Once, I found myself swimming in thousands of dollars in credit card debt. I finally concluded enough was enough, and knew it was time to do something.
If you find yourself in a similar situation, learn from the steps I used to make my credit card debt disappear.
Make a plan
First, I created a plan designed to achieve my goal. There are many standard debt-reduction plans, but I decided to do something a little different. In addition to debt reduction, I created an income-expansion component as well.
So, in addition to making extra payments so I could decrease my debt, I also created new cash inflows to ensure my budget remained intact.
You can do the same. For example, if your debt-reduction plan requires an additional $500 per month to wipe out credit card debt within a year, start thinking of ways to increase your income by $500 monthly.
Whether it is selling goods online, turning your passion into cash or working additional hours, there are always ways to increase your cash inflows.
1 at a time
If you have more than one credit card, determine which card should be paid down first. Some experts suggest paying smaller balances, while others recommend tackling higher-interest credit cards first.
I decided to pay off credit cards with higher interest rates first, which helped me save money in the long run.
Whichever method you choose, take it one card at a time. This will give you a sense of progress and provide the encouragement to move forward.
Remember, as you pay down additional debt, it is important to continue making the minimum payments on other cards to keep your credit score in good standing.
Stick to your budget
Making a budget is good, but sticking to it is better! Understanding your expected income and expenses can help you understand what you really can afford.
Spending haphazardly is a sure way to fall short of your debt-reduction goal. It also creates additional debt. Be diligent and careful with your money and spend within your budget.