Any kind of debt such
as credit card debt needs to be taken care of
quickly if you wish to establish a healthier financial
situation. You can try budget planning or other saving
methods, but the truth is it is more difficult than it
seems. In my opinion, budgeting just doesn't works plus
it's too time consuming. Improving your credit card debt
is essential if you are trying to improve your credit
rating since it also affects your overall financial
stability.
Here are 4 tips to help
you become debt free
1. Stop Spending
When you are already
drowning in debt, stop causing more trouble by adding up
to your existing debts. Stop using your card to make any
more purchases especially major ones since that will
only turn things worse. Cut it up, freeze it in your
fridge or better yet, just don't take it with you. You
can't use what you don't have. With access to your
credit card, it is relatively easy for you to splurge
today without realizing the financial burdens that you
will have to face in the coming days when your credit
card statement pops in the mail. Start your financial
responsibility by helping yourself cope with your credit
card debt before adding any more.
2. Create a Budget
Plan
Like I said before, I
don't like budgeting, but believe it or not, some people
do and it actually helps them. But, with the increased
access to credit cards, budgeting seems to have been
neglected by most people that often results in spending
more than you actually make. But, like anything in life,
it is never too late to get started on a budget plan.
Doing so will help you identify areas of your spending
habits that lead to wasteful spending and can be
eliminated from your budget plan. Creating a budget plan
will also enable you to realize the more important
expenses and make them a priority in your list. This is
an important method in financial planning that people
often fail to undertake.
3. Use Cash Instead
This is a simple step,
more like common sense, but for people who have relied
so much on credit card, they might find this difficult.
The trick here is that these companies provide you with
their card for spending instead of actual cash, because
it makes it easier to let go and spend them. It's all
mental. When we carry cash and actually use it, we see
it as money down the drain. When we use our cards, we
get a sense of comfort knowing that we didn't actually
shell out our own money. There is no emotional
attachment associated with spending our actual hard
earned money. Using credit cards to make your purchases
feels like you are not spending at all, It is then that
you expose yourself to bigger debt and more problems.
4. Lower Your
Interest Rate
Another way that you can
help eliminate your credit card debt is by improving
your credit rating. This can impact your monthly cash
flow significantly if you have a large personal debt by
reducing the interest rate. Sometimes all it takes is a
simple phone call and asking for your interest rates to
be reduced. However, the ability to get lower credit
card rate is dependent on your own credit rating.
Therefore, a good investment to takd care of your credit
status as it can have its own set of advantages and
disadvantages in the future.
