At a time when we should be enjoying life, many of us are still struggling with credit card debt. Financial wizards say there are 4 strategies that can eliminate that debt – if you have the will power to stick to the particular strategy you pick.
They all start with you sitting down and determining how much you still owe on each card and what the annual percentage rate (APR) is for each card.
Start with the Card with the Highest APR – Interest is really the backbreaker with most cards. You wind up paying far more for the things you bought that if you had paid the full purchase price in the first place. So, find out which of your cards charges you the most interest (APR). Work on paying that balance off while you make minimum payments of the rest of your cards. Once that card is paid off. Move the next highest APR. And so forth.
Start with the Card with Highest Balance – Carrying a huge balance on any given card can be a real pain point for many people. So, this strategy involves starting with the card with the biggest balance. Concentrate on paying off as much of that balance as possible while making minimum payments on the other cards. Again, when that card is paid off, move on to the next biggest balance.
Start with the Card with the Lowest Balance – Sometimes you need “wins” – feeling that you’re making real progress to conquering your debt problem. Bu starting with the cards with the lowest balance, you can get those paid off quickly, giving you a number of quick “wins” before you turn your attention the cards with the bigger balances.
Take Advantage of Low APR Balance Transfer Offers – Frequently, credit card companies will offer low or even 0% APR rates to get you to transfer balances from other credit cards. This offers you the opportunity to pay offer a balance while avoiding the extra dollars a high interest rate can add to the debt. A word of warning, though. Avoid the temptation to add additional purchases (and more debt) onto the new card or the card from which you transferred the funds.