Do you have a mountain of credit card debt that just won’t go away no matter how hard you try? Do you feel like you want to live a debt free life but are just not sure how?
If you watch this video, you will be able to get rid of credit card debt using simple yet effective strategies, and take a huge load off your shoulders.
Here are 7 easy ways to help you get out of credit card debt.
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1. Consolidate your credit card debt
Instead of making monthly payments on each of your credit cards separately, turn it into one consolidated monthly payment.
An easy way of doing this is through balance transfer. You can get a new credit card with a lower interest rate than your current credit cards, and transfer the balance on all your existing credit cards to that new one.
For example, if you got a new credit card with a 12% interest rate, and your other credit cards have a 15%, 18% and 21% interest rate, you can transfer the balance from these cards onto the new credit card.
This usually has a fee, but many credit card companies waive this fee. And, to further sweeten the deal, some credit cards waive the interest for the first few months – which helps you pay back your credit card debt even faster.
2. Replace your credit card debt with a personal loan
Personal loans usually have a much lower interest rate than credit cards.
So if you take a personal loan and use it to pay off your credit card debt, you will save a lot of money in interest, and pay off your debt much faster.
3. Use the avalanche method
In this method, you pay off the credit card with the highest interest rate first. By doing this, you pay much less in interest, and end up saving lots of money.
You should still pay the minimum amount due on all other credit cards, but put any extra money you have towards paying off the credit card with the highest interest rate.
For example, if you have credit cards with 12, 15, and 18% interest rates, focus all your extra money on the one with the 18% interest rate, while only paying the minimum on the other credit cards.
Once your highest interest credit card is paid off, move on to the one with the next highest interest rate, and so on until all your credit card balances are paid off.
4. Freeze your credit cards
I don’t mean literally freezing them in a block of ice (although if you want to do that, be my guest). I mean stopping all purchases on your credit card.
You can temporarily freeze your credit card by calling the credit card company, or you can simply stop using your credit cards. This way, you still have them in case of a real emergency.
Freezing your credit cards will stop you from racking up any extra debt, and help you pay off all of your existing credit card debt much sooner.
5. Slash your spending
Try to reduce your spending on discretionary expenses. For example, if you are spending $300 a month on movies and eating out, you can try to cut it by half to $150. This could free up money to help pay back credit card debt sooner.
And by doing this, you fix the root cause of the problem and learn to live within your means. This way, you are much less likely to go back into credit card debt ever again.
6. Focus on paying off credit card debt with everything
When you get a bonus from work or a big cash gift for your birthday, you might be tempted to splurge on something.
But, if you want to get out of credit card debt, it is best to use all – or at least most of the money – to pay off your credit card debt.
7. Just Ask!
If you call the credit card companies and ask them to lower your interest rate, you might get lucky. This may not work every time, but credit card companies often grant this request.
You can also get a settlement for your credit card debt where you have to pay back only part of your outstanding balance. However, this can have long lasting repercussions on your credit score and affect your ability to borrow for many years.
So debt settlement should only be used as a last resort.
There you have it. Start today and use these strategies to work your way towards a debt free life!