Want to be Free of Credit Card Debt?

Credit card debt is the burden that can change the way you live your life. It can add restrictions and make facing each day more unbearable. Applying realistic measures can improve your money management process that will direct you to the credit card debt free light at the end of the tunnel.

3 Easy Ways to Cut Credit Card Debt

Let’s start off with the simplest way first, which is stop using credit cards you don’t pay off each month. Each time you use your credit card the balance increases and interest is applied which makes the balance increase again. Paying the minimum monthly amount allows only a portion of the payment to be applied to the actual balance. You continue to rack up an exponential amount of interest which itself will incur interest. You can stop this dreaded cycle in 3 ways.

1. Pay Off Your Balance

First, pay off your credit card balance every month. If, like some of us, that’s not an option then start paying an extra $100 in addition to the ridiculously low and very tempting minimum monthly payment. The extra amount can make a difference of paying off a credit card in 3 years versus 7 years.

You can also look at making more than one credit card payment each month. Get into the habit of making a payment at the beginning of the month and another mid-month. You will be able to see your balance reduce significantly as well as the amount of interest incurred.

2. Ask for a Lower Interest Rate

Next, try asking your creditor to lower the interest rate on your card. Make sure you have a good payment record and decent credit score; this will give your more negotiating leverage for a positive outcome. The company may have options of a lower rate for short period of time or they could lower your interest rate overall.

If presented with the option, continue to manage your credit card usage in accordance with the guidelines to maintain the lower rate.

3. Transfer Your Balance to Another Card

Finally, I very cautiously, carefully and with many warnings offer the final suggestion of using zero balance transfer to another credit card. If you transfer a balance and have a well thought out plan to pay it off within the designated period of time, this option is for you.

Essentially, depending on the offer, you can pay the balance in its entirety with little or no interest. If the card offer rewards points or other incentive, you can come out with double savings. However, I want to reiterate, have a plan to pay the balance off within the designated offer period. If the balance remains after that time, you could face an even higher interest rate than before. All of this impacts your credit score so continue monitoring.

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Cutting Credit Card Debt Will Help You Save

Reducing credit card debt will play a positive role with money management and monthly saving options for your household. Stay focused, be consistent and implement them in your monthly budget plan. You will see a savings and when you do consider adding it to your saving account or increase your emergency fund account. Using these practices will keep you on the path of Investing in You.