5 Surefire Ways To Eliminate Credit Card Debt

Do you have enormous credit card debt? You are certainly not alone. According to research, the average family in the United States has $7000 in credit card debt and pays about $1000 in interest each year! Throw in a late payment or two, or an over-the-limit charge, and that number skyrockets. Imagine what you could do with that $1000 if it weren't being spent on interest.

Let's imagine for a moment that you have $5000 debt on one credit card that is charging you 17.5% APR. Let's also imagine that you pay only the minimum due of $25/month on this card. Guess what? You will never pay it off! The interest alone on this card is $73/month!

That means that each month you get further and further into debt. By the time you have been paying on this $5000 for 10 years, assuming you have not used the card during this entire period of time, you will owe $20,385! That's over $15,000 in interest. If you triple your payment to $75, it will take you over 20 years.

So, what do you do? How do you get out of debt and use that money towards other necessities, savings, and investments? Here are a few simple methods that you can use without having to go to an expensive financial counselor.

Tip #1: Cut Up Your Cards

The very best way to reduce your credit card debt is to STOP using your credit cards! There is no need to have more than one card, so pick the one with the lowest interest rate and cut up the rest. The one you keep should be deemed an 'emergency card." These are true emergencies, not mere inconveniences. For instance, buying a new TV would not be an emergency, but renting a car in order to get to the bedside of a dying loved one would be. You can carry your emergency card with you, but don't make it too easy to use. One good suggestion is to cover the card tape and paper and write on it: For Emergencies Only.

Tip #2: Move Your Debt

If you have more than one credit card payment, you may want to consider moving debt from a card with a higher APR to one with a lower APR. This will lower the amount of money you are spending towards the interest and get you out of debt faster.

Tip #3: Use the Snowball Principle

List all of your credit card debts, and the amount you are paying each month. Pay off the lowest amount first. Then use that money to start paying off the second lowest amount. And then the next and the next. Let's look at an example.

If you have a $7000, $5000, and $2000 card with payments of $150, $125, and $100, you will finish paying off the $2000 card first. Once it is paid off, you take that $100 and put it towards the $5000 credit card. That means you are now paying $225/month. You have increased your payments which will pay off that credit card sooner and will have you paying a lot less in interest. Once that is paid off, you apply the $225 to the $7000 card, making your monthly payment $375. This will greatly accelerate the payment of this card, reducing your interest payments even further. When everything is paid off, you now have $375/month extra to put towards savings or investments!

Tip #4: Prioritize Your Debt Repayment

One of the best ways to pay off your debts is to get rid of the highest interest payment first. Looking back at the snowball example, you took the lowest and paid it first. If, however, the $2000 card had the lowest interest rate, you would want to pay off the card with the highest rate first. This will save you much more in interest payments.

If the math gets too hard here, don't despair. There are many places on the Internet where you can find good debt reduction calculators. It is then just a matter of punching in your numbers and reading the report.

Tip #5: Consider Consolidation

If you own a home, you may want to consider consolidating your debt using a home equity loan. Since a home loan is a secured loan (they can take away your house if you don't pay) you have a much lower interest rate than you do on your credit cards. Paying a lower interest rate is always a good thing! Not only that, but the interest you pay on your home loan is tax deductible. This is NOT true for credit cards.

By following these tips, anyone can take control of and completely eliminate credit card debt.

Wesley Atkins is the owner of http://www.credit-cards-advisor.com- which aims to get you fitted with the best credit cards to suit your situation. With numerous credit card articles and easy online credit card applications you will never choose the wrong credit card again.

---

What You Need to Know about Debt Negotiation on Credit Cards

Debt negotiation on credit cards is often referred to as... Read More

10 Ways To Boost Your Credit Score

1. Deleting Errors in 48 HoursThis is the absolute fastest... Read More

Credit Card Tips

Here are some useful credit card tips for you to... Read More

What Is the Fair Credit Reporting Act and What You Should Know About It

The Fair Credit Reporting Act (FCRA) and the recent update... Read More

Dont Dig Your Own Pit

If you want to enjoy your life out of spending,... Read More

How To Eliminate Credit Card Debt

There is almost nothing more troublesome than having too much... Read More

Choosing the Best Low Interest Credit Card

With so many low interest credit cards on offer, how... Read More

Do You Know The Top Five Credit Card Mistakes?

When you're dealing with credit cards, you're playing with fire.... Read More

Useful Tips When Choosing Credit Cards

Chances are you have received your share of "pre-approved" credit... Read More

10 Ways To Protect Your Financial Identity Being Used For Someone Else?s Shopping Spree

Someone impersonating you could be spending your hard-earned money.Impossible! Not... Read More

Avoiding ID Theft and Credit Fraud

Article excerpted from the new book, "How to Do Space... Read More

Trade Credit: How to Determine if You Should Offer Net-30 Terms to Your Customers

What is trade credit?One of the major differences between consumer... Read More

Warning: Todays Non Profit Credit Counselors Are Yesterdays Bill Collectors!

Here's a dirty secret, today's "non profit credit counselors" are... Read More

Your Credit Rating and How To Check It

There is a lot of confusion surrounding UK credit ratings,... Read More

Trying to Land a Job? Poor Credit Scores May Hurt Your Chances

Many employers are now looking at an applicant's credit report... Read More

How To Choose A Credit Card

Your credit score may just be a little number, but... Read More

The Ghost of Expected Surprises

Here, Cratchet, what do you think you're doing?Uh, er, leaving... Read More

Stop Struggling Because Of Poor Credit And Improve Credit Rating Now

Did you apply for a personal loan only to be... Read More

My Credit Card Application Was Rejected! Now What?!?

No doubt, you've probably gotten literally hundreds of credit card... Read More

7 Consumer Credit Laws You Should Know if You are Trying to Repair Your Credit

There are seven consumer credit laws you should be aware... Read More

Dont Trade Your Future for Todays DooDads

"Easy Low Down Monthly Payment," "Buy Now Pay Later," "You... Read More

Credit Scores and Loan Applications

Keep Your Credit History Clean - Remove A Negative Credit... Read More

Credit Card Balance Transfers Can Help You Stop Putting Money Down The Drain

As you probably know, interest rates are at all time... Read More

Tips For Getting Your First Credit Card

Most of us get a credit card on our name... Read More

How Businesss Mess Up Their Credit Policies

In "Become the Squeaky Wheel" a book recently published, Michelle... Read More

Credit Report ? How Your Credit Score is Determined

Most consumers are aware that they have something known as... Read More

Balance Transfers Introduction

Credit card balance transfer involves using a credit... Read More

Credit Cards or Store Cards - Which Is Better?

Introduction In this article, a presentation is made of the... Read More

Building Your Credit History

Today, credit is an indispensable part of our lives. In... Read More

Know Your Credit Card Rights

When you apply for a credit card, the application that... Read More

Is it Safe to Use Online Car Finance?

Online car finance is convenient. You can apply over the... Read More

Choosing The Best Credit Card To Apply For

Always shop around to get the best deal when choosing... Read More

5 Ways To Prevent Credit Card Late Fees

Paying a credit card late fee is the same as... Read More