Paying off credit card debt is key in becoming financially fit
Posted January 10, 2012
Raleigh, N.C. — Getting physically fit is always a popular choice when people start coming up with New Year's Resolutions, but getting financially fit usually isn't too far behind.
For many, that means getting rid of credit card debt.
According to CreditCards.com, the average credit card debt for households that have at least one card is $15,799.
A simple calculation of the interest on that number might be motivation enough to pay off the debt fast, but money experts have some specific suggestions on doing it the right way.
First, get an honest assessment of the total amount of debt that needs to be paid off. Don't consider monthly payments alone, especially when making minimum payments has become the norm.
Try to negotiate a lower interest rate. This has gotten tougher to do in the last few years, but it's definitely worth a call. If the credit card company won't negotiate, shop around for a new card with lower rates and transfer the balance. That can help manage the debt before the payments to eliminate it even begin.
Once you start paying, be sure to pay off the card with the highest APR first. Try not to make minimum payments whenever possible.
If times are tough and making payments becomes too difficult in a given month, call the credit card company and explain the situation. Some companies might lower interest rates or even help set up a completely new payment plan.
Once that debt is paid off, financial experts recommend keeping it off for good.
Most experts still recommend not using credit cards at all.