Credit Card Quick

Tackling your Credit Card Debt One Card at a Time

If you are feeling utterly overwhelmed by your credit card debt and unable to get out from under the balances that seem to go nowhere then you’re not alone. Currently, one in 20 American households owes more than $8,000 on their credit cards.

Luckily, most of us have options regarding our credit card debt. Consolidation loans or home equity loans are often taken out to address the problem of numerous credit cards with high interest rates. But if your credit isn’t strong enough or you are unable to secure a home equity loan, then you may have to tackle your credit card debt one card at a time.

Here are several steps to assist you in reducing your credit card debt.

1. Organize all of your credit cards and separate them according to their interest rates.
2. Start with the credit card with the highest interest rate and work on paying that one off first.
3. Pay the minimum payments on your other credit cards and put any extra money onto the highest interest rate card.
4. Look for ways to cut back or save on your monthly budget, and put the additional money towards your highest interest rate card.
5. Once the card is paid off, move onto the card with the next highest interest rate and continue the plan of paying only the minimum payment on the other cards.
6. As each card is paid off, take the money you would have been paying towards that card onto the next highest interest rate card.
7. As you continue to pay off cards, you will free up more money every month to put towards another credit card, thereby paying off subsequent cards sooner.
8. Once you pay off a card, cut it up – but don’t cancel it! Canceling credit cards may have a negative affect on your credit score.
9. Once you have paid off all your credit card debt, put the extra money you would have been using to pay off your credit cards into an interest-bearing account that will serve as an emergency fund. Aim to put at least six months worth of your salary into your emergency fund.

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• December 29, 2009 -- Post-Holiday Debt: How to Handle it so it doesn’t Haunt you all Year Long (0)
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Posted on Thursday, May 28, 2009 under "Credit Card Debt Credit Repair"
Post tags: consolidation loans, Credit Card Debt, high interest rates, home equity loans, interest rate

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