Credit card debt is never fun. It’s a heavy feeling of weight that constantly follows you around from day-to-day. Fortunately there are ways to climb out of this hole and see the light at the end of the tunnel.
Once you start working on your debt seriously the weight will start to lift almost immediately and when you are done and have paid off all your bills you’ll feel as light as a feather.
Here are some useful tricks you can use so that you can experience this uplifting feeling faster:
1. Set a Goal
You should set a realistic goal for paying off your credit cards. There should be an exact time written down when you will be debt-free. This should be written on a piece of paper that is displayed somewhere prominently so that you never forget it. When you have a goal it’s a lot easier to formulate an exact plan.
2. Put a Plan in Place
Formulate a plan so that you can get started. You’ll have to take a look at your own priorities and figure out what would be best for you. Some people like to start off by paying down their cards that have a higher interest rate first before starting to begin on the cards with a lower rate. This is definitely a strategic plan that you can implement for yourself since you’ll end up saving more money this way.
Another way to confront the problem is to pay off the cards with the lowest balances on them first to see fast results. When this card is paid off it can be scratched off the list and you can move onto the next card with a higher balance on it. Many people find that they have a better sense of accomplishment by doing things this way.
Although you may have to pay more money in the end because you aren’t paying off the higher interest rates first, the motivation from this plan may be just what you need to keep you going.
3. Cut up Your Cards
This may seem dramatic but it is what is needed. If you can’t do it yourself get someone else to do it for you. If it hurts too much, be sure that you’re in another room when it gets done. As each card is paid off it should be cut into teeny, tiny little pieces to avoid identity theft.
When you’re getting closer to completely paying off your debt you should keep one card that you can use for emergencies only. As well, you may have to use a credit card to book a plane flight or a hotel so you should have at least one on hand that you can use for these specific purposes.
You should put this card away so that you don’t have it on you when you’re out shopping or you can even ask a close friend or family member to hold it for you. It should never be easily accessible and only used when absolutely necessary.
4. Establish a Budget
While most people do put together a monthly budget plan they may not be working out a budget that addresses the debt head on.
For example, it’s common to see rent and food put at the top of the list. With a specialized debt budget, the total amount of your debt should be listed at the top and all other things should follow. This establishes that the debt is the first priority.
Of course, you’ll have to make sure that your rent or mortgage is paid and that you have enough food to eat. This goes without saying. At the same time, however, your debt should be at the forefront of your mind when it comes to financial planning and working your way up from the bottom.
You’ll need to establish a monthly payment amount for your debt that you can realistically afford. Don’t get discouraged if the amount you can pay seems low right now. We’ll show you ways below that will add to this amount so that your credit card debt gets paid off as quickly as possible.
5. Look for Extra Money
Any extra money you receive should be used towards paying off your credit debt. If you get a Christmas bonus, for example, don’t run out and spend it right away. Put all or at least a good chunk of the bonus towards your debt. Not only will you be paying down an amount on the card but you’ll be saving on interest as well.
Paying the debt down little by little might not seem worthwhile at first but once you start doing it you’ll see it starts to pay off quickly. One day you’ll be looking at a $5000 debt and soon see it reduced to $800 just by putting some extra money towards the goal.
6. Cut Your Operating Costs
Anyone can take a closer look at what they are currently spending and reduce that amount. Let’s say that you are stopping on the way to work to pick up a coffee every day. By spending a few extra minutes to make a coffee at home to bring along the way you could save a lot of cash.
If you eat out once a week you can reduce that to once a month. Instead of eating out plan a potluck dinner with your friends or neighbors or host a cooking party in your own home.
Saving money doesn’t have to be boring -you just need to switch things around a bit to your advantage. Look for ways to reduce your spending and put the money you save towards your debt reduction. Once again, these small amounts really add up over time – especially when a high interest rate is involved.
7. Use the Holidays to Your Advantage
When your relatives ask what you’d like for Christmas, your birthday or any other holiday, ask for money. Explain to them that you are taking responsibility for your debts now and instead of a present you would like a cash donation to help pay down your credit cards.
Most people will be inspired by your commitment and will comply with your request. If you have an extended family that usually gives gifts, this could help pay off your card in no time at all!
On the other hand, if you are used to giving luxurious presents out at certain times of the year you’ll need to claw back on your spending. There are fantastic homemade gifts you can make that would be much more appreciated than an expensive present bought at the mall. Some of these homemade gifts are extremely creative and useful and can appear to be store-bought.
Don’t forget about homemade cooking either! If you have relatives that are living alone and seldom cook for themselves you can prepare an exotic dish and even gift wrap it before presenting it to them! Of course, the money saved goes into your debt pot for an extra boost.
8. Create a Chart on the Fridge
Make a payment chart that you can keep on your refrigerator or even on a mirror in the bathroom as a reminder of the progress you’re making. Every time you make a payment, no matter how small it is, fill in the chart.
It’s extremely satisfying to see the numbers come down in front of your eyes and will help give you the drive you need to keep the payments flowing.
9. Give Yourself a Reward
Besides knowing that you’ll be debt-free when you’re finished paying off your credit cards it would also be nice to have a reward available at the end of the line. Perhaps you could go to a fancy restaurant when your card is down to zero or purchase a new outfit for work along with a new pair of shoes.
Just make sure that you don’t use your credit card to pay for your reward! You’ll have to save up a little bit to afford the reward but by the time you have finished paying off your debt you’ll certainly deserve it!