Are you trying to figure out ways to effectively reduce your credit card debt? There are a multitude of reasons to rack up debt such as a recent job loss, unexpected purchases, or enduring an illness. No matter the reason for piling up debt, getting rid of it should be your top priority. Having an action plan will help you combat debt by reducing and eliminating your credit card balances.
Here are the 8 best proven strategies to reduce your credit card debt and gain financial freedom…
TARGET THE HIGHEST INTEREST RATE CARD FIRST
If you have multiple credit cards with balances, it may take a while to pay off the debt. To reduce your debt, invest extra cash each month into your highest rate credit card and pay the minimum amount on your other cards. As soon as you pay off your highest interest rate credit card, you can begin to pay extra funds towards the next credit card with the highest interest rate. It’s a great snowball effect.
If your goal is to pay off each credit card in full, then it is recommended to pay off the card with the lowest balance first. Alternatively, if your goal is to increase your credit score, then you should focus on paying off the credit card with the highest utilization rate first. The formula for the utilization rate is dividing your overall credit card balances by their credit limits. A lower utilization rate equals a better credit score.
ASK YOUR CREDITORS FOR LOWER INTEREST RATES
Contacting your creditors to negotiate lower interest rates can be a huge money saver. Simply call your creditor and request a reduction of the rate. The odds of getting approved for a lower interest rate are much higher if you have a good credit score and you make your monthly payments on time. Lowering your annual percentage rate will add up to hundreds of dollars saved.
REQUEST A BALANCE TRANSFER
Transferring a balance from one credit card with a high-interest rate to one with a lower interest rate can be a very smart move. The good news is that you may be eligible for a 0% promotional rate on the new card, which will provide you with extra time to repay the balance. You’ll be spending much less on interest charges, and more money will go towards the principal.
Contingent upon the terms of the card, you may be charged a balance transfer fee, the savings will most likely outweigh the fees (which is typically around 3 to 4 percent of the total amount transferred.
MAKE TWO MINIMUM PAYMENTS PER MONTH
Making at least two minimum payments consistently each month can be vital to reducing and getting rid of credit card debt. Each payment installment you make will result in decreasing your average daily balance, which results in lesser interest charges.
The outcome of this smart financial decision will result in paying off debt at a substantially quicker speed and will also aid in increasing your FICO credit score. To keep track of your monthly payment installments, simply put a quick reminder on your calendar.
CONSOLIDATE YOUR DEBT
It may be a great advantage to consolidate your credit card debt. Working with a debt relief company will help to reduce the balances on your credit card debts and other unsecured obligations.
When you enroll in a debt consolidation program like Consumer Credit Card Relief, your debt will be consolidated into a low monthly payment you can afford, which will help to reduce your credit card debt.
UTILIZE A PEER-TO-PEER LENDER
If you can’t find funds to pay off your credit card debt, consider borrowing money from a peer-to-peer lender, such as LendingClub.com to pay off your cards.
Peer-to-peer lending websites offer loans with fixed rates which can be up to 30 percent lower than most standard credit cards. With a lower loan interest rate, you could save hundreds of dollars on interest.
DON’T STOP PAYING YOUR CARDS OFF
Each time you pay a credit card off, it might be enticing to save or use that money you would typically spend on that bill each month. The exact opposite thing you ought to do at this moment is pay less on your credit card debt; your objective should be paying more than the minimum amount due to eliminate the debt. Putting that money towards another credit card will bring about expedited debt payoff.
STOP UTILIZING YOUR CREDIT CARDS
The easiest and quickest approach to wiping out credit card debt is to stop utilizing your credit cards. Each time you’re making new purchases, be sure to use cash instead of credit cards. You will automatically spend less when you’re using funds from your personal income.
Studies have shown that consumers will pay twice as much to purchase a product or service when they are paying with a credit card as opposed to personal funds.
GET HELP TODAY!
At Consumer Credit Card Relief, our debt settlement program covers an extensive amount of credit card debts. Many of our customers carry high credit card balances, and we’re especially skilled at negotiating with major credit card companies and banks.
We guarantee to do our absolute best to reduce your existing debt, and our results speak for themselves. Call us today at 1-888-407-0855 to learn more about our program and start eliminating your credit card debt today.