Advice to Pay Off Credit Card Debt

If you're deep into credit card debt, it might seem like there's no way out. However, that isn't the case. No amount of debt is insurmountable, but you need the right plan in order to climb your way out of your debt hole.

Stop Using Credit

If you're in a huge debt hole and you aren't already maxed out, odds are good that you soon will be. Cut up your cards immediately and stop making the problem worse. Living without credit is a scary thing, but it's necessary to start paying down your debts. If you're worried about making ends meet, it's a sign that you've been relying too heavily on credit for too long.

Negotiate

Once you resolve to stop using your cards and start paying down your balances, call your credit card companies and see what they can do for you. Whether it is reduced interest or a payment program, the credit card company will likely work with you to help you get your balances down. Remember, they want their money, so it's in their best interest to help you out, but they can't help you unless you call them to explain your situation.

Create a Budget

After you negotiate a better interest rate or payment plan, be sure to hold up your end of the bargain and make those payments on time each month. Create a calendar containing all your expenses for the month and see what you will have left over to make payments on your cards above and beyond your minimum requirements. You can pay the cards in any order you want; attacking the card with the highest interest rate will save you the most money long-term, while paying the smallest balance first can help you to see results more quickly. The most important part is sticking to your budget and doing whatever you can to get out of debt.

Eliminate Unnecessary Expenses

If you've made a budget and you don't have as much to pay down your cards as you'd like, take a look at your expenditures and see what you can eliminate. For example, if you're paying for a premium movie package and you barely watch it, you can safely get rid of it and use that money to pay off your cards. Similarly, you can bring lunch from home, cancel any services you don't use or sell old jewelry you don't wear anymore. Even if you just clear up $50 extra a month, that's $600 a year that can go towards paying down your credit card balances.