05 Feb The Best Ways to Tackle Credit Card Debt
Tackle Credit Card Debt – Many people are struggling with credit card debt. Unfortunately, a majority of the workforce now lives paycheck to paycheck and rely heavily on credit to pay for living expenses. With the cost of living rising each year, it can be easy to fall behind on monthly credit card payments. Unpaid debts can stay on your credit report for seven years so failing to make on-time payments can harm your financial future for years to come. Here are some great ways to quickly pay off your credit card debt.
Begin By Stopping the Ship from Sinking Much Faster
You cannot get out of credit card debt unless you first begin by locking up your credit cards. You should keep one credit card in your wallet, but label it only for emergencies. You do not want to continue relying on debt to live. This causes more problems as time goes by.
Cut Your Monthly Expenses
Many people spend more money than they make. This can lead to having overinflated monthly expenses. You should come up with a list of your monthly expenses and try to find ways to reduce them as much as possible. For example, consider not eating out for six months. You could also bring lunch to work each day instead of buying from your company’s cafeteria. You need to be aware of how and where you spend your money so that you can begin to be more frugal so that more money can be set aside to reducing your debt.
Reach Out to a Credit Card Debt Relief Company
A credit card debt relief company can provide great resources to help you get your debt resolved. These trained professionals will ask you to provide them with a list of your outstanding balances so that they can work with your creditors to come up with a plan in which they can settle the amount owed for less than the full balance. Many creditors will take this action because if you are forced to file for bankruptcy then they will often only receive ten cents on the dollar if any money is recovered from the legal proceeding. Learn more about Credit Card Debt Relief Programs.
Avoid Only Paying Your Minimum Credit Card Payments Each Month
One mistake many people make is that they think that paying only their minimum payments each month will help them get out of debt quickly. This strategy is flawed because each month that you carry a balance on a credit card, you incur interest fees. For example, you might pay $11.00 in fees and have a $30.00 monthly payment. This means that only $19.00 would go towards paying down your outstanding balance. You should consider at least doubling or tripling your minimum payment each month to reduce the amount of time needed to completely pay off the card.
Enroll in a Credit Card Debt Relief Program
Many credit card companies have credit card debt relief programs where you can qualify for payment plans based on your particular set of circumstances. For example, if you have been on disability leave, have gotten divorced, or have suffered a loss of income then many creditors will work with you to reduce your minimum monthly payments so that you can catch up on them. They also can waive late fees which can also help the credit card debt to stop from increasing when you are in the program.
You need to be upfront with your creditors because ignoring the phone calls and letters can cause huge problems down the road. These companies want to be profitable so they are usually pretty flexible when it comes to credit card debt relief options.
Consider Offering a Credit Card Debt Settlement to Your Creditors
If you have fallen more than four months behind on a credit card payment, then offering a credit card debt settlement could be a great way to reduce your credit card debt. You can offer to settle the debt for at least 40 percent or more off the current outstanding balance. If your delinquent account has already been placed with a consumer debt collection agency then you should reach out to them first. They will be willing to work with you because they only get paid if you actually start paying on the amount owed.
Look into Credit Card Debt Consolidation
Credit card debt consolidation is when an individual takes out a loan to consolidate all of the credit card debt into one loan and then make one monthly payment each month. This can be advantageous because you pay off all of your existing credit card debt that very day. For many borrowers, having one due date to remember helps them avoid late fees and other penalties. You also will have a lower interest rate on this loan versus the interest rates that you had on your open credit cards so you will save money as well.
Some credit card debt consolidation companies do charge fees for the services that they provide. You should shop around for a company that does not charge you exorbitant fees & are experts in consolidating your payday loan debt like Consumer Credit Card Debt Relief –
Pay Off Your Smallest Credit Card Balance First
They say that a journey of 1,000 miles begins with just one step. This mentality is crucial when you are trying to pay off your credit cards quickly. You need to set small milestones so that you feel a sense of accomplishment when you reach them. You can begin by starting to make extra payments towards your smallest credit card balance first. You should monitor your credit score while doing this because as you pay down your outstanding credit card debts, your credit score will begin to rise because of your on-time payment history and the increase in your available credit line.
Most people will face financial struggles at some point in time. Credit card debt relief is the only answer to being able to have access to credit lines at favorable interest rates. If you budget well and have a plan to manage your money, then you should be able to be debt-free in a short period of time.