Credit Card Debt – Eliminate It And Increase Your Credit Score
Credit card debt is a very big problem many people have, especially in the west. Many people are now paying enormous amounts in interest year after year because of their continued usage of credit cards, to finance almost everything. Though some might have landed up with credit card debt due to some unfortunate event or emergency in their life, most people carry credit card debt due to their own misuse of their credit cards.
Once you have accumulated credit card debt, it’s not impossible to eliminate, but it could be difficult. Two of your choices are to hire a debt paying service or do-it-yourself. There are pros and cons to both. Debt charges usually charge a fee. Doing it yourself requires patience, discipline and planning.
It is not difficult to eliminate credit card debt but it does require a change of habits, especially spending habits, you may have taken years to build. Eliminating debt is step one and keeping it paid down is a big step two, which should last the rest of your life. The key is to create a doable plan and stick to until your credit card debt is completely paid off.
You have followed the plan you made or hired a debt-repayment-service, and after some time all your credit card debt is gone. Whatever you did to eliminate the debt continue with the same habits to keep it that debt monkey off your back. Whatever you do, do not fall back into the same habits you had before debt repayment.
First, congratulate yourself for paying off your credit card debt. Not everyone has the discipline to do this. Unfortunately, many people fail too. On the other hand, some people who were successful at paying off their debt, fail to keep this debt down. Over time some people build their credit card debt right back up.
There is much we can do within ourselves to change negative spending habits. We can develop a process for eliminating the original debt, which could take 60 to ninety days to implement. After doing the new routine for this period of time we should be acclimated to it, thus falling back into former bad habits won’t be so tempting. A few easy rules to help us keep up the new routine are to:
1) Do not overspend. Yielding to the sale offers for something that you don’t really need, is a big mistake that leads to overspending.
2) Always remain within 70% of your credit limit.
3) Pay off all your cards by the grace periods.
4) If you do need credit cards, cut up and close all your accounts except two (2). For example I have an American Express (for places that don’t take Visa or Master Card) and one Visa, which as a bonus pays for airplane tickets.
Adding these rules, and other rules that work for you, will eliminate stress and you paying any unnecessary interest. It has helped me considerably to not apply for any credit card offers that are mailed to me, although it is tempting to do so. You can use the extra money, you had paid in interest, on other necessities or even luxuries that will add to the quality of your life. Take it from one who has had experience, life after credit card debt is a lot less stressful, costly and the new habits you will acquire are much smarter.
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