A statistic shows that around 40 percent of Americans have debt on credit card in month to month and they cannot pay it off. In addition, the average of interest rate on the credit card is over 13 percent. From those statistics, we can see that many cardholders struggle to pay off credit card balance. If you also have the same problem, you need to know how to get out of credit card debt.
What to Do to Get Out of Your Credit Card Debt
Paying credit card with big amount can cause serious financial problem. So, you must find the way how to get out of debt. There are some tips that you can do to help you eliminate your debt. Here they are:
- Stop Using Credit Card
Interest rate can cause balance of credit card grow fast. In this case, how to get out of credit card debt requires you to stop using credit card until your debt is fully paid off. You can use cash for a while. So, you will not be tempted to spend higher than you earn.
- Track Your Expenses
To get out of credit card debt, you need to track your own expenses. You have to make sure that you spend lower than you earn. It is very basic but in fact many people do not know about it. So, you have to know where your money goes every month. You cannot spend higher than your income. It belongs to the most basic plan how to get out of credit card debt.
- Cut Unimportant Expenses
Before your credit card debt is fully paid off, you need to cut out unimportant expenses. For example, you may not go to concert, not go to expensive restaurants, etc. In short, you have to minimize your expenses for a few months until you pay off all debts. Even though it is difficult, it belongs to the best ways how to get out of credit card debt rapidly.
- Earn More Money
If you cannot minimize your expenses because all of them are important, you have to work harder to earn more money. For example, you may need to get a part time job. Besides that, you can also look for passive income. If you earn more money, you can allocate it for paying off your debt. That is why it becomes one of the tricks how to get out of credit card debt.
- Negotiate for Lower Interest Rate
Maybe, it is your time to call your creditor and then negotiate with them. In the negotiation, you can request for the lower interest rate. Alternatively, you can negotiate for a short term repayment plan. Anyway, it is very effective how to get out of credit card debt.
- Meet a Credit Counselor
Another idea is to contact a credit counselor. They may help you to by giving useful advices how to get out of credit card debt. However, you have to make sure that the credit counselor is reputable.