Pay Off Debt

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You’ve dug yourself into quite a hole with your credit card debt. It sure was fun using your credit cards as an ATM machine, going to lunches with friends, nights on the town, and maybe even a vacation or two – all without thinking about the consequences of what boils down to borrowing money from the credit card companies to have all that fun.

Well, the fun is over now, and you are staring at a piece of plastic that buried you. If you had a lot of fun with those credit cards, your total debt figure can be staggering – mind-blowing even.

Hopefully you have taken the first steps to pay off credit card debt already, which includes creating a savings account that holds about two to three months worth of your expenses and making efforts to stop using your credit cards. You simply can’t pay your cards off if you are still using them, and the savings account is a “must” for making sure you don’t end up using your credit cards in the case of emergencies.

But with these two steps taken care of, what do you do next? It’ll take months or even years to pay off the kind of debt you’ve accumulated on your credit cards.

First, don’t panic. Panicking never got anyone anywhere, so just take a deep breath. Sit down and get out a pencil and paper, or a computer spreadsheet program like Excel. What you need is a plan. First, make a list of all of your credit cards, along with the total debt owed and the minimum monthly payments. This in itself can be an incredibly astounding task for some people – to see all of their credit card debts laid out in front of them.

Then make a plan to pay off credit card debt. Sure, you can throw a little extra at your credit cards each month, but this strategy can take years to see results from if you have some serious debt. Another option is to do what many people call the “snowball effect”. Think about rolling a snowball down a hill. It may start out very small, but it grows and grows as it goes down the hill.

Now consider that you likely only have a few extra dollars on hand to put towards your credit cards each month. Start by applying that small amount of extra cash towards your card with the smallest balances. When that card is paid off, you will have extra cash to throw towards your next biggest card card.

As each of your smaller card balances are paid off, you will then have a bigger amount of money to use each month to pay off your debts. This strategy can take time, too, if you have a lot of debt, but it is often more effective and satisfying for people to do.

When you pay off credit card debt, you are in for a challenge. It’s not an impossible task, but it will take a good plan and a lot of determination.

Don’t feel guilty about your credit card debt. Find out more about how to reduce your credit card debt and get setup with your own personal accounting software