there sooner than you think.
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