We've become a nation dependent
on plastic. Rent a car, buy a gift online, make airline
reservations.
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6 steps to credit card serenity | |
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We think nothing of pulling out our credit card for these
and hundreds of other transactions every year. That's not necessarily a
bad thing. Credit cards can be a convenient and safe alternative to cash. But
too often, before you know it, credit card purchases spiral out of control (to
the tune of more than $8 trillion a year) with a simple swipe of the card. Then,
with high rates, fees, penalties, continued spending and the other pitfalls that
can happen with credit cards, debt accumulates much faster than your ability to
pay it down.
But that all too common and sad scenario
doesn't have to happen to you. Whether you're carrying
a balance of a couple hundred dollars or several thousand,
take the following steps to get out of debt -- fast.
1.
Know where you stand
When you're feeling overwhelmed by debt it's easy
to let the bills pile up, unopened like so much junk
mail. But, you can't control your credit cards if
you don't have a handle on how much you owe, says
Bill Driscoll, a financial planner in Plymouth, Mass.
Sit down at the computer screen (or with pencil and
paper) and make a list of exactly how much you owe
and what rate of interest you're paying on each card.
Then list your cards in order of highest rate to lowest.
Use this work
sheet for organizing your cards, rates and balances.
2.
Pay your highest rate cards first
These cards are the ones that are costing you the
most over the long run so you need to make every effort
to pay more than the minimum payment each month on
these bills first. Find out the fastest and cheapest
strategy to use to pay down your card balances. Our
calculator
will automatically set up a plan of action for you
to follow.
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