Are you having credit card debt?
If yes, then no matter what, it’s gonna be difficult to pay off! One of the prominent reasons being the incessantly high Annual Percentage Rates (APRs) of credit cards. As you know, credit cards are usually unsecured debts as you don’t need to provide any collateral. And that’s why the credit card companies levy a high-interest rate to compensate for that risk!
Eventually, you will see a substantial part of your paycheck deducted every month to pay off your credit card debt. And you might be waiting for the time when you will receive your next paycheck. In short, you might be living paycheck to paycheck!
On top of that, the effects of the recession can add to your problem! And thereby it can be more cumbersome to pay off your credit card debt.
Yes, you heard it right!
A 2019 Bloomberg report says that there is a probability of 26% that recession will hit our country within one year!
Whereas, a 2019 Bankrate survey has found that 2 out of 5 people in our country are not ready for the recession!
So, if you are one of them, you need to pay off your credit card debt asap. And it can be one of the baby steps to prepare for any economic downturn!
Let’s start!
Opt for a balance transfer card
Exhausted by the high APRs of your credit cards?
Well, in that case, you can opt to transfer your outstanding balance amount to a new credit card. It’s always advisable to opt for a balance transfer card that has a comparatively lower interest rate, preferably 0%.
But always keep in mind, most of the balance transfer cards come with a 0% balance transfer fee for an introductory period.
On the other hand, many balance transfer cards charge about 3% to 5% of the amount transferred as the balance transfer fee right from day one!
So, to avoid mistakes while opting for a balance transfer card, you should always read the terms and conditions carefully!
You can save a substantial amount of money on interest payments. Besides, you don’t need to bear the hassle of multiple loans! Thereby, it helps you to pay off your credit card debt with ease!
Opt for a consolidation loan
You can take out a personal loan to consolidate your multiple credit card debts into a single one. But make sure that the interest rate is lower than your existing debts.
Let’s say, you have two credit cards with outstanding balance amounts of $3,000 and $2,500. And both the credit cards have the same APR of 22%.
If you take out a consolidation loan of $5,500 with an 18% APR, you can pay off both the credit cards.
Besides, your repayment plan becomes simple as you need to make a single payment every month to pay off your debts. And the biggest advantage is, you have to pay a lower interest!
Opt for a debt consolidation program
Well, you might be stressed already being up to the neck with your multiple credit card debts. So, what if a company takes away your burden by consolidating credit card debts? And that too at reduced interest rates!
Yes, you heard it right! It might seem impossible to you! But actually, it’s possible! To do that, you just have to approach a genuine debt consolidation company.
First, they will assess your financial situation. Then they will try to negotiate with your creditors on your behalf to reduce the high APRs of your debts.
Once your creditors agree, the consolidation company will chalk out a single monthly payment plan for you, based on your debt amount and financial situation!
So, you need to make a single payment to the consolidation company every month to pay off your credit card debts. The consolidation company, in turn, will distribute the amount among your creditors.
And guess what?
You won’t have any chance to forget the different due dates of your multiple credit card bills. Thereby you don’t have to shell out more to pay late fees and all if you miss the payment deadline!
As you can see, by opting for any one of the ways I suggest, you can pay off your credit card debt faster and easier. Besides, you can save money too!
You can stash this money in your emergency fund. So, if there is an economic downturn, you can use that money during any exigency!
So, what are you thinking? Learn how to tackle credit card debt and get rid of your credit card debt asap!