3 Ways To Eliminate And Reduce Credit Card Debt
When you are above your head with credit card debt, relief can be felt for miles away. Sometimes it seems like you work as hard as you can to make minimum payments or even just to cover interest on your balance. If you want to get out of the credit card debt cycle, follow these 3 easy steps and you will be headed for financial freedom.
1. Switch to a card with a lower rate.
If you can switch balances from cards with higher rates to cards with lower rates, you can save a little money. Even cards with a 5% lower interest rate will make a difference in the amount of your debt on your monthly credit card statement. Take the money you save and apply it to your balance to reduce your debt faster.
2. Pay based on principle.
It’s easy to fall into the trap of only paying the minimum payment on your credit card statement, but if you do this, you will never get out of debt. The only way to get rid of credit card debt is to jump in and pay it off. The more you pay based on principle, the less you will pay interest, and you will begin to see a difference in the amount of money that is billed each month.
3. Don’t increase your debt.
Make it a rule that credit cards are only used for special or emergency purchases. Stop buying things like groceries or clothes using your credit card. Chances are that if you are going to put things on the card, you will often end up buying things that you did not plan to buy. These impulse purchases may be convenient, but they increase, and you will pay for them long after their usefulness is lost.