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Credit Card Debt

5 Tips for crushing it

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Credit card debt has a bad habit of sneaking up on you! One month you can't quite pay the balance, and before you know it, you owe $5,000 or $10,000. Many people feel a bit defeated at this point, but here's some good news: you can crush that credit card debt. You'll have to focus and put in the effort, but once you do, you'll see that balance drop faster than you thought possible.

To that end, here are some tips to help you pay off your credit card debt and clear your financial slate.

1. Stop Spending on Nonessentials

The first step in paying off credit card debt is to stop racking up more debt. From now until the date when your debt is fully paid, you need to follow this rule: If it's not essential, you don't buy it. 

If you have a hard time resisting making additional purchases on your credit card, consider freezing it into a block of ice. This way, you can still access it in case of an emergency. But the hassle of thawing it out will make you think twice about nonessential purchases.

2. Consolidate With a Personal Loan

Credit cards often have a high-interest rate of 15, 18, or even 22% APR. The interest compiles quickly and can make it hard to catch up. Consider taking out a personal loan through your local bank, and then using the personal loan to pay off your credit card debt. Personal loans tend to come with much lower interest rates. You'll pay a lot less in the long run with this strategy. You'll also only have one payment to make each month, which is convenient and approachable.

3. Transfer Your Balance To a 0% APR Card

Some credit cards offer a 0% APR for a certain introductory period—often six months or a year. You can open one of these cards and transfer your balance over from your high-interest cards. This enables you to pay the balance down over time without paying off any additional interest. Pay attention to when the 0% APR period ends, though. If you can't reasonably pay off your debt within this period, you may be better off taking out a personal loan.

4. Make Budget Cuts To Free Up Funds

Whether you transfer to a 0% APR card or take out a personal loan, you will need to make more than the minimum payment if you want to crush your credit card debt. 

If you don't already have a budget, make one. Subtract all of your expenses from your monthly income. Any money that is left should be put towards your credit card debt. See if there are any budget categories you can cut back on to leave more funds for your debt payment. For example, if you're spending $300 a month at restaurants, see if you can cut that back to $100 a month and put that extra $200 towards debt.

5. Generate Some Extra Income 

If your budget is tight, you need to generate some extra income to pay down your debt faster. Take on a part-time job on the weekends. Start a side business mowing lawns, walking dogs, or cleaning houses. You don't have to do this forever, just until you've paid off your credit card debt.

By putting an end to excess spending, consolidating, and then making large monthly payments, you can crush that credit card debt—and fast! Being credit card debt-free is so rewarding. You'll feel like a weight has been lifted off your shoulders. 

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