Finance

Tips for Reducing Credit Card Debt

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Are you drowning in an ocean of debt? This can cause endless anxiety and many sleepless nights. No doubt you sometimes wonder if you’ll ever be in the position to pay it all off. Unless the debt is a result of medical expenses, chances are it was accumulated over a longer period of time. As such, reducing that debt won’t happen overnight. With a serious plan, a determination to execute that plan and plenty of self-discipline, retiring our credit card debt can be a reality. Prepare for a period of austerity and your debt hangover will soon be a thing of the past. Follow the recommendations from the financial planning gurus and you’ll soon be on your way to a debt free lifestyle.

The absolute most critical component of any plan to eliminate credit card debt is the solid commitment to cease using your credit cards. Credit cards should never be considered an additional source of income. On a spreadsheet or simple piece of paper, list all of your outstanding balances and minimum payments on all of your credit cards. You can’t begin to make a serious plan unless you know exactly the extent of your debt.  Determine the maximum amount of discretionary spending to earmark towards debt reduction each month or even each week. There are a multiple of ways to increase discretionary spending for debt reduction.

Purchasing a designer cup of coffee on the way to work every morning and enjoying lunches at restaurants with coworkers can amount to several thousand dollars each year. Prepare a to-go coffee mug and brown bag your lunch. Ear mark these savings to debt reduction. Take advantage of the awesome deals offered by Groupon coupons and snag a Carters coupon to save big bucks on all items baby related. Shop at warehouse stores for food and plan to cook more and eat out less. After you have determined the absolute maximum amount you can pay towards you debt each month, divide your total outstanding debt balance by this figure. You’ll then have a target date to be debt free!

Another option to shorten the length of time necessary to eliminate your debt is to secure a part time position and earmark all of the earnings toward debt reduction. Stick with your plan, exercise self-discipline and remind yourself that every day you’re coming closer and closer to reaching your goal.

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