If you find, like millions of Americans, that you have too much personal debt, take comfort. You’re not by yourself, and there ways to reduce your 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 stress, but the majority of people are burdened about the amount of debt they have and for valid reason – learning to control and eliminate debt is one step toward financial freedom as a debt free Christian, something many of us would love to attain .
In this article, we’ll look at several ideas for credit card debt reduction . Some might not be interesting to you , while others will strike you as something to try out .
1) Spending & Buying Habits
To reduce your credit card debt, you will have to quit using them for purchases . This is a difficult one. Maybe you pay some of your bills with your credit cards. You tellyourself it’s for the “rewards” like hotel credits and airline miles. But if using your credit cards for these purposes is adding to your debt, you should pay anotherway. Stop any automatic bill payments that go on your credit card and use a debit cardinstead.
A lot of people talk themselves into paying for things with credit with the good intention of paying the charge back off when the bill comes, but when the statement arrives , the balance often is not available. The credit card balance continues to increase as little more than the interest is paid down each month.
Credit card debt reduction means working toward eliminating debt , of course, but you can’t do that without working toward reducing your expensesfirst.
Now, once you quit using your credit cards for payments and activities that you have been used to pulling out a credit card for , you also need to quit using your credit cards for daily spending. That means if cash is short and you want tocatch a movie , 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 things that have to be given up along the way will be worth it.
2) Debt Elimination
Once you have dealt with your spending , you need to start working on the debt . If you are only making minimum payments, find a way to increase the amount you pay . Financial experts say that if you pay 2% of your balance each month – many times 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.
Increasing your payments might seem hard , but as you see your credit card balances decrease , you’ll be pleased with your efforts.
If you can afford to pay additional amounts , think about focusing on one debt at a time. If you have more that 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 card at a time, perhaps 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. Make multiple payment each month if you can. Set up your account online so can quickly and easily make payments from your checking account.
- Look for ways to make additional money in order to 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 retired you will feel more in control of your finances and the payments that you no longer have can be used on existing debt to reduce it even faster . This is known as the “debt snowball” method of debt repayment.
3) Stay Focused
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.
Debt-Free-Christian.com is a website with many articles on topics such as Christian debt consolidation and Christian debt management.