For the 61% of Americans carrying revolving credit card debt*, at an average $10,691**, January credit card statements pack an unwelcome New Year’s punch. For the past decade, getting out of debt has been one of American’s top New Year’s resolutions.
In tough economic times, the certified credit counselors at Clearpoint Credit Counseling Solutions expect even more people to resolve to work on lowering their debt in the new year.
Before the holidays, the average consumer expected to spend $682.74 on holiday-related shopping.*** That cost, along with previously racked up debt, and an unstable economy creates the incentive to take active steps to address the debt as soon as possible
Credit counselors at Clearpoint encourage consumers in debt to:
Adding to your existing debt will only make the problem worse and counteract any other steps you take to pay down your balance.
Call your credit card issuers and try to transfer all of your balances to the card with the lowest interest rate. If this isn’t possible, make minimum payments on the cards with the lowest rates and pay as much as possible on the highest interest card/s until they are paid off. Once you get down to one card, continue paying as much as you did to the highest interest rate card.
Once you determine the total, use an online debt repayment calculator to experiment with different payment amounts to see what realistic monthly payment you’ll need to make to pay off the cards.
When you don’t have enough income to have funds remaining after expenses, your only alternatives (other than winning the lottery or getting an inheritance) are to cut spending or to increase your income to free up as much cash as possible to make additional credit card payments. Some options include working overtime, seeking temporary part-time work and selling stuff on Amazon, eBay or Craigslist.
This plan will work if you maintain focus. Paying off your debt must become a priority for the duration of your plan. There will always be temptations to charge a vacation, buy a new car, or undertake home-improvement projects. Being conscious of each and every decision you make regarding spending will help you meet your goals.
If credit card debt remains an issue, consider speaking with a consumer credit counselor, such as those at Clearpoint, for a free financial review and recommendations.
To schedule an appointment, call 800.750.2227 (CCCS) or enter your budget information online to get started.
Sources: *CardTrak.com Press Release: Credit Card Debt – What Do Americans Really Owe? **CardTrak.com Card Facts: Average U.S. Credit Card Debt Per Household ***National Retail Federation (nrf.org): 2009 Holiday Consumer Intentions and Actions Survey
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