How to Eliminate Credit Card Debt

There is no magic potion that will eliminate credit card debt, only discipline, and organization will do the trick. Several methods may be utilized to ease the pain, but the experience of credit card debt is a good teacher for your future.

The first step to take regarding your debt is to get a total overview of the situation. Every credit card debt should be listed on a sheet of paper. Items to be specified are the total balance, minimum payment, available credit line, and interest rate. When you have all cards listed, do the math. With these totals in hand, some analysis may be done.

First, determine whether or not there is available room on your lower interest cards for a transfer of some of your higher interest debt. If there is enough room to eliminate the balance due on a higher interest rate card, it would be wise to do so, and cancel the high rate card.

If your situation is that of being maxed-out on your cards, you should study the applicable interest rate on your debt. It could be that a consolidation loan from your local bank would be a good idea. That depends upon your interest rate, and ability to retire the debt on a payment schedule within two or three years. The information in hand as to total credit card debt, payment amounts, and interest rates is exactly what your personal banker would need to advise you, which might be an excellent idea.

The biggest reason to eliminate your credit card debt is for your own personal benefit. Peace of mind, and maintaining a reasonable budget go hand in hand. Credit cards are great if they are used sparingly, and for the right reasons. You just need to remember one thing, if you only make the minimum payment of 3% of the balance due each month, it will take 5 or 6 years to eliminate the debt. It is essential to pay much more than the minimum each month, the alternative is a very long term relationship that is very one-sided!