Getting Out of Credit Card Debt
Paying off credit card debt can take decades for many people, especially folks who are only making minimum payments. However, many people are surprised at how easy it can be to find extra money
each month to tack on to their credit card payment and how fast they can get out of debt by doing so.
Assume your credit card has a balance of $2,000 and an interest rate of 19%. The required minimum monthly payment is normally going to be around $40. If you pay just the minimum each month, it will take nearly 21 years to pay it off. However, if you add just $50 to the minimum and pay $90 monthly, you will have the entire card paid off in just 28 months!
That is just a little over two years! You will also save over $4,000 in additional interest payments.
If you have more than one credit card with a high balance, donâ€™t get used to having extra money to spend simply because one card gets paid off. Rather, you should take the payment you were making on a card that is now paid off, and applied it toward other credit cards that you may have. By doing
this, you will get out of debt in a fraction of the time, and you will not have to make any lifestyle changes.
For many, especially those on a budget, the most difficult part about following this plan is finding
the money to make regular payments that are twice the minimum required.
However, you just might be surprised how easily you can come up with an extra $40 or $50 a month just by holding off on unnecessary purchases, using coupons, comparison shopping, saving energy in your home (cutting off lights and televisions), or eating out less.