How to Get Out of Credit Card Debt

Video Transcript

"You're looking at how to get out from under your credit card debt. Well, there are several things that you can do to incorporate into fighting back that credit card debt. First off, and this is a real easy one to say but not as easy to do, you have to quit adding new credit card debt. And the number one thing that you have to remember is, when you receive those advertisements for sales, or those enticements for percentages off, and all the different tools that these credit card companies use, and these store credit cards use to try to get you back out there and buying, those are sometimes too tempting. You simply have to take those and throw them away, so that you won't be enticed into adding up more credit card debt to what you already have mounting. Now secondly, you want to pay down, as fast as possible, the smallest balance credit cards. Now I know this seems to go against the idea of always pay as much as you can to the higher interest rate loans and credit cards, and, that is true. That's very important, too. We'll discuss that in a moment. But if you can pay down your smallest credit card balances to where you have them paid off, then you'll actually have more cash to incorporate into paying off those higher interest rate loans. Then, you'll have more cash to pay towards those higher interest rate credit cards, and pay them down even quicker. So, you need to set a goal, and then you also need to consider transferring from your higher interest rate credit cards to lower interest credit cards, as well. You can do this by, perhaps doing a transfer out from one credit card to another, or sometimes you'll even receive these little checks in the mail that come along with your credit card statement. The one warning I'm going to have here is, you need to make sure what is your interest rate going to be after you do that transfer. Probably even better is to speak with your local bank, savings and loan, or credit union and find out what type of credit card they have that you could transfer your higher interest rate loans and credit cards to. And do remember, as you're paying down your credit card debt, you do not want to add additional debt. Do not open new cards and keep only one major credit card to be able to use that for emergencies only."