How to Get Out Of Credit Card Debt Systematically
After charging for goods and services left and right and living way beyond your means, you end up with maxed-out credit cards and deep into credit card debt.
You will need determination, a strong will, and a goal to escape from this debt.
What Is The Best Way
The best way on how to get out of credit card debt, experts agree, is aiming to pay up the balance with the highest annual percentage rate first. After that debt is paid up, move onto the debt with the next highest interest rate.
Tracking Your Daily Spending
To avoid falling into the credit card debt trap, take a hard look at your finances and determine how much you can realistically afford to pay each month. You will need to track your daily spending for a month to get a firm grasp on where your money is actually going.
After tracking your spending, you can better decide how much they can afford to pay toward credit card debt.
Steps On How To Get Out Of Credit Card Debt
The key to using credit wisely is to avoid unnecessary debt. Follow these steps on how to get out of credit card debt:
Take note of all your expenses for the month and classify these expenses by importance.
Think about the items you can live without. Separate the needs from the wants.
Arrange your credit card account statements by rate of interest, from highest to lowest.
Sum up all your credit card debt balance. After determining your total balance, apply for a low interest card that you can use for balance transfer. Transfer debt to that new card as much as you can. Start with the highest interest card first.
Start making sacrifices by allocating a greater sum of money for payment of your highest-interest credit card balance.
Pay only the minimum amount due on your lower interest cards, while you focus on putting in a greater amount of money on your highest-interest credit card.
After a credit card has been paid off, close this account so you will not be tempted to use this credit card again.
Alternative Plan
An alternative plan on how to get out of credit card debt is by paying up some low-balance bills first and eliminating a bill or two from your debt list. Once those smaller balances are gone, you can revert to Plan A. That is to pay up the balance with the highest interest rate first.
Learn how to get out of credit card debt and you will earn the benefits of having access to standby credit and getting positive credit reports.
