How to Quickly Pay Off Your Credit Cards
Credit card debt can very quickly suck you into an endless cycle of poverty, bad credit and frustration if you don’t pay it off quickly. Here are 5 ways to quickly pay off your credit cards with the least amount of pain.
Tip #1: Cut Costs
Take note of all your monthly expenses, and see where you can cut back. You don’t need to settle for less than what you want – instead, simply find the cheapest ways to live a lifestyle that makes you happy.
Try cutting back on buying new doodads like gadgets, TV’s, and cars, and try postponing those vacations and massages until you’re in better financial straits. After all, if you’re in credit card debt, it’s likely you’ve already had your fun – now it’s time to pay the piper over the next 2-3 years.
Even an extra $25 a month will go a long way in the journey to financial freedom, so start cutting back!
Tip #2: Pay Off the Credit Card With The Highest Interest First
If you have multiple credit cards and you try to make equal payments to each one each month, then it’s easy to feel like you’re going nowhere. To get a sense of accomplishment, find the credit card with the highest interest, give it the biggest chunk of your monthly payments, and only pay the minimum and finance charge (plus a little more) on the other cards.
Once you pay it off, congratulations – that’s a huge chunk off your financial worries, and paying your cards just became much easier.
TIP: If you’re the type who gets motivated by success, then there’s also the option to pay off the credit card with the smallest balance first. You’ll pay it off sooner, and you’ll get the determination to stay the course.
Tip #3: Consider Debt Consolidation
Debt consolidation is a service that lets you combine, or “consolidate,” all your credit card bills into a single bill. The great thing about debt consolidation is that it lets you pay just one bill, and at a smaller interest, than by paying each card individually.
The drawback is that your credit rating will take a hit, but that can be fixed over time, too. Right now, the most important thing is to get out of debt, and fast. Debt consolidation does just that.
If you don’t want to try debt consolidation, then we recommend you find a way to transfer balance from high-interest cards to lower-interest ones. Even a reduction of 2% in interest can result in hundreds of dollars of savings each year, which you can use to reduce your debt even further.
What About Cutting Up Your Credit Cards?
You may have been advised to cut up your credit cards until you pay them off, just to keep yourself from using them before then. If you’re prone to uncontrollable swiping, then that’s good advice – otherwise, it’s better to work up the discipline to simply not use them, cut costs, and make faithful payments, and keep your credit cards handy in case of emergencies.