Are You Responsible For The Credit Card Debt of Your Spouse?
After you pay off credit card debt, you will not be able to return back to your old life with using your cards whenever you want without any reflections on how to pay back the burned money. The reason is simple; you don't want to fall back into the dark whole of credit card debt.
You may have good reasons for the high debt that you were burdened with. A medical emergency or loss of your job may have forced you into using credit out of necessity.
For years, credit was easy to get, limits were quickly raised as long as you made your monthly payments. With other words, life was good.
For some of us, the debt is a reflection of our shopping habits. We see something we want to buy - and the credit is available so we buy it. Then we find something else we like and before we know it we are crushed under a load of debt.
When the economy went into freefall, institutions that issued all that free credit took action to protect their own back. Interest rates on existing accounts with even one late payment often doubled or even tripled in a month.
Credit lines are being lowered by lenders who want to lesson their exposure to risk. That can be harmful to you as your balance will show you using a higher percentage of the credit available.
As you already know, paying off those credit cards takes self control, spending restraint, planning and perseverance. Carrying a heavy amount of debt is not safe yet paying off those accounts is not easy to do.
You probably already know some strategies on how to eliminate debt, but if you are starting to fall back into the same bad habits, make sure to keep on reading and adapt the tips below.
Sure, most of them are obvious but if you do not use them, you will slowly fall back into the same dark whole of debt and start from scratch again.
Use The Extra Money
Stop using your credit cards NOW - cut back on other expenses wherever you can and apply that money to extra payments on credit accounts. Target the highest interest rate cards first and apply all of your extra money to that one card until it is paid in full.
Apply the extra money PLUS the regular payment from that first account to the second account on your list. It will be a tough slog at first but as the momentum picks up those accounts will fall to zero one by one. The sense of accomplishment you will have is worth the effort.
You Don't Need Everything You Buy
Don't spend money on things you don't need. Sales can be tempting but they lose the excitement when you realize that saving $10 today can mean paying $50 in interest over time if you can't pay the bill in full when it arrives.
Limit Yourself To Only Two Credit Cards
After you pay off credit card debt, limit yourself to using only two credit cards. Designate one account to use for payments you will make over time such as replacing a major appliance that breaks down, paying a medical bill or buying furniture for your apartment. Use the second one for monthly purchases and pay it off monthly.
Use Your Card Only For Emergency
Define for yourself what an emergency is and what lack of money management skills is. If your power bill is three times higher than normal due to freaky weather conditions, you might need to charge it one time.
Plan Your Purchases
If you find yourself paying that bill with a credit card every month you may be spending irresponsibly in another area. Make credit work for you by planning purchases, keeping your charges to less than 50% of your credit line and paying those bills on time every time.