11 Sep 5 Simple Tips on How To Pay Off Your Credit Card Debt
Taking that first step and deciding to pay down your credit card debt can be a very scary thing, but it really can’t be avoided and it’s something that you’ll thank yourself for later.
So now that you’ve decided to take action and pay down your credit card bills, how exactly should you begin?
- The best way to start, as with any debt or financial problems, is simply to consult with a financial adviser. Don’t be afraid of paying a fee for these services; instead, consider it an investment that will help you to manage your money better in the future.
- There are many approaches for paying off credit card debt, but one of the most common strategies is to consolidate your debt into one big payment, which you can do through an independent debt management service. This allows you to make one big payment each month rather than coordinate multiple smaller payments and accidentally miss one.
- If you prefer not to consolidate your debt, another approach is to pay off the debts with the highest interest rates first. You’ll still have to pay the minimum amount on each credit card bill, but paying more than that amount for the bills with high interest rates will help you out a lot. Credit card companies are sneaky and they often compute minimum monthly payments so that if a debtor chooses to pay the minimum, he/she is mostly just paying off interest.
- There are services available that will allow you to get cash for structured settlement payments, annuity settlements, and even lottery annuity payments that you already own but can’t use. These services provide immediate money in return for your structured settlement or annuity plan, so that you don’t have to worry about paying an early withdrawal fee (which can be anywhere from seven to 10% of the total invested amount) and annual maintenance fees (which are often $20 or $30, but possibly as high as 3% of the total invested amount).
- With credit card debt in particular, it’s important not to open new lines of credit but also not to close out all of your current credit lines at once. This is a warning sign that you can’t manage credit lines and will impact your overall credit score negatively. Instead, keep these cards open until you’ve paid down the debt on each one — and then close them out for good! (Maybe keep one credit card for emergencies, though.)
Now we’d like to hear from you! Whether it’s advice on managing high-interest credit cards, or maybe the process of selling an annuity or settlement, what tips would you give to someone else who’s trying to get their debt under control?