According to a prominent business journal, after surveying a group college student, it has been found that around 75.7% of them had no inkling about late payment penalties on their credit cards. As a result, they racked up a huge amount of outstanding credit card balances by the time they completed their degree and became graduates.
So, if you’ve been reeling under similar kind of financial crisis, then there are certainly many ways to come out of the same, safe and sound.
So, if you’ve been reeling under similar kind of financial crisis, then there are certainly many ways to come out of the same, safe and sound.
Ways to get rid of credit card debt
Here are some of the ways that can help you to pay off all your credit card balances:
- Reduce costs – You must be prepared to eliminate all sorts of unnecessary and impulsive buys you’ve made all these years. For many graduates like you giving up a single habit of $3 coffee everyday will help you to save almost $1,095 a year.
- Create a budget – You must have a budget for yourself and be determined to follow to the same religiously. For instance, don’t end up buying that latest smartphone, when you haven’t prepared the month’s budget. In other words, you should keep the above tips always in your mind whenever you are going for shopping.
- Know your credit card – You must go through your credit card agreement and find out all the crucial terms and conditions like payment deadline, late charges, over limit fines, etc. Moreover, you should be aware of all the rewards that your creditors offered you while approving you for the cards. In case you don’t know of these rewards, then it is very likely that you’ll end up spending more than the amount of the reward itself. So, you may have to pay excessive interest rate as well as additional fees for your ignorance.
- Carry low credit card balance – You should always try to keep all your cards’ balance for not more than 6 months. After that, you may have to struggle to repay a balloon debt amount with compounded simple interest levied on it. So, you should consider your credit card balance as a snowball that grows larger as it rolls.
- Be wary of balance transfer offers – You shouldn’t rely too much on low interest balance transfer offers provided by the creditors. This is because those offers are provided temporarily and so, you may be left with the original rates once the offer period lapses. It is best to utilize that offer period to pay off debt as much as possible rather than piling up on fresh ones.
Lastly, you can ask your creditors for better rates. Even if they cut down your rates by more or less half a point, then also you’ll be able to save quite a lot of money to make the debt repayments.
