Credit card debt affects countless consumers worldwide. While credit can be a useful tool if used correctly, it can easily become a mountain of seemingly unconquerable debt. The good news is that you are in control of your financial future. As long as you have income, you can take steps to best use it to lower your credit card debt.
Increase Discretionary Income
One way to lower your credit card debt is to increase the amount of income you currently make so you have more discretionary income left over after all of your expenses. Consider taking on a part-time job or turning a hobby into a money-making opportunity to bring in extra cash. Sell some of your old household items on an auction site or have a yard sale. Apply this discretionary income to your credit card debt to lower it.
Decrease Variable Expenses
Decrease the amounts of money you spend on frivolous or unnecessary items such as going out to eat, coffee shop visits, movie theater tickets, clothes and shoes, and other items that you can live without. Apply this money toward your credit card debt. Resist the urge to use your newly-cleared credit card balances to charge unnecessary expenses, or you will likely find yourself with high credit card debt once more.
Apply Extra Money Wisely
Apply your tax return towards your credit card debt to reduce it more quickly. If you receive an inheritance or other gift of money, use part -- or all -- of the money to decrease credit card balances. Even though you may want to spend the money on something more exciting, think of the extra money you will have every month once you eliminate your credit card debt.
Stop Using Your Credit Cards
It may be difficult to stop using the plastic, especially if you rely on it to get through sparse financial times during the month, but if you're ever going to lower the debt, you must stop increasing it. Many people make their minimum credit card payments and then charge the available balance once the payment posts to the account. Using this method will keep you in credit card debt forever.
Pay Off High-Interest Debts First
When applying money toward your credit cards, pay off the ones that carry the most interest first. The longer you have these high-interest debts, the more you will eventually pay. Work toward paying off the high-interest rate cards before turning your attention to those that have lower interest rates.
Pay Small Amounts Off
If you have several credit cards that have small balances, pay them off. They will be easier to pay off quickly and you will realize a sense of accomplishment. Don't focus solely on these debts unless they are the ones with the highest interest rates. If they aren't, pay those that carry higher interest rates first to reduce the amount of money you will pay in interest charges over time.
0 comments:
Post a Comment