Credit Card Debt Tips

If you can afford to pay off your entire credit card balance every month then your credit card is your friend. However, if you don't pay off your balance every month then your credit card quickly turns into your enemy. The tips below assume the credit card is your enemy.

Tip #1
Understand that the tips I give are very general and can't properly address every situation, especially serious credit card problems.

Tip #2
Do not underestimate the destruction that can be caused by credit card debt spiraling out of control.

Tip #3
If you are in credit card trouble you must confront the problem head on. Trying to hide from credit card problems will only make them worse.

Tip #4
If you already have credit card problems then buying more things with your credit cards will make things worse.

Tip #5
Always find a way to pay what is required to avoid things like late fees and over the limit fees because these fees are unnecessary and can crush you.

Tip #6
Understand that it is often possible to negotiate with credit card companies to reduce your balance, reduce your interest rate and reduce your monthly payment.

Tip #7
There are services available to help you negotiate with credit card companies and to consolidate your debt. However, be careful because not all services have your best interests in mind.

Tip #8
While being sure to avoid all late and overage fees you should pay off credit cards with the highest interest rate first. For example, if one credit card is charging 18.9% and the other credit card is charging 9.9% then work to pay off the 18.9% one first.

Note: Some people recommend working to pay off cards that have to lowest balance so you get a psychological boost as you see your progress. For example if a 9.9% percent interest card has a balance $125 and the 18.9% card has a balance of $2,500 then you might find it psychologically beneficial to completely pay off the $125 balance card first.

Tip #9
Paying down high interest credit card debt is mathematically equivalent to making a great investment. When you don't use your money to pay down high interest credit card debt it is like you are missing out on high yield investment that is 100% guaranteed and 100% tax free. Paying down your high interest debt is an amazing investment in your future.