Tackle Credit Debt
Credit debt can grow like a mountain on top of you and it’s difficult to know if it will ever get better. Learning how to get out of credit card debt is the first step to gaining financial freedom. If you are only able to make your minimum monthly payment , you’ll never get out of debt . Making the minimum payment will not pay towards the principle, and it probably won’t cover the interest. Unless you reduce credit card debt, or make more money, you will never reduce your credit card debt.
The first step to getting out of credit card debt is to stop making it. You have to totally stop using your cards , or the mass of debt will keep increasing. Keep the card that has the lowest interest with you in case of emergency and rid yourself of the other ones. Freeze them, put them underneath your stove, or behind the exercise equipment you never use, any place that you won’t be tempted to access them.
Are your cards under the yoga mat? Good, we can begin.
Organize Your Debt
Take all of your bills and jot down what the interest rate is on all of them. The highest APR credit cards are the ones that get paid first . If you have to only make the minimum payment on the lowest interest cards to focus your money on the high ones, do it. If you don’t get the high interest credit cards under control, the debt that you owe will rise faster than you can open the bill .
Reducing credit card debt is about taking care of what debts are burning you the fastest. It’s an even mix of prevention and taking action . Prevent debt from getting out of control, and take action to pay them down.
Interest Negotiation
If you have interest on credit cards higher than 12% (of course you do!) you can contact the credit card company or bank and talk to them about lowering your interest rate. This won’t always work, and the success rate grows with the interest rate.
There are a few angles you can try to shmooze them over. Don’t be afraid to put on the Hollywood show here, it’s your money and you have to be willing to take a risk to save it. You can tell them that you received a better offer from another credit card company and are considering moving your balance over there. They want to many[spin] will be [spin]very willing to negotiate to keep you as a customer . Another option is to be totally up front with them. You can tell the credit card company that you’re having a hard time making your payments and see if there are any offers that they can make for you. They prefer to get a small payment from you, rather than you default, even if it means a lower APR.
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