more articles

Getting Out of Credit Card Debt

Most Americans would rather tell you how much they weigh than admit to the amount they owe on their credit cards. Here's how to tell if your cards need to lose weight and some steps to help you do it.

How to know if you're in trouble:

• Do you use cash advances from one card to pay off another?
• Are you making only minimum payments each month?
• Do you carry three or more credit cards?

If you've answered yes to these three questions, odds are that you're in trouble with your credit cards. What's the answer?

Pay them off, of course, but that's easier said than done. Here are some tips to help you pay down your debt and get your credit spending under control.

• Look at your total debt load. Choose the card that charges the highest APR and pay that one off first.
• Stop using your cards. Cut them up if you must.
• Call your creditors and ask for a lower interest rate; if they won't give it to you, switch cards using a credit card balance transfer plan that offers low or 0% interest for six months to one year. (If you have the time and energy, you can keep switching to 0% interest cards, but you must keep careful accounting records to do this.)
• Make a budget and stick to it.
• Consolidate your debts.
• Reduce the number of cards you carry. Fewer cards means less temptation to spend.
• Only use secured cards. Then you can't spend beyond your budget limit.
• Treat your unsecured cards like a checking account. Record all your spending so you have an ongoing accurate record of where you're putting your money.
• Reward yourself as you reach your goals. This will motivate you to continue to try and become debt free.
• Turn to a debt counselor. Debt counselors can help you to set up a plan to repay your creditors.
• Use the law. It's really in your favor. Chapter 13 Bankruptcies allow you to reorganize your finances so that you can get out of debt and back in control of your finances.

Being in debt is no fun. But, with a little bit of determination and a plan, you can get on the road to put your debts behind you forever.

Top | More Topics

Share This Article

| | | | |