Practical Advice For Reducing Credit Card Debt - Online Article

If you find, like millions of Americans, that you have too much debt, take heart. You're not alone, and there ways to get rid of debt. Credit card debt reduction, in fact, doesn't have to be a dream, but an easy reality.

These days, the typical American with debt carries more than $12,000 in credit card debt. (Of course, the debt we have from mortgages, car loans and other loans don't count in this amount.) For many people, this causes them no worry, but the majority of people are burdened about the amount of debt they have and for valid reason - learning to control and get rid of debt is one step toward financial freedom as a debt free Christian, something most of us would love to accomplish.

In this article, we'll look at many solutions for reducing credit card debt. Some might not be an option, while others will strike you as something you can do.

1) Buying Habits

To reduce your credit card debt, you will have to quit using them for purchases. This is a difficult one. Perhaps you pay some of your bills with your credit/debit cards. You try to tell yourself it's for the "rewards" like hotel credits and airline miles. But if using your credit cards for these purposes increases the balance to your debt, you should pay another way. Stop any automatic payments that go on your credit card and use a debit card or check instead.

A lot of people fall into the trap of paying for things with credit with the good intention of paying the charge back off when the bill comes, but when the bill comes, the cash is not available. They then pay the minimum payment and their credit card balance continues to increase.
Credit card debt reduction means working toward reducing your debt, of course, but you can't do that without working toward reducing your expenses as a primary focus.

After you stop using your credit cards for payments and activities that you have been accustomed to putting on credit, you also need to quit using your credit/debit cards for discretionary spending. That means if cash is short and you want to take a trip, you simply don't go, if going means pulling out a credit card to pay for it. You forgo dinners out, and the new shoes you don't really need.

If reducing debt is a priority then the sacrifice will be worth it.

2) Debt Elimination

After spending is under control, you need to start working on the debt. If you are only making minimum payments, you aren't making enough progress. Financial experts say that if you make payments of 2% of your balance each month - often the minimum payment is about 2% of your balance - it could take up to 22 years to pay off a $1,000 debt!
If you double your minimum payment each month, you can cut down your overall repayment to 11 years instead of 22.

Paying so much more on your debt might seem difficult, but when you see your credit card balances go down, you will be motivated to continue.

If you can afford to pay additional amounts, think about focusing on one debt at a time. If you have more than one bill you are looking to reduce the balance on, or pay off, here are some tips:

* Focus on paying extra on one bill or credit/debit card at a time, while paying only minimum payments on the others.
* When you get extra money, say a tax refund, or a rebate, apply that toward the one bill you are working on.
* Add as much money as you can each month to the card you are working on paying off. You can make more than one payment per month. Set up your account online so can quickly and easily make payments from your checking account.
* Look for ways to make additional money strictly to pay down debt. Have a garage sale or if you are really serious take a part time job delivering pizzas or as a waiter or waitress.

As each debt is paid off you will feel more in control of your finances and the payments that you no longer have can be applied to existing debt to reduce it even quicker. This is known as the "debt snowball" method of debt repayment.

3) Make the Commitment

To successfully see your credit card balances reduced, you must be committed. It's not easy to take extra money and apply that to debt, and not spend it. It's not easy to shop with cash only and not credit, especially if it's become a habit. But if you reduce or completely eliminate your credit card debt, you will begin to see the immense benefits of financial freedom.

About the Author:

Craig Frazier is the Marketing VP for PbC Publishing Co. and is a website with many articles on topics such as Christian debt consolidation and Christian debt management.


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