Simple Ways To Tackle Your Credit Card Debt
According to the Financial Conduct Authority (FCA), there are 4.1m Adults in the UK that are in financial difficulty, with many struggling with household debts.
The pressure to spend at Christmas fuels many debt issues and January can be the toughest financial month for many. So, if you’ve racked up a lot of credit card debt over the Christmas period and you’re worried about how you’ll pay it off, fear not, there are plenty of ways to tackle it and get on top of your finances in no time.
Raise your minimum payments
Maybe a little obvious, but often overlooked, the more you can pay off each month the quicker you will be able to clear the debt. By clearing your debts quicker you will also reduce the amount of interest you will pay on your balance.
Explore your options
By transferring your debt to a new card with a 0% balance transfer deal, you will be able to avoid paying interest for a set amount of time, allowing you to make a dent in the balance you owe. Though be aware, there is often a fee to transfer your balance, but often this will be worth it and you will save overall.
One of the best ways to speed up the progress of repaying debt is to reduce the amount of interest you are paying. If you have multiple credit cards, prioritise by paying off the balance of the card with the highest interest rate, moving on the next highest once that has been cleared.
Though it is extremely important that you make sure you are making at least your minimum payments on your remaining cards to avoid facing late fees.
Don’t bury your head in the sand
People ignore their credit card debt in a variety of ways. Perhaps you only pay the minimum balance each month, make late payments occasionally or have stopped paying altogether. All these habits fall under the umbrella of ignoring your debt.
Here are four major reasons why you shouldn’t ignore your credit card debt:
Late payments hurt your credit score
Your debt could end up in collections
Carrying a balance is expensive
Your relationships could feel the strain
These consequences are only the beginning. Instead of ignoring your credit card debt, it’s best to face it head on.