A huge credit card debt can ruin your finances. If you are not careful and deal with it quickly, your debt will keep building up, which also means that you will end up with serious credit score issues, putting your financial stability in jeopardy. Be disciplined and take steps in the right direction to avoid /credit card debt.
Increase your credit card payments
Prepare a budget for your monthly income and expenses to find out what is the maximum payment you can make on your credit card, and use your card accordingly. Cut down on unnecessary expenditure and try to increase your credit card payments.
Pay more than the minimum amount due towards the debt if you can afford it. By paying an additional amount, you not only reduce the pending payment but also save on the interest that you would have incurred by paying only the minimum amount.
Pay on time
Always make timely payments. Failure to pay within the due date will attract a late payment fee and additional charges. It is a good habit to set up an automatic debit towards the card from your bank account to ensure that the payments are made on time.
Look around for better deals if you have a credit card carrying a high interest rate, and transfer your balance to one with reduced rates. Make sure you ask questions about hidden fees or charges like transfer fees before you apply for that particular credit card.
Do not run up further debt
When you already have problems making your current payments, it would be unwise to apply for new loans or credit cards, no matter how tempting the offer might be. Only use cash to make your purchases and put away the plastic until you have settled your dues.
If you are paying a high rate of interest on multiple credit cards, you can consolidate your debts in a single lower interest rate loan and pay off the others. This will not only reduce your monthly payments and the interest that you accrue on your debt, it would also simplify your monthly payments, as you would only have to deal with a single loan. There are several debt consolidation companies that can negotiate payments with your creditors, and they can help you find a single low interest loan offer.