Get Rid of Holiday Credit Card Debt in Six Months or Less

Slimming down is always a popular goal for the New Year. If your credit card statements are feeling a bit thick from all of your holiday shopping, it's time to put your debt on a diet.

It's not your fault, really. Everyone splurges a bit on the holidays. Credit card companies count on that fact, offering great-sounding seasonal deals that target last-minute shoppers with a tendency to overspend. And once you start carrying a balance on that shiny new card, the card companies start making money from your fees and interest. Here are some quick tips for getting your finances back in shape.

Ask for a Lower Interest Rate

Call your credit card company and let them know that you would appreciate a lower interest rate. If you are a good customer with a history of timely payments, this tactic works very well. Sometimes, you need only ask. Other times, you might have to politely inform your creditor that you've been offered a better deal by one of their competitors. Credit card companies are currently feeling the financial squeeze. Due to the mortgage crisis, unemployment, and looming economic woes, they've had to write off a record amount of bad debt. They won't want to lose your business. If your card company knows that you're investigating other options, they will be more willing to negotiate. If all else fails, go to your bank and request a low-interest personal loan. Use it to pay off your credit cards.

Remember: Always be polite, but firm, when dealing with your credit card company. You catch more flies with honey, as the old saying goes, but don't be so sweet that you get suckered into signing up for special offers you don't need.

Cut Other Expenses to Pay Down Your Balance

As any seasoned card holder knows, minimum payments get you nowhere. If you double or triple your minimum monthly payments, you can get rid of your debt at an exponentially faster rate. By sticking with the minimum payments, you stretch your debt out over several years and accrue a ridiculous amount of interest. It's better to cut other monthly expenses as much as possible to get that debt paid off faster.

If you're paying off a credit card in preparation for canceling it, ask your card company if you can have a lower interest rate while you pay off your balance. Some companies will accommodate your request, though you will not be able to make further purchases with that card while you repay the debt.

Get a Zero-Interest Balance Transfer Card

Some cards offer an introductory period of 0% interest. These periods vary widely, but most last from three to six months. Some balance transfer cards offer a full year of zero interest. A balance transfer card can be just the thing for card holders with a small or moderate balance that can be paid off within a few months.

As with any credit card, you should do your homework before applying for a balance transfer card. Make sure you understand the card's terms and conditions, and find out how high your interest rate will be after the introductory period has ended. Pay off your debt as quickly as possible; you don't want to go back to square one by carrying a balance with a high interest rate.

Avoid Temptation

Credit card companies confess that January is their most active month for marketing. Many overspent post-holiday shoppers are tempted to add to their collection of credit cards. This is exactly what you shouldn't do. Instead, prune your wallet a bit. Get rid of credit cards that you don't really need, and avoid applying for others. Review the current terms of any "reward" cards you possess. You might be paying more in fees and interest than you're redeeming in rewards. And remember that having too many lines of "revolving" credit, such as credit cards, can look bad on your credit report. Demonstrate that you really can control your spending by keeping only the two or three cards you really need.

These strategies won't be easy, but their benefits are well worth the effort. A little discipline can add up to a lot of savings. Give yourself a pat on the back as you watch your credit card balance slim down over the coming months. You don't really want to be paying for last Christmas when the next one rolls around, do you? With some smart debt management, you won't have to.