If you carry around credit card balances, you could be affecting your credit rating. It’s also often stressful to know that you owe money that you need to pay off. For many people, they’ve gotten in over their heads with the credit and charged up more than they can reasonably pay off at one time, so they need to create a plan for paying down their balance. If you fall into this category, here are some tips for getting through it.
If you’re looking to pay off your credit card balance, here are some tips:
- First, determine how much you have to pay off and how many cards. Which cards have the highest interest? Which cards carry the highest balances? How much extra can you afford to pay each month toward your balances? Answering these questions honestly and accurately will help you create a plan for paying down your debt.
- Find a debt repayment strategy and then stick with it. There are different types of strategies. Here are two examples: in a “debt avalanche”, you pay the debt with the highest interest rate and then you can work your way down. This way, you’re actually paying less over time and you’re getting those high balances down. Another strategy is the “debt snowball” in which you pay off the small debts first, which can motivate some people to keep going and get all those debts down. Determine which will work best for you and then get to it.
- Stick to your plan. Some people get excited when they first create a plan but that excitement dwindles over time, when money is low, and if emergencies arise. It’s important you remember why you were doing this in the first place and stick to your plan.
- Get expert help. You should always consider talking with a debt relief specialist about the best options for you and how to pay down your debt. Depending on your current credit score, you could qualify for certain programs or options to help you pay down your debt such as a personal loan (if your credit is over 600) or a zero interest program (if your credit is in the 700s). Experts will know how to help guide you through this process and which options are best for you.
Paying off your credit card balances does not have to feel stressful or overwhelming. When you create a clear plan on how to do it and you have the right tools to make it happen, it’s possible. While you are paying down these debts, it’s also important to understand how you obtained the debt in the first place, so you don’t rack it back up again. Maybe you had an illness or injury that put you out of work for a while. Perhaps you had an urgent home or car repair to take care of. Maybe you have a shopping addiction or you were not planning your budget properly and you used cards to help sustain your daily living. Whatever the reason you ended up with the debt, it can help to understand it so you can prevent it in the future.