Credit cards are seductive. If you’re not very disciplined, you can easily find your credit card bills mounting. It doesn’t make you an irresponsible person. It’s too easy to get into debt, and the credit card companies make a lot of revenues, by keeping people in debt. If you’re like a lot of people, you took out an additional card, just to pay for your first debt, and now you find that you’ve maxed out two or more cards.
Firstly, no debt reduction solution will ever work if you continue to live beyond your means. You need to take an honest appraisal of your finances, and determine which expenditures can be reduced. It will take a bit of effort, but you’ll get used to life without the extras, and the relief you’ll feel at your debt reduction is a great compensation for your responsible financial efforts. If you’re having trouble with this on your own, you can take advantage of one of the many non-profit consumer help organizations. They will structure a program for you that will help you on your way to solvency.
If you’ve got a lot of credit card debt, then chances are a big percentage of your monthly payments are going to interest fees alone. Now that’s not going to get you of your financial hole in a hurry! One solution (although it has some drawbacks) is to capitalize on the no interest promotions often offered by credit card companies eager to attract customers. Transfer your debt to one of these no interest cards, and all your payment dollars each month will go towards reducing the principal. Be careful to move your debt to a different card after the initial no interest promotion expires. This is a great way to reduce your debt load, but can harm your credit score if done too often.
Another often overlooked, but easy solution, is to call your credit card company and explain your situation. If you say you’re having trouble making your payments, then they’ll often reduce your interest rates on the spot. The last thing that they want to see is you defaulting on your debt!
You can also transfer your credit card debt to a low interest personal loan. If you have significant collateral (a car or a house), then you’ll qualify for great interest terms and will be able to knock down the principal a lot faster.
You can also sign up for the services of a debt consolidation company. These offer lower monthly payments and an easy structured way to get rid of your debt. These companies don’t work for free though, and you’ll likely pay a substantial amount over the course of your relationship for services that you probably could have done yourself.
These are just a few of the “tricks” that you can use to get out of a bad credit card debt situation. None of these is a panacea to your problems though. They will all still require a bit if hard work on your part!