How to Get Rid of Credit Card Debt

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By jenstewart
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credit card debt elimination

Credit card debt elimination is a process that can entail various solutions including debt consolidation, debt settlement, and debt management. Depending on your financial situation eliminating credit card debt should be the first step in salvaging your credit rating and restoring borrowing capability.

Difficulty: Moderate

Instructions

Step 1

First make a list of all your card debt including credit balance owed, interest rate, due date, and minimum payment amount.
Step 2

Second organize your cards by due date in a given month and add all minimum payments together to figure your monthly credit debt.
Step 3

Determine a monthly discretionary spending amount by organizing all other expenses by pay schedule and eliminating from your total income.
Step 4

Subtract your total minimum credit debt from your discretionary income to get a balance left.
Step 5

Start with the highest interest rate credit card debt with the smallest amount and focus on applying as much extra to this debt as you can to pay it off first.
Step 6

Continue to pay off each remaining card amounts in the same way until you completely eliminate all other credit debt.

Tips & Warnings

A good practice is to place some additional income in an interest bearing account for emergency liquidity equaling 2 to 3 months of earnings.
When your balance allows you you can then apply some of it to help eliminate remaining smaller interest rate cards with higher balances.

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