Free yourself from credit card debt

Free yourself from credit card debt
by Nick Cox

If your debts are starting to build up to uncomfortable levels then now is the time to act! Procrastinate at your peril, because a debt problem that is ignored will just grow and grow, until you are left with a mountain to climb.



An increasing amount of people are struggling with what feels like insurmountable debt. As debts worsen, many are forced to search for more credit to help meet monthly outgoing demands. Debts then begin to spiral out of control as more and more credit is sought to help keep afloat.



If this sounds familiar, then now is the time to stop and take stock of your situation. There are things you can do to help improve your situation.



If your debt is serious then seek professional assistance. Services such as the Citizens Advice Bureau and the Consumer Credit Counselling Service provide free advice.



It could be time to assess your lifestyle. If you are using your credit cards to fund your social life then this has to be one of the things that must be swiftly curtailed. Credit cards should never be used to fund anything that is non essential to your life. It's time to cut up your credit cards to avoid accumulating more debt.



Check to see if your credit card balance can be moved to a new 0% balance transfer card. Once you have done this, make sure your old credit card is destroyed. This avoids the temptation of maxing out your old cards and thus worsening your situation.


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Eliminating Credit Card Debt

Five Easy Steps to Credit Card Debt Elimination

For many consumers, credit card debt elimination can seem like mission impossible. When you're thousands of dollars in debt and trying desperately to find a light at the end of the tunnel, the outlook can be quite bleak. Fortunately, no one is beyond help when it comes to breaking free from credit card debt. Here are five easy steps that will have you on the road to credit card debt elimination in no time.



1. Get All of Your Credit Card Statements Together



If you're serious about credit card debt elimination, the first thing you need to do is gather all of your credit card statements together and begin creating a "debt elimination" spreadsheet.



What's going to go on this spreadsheet? You'll want to note how much you owe on each credit card, the interest rate and whether that rate is an introductory teaser rate or a long-term rate. If any of your credit card rates are currently on an introductory time line, make note of when that rate will expire and what it will go up to when it does.



2. Figure Out How Much You Can Afford Each Month



Once you know exactly where your debt stands, it's time to form your game plan. This is critical if you want to pursue credit card debt elimination in the quickest and most efficient manner possible.



First, take a look at how much you can afford to put towards your debt each month. Add up all of your monthly expenses (not including the minimum monthly credit card payments you must make). Take all of your other expenses (include rent/mortgage, car payments, insurance, gas, groceries, utilities, phone, etc.) and add them up.



Once you have your monthly expenses added up, deduct them from your income and see how much you have left over. Take as much of that amount as you possibly can and put it towards your credit card debt elimination plan.



For instance, let's say you have $400 a month left after all of your monthly expenses have been paid. Take $350 of that (leave $50 for emergencies, etc.) and put that towards paying off your credit card debt.



3. Addressing Your Minimum Monthly Payments



The next step towards credit card debt elimination is adding up all of the minimum monthly payments for all of your credit cards. For instance, if you have three credit cards, all with a minimum monthly payment of $75, your total minimum monthly payments would be $225.



If your credit card allocation were $350 each month like the scenario we outlined above, you'd be in okay shape so far. However, if your minimum monthly payments were $400 and you could only afford $350, then you have a serious problem and you need to start cutting out expenses. This may mean turning off your cable till you've achieved credit card debt elimination or foregoing your Starbucks runs, but it will be worth it in the long run.



4. The Plan of Attack



Now that you know exactly how much debt you have and how much money you can afford to pay off that debt each month, it's time to form your plan of attack.



First, take the total of your minimum monthly payments and subtract it from what you have allocated towards credit card debt elimination. So if you have minimum monthly payments of $225 and a credit card debt elimination allocation of $350, your remaining balance would be $125. Take that $125 and apply it towards the credit card with the highest interest rate.



Once the credit card with the highest interest rate is paid off, you're going to take the money you were paying towards that card each month (in this case, it'd be the $125 plus the $75 minimum monthly payment) and pay that $200 towards the card that now has the highest interest rate in addition to the minimum monthly payment. Keep repeating this process until you have achieved total credit card debt elimination.



5. The Fruits of Your Labor



Once your credit cards are all paid off, take half of what you were paying towards your debt and put it into a savings account. This will help you avoid having to rack up credit card debt in the future.



What are you going to do with the other half? Take that half and apply it to the things you were doing without while pursuing credit card debt elimination. After all, once credit card debt elimination is achieved, you do deserve to treat yourself.

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For more tips on credit card debt, saving money and avoiding getting taken, check out CreditCardTipsEtc.com, a website that specializes in providing credit card tips, advice and resources.

Credit Card Debt Reduction Strategy

Credit Card Debt Reduction Strategy - A Simple 3 Step Mantra
By Gary Worthington

Sometimes, you know things are quite uncontrollable. Einstein was once asked by someone as to what according to him was the greatest force. And in his humor, he had replied, Compound Interest. Now that is precisely what hinders, and to a great extent pulls you down in your attempts to formulate and execute any credit card debt reduction strategy that you think is your "damnedest best"!

No, I do not mean to sound like that, but the thing most people do not understand about debt reduction solution is that your efforts to reduce the credit card debt or pay them off is seriously devastated by interest on your balance. If you don't know how to proceed exactly, you will find yourself deep in debt - even if you had tried very hard to divorce your credit card!

One of the main reasons people don't succeed in paying off credit card debt is inconsistency and impatience. Aside from that, in many cases, I've found that people are not especially calculative about their debt reduction strategy. Here's a plan that works wonders when you follow it seriously...

I call it the 3E formula. Estimate, Enumerate And Execute.

1. ESTIMATE
Number one thing you need to do before you actually start - and if you wish to have a great start - is to estimate the total debt, the APR or the EAR (rates of interests), and other such trivial and important details. That is the first and best part of any debt reduction strategy or plan. Once you estimate and understand your position, you will know how long you need to be patient and put-in the effort.

Remember, no debt is non-eliminateable - if that word exists. You can eliminate every debt, but by constant efforts. Estimate.

2. ENUMERATE
This is a number game. Supposing there's an amount of balance that seems frightening, we tend to move away from it - and in the process, do not pay up at least (and even) a part of it. What happens then is that as Einstein said, compound interest increases the balance and in the end, you have got a terrifying amount. If the initial balance was frightening, this one was terrorizing!

What you need to do here, is to find out an approximate percentage of the balance - say about 3-8% - and pay that every month. That way, you decrease the balance for which the interest is calculated and thereby, the percentage of amount you pay also decreases! And by the end of an year or so, who knows? You might just become a debt-free man or woman!
Enumerate!

3. EXECUTE
This is where most of the credit card debt services tend to lose their reputation. Psychologists say, you need to be motivated bluntly to get you started in the actual process of "credit card debt pay off". I do not completely agree with them, but I think sometimes they are wiser. So, here I am, forcing you plainly, screaming in your face bluntly, GO AND DO IT.

Start your game today, and you will be debt-free soon. Think about doing it tomorrow, and you are lost. Which do you wish to be? A Winner or A Loser?

Gary is a debt-management freak - who loves to help people solve their debt-problems. He is so "freaky" that he has a personal blog on paying off credit card debt where he frequently rants about credit card debt reduction strategies. Visit his blog to know more about credit card debt pay off.

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