Being in credit card debt sucks. Luckily, it’s not the end of the world. And there are some sure-fire ways that can help you pay off your credit card debt faster and with spending less money on it. In this blog post, we are going to share with you 3 simple yet effective steps that will help you do it.
- First of all, you need to know who you owe how much you owe. It will give you clarity on the whole process of paying off your debt. Grab a piece of paper. If you don’t have it use your notes on your phone. Make a list of all your credit cards with all the balances. Now you know who you owe how much you owe and how much you.
- The next step is paying close attention to the interest rate. Place all your credit cards in the order through the highest interest rate to the lowest one. Now you may think “Why would I do this? How does this help me?” Well, the answer is very simple. It has to do with the so-called avalanche method. This is what you need to do in step #3. Once you start paying off the card with the highest APR the statistics show that you’ll save more money over time.
- Pay more money towards the card with the highest interest rate. And pay the minimum to the rest of the cards. Once you are done paying with the highest one you transfer over your focus on the next one and so on. You rinse and repeat until you are completely debt-free. Eventually, you should be done paying off your debt.
Here is a real quick example of how you can pay off your debts
For example, you want to finish your debts in six months and you owe $10,000. Just divide it by 6. Well, you have to pay around $1,600 each month. Now if you want to make sure you pay it on a weekly basis. So you would divide it by four. There you go. On a weekly basis, you would pay around four hundred and sixteen dollars towards your credit card debt and in six months you are literally done.
You may think “Ok I get that. I know how to pay it off but how do I avoid paying interest?” Yes, indeed, it’s the most important thing here. You do it by using a balance transfer method. What’s a balance transfer?
The truth is that you can’t stop paying the card because it’ll hurt your credit score. However, what you can do is you can get another card, the so-called balance transfer card that has a promotion. For example, you transit balance from your credit card debt with the highest interest rate to this card. Once you do that they give you 18 months, 12 months, or 21 months to pay off your balance in full with no interest, which is pretty cool.