How To Pay Down Credit Card Debt
Debt can seem like a bottomless pit but it’s not hard to figure out how to pay down credit card debt and climb out of the pit. It’s probably going to take more time to get out of debt than it did to get into it and it’s not going to be very comfortable but, hey, when you’re done you’ll have the satisfaction of accomplishment and no debt. Sweet.
- Stop adding to your debt. If you owe on a credit card, stop using it. Once you start to carry a balance, the credit card company can charge interest on new purchases, too. Tricky bastards, aren’t they? Don’t fall into the trap. You can use a different card but it’s better to pay cash or do without. You won’t have the pleasure of immediate gratification you’ve been used to, but that’s better than losing sleep wondering how you’re going to pay down your debt.
- Make contact with your creditors. They’ll be happy to hear from you. No, really. They don’t want to garnish your wages or sue you or any of that other scary stuff if they don’t have to. All they want is their money. They’d rather work out a payment plan then spend more money going after you. Give them an incentive not to go medieval on your butt; call them and work out a payment plan, then stick to it.
- Pay on time. Most credit card companies will sock you with a fee if your payment is late. These fees can be hefty and will add to your balance.
- Pay off high interest cards first. Do the math. The more you owe and the higher the interest, the more you’re paying just to pay down the debt. Figure out how much you can pay each month on all your credit card debt, then portion it out so the most goes to the highest interest card, the next most to the next highest and so on. If you can, transfer your higher rate balances to a card with a lower interest rate.
- Pay more than the minimum. Those little bitty minimum payments are attractive but they’re another trap. Paying the minimum only reduces the amount you owe by a little. You’re still paying interest on a balance that’s not getting smaller by much. It’s possible to end up paying interest that’s more than your minimum monthly payment, which seriously sucks. Paying the minimum can be a plan that keeps you in debt. Don’t do it and you’ll find you’re beating your credit card debt faster than you ever thought possible.