Credit card debt can easily get worse. This is especially true if you’re only paying the minimum every month! This may seem like a short-term solution. But you’ll end up in a vicious circle of debt. In fact, the interest accumulates. And the debt goes on indefinitely. Then there’s the financial stress. Fortunately, there are ways out of this situation. Here are a few tips on how to reduce your credit card debt.
Prioritize your debts: where to start?
Start by taking stock of your credit card debts. First, make a detailed list of your debts:
- Keep track of your credit card balances;
- Specify the corresponding interest rate ;
- Indicate the minimum monthly repayment.
From there, you can rank your loans. This is done by interest rate. You pay off the debt with the highest interest rate first. This way, you reduce the lightning effect of accumulated interest.
Another alternative is to pay off the smaller debts in full. At the same time, you make the minimum payments on the others. You can then pay off your debts bit by bit.
Increase your monthly payments
Don’t just pay the minimum every month. Increase your monthly payments, even slightly. Over time, you’ll be able to reduce your credit card debt. Their cost will also decrease.
To make sure your efforts pay off, set up automated payments. Schedule automatic payments. The amount of each payment will increase in relation to the minimum required. This way, you’re sure not to forget to pay. You’ll also remember to gradually increase the amount.
Reduce unnecessary expenses
To be able to repay more, you need to disburse less. So cut back on non-essential expenses. Here’s how to do it:
- Identify reducible expenses;
- Identify disbursements that can even be eliminated (if only temporarily);
- Avoid compulsive buying.
Choose more economical solutions:
- Cook it yourself ;
- Take public transport;
- Go for less expensive (or even free) leisure activities.
Consolidate your debts
If you’ve accumulated several credit card debts, you can consolidate them. How does it work? Your debts are combined into a single loan. This loan has a lower interest rate. What’s more, you only have to make one monthly payment. This certainly simplifies the management of your finances. In some cases, you can even avoid bankruptcy.
Professional help is welcome
Still can’t get your credit debts under control? You can call on an expert in the field. We offer you personalized advice
