Title:  Credit Card Debt Relief – Keeping the weight of credit card debt off
Written by  BankCD Man

Credit Card Debt is suffocating this country.  The best solution is to stay away from credit cards to begin with.  However, there are certain purchases these days that generally require some credit history, so that is difficult.  Here are some methods for managing credit cards and some personal history about knowing your limits.

First, establish a categorized budget.  At a minimum your categories need to include Food and Household,  Auto expenses such as gas, payment, insurance; house expenses such as rent or payment, maintenance, upkeep, insurance, and taxes; phone and internet; school expenses; doctors visits and medicine; entertainment, and miscellaneous (be very careful with this one.  Also, if you believe in tithing or giving to charities make that your first category.  When you are just starting out and trying to build a history, use the credit card to purchase those items you have budgeted for.  After you’ve used the credit card, go home and transfer the funds immediately so there is no balance.  Don’t wait until the end of the month.

I decided to sign up for a rewards type credit card.  I did the above, but didn’t pay it off right away.  Then I forgot and did the same the next month.  It seemed like I had all of this extra money.  I then made purchases of items I didn’t need.  Suddenly, I was in debt.  I learned the hard way that credit cards aren’t a good thing for me.  I didn’t have the real discipline necessary to pay them off each month.  No my budget has a credit card category and less money for entertainment and other things.

I’ve done a few things to get out from under the debt.  First, I alluded to adjusting my budget so I took into account the monthly  payments I know need to make.  Secondly, I took on extra work to pay the credit card debt down faster.  Just making the minimum payments would take years.  Paying extra pays the debt down faster and greatly decreases the actual interest I will be paying down.  Many people seek debt consolidation loans.  But the only way this can work is if you lock up or shred your credit cards.  Most people get the consolidation loan, then run their credit cards up again.  At that point they are in twice as much debt.

Next, create a savings account and be diligent about putting funds in there.  You should save up three to six months of monthly expenses before making major purchases of dream items.  This will give you some Cushion to cover items such as car repairs, broken appliances, etc.  Although, they don’t happen monthly, you need to plan for them.  You know its going to happen, you just don’t know when.  Plan ahead.

Finally, practice wait training.  When you think you have to have something, wait at least thirty-days before purchasing it.  Do some extra research and price hunting and give yourself time to decide if it is truly something you have to have.  Impulse buying is a huge budget killer and ultimately can lead to more debt.

Do your best to not get into debt.  But if you do, follow the above plan.  It will take a few years of discipline, but before you know it, the credit card debt weight will be gone.

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Filed under: Debt Consolidation

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