Credit card debt doesn't have to be a permanent part of your life. You can learn to pay off your credit card debt and to live without credit card bills. There are three easy ways to pay credit card debt off: 1) eliminate credit card spending, 2) pay more than the minimum, 3) snowball debt payments. Yes, I'm sure that eliminating credit card spending and paying more than the minimum sound painful (and that snowballing payments is probably a foreign concept), but it's not very difficult.
Eliminate Credit Card Spending
I know, you're attached to your credit cards. I was too. They sure make life easy. But they're expensive too. Each time you make a purchase (when you carry a balance month to month, like 60% of us do), you're racking up more interest for yourself.
Look at it this way, if you have credit card debt, you're taking out a loan each time you make a credit card purchase. Would you go to the bank and ask for a loan for that new outfit you're thinking of buying or for that stereo system you really want? I doubt that you would. When you look at it as a loan, those “nice to have" things - those luxuries in life - sure seem expensive. When you add 9%, 12%, or 18% interest to the price of the things you want, it gets expensive.
Eliminating credit card spending is one quick way to help pay credit card debt off. When you buy with cash you spend more reasonably.
Pay More Than The Minimum
It's easy to pay the minimum. Credit card companies make it feel that way on purpose. But it's a dangerous game.
Given a typical interest rate on a credit card, a $1,000 purchase (maybe that stereo we were just talking about) would take more than 20 years to pay off if you only made the minimum payments. You'll also end up paying more than double for the item (because of the interest the credit card is charging you).
Are you still going to have that item in 20 years? Is it worth paying double for?
Snowball Debt Payments
This is probably a new concept to you, but I think it's the fun part.
The snowball payments method essentially takes the math out of the equation for a moment. While a math major may argue that you could save a little in interest by following his formula, you will find (like so many others) that the debt snowball is motivating and gets you to pay off your debt.
So what is it?
List out all your debts: the amounts, the interest rates, the minimum monthly payments - everything. Rank them however you want. Then look at them and figure out a plan. Is there one that really bothers you (keeps you up at night)? Is there a little one you could knock out quickly? Whatever it is, come up with a plan. Pick one to knock out first and others to knock out later. Rank how you're going to attacK them.
From there, you attack the first one with everything you have. You make the minimum monthly payments on all your other debts and apply every last penny you can on the one you want to knock out. Once it's gone, you keep paying the minimums on everything, except you take what you were paying on the first debt and add it to what you're paying on the second debt. This will knock out the second debt quickly! Once the second debt is knocked out, apply the payment from the first and second to the third debt. Repeat this until you are finished. It's called a snowball because by the end you're putting a big payment towards the debts - like a snowball running downhill.
These three tips are a great way to get yourself out of debt. By eliminating your credit card spending, by paying more than the minimum, and by snowballing your debt payments, you will pay credit card debt off.
You may need more than just this though - you may need a more detailed plan and you may need to be held accountable. Most of us do. Find some resources to depend on. Find blogs and programs that can help you pay credit card debt off.
Michael M Thomas is an executive at a Fortune 500 company who paid off over $50,000 in credit card debt. You can learn how Mike did it by reading his blog . You can also sign up for his newsletter which provides tips on how to reduce your spending by thousands of dollars per year and also gives tips on how to make more money in your spare time.
If you are serious about getting out of debt, you should consider a product like Debt Free in Three. Mike talks about Debt Free in Three on his blog .