Unpaid credit card debts are a lawsuit waiting to happen. Save yourself from a lot of headache and learn what you can do to reduce your debt quickly and efficiently.
Check The Statements
Not only should you check your card statement but also your bank statements. The statement shows how much money you owe to your card company while the bank statement shows you where your accounts are. Now, compare these statements with your monthly income, divide a chunk of your salary into portions, in which you need to repay your card company. This is where you will discover if your monthly income is sufficient to cover your debts. In addition, not all records are accurate so always search for errors on your monthly statements as well.
Use Low Interest Cards
If you have multiple cards with varying interest rates, it's best to check which cards have the lowest interest rates and use them instead of credit cards with higher interest rates. The fact is, cutting off credit cards with a long history of credit could do more harm than good. Instead of cutting them off completely, focus on using lower interest cards and use higher interest cards once in a while.
Use Cash/Debit Cards
Generally, using credit cards is more expensive as opposed to paying cash or using debit cards to make purchases. An average credit card's APR is around 5% and most card companies require a monthly or annual membership fee. Save more by using cash instead of your cards. You'd be surprised at how much money you can actually save by using your credit cards during emergencies alone.
Create Expenses Plan
Always manage your expenses. By mapping out a daily or monthly budget, you will not only manage your money, you will also discover where you spend your money the most. Of course, planning your expenses is one thing, executing the plan and sticking to it is a different story. If you create a budget, be sure to stick to your budget. Otherwise, your careless spending could be defeating the purpose of creating a budget for manageable debt.
Better financial situation starts with keeping tabs on your expenses and managing your debt effectively. By keeping track of your expenses and card use, you should have no problems making payments on time, each month. This will help avoid any trouble with your creditor that could possibly lead to a credit card lawsuit.
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