Some financial advisors will always encourage individuals to avoid using credit cards as it gets them into credit card debts. But credit cards can still always provide you with emergency funds to sort your bills, and finances to make big purchases. How to get rid of your credit card debt becomes the question.
Although credit cards can help you sort out bills when you’re out of cash, they can also lead you to credit card debt. Which can ultimately lead to a poor credit score. You should always be fast about paying off your credit card debt as it can lead to bad payment history. Which is the most influential factor that affects your credit score.
This article is aimed at how to get rid of your credit card debt. Let’s look at how you can get rid of your credit card debt.
How can I get rid of my credit card debt?
Using a credit card responsibly can be a great source of building credit credibility. But when you cultivate the habit of using your credit to make unhealthy expenditures it can lead to debt. And the earlier you start to tackle the problem of you staying in debt, the easier it is to come out of it as it will also save you from financial dangers which have led many into depression.
Being in debt can make you lose grasp of your finance for you might not know how much you make or spend hence you have settled in living from one credit card to another.
Nevertheless, this brings the need for you to study these tips and know-how to get rid of your credit card debt. Follow these 10 actionable steps to get rid of your credit card debt.
1. Get Every Knowledge Necessary about Your Credit Card Agreement
This is the first step to getting rid of your credit card debt. Most times we get thrilled and overwhelmed with the bills we must have to pay either for our health, feeding, shelter, or even clothing that we sort every means possible to pay such bill.
Most of these times, when an offer for a credit card is made to us by any financial institution or bank, we are always in a hurry to close the deal that we forget to clearly read the terms and conditions and hence understand the terms and conditions before making any decision. As it is usually at this part of the agreement that we read and understand the condition of payment, the interest rate, and the time interval.
This habit of not studying the terms and conditions can get you into a bad debt when you might have not noticed the huge interest that it comes with. Hence to get rid of credit card debt, you will need to always study the terms of agreement and know whether it is affordable to you. You can also seek financial guidance before making such.
2. Never Be in a Rush to Get a New Credit Card
This is another step to getting rid of your credit card debts. I can understand how much you need that bill to be paid out but don’t ever rush into getting a new credit card. Learn to analyze the bills and find out how much it will affect you before rushing to get a new credit card to settle it.
3. Solve Your Needs with The Credit Card and Not Your Wants
So many people are in the habit of using their credit cards to solve any little problem that comes around them and buying what they cannot afford. Please don’t be that person.
You must learn to spend the money from your credit card on what you need and not on your wants. Don’t go getting a credit card because you need to go shopping or buy clothes to show off on social media.
4. Plan Your Expenditure
Don’t start each month without a plan on what you should spend your money on and also draw your scale of preference. Don’t just spend the money from your credit cards because you think you need a particular product or you want to live in a particular way. Set a plan on what your basic needs are and review it always.
5. Use the 24 Hours Format before Making a Purchase
Check the last few groceries you bought and you might find out that you have been spending your money on things you could easily do without. Because most times what we think we really need might not matter as much as we think they do.
Therefore you should not buy everything you want because you feel so but follow the 24-hour guideline that allows you to think over it or wait for 24 hours before making the purchase to check if you need it.
6. Develop a Payment Strategy
Your credit card is a source of income that you can use in paying your bills. But it can also become detrimental to you when you are unable to pay it and at the due time.
Hence you need to develop a strategy that you will use in paying for your credit card before it expires in your hand. This expiry period comes with an interest which brings the need for you to develop a strategy of paying before it comes with an interest.
For you to make your strategy effective, you will need to write it down and make the decision to follow through. This strategy should include the amount of money you will pay on your credit card either daily, weekly or monthly as this will make it easier for you not to feel the impact of paying it at once.
7. Set a Goal To Never Skip Your Payment
Discipline and consistency is a character that enables every individual to achieve their goal. You must learn the discipline of sticking to your developed strategy of payment by being consistent with the payment process you have developed.
Set the standard to make that payment before paying for your other bills and don’t get distracted by the numerous things you might be thinking that you want. Forget about that shopping you want to go for, you don’t need that grocery as much as you think. You can stay that week without them.
8. Live Below your Credit Limit
To effectively achieve your goal of not skipping your payment through consistently following the payment strategy. You need to live below your means and purchase only that which you can afford to buy that will not affect the payment strategy that you have developed. Don’t go for a higher credit limit if you have a poor spending habits.
Don’t feel bad during this period but be happy that you will soon be free from being in debt. This should be your source of motivation as it is only but a season that will surely come and pass with a lot of victories. So make sure you stay true to the process
9. Generate Other Sources of Income
Financial experts have proven with so much evidence that having one stream of income can be detrimental to an individual. As it can bring so much trouble when such a source is affected hence there is a great need for you to generate other sources of income.
This other source of income can be in the form of side businesses in which you involve yourself partly. The world is already much digitalized and hence you can just learn a new skill online while you go about your other offline business or main job.
There is a lot of online skills that you can acquire such as affiliate marketing, taking a paid survey, becoming a visual assistant among others. It might also interest you to know that you can also start a side business offline, you can start a home-based business in that open space in your apartment. And you can also share your apartment with another person temporarily while the person pays you for as long as they stay with you.
You can charge such individuals daily, weekly, monthly depending on how long they want to stay with you. This home-based business is usually dependent on the kind of skill you have. So do an interception of yourself, know your strengths, and let it pay you.
10. Take a Decision to Stay Out Of Debt
You must decide to avoid the mistake of ignoring the size of the problem of being in debt. And not just hoping that your debt will get away someday. Because the debt has a way of hanging around those in it and getting worse hence it is important to recognize very early the need to stay out of debt.
The worst approach to handling your financial problem is trying to ignore the fact that you have such a problem hence this is the big choice you must make. The choice is to stay out of debt and you must start taking those steps that will take you out of debt by practicing the tips that are listed above.
Being in debt is not a death sentence but staying in a bad debt can lead to depression because being in too much debt even when the interest is low can become a bad debt. Living with a bad debt without an organized plan to pay it off can lead to an unsustainable lifestyle hence you must make every effort necessary to come out of that debt as soon as possible. Take the above steps to get rid of your credit card and also seek counseling if needed.
Congratulation in advance for your freedom!!!