Beat Credit Card Debt - 10 Tips

This is a guest post by Mirsad Hasic who is the webmaster and editor of http://www.think-creditcards.com where you will get tips and advice on different types of credit cards, debt control, credit monitoring and more. He is also regularly contributing with guest posts on other blogs as well where he shares his knowledge within the finance area.

It all started out as such a beautiful romance. That credit card felt as if it had been created just for your hand and the two of you went everywhere together. You could depend on it to cover the cost of whatever happened to catch your eye. A new suit? A $500 pair of Jimmy Choo shoes? A vacation at the ski slopes? Why not? After all, the magical connection between you and your platinum-plated sweetheart is not to be denied. However, all good things do come to an end and it’s time to face the music and take stock of your financial situation. You are now looking at some serious credit card debt and it is time to create a plan that can get you out of the deep, murky waters before you drown.





Here are 10 tips you can use to free yourself from credit card debt that really work.





• You need to get out the scissors and start cutting those plastic passes to debtor's prison into tiny little shreds. You only need one credit card that you can use for identification and necessary purchases. If you continue getting calls and letters offering pre-approved credit cards don't fall into the trap again. Say "no" to the salesmen and shred the mail as soon as you get these "come hither" messages.





• Remember that just because you are destroying the credit cards you do not have to close all of the accounts. You might need a couple of open accounts to maintain your good credit rating. If you are already having problems with your credit rating you should close the accounts when you shred the cards. One open and active credit account is enough for you to handle and you still need to pay the other balances off as well.



• Leave your credit cards and checkbook at home when you go to the store. Take only enough money to cover the purchases that you absolutely have to make. Having access to additional funds only makes it more likely that you will make some impulse buys while you are out and about. If you see something that you absolutely must buy, take a deep breath and walk away. Allow yourself a 72 hour cooling off period and then go back and look at the item once more. Chances are it will not seem nearly as impressive the second time you see it.



• Remember that the ATM machine is not your personal cash cow. A cash advance courtesy of your ever available credit card will keep you in debt for a very long period of time. You may not have known it but the interest begins to mount on these cash advances the second those $20 bills start spurting from the ATM machine. If you think the APR on normal credit purchases is high, take a second look at the interest rate that is tacked on to credit card cash.• Instead of making minimum monthly payments you should at least pay double the amount that is shown on your statement. Paying even more money will help you cut your credit card debt even faster. Make bi-monthly payments if this makes it easier, but stay ahead of those minimum amounts at all costs.



• Do not use your credit cards for small purchases such as fast food meals, sodas, magazines and snacks. The interest you are going to be charged can result in the same financial hit to your bank account as if you had paid triple the going rate for these purchases. Is that Mickey D soy burger really worth $3.50 of your hard earned dollars?



• Curtail those shopping habits! Make a budget and keep track of all of your daily spending. This will help you discover the ways to stop unnecessary spending. The money you save can be used to chip away at your credit card balances.



• Get a copy of your credit history and look at of your outstanding debts. Then categorize them into groups. Separate the largest balances, the smallest balances and those debts with the highest interest rates. Begin with the highest interest rate balances and commit yourself to paying them off one at a time. When you finish with this group move on to the smaller balances and pay them off the same way and then you are free to concentrate on the bigger balances that you owe. Slow and steady payments will get you out of the credit card debt that has you trapped at the present time.



• Forget the grace periods and get your payments in on time so that your credit card providers will not add late fees and penalties to the balance each month. One late payment that is only 24-48 hours overdue can result in your being assessed an additional $35-$75 or more.



• Beware of the convenience of making credit card payments over the phone because that can mean an additional $10 that you are paying each month. Stick to online banking, pay the amount in person at your local bank or just use snail mail to deliver the money. If you choose regular mail for your payments allow plenty of time for the check to reach its destination and be processed before the payment due date arrives.