1. If you spend more than 50% of your credit limit every month, this indicates to the Credit Bureau that you do NOT have enough cash on hand to meet your monthly expenses. This will identify you as a high credit risk and will actually reduce your credit score by 60 - 70 points overnight (Fair
2. If you miss 1 or 2 payments on your credit card debt, the issuing company will skyrocket your interest rate to a whopping 27% -
3. Out of a random sample of 3 million American consumers (included in Experian's National Score Index), 51% of them have at least 2 credit cards and 14% of them have 10 or more credit cards.
Tips to Help You Say
Good-Bye to Debt
There is no single solution for
getting out of debt.
You did not get into debt overnight, nor will you get out of it
These tips can help you take those crucial steps
to financial freedom.
Stop accruing more debt: The more you continue to spend,
the longer it will take for you to pay it off. Reduce your
spending. If you have high interest credit cards, transfer the
balance to ones with a lower APR. That way your debt won’t
increase while as you’re paying it off.
Increase your income: If your current salary isn’t
enough to cover the payments on your debt, get a second job.
Even a few hours a week can make a huge difference. Look for
that will fit around the rest of your life.
Make a budget and stick to it: It easy to overspend when you
don’t have a budget. Calculate how much you have to spend and
stick to that limit. Write down all of your expenses so you know
where your money is going.
Video: How to Create a Do-able Budget
Pay more than the minimum: If you only make the minimum
payments each month, it will take you ages to pay off the
whole debt. Instead, pay as much as you can each month.
Every penny to put towards that debt will save you interest
fees and get you one step closer to your goal.
Reuse and recycle: It’s environmentally sound and
financially smart to reuse as much as you can.
Change your spending philosophy: Are you only buying the
things you really need? Those impulse purchases may feel
good at the moment, but in the long run, they will only get
you further into debt. If you’re going to get out of debt,
you will need to change your whole attitude to spending.
Get organized: Are you the sort of person who forgets to
pay the bills on time? Late fees cost a fortune and are
completely unnecessary. Get a calendar and write down when
the bills are due. Then try to pay them a couple days early.
Make frugal friends: It’s difficult to stick to a budget
when you’re surrounded by spendthrifts. Spend time with
people who understand your goal and help you live within
Set up an emergency fund: When you’re in debt, it’s hard
to think about putting something aside for a rainy day.
Every day feels like a downpour. But it’s crucial to have
even a small emergency fund. Just make sure you don’t tap
into it unless it’s truly an emergency.
Shop around: Take time to shop around. This doesn’t just
apply to clothes and gadgets. Shop around for the best bank
account, the best credit card, the best loan. There is no
point in paying more than you have to.
Throw away your credit cards: If you don’t trust
yourself to stick to a budget, get rid of all but one credit card.
Keep that last one for emergencies, and only emergencies.
That way you will not have the option to buy things that you
Video: How to Get Out from Under Your
Credit Card Debt
Stay busy: Many people shop out of boredom. Find some
cheap hobbies and stay busy. Don’t spend all of your time
watching TV. The adverts are designed to tempt you into spending
money. Resist the urge.