Need to erase bad credit card debt? Join the club - hundreds of thousands of people around the world are waking up to precisely the same predicament. We have all spent more than we have choosing to enjoy our new things without thinking about how to pay for them. Then, when the credit card bills roll in, we feel overwhelmed...crushed by the weight of our own bad choices. If you feel crushed by the weight of your own debt there is hope for you. Using these time-tested steps you can free yourself from your bad credit card debt nightmare.
KNOW WHERE YOU STAND: It is time to begin by calculating how much debt you are truly in. Gather together all of your credit card statements and get a notebook and pencil. Organize your statements, not by how much is due, but by how much your APR (annual percentage rate) is. Put the highest percentage rate on top and each subsequent below that. Grab your notebook and begin to chart your cards. From left to right write down:
1. The card name
2. How much total is owed on the card
3. How much the minimum monthly payment is
4. What your current APR rate is
Repeat these steps for the remainder of your credit credit card bills.
PROMISE YOURSELF. Calculate your total bad credit card debt by adding your total card owed column together. Now, for a moment, sit back and look at your debt. If you are like most folks you will be shocked at just how much bad debt you have allowed yourself to get into
So now what? Now you make a promise to yourself. Never again will you make another purchase with your credit cards unless it's an extreme emergency. You will always carry and pay for your purchases with cash. As challenging as this may be for you - it is the secret to your success.
START CUTTING: Time to trim the fat out of your budget and live within your means. This means you need to take a good hard look at your lifestyle and cut out all of those things that aren't "life essentials". What does that mean? It means forgoing that cup of joe from that expensive chain coffee restaurant. It means doing your own nails and dropping the fast food lunches. ANYTHING you can do to reduce the amount you spend each month will get you to your goal of being debt free that much quicker.
SET UP YOUR PLAN OF ACTION: You are not going to set into motion your bad credit card debt repayment strategy. Get your notebook - here comes your plan. You will pay the minimum balance on all of your cards except one. The card that has the largest APR rate - this card you need to throw as much money into as possible! Try to determine a flat payment you will make into this particular card.
Continue this plan month after month until that card with the largest APR rate is history! Here's where the snowball effect comes into play. You are going to take that set amount you have been paying into the first card and apply it to you next largest APR rated card. This means that you are paying the minimum you were before + the total you were paying into the first card which is now history.
CONSIDER ALTERNATIVES: If you go through your budget with a fine-tooth comb and you still are not able to make your credit card minimum payments, it's time to consider alternative options. Debt consolidation may be the answer you've been looking for. You can search online to find many companies that can help you with this.