Finding Relief from Credit Card Debt

This is how it usually happens. One day you wake up to the realization that credit card debt is overwhelming your financial situation. It seems that every last dollar you make goes to the monthly minimum payments with little left over for life's needs. Getting relief from the burden of out of control credit card balances is something everyone who is struggling financially wants to do but many people are unsure of where to start.

The most obvious starting point is to quit using the nasty things. Every time you swipe one through the card reader you just add to a growing problem that is compounded because of the interest that is calculated each month. For every step forward you seem to fall to two steps back and the stress of meeting those payments each months becomes harder and harder. So perform a little plastic surgery, cut the things up, and stop the financial bleeding.

The next step is to figure out exactly how much you owe and to whom. Pull out a piece of paper, a pencil, and your latest credit card statements and write down in columns for each card the balance owed, the interest rate and the amount of interest paid each month. Once you have a clear picture of the balances owed you can prioritize your credit card debt and start working a plan with debt freedom being the goal.

When it comes to making a game plan to pay down your credit card debt there are two trains of thought on the best way to do this. Some people advocate choosing the card with the highest interest rate and send any extra money you have to it each month while paying the minimum on all your other debts. When that one is paid off then you roll that payment into the next one and so on and so forth until all the card balances are paid off.

The second way to approach paying down your debt is to list your balances from lowest to highest and attack the one with the lowest balance first. This may not make sense from a mathematical perspective but it can give you a huge motivational boost because chances are you can pay that one of rather quickly. Using the same strategies as in the paragraph above roll that payment into the next lowest balance and continue on down the list. This method gives you a certain amount of psychological satisfaction because those smallest balances go away quickly and by the time you get into the meat of your debt your motivation is steamrolling you through those balances.

Whichever approach you take to finding relief from credit card debt once you successfully pay off all your balances you will find a new financial freedom that gives you many more options with your life. And once those cards are paid off cancel the accounts so you are never tempted to repeat your mistakes of the past.