Help With Clearing Debt

Writing your last debt payment and clearing your debt is a huge challenge, but a major accomplishment. Sadly, some people will never resolve their credit card debt due to lack of self control and poor debt management habits. But by researching debt elimination strategies and implementing these tips into your daily life, you can clear your debt.

Significance

Several benefits follow paying off credit card debt. If you owe several thousand dollars, just meeting credit card minimum payments can require a major chuck of your monthly income, leaving you little money for starting a savings account or caring for other responsibilities. But because the amount of debt you carry can negatively affect your credit score, paying off or clearing debt helps improve your FICO rating. A better rating opens the door to better interest rates on financing.

Time Frame

Creating a tentative time frame for paying off or clearing your debt helps you reach your goals. Unless you have a significant amount of disposable income and you're able to wipe the slate clean with one check, be patient and pay down debt one month at a time. Review your finances, and once you determine how much you have in disposable income. Increase minimum payments and use extra cash to clear debt. For example, an extra $400 monthly pays off a $5,000 balance in less than two years.

Considerations

Monthly earnings aren't always sufficient when trying to erase debt. You can continue to make the minimum each month and remain in debt, or you can take an active approach and do whatever it takes to get rid of your debt and improve your rating. This might involve certain inconveniences such as looking for part-time employment or applying for better-paying opportunities.

Prevention/Solution

Some people are addictive to shopping and can't stop using their credit cards. This problem can play a role in debt problems, and overcoming debt requires a self-assessment of your spending and drastic measures. Resolve to put down your credit cards and live on cash -- alone. If necessary, do not visit department stores and do not shop with friends. Slice your credit cards into small pieces to remove any temptation.

Expert Insight

Debt elimination requires patience and self-control. If you can't seem to overcome this hurdle, soliciting the help of a professional debt/credit counseling service may prove useful. It'll design a program to help slash your interest rates and reduce your monthly payments. Agencies put a hold or freeze on accounts included in the debt management problem, which stops you from incurring additional debts while trying to clear your balances.