How To Get Rid Of Your Credit Card Debt

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photo: Madewell

 

With Christmas spending and then sales shopping, it can be really tempting to start using that credit card that you definitely got for emergencies only! And once you start it can become really easy to keep spending on your credit card, until you suddenly can’t just pay it off when you want to.

So it’s time to kick that credit card debt, so you can improve your credit score, stop paying interest, and most importantly, spend your money guilt free! So here are the Career Girl Daily top tips on how to clear your credit card debts and feel the weight lifted off your shoulders!

1. Set realistic goals

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The first thing you have to do if you’re serious about clearing your credit card debt is to face up to the problem. This means working out exactly how much you owe, whether it’s a big debt or just a few dollars you’ve been meaning to pay back for ages, include EVERYTHING. This way you can make realistic goals for paying off your debt, and know exactly where you stand all the time.

2. Stop spending on the cards!

There’s no point working hard to pay off your credit card if you’re spending on another one at the same time. Stop the mentality that you can spend a bit more, just because you’ve paid off a chunk. If you spend this way you’ll never clear your whole debt which is not only bad for your mental state, but also your credit score. Why not try going cash-only, and leave your cards at home. It might be a real eye-opener as to how much you actually spend each day – those morning Starbucks might need to stop!

If you’re really struggling to stay away from your cards why not freeze them in a bowl of ice, that way you have them in case, of an emergency but they’re not readily available for those shoes you’ve just seen online…

3. Target one card at a time

Set realistic goals in paying off your credit, and target one card at a time. This way you won’t feel the targets are unmanageable, and when one is completely paid off it will give you a big morale boost to target the next. The obvious thing to do is to pay off the one with the highest interest rates first, so you’ll pay less in the long run.

However, if your immediate concern is your credit score then you need to work out the utilization scores of each credit card and work on the highest first. Divide the amount you have on a credit card by the card’s limit. Scores above 0.2 will affect your credit score, so you should try to pay off enough on each card to get your scores below this rate.

4. Cut your interest payments

If your credit cards have high interest rates, you might want to consider shifting your debt to a credit card that offers a 0% balance transfer card deal. This way you’ll stop paying interest, so all your repayments will go towards paying off your actual debt. But there are a few things you need to consider before going down this route.

Firstly, you need to check the balance transfer fee, as this can incur a big charge if you want to transfer a large debt, and might make you worse off than your interest paying credit card. Secondly, try to get a card with a long interest-free period there are some that offer up to 40 months. You need to be extremely disciplined in order to pay off the whole debt before the interest-free period ends as this type of credit card tends to have a high interest rate afterward.

5. Get help if you need it

There are some great places to go for advice if you need it, who may be able to help you consolidate your debt and manage your finances better in the future. To find a reputable debt counseling agency go to nfcc.org.

 


On Sunday 29th January, Career Girl Daily will come to life at the coolest spot in London. With masterclasses on everything from starting a business to managing your money. So you can network, make friends, and figure out how to accomplish anything you set your mind to! Reserve a guaranteed place when you book your tickets to this event here.


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photo: wethepeople

 

With Christmas spending and then sales shopping, it can be really tempting to start using that credit card that you definitely got for emergencies only! And once you start it can become really easy to keep spending on your credit card, until you suddenly can’t just pay it off when you want to.

So it’s time to kick that credit card debt, so you can improve your credit score, stop paying interest, and most importantly, spend your money guilt free! So here are the Career Girl Daily top tips on how to clear your credit card debts and feel the weight lifted off your shoulders!

1. Set realistic goals

The first thing you have to do if you’re serious about clearing your credit card debt is to face up to the problem. This means working out exactly how much you owe, whether it’s a big debt or just a few dollars you’ve been meaning to pay back for ages, include EVERYTHING. This way you can make realistic goals for paying off your debt, and know exactly where you stand all the time.

2. Stop spending on the cards!

There’s no point working hard to pay off your credit card if you’re spending on another one at the same time. Stop the mentality that you can spend a bit more, just because you’ve paid off a chunk. If you spend this way you’ll never clear your whole debt which is not only bad for your mental state, but also your credit score. Why not try going cash-only, and leave your cards at home. It might be a real eye-opener as to how much you actually spend each day – those morning Starbucks might need to stop!

If you’re really struggling to stay away from your cards why not freeze them in a bowl of ice, that way you have them in case, of an emergency but they’re not readily available for those shoes you’ve just seen online…

3. Target one card at a time

Set realistic goals in paying off your credit, and target one card at a time. This way you won’t feel the targets are unmanageable, and when one is completely paid off it will give you a big morale boost to target the next. The obvious thing to do is to pay off the one with the highest interest rates first, so you’ll pay less in the long run.

However, if your immediate concern is your credit score then you need to work out the utilization scores of each credit card and work on the highest first. Divide the amount you have on a credit card by the card’s limit. Scores above 0.2 will affect your credit score, so you should try to pay off enough on each card to get your scores below this rate.

4. Cut your interest payments

If your credit cards have high interest rates, you might want to consider shifting your debt to a credit card that offers a 0% balance transfer card deal. This way you’ll stop paying interest, so all your repayments will go towards paying off your actual debt. But there are a few things you need to consider before going down this route.

Firstly, you need to check the balance transfer fee, as this can incur a big charge if you want to transfer a large debt, and might make you worse off than your interest paying credit card. Secondly, try to get a card with a long interest-free period there are some that offer up to 40 months. You need to be extremely disciplined in order to pay off the whole debt before the interest-free period ends as this type of credit card tends to have a high interest rate afterward.

5. Get help if you need it

There are some great places to go for advice if you need it, who may be able to help you consolidate your debt and manage your finances better in the future. To find a reputable debt counseling agency go to nfcc.org.

 


On Sunday 29th January, Career Girl Daily will come to life at the coolest spot in London. With masterclasses on everything from starting a business to managing your money. So you can network, make friends, and figure out how to accomplish anything you set your mind to! Reserve a guaranteed place when you book your tickets to this event here.


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