How to Pay Off Your Credit Card Debt

Do you have a lot of credit card debt? Tired of carrying a balance on your credit card? Take control of your finances by paying your credit card down quickly!

Difficulty: Challenging

Instructions

Things You'll Need:

• Patience
• Discipline

1. 
    

   STOP USING YOUR CREDIT CARDS
   If you carry a balance on your credit, and chances are you do (the average American household has almost $9000 of credit card debt on average), the first step in eliminating your credit card debt is to stop using them.

2. 
    

   STASH YOUR CREDIT CARDS IN A PLACE WHERE YOU ARE NOT TEMPTED TO USE THEM
   I keep the two credit cards I have buried in my filing cabinet. By not having them in my wallet I am not tempted to use them to make that impulse purchase at the grocery store, at Best Buy, or online. This is an important psychological point because by simply not having them with you, you will begin to use them less and be more disciplined about your spending.

3. 
    

   PAY MORE THAN THE MINIMUM PAYMENT EVERY MONTH
   Interest on interest that you pay every month that you carry a balance can add up quickly. An average balance of $9000 on credit cards at a 19% APR generates about $142 of interest JUST IN THAT MONTH. If say you only pay $100 a month to your credit card, you are actually hurting yourself and costing yourself more money. Try to double your monthly payment every month to bring down the principal amount you owe.

4. 
    

   SET UP AUTOMATIC PAYMENTS WITH YOUR CREDIT CARD COMPANY
   Most credit card companies offer an automatic payment option; take advantage of it. This will make sure that if you happen to forget to submit a payment to your credit card one month that you will not be charged late fees, which is basically screwing yourself twice. You will get charged late fees (sometimes as high as $50, PLUS your credit score will take a hit). Play it safe and take the ten minutes it takes to set up an automatic payment.

5. 
    

   FINALLY, PREPARE A BUDGET FOR YOURSELF AND STICK TO IT
   If you do not know how much you spend every month, start to keep your receipts for a week and look at where your money goes. Those one or two trips to Starbucks for that tall latte at $4 adds up over time. You will be surprised. Figure out how to be more efficient with your spending and re-allocate the money you spend on treats towards your credit card debt. The more you pay every month toward your credit card debt, the faster you will get out of it! GOOD LUCK

[raymels]

on 8/13/2009 Thank you, would love to follow this....5* and rec

[gahazeleyes]

on 8/3/2009 Well needed article. Thanks for sharing good info. 5*s

[haniya]

on 7/17/2009 wonderful tips thanks!

[apalmer]

on 3/9/2009 Great tips! 5*

[mfahrney]

on 2/27/2009 Very good article and so true..thanks!