How to Diminish Credit Card Debt?

Answer 1

It is very tempting to keep on using your credit cards, even if you know that you are close to reaching your credit limit. After all, it is fun to go on a shopping spree without having to hand over your hard-earned cash, right? What you don’t realize (or refuse to acknowledge) is the fact that you will go deeper in credit card debt as long as you use your credit card for unnecessary purchases, and if you don’t control your urge to keep doing so until you reach or go over the credit limit. Here are some tips on how you can diminish your credit card, which is the first step towards financial freedom.

Step 1: List down all lf the credit cards you own. You can put the one with the smallest balance first, followed by those with larger balances as you go down the list. You also need to take note of the minimum payment you need to make with every credit card at the time the list is made.

Step 2: Start using cash on everything you buy, and immediately stop using your credit card. It’s as simple as getting used to the idea that if you do not have enough cash to buy something, then do not buy it! Do not put off this task – stop using your credit cards NOW. Do everything to help lessen the temptation of using them – some people lock up their credit cards, ask their family members to keep it for them, and some actually put the cards in the freezer. Nothing is too weird or outrageous; whatever stops you from using the cards do it.

Step 3: Make sure that you pay the minimum amount on your credit cards monthly; if you have the capacity to pay more than the minimum, do it. When the balance on your credit card goes down, the minimum payment needed (and of course, the total balance) is also reduced.

Step 4: If you come up with an unexpected source of income, resist the urge to go on a shopping spree and instead use the money to pay off the balance on the credit card that has the smallest balance. This way, the time you need to spend on paying off that credit card is reduced, and you will have one less credit card to worry about.

Step 5: You can also consider using some of your savings to pay off a percentage of your credit card balances. Just make sure that you still have enough cash to use in case of an emergency.

Step 6: Keep track of your progress with a spreadsheet or a document, so you have a visual representation of how you are doing in your quest for credit card freedom.

Credit cards have a lot of advantage, but they are also sources of temptation. The quickest way to financial freedom is to learn how to manage your credit card usage – in most cases, the best thing to do is to just stop using them.