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How to Get Rid of Credit Card Debts

You’ll hear a hoard of people on TV and radio who promise to make your credit-card debt disappear overnight. It’s not that easy, but you can get rid of credit-card debt if you play it smart. There are various ways to handle it, and every one of them centers on you being smarter with your money and making intelligent choices.

When it comes to credit-card debt, quickly paying it off will help you avoid interest piling up over time. The longer you wait to pay it off, the more money you owe. To avoid this Catch-22, consider consolidating, prioritizing, and getting help from experts. Let’s take a look at some of the best ways to rid yourself of that annoying credit-card debt.

Working Smarter

  1. Pick the best credit card to pay off first: You need to take a long hard look at your credit. Identify the card with the highest interest rate or risk factor to begin prioritizing your payoffs. This move doesn’t necessarily mean you need to be paying off the card with the highest balance first, as it sometimes is helpful to pay off the smaller balances quickly to keep your credit score in good standing.
  2. Pay off your smaller balances: Paying off lower balances can give you an improved outlook on your overall debt picture. You must keep a winning attitude while paying your balances, and getting some small balances down to zero can be just the motivation you need to keep chipping away at the others. You can’t sit around and wait for some big break to come your way. You need to act as quickly as possible. Once you see that balance dropping, you’ll be pumped to sprint to the finish line.
  3. Find alternative sources of income: It’s never a bad idea to have extra cash flow coming in, and there’s no reason you can’t be making a few bucks here and there in today’s digital age. With so many part-time jobs out there, you have plenteous opportunities to address your credit-card bills without busting your primary source of income. Think about freelancing, driving for rideshare services, or picking up odd jobs on online forums. If you set aside even ten extra hours a week for a second job to pay your credit card bills, you’ll make significant strides in just a few short months.
  4. Make substantive payments to raise your credit score: Having a good credit score can help you get out of debt. While you shouldn’t open 20 other credit cards to pay your bills, you can transfer high-interest balances to new cards with lower rates and pay those off to save you money in the long run. If you’re able to make more substantial payments, it will help a lot. Even making one more significant payment during the year – combined with your reduced interest rates – can help you get out of debt quicker. The better your credit score, the better your chances of getting a more reasonable credit line and interest rate from your creditor. If you can get your balance to below 30 percent of the total amount available, you’ll be surprised how much your score can improve.
  5. Try to negotiate your rates by talking to your creditor: With your financial freedom hanging in the balance, there’s never been a better time to reach out to your creditor and see what they can offer to help. Telling your creditor that you plan to switch companies for a better rate can motivate them. Speak to a representative and see what they can offer you to keep your business. You have nothing to lose. At the end of the day, lenders want your business for the long haul, and if they think you’re willing to transfer your balance to another creditor, they might make you an offer that can save you money.
  6. Consolidate your balances: In reviewing your account for credit, a lender typically will take note of how many accounts you have open and how many of them have outstanding balances. Work to clear these smaller balances to bring down your total debt. Transfer your remaining balances to a single card to make it easier to track and pay. Ideally, try to keep your debt in that sweet 30-percent range to support a healthy credit score.

Consider Taking Out an Installment Loan

A debt-consolidation loan can be your saving grace, and it all boils down to interest rates. As it is always important to pay off your balance as quickly as possible, rolling your card balances into a single loan can be a viable option to save you money in the long run. You’ll avoid watching your balances increase because of high interest rates that leave you treading water.

These installment loans can not only come with lower interest rates, but they can help boost your credit score in a major way. By paying off your balance in full, you give companies the green light to lend you money down the line.

Benefits of these types of loans include:

  • Ease of simple, predictable payment schedules.
  • Easier budgeting to fit your income level, with no surprise fees.
  • The knowledge that your debt will be paid off by a specific date.
  • No rising interest rates.
  • No pestering collection calls and unexpected visits.
  • Installment loans are prevalent, with auto loans, student loans, and mortgages being examples of widely used ones.
  • These loans allow you to pay off your debts in one fell swoop and move on with your life.

There are not enough hours in your busy schedule to sit and worry about your credit-card debt. You now know some ways to work smarter, faster, and more efficiently toward fiscal responsibility. Whether you choose to go with an installment loan or simply chip away at your credit-card balance over time, there is always a way out to reach the light at the end of the tunnel.

Writer

Vivaan Marsh is a professional writer, editor and an expert in personal finance. Her career as a professional writer stretch for over 11 years. One of her passions in life is to help everyday families with there financial problems, making their life a bit easier and explaining complicated topics in an easy way. Read more >

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