Credit Card Debt – Steps to Reduction
Mar 262020In the United States, the 21st of March 2020 marks National Credit Card Reduction Day. This is a day established to promote the assessment of one’s level of indebtedness due to credit card use and the strategies to reduce or eliminate such indebtedness. While statistics show that Americans’ credit card debt totalled $930 billion in the fourth quarter of 2019, we know that credit card debt and the concerns regarding such isn’t simply an American thing. Therefore, in recognition of this day, here are some tips that you can employ to reduced or avoid credit card debt, a negative credit report and ultimately MAKE CREDIT WORK FOR YOU!
1. Yes, you may have a credit limit, but remember your real limit which is the amount of money you would be able to repay at the end of the month or on your credit card due date. Evaluate your finances and always remember that after you swipe the card, you still have to find the money to repay the card so budget, budget, budget.
2. Be organized! Have your credit card bills available, go through your transactions, check your balance every two weeks so you don’t lose track and compare with your savings or budget, set alerts for your payment due dates.
3. The only automatic set up should be the automatic deductions for the repayment of the credit card to avoid late payments and interest. You should always try to clear off the total balance at the end of each cycle or pay double the monthly minimum payment. If these steps may be too challenging, set up the deductions for at least the minimum payment. Beware of automatic charges by merchants, iTunes, Netflix etc. Avoid saving your credit card information on such accounts or erase and delete if you have already done so. Close the subscription accounts that you do not need.
4. If a lump sum payment at the end of the month is daunting, try making smaller payments more frequently. This will be reducing the amount the interest is being calculated on.
5. Don’t be afraid to ask your financial institution to freeze your credit, seek help or negotiate.