You are not the only one to feel the weight of credit card debt on your shoulders. According to a recent study by ValuePenguin.com, 38% of households carry some sort of credit card debt, with the average being $5,700. Every month that you do not pay off the entire statement balance it will carry over to the next with interest. Depending on the balance and interest, most of the payment could be going to interest, paying down the principle very little. If you find yourself sinking into debt it is time to make financial changes and start to pay down credit card debt now.
Come to Grips with the Balance
Before you actually roll up your sleeves and get to work you need to figure out where you stand, and that includes cutting off credit card use going forward and focusing only on the balance. Write down each credit card, current balance, interest rate, and due date. You can no longer hide from your outstanding debt and it is time for it to be a reality and to face the music and get it under control.
Track Costs and Create a Budget
Now you are ready to dig a little deeper and analyze all money coming in and going out. Figure out what the absolute must spending items each month, including mortgage, insurance, utility bills, gas, and grocery, refinance student loans, not including any sort of spending money. Now create a budget where you can incorporate these necessary items, figure out an ample amount to contribute to a savings account, and the remainder of the funds can be used for paying off debt, the more unnecessary spending the better.
Figure Out a Payoff Strategy
The next plan of action is now figure out which debt takes over to payoff first. Start with the loans or cards with the highest interest rate and pay off first. It actually can help you feel more relief to pay off one card at a time instead of spreading across, so maybe a little sense of accomplish to pay off highest card first, and then to the next. Also, don’t be embarrassed if you need some assistance with this sort of thing. If you read Lexington Law reviews you will see that there are many satisfied customers that have used their services in order to minimize debt and improve their credit scores.
Eye On the Prize
You will not be debt-free overnight, it could even take years, but as long as you have put together a solid plan with an end in sight, you are in good shape. Stay positive, remain motivated, it will take patience.