Getting Rid Of Credit Card Debt

Credit card is one of the useful services provided by banks. But not infrequently the use of credit cards that used to have good intentions turns negative. Many people use the wrong credit card until they end up in very large debts. If so, how to get rid of credit card debt?

Illustrative image (Picture: thepennyhoarder.com)

According to Christopher Ingraham at The Washington Post, he said that after analyzing data from 1.4 million credit cardholders in the UK who own more than one card and do not pay off the entire bill each month, researchers found that people choose very ineffective strategies to pay down debt.

Getting Out Of Credit Card Debt Fast

From various references, the most effective way to get rid of debt is to follow the 'snowball avalanche' method, which is to sort debt from highest to lowest based on interest rates. Pay the minimum amount for each debt, then add as much extra as you can each month to the debt with the highest interest rate.

But there are other ways to be able to immediately pay off credit card debt that can be applied, including:

1. Calculate the amount of monthly income

The first way to pay off credit card debt quickly is to take into account the amount of monthly income. You can make a priority scale of financial allocation from monthly income, how much is used to pay bills, installments, and daily expenses.

The ideal allocation of daily expenses, debt, and savings is 50%/30%/20%. However, if it is not possible to use this ideal calculation, you can reduce the amount of savings to 5% to 10%.

2. Pay credit card debt directly after getting a paycheck

The next quick way to pay off credit card debt is to pay bills right after getting a paycheck.

For the salary at the beginning of the month to be allocated properly, you should make credit payments as soon as possible after getting the salary. Thus, you can immediately release the burden of paying bills without waiting for financial conditions to run low.

Even if possible, pay off credit card debt above the amount billed should be. Thus, you can live more calmly if one day there is a sudden expense that has to cut the credit payment ratio.

3. Prioritize debt based on the maturity date

Discipline to pay credit card bills on time is a way to pay off credit card debt quickly. Paying off bills before they are due will make you avoid penalty fees such as late penalties.

If you delay the payment of credit card debt, the burden of installment fees in the next month will swell. Because credit card interest is inflated, as a result, the interest bill in the next month doubles.

4. Side job to increase income

If how to pay off credit card debt quickly has been tried but credit card debt is still not resolved, maybe you can find additional income. For those of you who have time after work, you can find a side job.

Side jobs such as freelancing are one way to pay off credit card debt that accumulates. With the additional income, the settlement of credit card arrears can be done faster.

In this day and age, finding a side job is very easy and can even be a hobby. You can be a designer, writer, ride-hailing driver, social media influencer, product reseller, and so on.

5. Stop using the credit card until the bill is paid off

Temporarily stopping the use of credit cards until the previous bill is paid off is one way to pay off credit card debt that accumulates.

During the gap period of not using this credit card, you can use it to pay off previous credit card bills, so that debt does not accumulate. As long as you stop using credit cards, you can rearrange your credit card usage plan so that debt does not accumulate.

That's a bit of information about "getting rid of credit card debt". Hope it is useful.

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