By: Sean Reeves September 7
According to creditcards.com, the average American adult credit card-holder is in debt of $5830. If you are struggling with credit card debt, hopefully this information will help you get started on the journey of getting out of the credit hole.
Write Down All Your Financial Details
Before you do anything, you want to start out by writing down your income and all of your financial information. This means your bills, expenses, credit card debt, credit card interest.
Formulate a Gameplan and Stick to it
Pay off your highest interest cards first and paying more than the minimum is a great plan. Instead of buying a mocha frappa lappaccino from Steal-my-bucks every morning, brew your own java from home. Or instead of getting a foot-long oven-roasted meatball sub from Subway during your lunch break, make your lunch in your kitchen before work. These things will require you getting up earlier in the morning but will combine to save you $250-300 per month.. Cancelling cable and deciding to Netflix and chill can be beneficial also. Are you getting any money back for your tax return? Don’t spend your refund on a brand new TV. Use that fat chunk to knock out some of your credit debt. When your debt is paid off you can use your tax returns for whatever you want.
Find Some Good Financial Resources to Help You
As in resources, I mean websites, apps etc to help you pay down your debt. In my previous blog How to Get an 800 Credit Score I mentioned an app called Personal Capital. This is perfect for putting all of your information in front of you. It can be very eye-opening on where you’re spending your hard-earned dollars. Personal Capital will break down your expenses to the very store. It shows you how much you make, how much you pay in bills, at the gas station, at the grocery store and how much you spend eating out. I stand by this app as the ultimate budgeting tool.
Avoid Debt Consolidation at All Costs
People get tricked into debt relief because they’re offered lower monthly payments. But they spread the loans out really long and you end up paying even more. Dave Ramsey breaks it down really well how the debt consolidation companies fool you.
Let’s say you were only paying $100 toward your credit card bills. Following a budget and taking this advice could allow you to make $400 payments or higher. Once your debt is paid off, don’t let it build back up again. Maintain your budget and don’t spend more than you can afford. The money you saved towards payments and the tax return you used to help pay off debt could go towards fun things like saving towards a vacation or even putting towards investments. The possibilities are endless when you’re debt free.