[CMF-checkins] John Rosatti, Stop All That Credit Card Spending And Start Using Debt Management

Super Star candyshop999 at gmail.com
Fri Jan 4 07:44:53 EST 2008

John Rosatti, Stop All That Credit Card Spending And Start Using Debt

Reducing your credit card debt is not easy, and requires planning and
discipline. We all know that it is much easier to pull out that plastic than
to pay cash for something. Credit card balances therefore escalate quickly
since it doesn't even feel like we are spending. The high interest rates on
credit cards just make the balances go up even faster.

The answer to reducing credit card debt is to reduce credit card spending.
But this is easier said than done. If you have the credit card in your
pocket, you will be tempted to use it. The best solution is simply to
destroy all of your credit cards except one. You save that one for use in
case of emergencies. Cut up all the credit cards except the one with the
lowest interest rate.

Another solution would be to take advantage of a zero percent credit card
offer to do a balance transfer of all of your credit card debt. These offers
come in the mail from time to time, so watch for them. The advantage of this
is that 100% of your payments are reducing your debt, not paying interest.
The zero percent will only apply during the introductory period, and what
the credit card company making the offer is hoping for is that you will
still have a balance at the end of that period that they will earn their
interest on.

But for you, the credit card holder, the best way to manage this is to
dovetail one zero balance offer onto another. Have the application filled
out on a new one so that as the old one finishes its introductory period,
you are ready to transfer that balance onto the new one, and on and on until
the entire balance is paid off. If this is not possible, try to pay as much
as you can during the introductory period so you end up with a smaller
balance instead of a larger one due to interest accumulation.

If you do not receive a zero percent interest rate offer, look around for
the cheapest offer you can. As long as it is lower than the interest rates
you are currently paying, you will save money and be able to pay off your
debt faster. Your goal should be to reduce your interest rate so that part
of your monthly payment is paying off balances instead of just interest.
Otherwise, you will never get rid of credit card debt.

Another excellent idea is to have your bank make automatic payments to your
credit card bill. Your payment will always be on time, avoiding late
charges, and you will start to reduce the credit card debt.

You can also consider a debt consolidation loan. The main advantages of a
debt consolidation loan is that it is at a lower interest rate than your
credit card debt, and that you only have to pay one lump sum instead of
several smaller payments that add up to a larger total sum. This makes
keeping track of your bills easier, and it will get all those collection
agencies off your back.

 Clinton Maxwell is writing principally for  , a web publication with
information about money management and assets. His publications on managing
credit card debt are published on  as well as other web sites.
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