Finance Globe

U.S. financial and economic topics from several finance writers.
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What to do with your Credit Card Debt

What to do with your Credit Card Debt

What do you see when you look at your credit card statement? While there is nothing better than a “0” next to your balance, for many people this is not realistic at the present time. Instead, they realize they have some level of debt that must be taken care of.

The way you approach your credit card debt may not be the same as the next person. However, there are basic steps you can take, just the same as many others, to work towards achieving your goal of paying off your debt entirely.

1. Slow and steady approach. There is nothing wrong with paying the minimum if this is all you can afford, but it will mean more interest charges and a longer repayment period.

If you can pay any extra on your credit card balance, no matter how much or how little, be sure to do so. This can go a long way in speeding up the process.

2. Consider a balance transfer. Do you have high interest credit card debt? When you transfer your balance to a zero interest credit card, you can make up a lot of ground in a short period of time.

Note: make sure you know what the interest rate will be on your new card when the introductory period ends.

3. Chunk it down. If you happen upon a large chunk of money, such as a tax refund or work bonus, consider putting it towards your credit card balance. When you take big chunks out of your debt, you will find yourself in much better position moving forward. Who knows, you may find at some point that you have enough money to get rid of your entire balance.

4. Negotiate with your credit card company. This may not be something you want to do, but it is a step to consider if your debt has taken over your life and you have no other option. Your credit card company may be willing to negotiate with you, such as in the form of a pay off or an interest rate reduction. Remember, it never hurts to ask.

If you find yourself dealing with credit card debt, consider implementing one or more of the ideas above.

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Saturday, 04 February 2023

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