Eliminate Credit Card Debt

When credit card debts attack…
At times, your credit card debt can seem absolutely unmanageable. Sometimes you just want to press a button and make all the debt go away. Is there such an easy step to eliminate credit card debt? Maybe, but let’s review what you should be doing to settle your debts before giving up entirely.

Video: Avoid future credit card debt

Don’t be scared by collection agencies
Whenever anyone receives a notice from a collection agency, the first thought is to assume the worst: they’ll take away your home, your car, and your stuff before you have a chance to work off the debt. But remember that the chances for this are very small. Most collection agencies have only a certain window of time to sue you for your debts, and you have more time than you think to get your debts settled. Calm down! You can work on this. If you need help go ahead and call a debt consolidation professional. It’s their job to help you. They are good at it and quite understanding.

Know the difference between a secured and unsecured loan
When we think of things we usually take out loans for, we think of houses, cars, and other big things. For our biggest purchases, we will take out a secured loan—a loan where the product will be taken away if we don’t make payments. Your credit card debt, however, is an unsecured loan, which means there’s nothing that will be taken away automatically if you don’t pay it off. You got your credit card because it was assumed your credit would be good enough to pay the debt off.

Use the credit crunch method
Another way to eliminate credit card debt is to use what has been dubbed the “credit crunch method,” which is what many experts recommend. This process involves arranging your credit card bills by interest rate, and paying the minimum payment on the other cards, and adding the difference in what you can afford to the minimum payment of the card with the highest interest rate. This method will keep your credit card payments within your budget while reducing your interest payments to the lowest amount possible.

Video: To avoid credit card debt entirely, get rid of your cards


If all else fails…

There’s one way to avoid credit card debt entirely: getting rid of all your credit cards! If your debt becomes too overwhelming, just stop using your cards and cut them up. Stop charging for purchases you can not afford. Cut back on spending. Don’t buy all those extra goodies. If you cannot pay cash you cannot have it. In general, canceling your account will hurt your credit score. But if you don’t cancel your account and your debts are overwhelming, there’s no need to keep adding to it. Work on paying off the debt you already have. If you feel like you can start paying off debts later, then eventually open another account after you have broken the spending habit and developed a saving habit. For now, you need to work on the debts you have, not one that keeps growing and growing.

DebtFree.net does not assume or pay any debt, nor does it give legal advice, offer credit repair or help stop creditor & collector calls. DebtFree.net provides information regarding various debt relief options as well as referrals and connections to debt relief companies. These companies specialize in specific debt relief categories, including debt management plans through credit card counseling, debt consolidation, debt settlement, debt negotiation, and debt mediation.