6 Ways to Reduce Your Credit Card Debt (Part 2)

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Yesterday I told you about 3 strategies to Reduce Your Credit Card Debt.

Today I have the final 3 for you to consider. Hopefully you will be able to take away something to discuss with your financial planner and help you move beyond the stress of credit card debt.

4. Negotiate with your credit card companies. Credit card companies simple want to be paid in the end.

  • If you really can not pay you bills under your current terms, the companies might be willing to make some adjustment for your current situation. Interest rates can be lowered and penalties can be reduced or possibly even removed. You can start this whole process with a simple call.. it never hurts.
  • Generally these companies are more likely to negotiate if you already have a history of paying late or not paying.  But being proactive may have the positive outcome you are looking for.

5. Look for a lower interest credit card. There are so many credit cards available. Moving your high interest rate balance to one of a lower interest rate is a possible way to save money.

  • 1st call your credit card company and tell them you’re looking to move your balance to a lower rate card; it is possible that they might just reduce your interest or give you options.
  • If it is best to move your balance, make sure to read the fine print. Often lower rates are temporary and raise to a very high amount after a certain time period.

6. Explore your Home equity. If you’re a homeowner with equity in your house, it is possible that you can use a home equity loan to pay for your credit cards. The interest you’re paying can be tax-deductible in most cases.

  • Ensure the payments will be manageable for your situation. Home equity loans can get expensive VERY quickly. And keep in mind, your home is your collateral with a home equity loan, so if you don’t make your payments, you can lose your home to foreclosure.  I would regard this as a last resort.  But it is something to discuss and consider with your professional financial adviser.

Once you pay off your debts you need to make sure to avoid the common mistake of running up the balance on your credit cards again. Then you’ll potentially have a loan and a credit card balance to deal with. Even go as far a cutting up the cards you don’t need, and then move forward with your life on a cash-only basis.  I recommend reading anything from the Dave Ramsey series to really get you going in this direction.  He is very motivating and has great advice.

Dave Ramsey

When you have lot of debt, you need to avoid waiting for things to get even more challenging. Talk to your Financial Advisory then pick the best idea for your current situation and go for it.  Get rid of that burden and Reduce Your Credit Card Debt . Just thing about the feeling you will experience when that credit card statement arrives in the mail, and the balance owed reads $0.00!  Crazy, huh?

Please remember, I am just someone who loves to save money, not a Financial Adviser.  For big decisions like this make sure you consult a professional.

Reduce Your Credit Card Debt

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