How To Pay Off Credit Card Debt

Ok so let's face it.... We ALL have credit card debt at some point in our lives. At times we can get carried away. Hey it happens to the best of us. While having credit cards does help to build up our credit score, it can also hurt you if not used properly.

So let's look at a few ways we can avoid credit card debt and pay the debt off faster.

1) DON'T USE IT & ABUSE IT!!!! 

Look it's one thing to have a credit card, but it's a whole other situation if you're abusing it. For example, let's say that you have a credit card to your favorite store. You decide to go shopping one day and use the card and when your bill comes in what do you do???? Well some people just pay the minimum payments........WRONG!!!!!

The correct way would be to pay that card off as soon as you receive the bill. That credit card wasn't meant for you to use and then only make small payments and use it again. NO!!!!! When your bill comes in, pay the whole thing off. If you're doing that then you wont get behind and max it out. By demanding that responsibility from yourself, you a making yourself accountable to pay it off.

2) STAY UNDER 40%

If you're paying your credit card bills the way you should......than this wouldn't apply to you. But sometimes we sign up for credit cards when we're remodeling for example. Regardless, it's important to get your credit cards under 40%. Now what does this mean you ask? Here us how you figure this percentage out.

Pay Off Balance  /  Max Limit  = %

So let's say you have a Lowe's credit card that has a balance of $2300 and the limit is $5000. You would divide the pay off by the limit.

2300  /  5000 = 46%

As you can see, this card would be over the 40% limit and would need to be lowered. Having a card with the percentage being over 40% can actually hurt your credit.

3) DON'T CANCEL YOUR CREDIT CARDS!!!!

Studies have shown that cancelling your credit cards can actually hurt your credit. Think about it this way, if you've had a credit card for 5yrs and have always made payments, than you have a good standing long credit. If you cancel that card and apply for a new one than you have lost that long standing credit. I'm serious it doesn't look good on your credit report.

Instead of cancelling the card or cutting it up, try freezing it. What I mean is that you would actually put it in a cup full of water and put it in the freezer. Look at it this way, you're less likely to use it and max it out.

4) USE DAVE RAMSEY'S SNOWBALL METHOD!!!!!

Ok I'm being serious with y'all......this method really does work. I've used it before and I was shocked at how quickly I was able to pay off all my debt using this method. If you haven't looked it up yet you really need to. It's very simple and will have you debt free in no time.

Well that's it everyone. That's my 4 tips on how to pay off your credit card debt and help your credit. These simple steps will keep you from being buried under debt.

*~ Cassie ~*

@livingtobudget