How to Reduce the Debt & Interest Payments I Owe

The interest on your debts affects the rate at which you're able to pay off the debt. Negotiating with creditors and re-working the terms of your loans or credit cards helps speed the debt elimination process. Being free of unsecured debts such as credit cards can create extra income in your pocket each month and raise a less-than-perfect credit score.

Instructions

1

Contact your credit card companies and ask for a lower interest rate. Call the customer service department and draw attention to your good payment record. A better interest rate will save you money on interest payments and help reduce your debt faster.

2

Transfer the balance to a low-rate credit card. Shop around for another credit card company and transfer your existing balance once you secure a low-interest rate card.

3

Check finances to see if you can afford higher payments each month. Increasing debt payments and writing a check for more than the requested amount helps reduce your principal balance quicker.

4

Avoid late payments and going over your limit. Missing a payment results in late fees, and credit card companies charge a fee for every month you exceed your limit. Extra fees increase your debt and make it harder to pay off the balance.

5

Shop with cash to avoid debt. Become accustomed to using cash for everyday purchases, and only pull out your credit card when absolutely necessary (emergencies only). Pay off new charges in full to keep debts low.