Drowning in Credit Card Debt? You Can Be Debt Free!

When you have credit card debt, the pressure can be overwhelming, it can feel like you are being crushed by the weight of debt. Trying to figure out how to pay the debt down while also keeping all your other bills paid on time can seem virtually impossible. When those bills come in each month, it can feel as though you are drowning in the debt with no relief in sight.

Credit card debt can quickly become out of control and devastating. However, with a little careful planning and determination you can get out from under the crushing weight of debt and live the debt free lifestyle you have always dreamed about.

With determination and dedication you can break out of the prison of debt and achieve financial freedom. It will be hard and you will have to be dedicated but you can do it. In this article, you will see simple steps to getting out of and avoiding credit card debt.

Develop a Debt Elimination Plan:

The first step to eliminating credit card debt is to make a plan. Without a plan you will be swimming upstream against the current never getting ahead. A good solid plan will set you on the road to becoming debt free so that you can walk in financial freedom.

Make a Budget:

In your budget, you will need to take into account the net income you have coming in each month. A solid budget will include a list of all monthly expenses. This list will include: Food, cleaning products, hygiene products, gas, utilities, house payment/rent, vehicle payments or repairs, entertainment expenses, clothing expenses along with any other monthly bills you may have including your credit card minimum balance.

Your next step is to compare this list to your monthly income. At this point you will need to go through your initial totals and see if there are area's in which you can cut back a bit to save money. .

Realistically cut Expenses:

Generally, the easiest place to cut expenses will be the entertainment area. If you typically go out twice a week cut that back to once a week. Alternatively, do something that is a little less expensive. Many things you can do for fun don't cost a lot of money. Use your imagination. You may find yourself having more fun while saving money.

Clothing and groceries are two more area's in which it is easy to cut back on expenses. While you are working on becoming debt free, you should only buy clothing when it is necessary. A little imagination and you could redo your wardrobe without going shopping or by shopping a lot less.

Many times, we can cut our grocery bill down a lot by simply making a few changes. Learning to cut coupons or shopping at a couple of stores instead of just one can sometimes make a big difference in how much you spend.

You can cut your monthly utility bill by making a few changes. Even small changes like turning the lights off when leaving a room can make a large difference on the electric bill each month. Setting the thermostat a little higher than usual in the summer and a little lower than usual in the winter can make a huge difference in heating and cooling bills.

I've Cut Expenses, Now What?

I am so glad you asked! The reason I went over various ways in which you can save money each month is so that you can use the money you save to pay a little extra toward your credit card payments each month this will enable you can pay them off quicker.

The Hard Part!

Stop using all credit cards. Cut them up if you have to. Some people freeze them however, they are still usable and most of us know that a woman who is feeling the need to shop will thaw a credit card to do it. Therefore, you will have to be able to maintain a great amount of willpower or you will need to do something that will prevent you from using them.

If you have cards that have, high interest rates you may want to see about transferring those amounts to a card that has a lower interest rate. After you have transferred any balances that need transferred, call the credit card companies and tell them that you have become overwhelmed with your credit card debt and you have made a plan to pay all your credit card debts off. Ask them if they will put a hold on your cards and if they will reduce your interest rate. It never hurts to ask and they just may go for it since they would much rather get the money you already owe them than to lose it if you file bankruptcy.

Eliminate that Debt!

You have laid the foundation and you are on the road toward freedom from credit card debt. You have created your budget and edited it to give you a little more to put toward credit card debt. Now you are ready to get all those credit card statements out and put the final touches on your debt elimination plan.

Get your credit card bills out and arrange them from lowest balance to highest balance. Make note of what your minimum payment is for each. You will need to pay the minimum due on each bill. All extra money will then be put toward paying down the card with the lowest balance. When you finally get that card paid off, you will add the money you would normally pay on it toward the next bill to be paid off. Continue doing this until they are all paid off.

After the Debt is Paid:

You've done it! You are debt free. Now it is important to stay that way. It is wise at this point to open a savings account if you don't already have one. Since you no longer have credit card debt you can now deposit the money you were using to pay your debt of to increase your savings. By doing this you can now save for larger items that you may need or want in the future, so that you will not feel tempted to charge them.

Use Credit Cards Responsibly:

Generally, everyone needs at least one credit card to make reservations or in case of emergency, therefore it is important to learn how to use credit cards responsibly. Below is a list of steps that will help you with this.

* Pay All Credit Card Balances Every Month:
When you pay credit card balances in full every month not only will you prevent falling prey to credit card debt, you will also be avoiding interest charges. Generally, interest does not accrue until after the 1st month.

* Think Before you Charge:
You should never use a credit card for perishables. It is very difficult to continue paying for something long after it is gone.

Always make sure you can feasibly pay the bill in full before you charge it. If you cannot afford it save your money until you can afford it. This will give you a chance to look for a better deal.

* Avoid Paying Late:
Late fee's are high and if you are not careful not only can paying a bill late ruin your credit it can also add up to an unreal amount very quickly.

* Do Not Live Above Your Means:
Make a budget according to your income level and do your very best to stay within or below that level. By sticking with your budget you will be able to save up for extra expenses that may come along while also avoiding credit card debt.

* When Making Reservations:
Most Reservations require credit card information in order to hold the reservation. However, they don't charge your card until you sign the bill upon arrival. You can make arrangements with them in advance to use the card only to make the reservation and then when you get there you can pay cash and they will not charge your card for it.

This is very helpful in that you don't actually have to make a charge on your credit card therefore you will not risk being unable to pay it in full later.

One Final Note:

Once you get out from under the crushing weight of credit card debt, it will be important to take what you have learned from the experience and use it to keep yourself out of debt in the future.