Credit cards can be either a blessing or a curse, depending on the way in which you choose to use them. Being able to have the back-up of plastic should an emergency arise is great. However, when the card is simply used for items that you don’t really need, that’s when problems arise. The good news for the credit card companies is that there are far more people that fall into the latter category, simply choosing to flash the plastic for every single purchase until they reach a point where paying back that amount becomes virtually impossible. Eliminating credit card debt can be done if you apply yourself, even if you think that there is no way out of your current situation.
Getting Started With Credit Card Debt Elimination
The best way to start eliminating credit card debt is to look over your past statements to see where you are using the card. There is a better than average chance that you will see the vast majority of purchases is for non-essential items like restaurant visits and luxury items. These types of purchases can completely blow your monthly budget, assuming of course that you even have one in place.
If you don’t, then it’s time to create one so that you can see exactly how much disposable income is available. From there, you need to eliminate or drastically cut back on the amount of times that you eat out or spend money. Using the credit card is all-too-easy and most people will actually spend a lot more than they normally would if they were using cash. If you do go out, use cash, check, or a debit card and leave the credit card at home.
Start To Dig Out Of the Hole
Overspending isn’t the only factor that contributes to mounting credit card debt. Simply paying the minimum amount due will mean that about 95% of you payment goes towards paying off your interest rate. You will never be able to dig out of the hole by paying the minimum. The first thing you need to do is make a list of how much you owe and to whom, and then start calling them all to see if you can get a little help. The credit card companies aren’t all monsters and most will be quite happy to work with you in reducing the amount you owe or vastly reducing your interest while you catch up. It can be quite easy to create a repayment plan that works for both sides, but it’s your responsibility to make that first call.
Continue To Show Restraint
The key to eliminating credit card debt is sticking to the plan once you get started. For example, don’t decide to treat yourself to a nice meal or a mini shopping spree once you start to get your finances under control. Using the credit card can be very much like a drug that once again becomes addictive once you fall off the wagon. Create a budget, stick to it in a responsible manner, and you can get out of credit card debt.