| |
| |
|
All About Debt Relief |
|
|
|
Credit Card Debt: How to Get Rid of It
This method is simple, but requires some discipline. First, you have to stop any new spending on your cards. Second - you'll need to examine all of your spending. You'll need to know how much extra money you'll be able to put towards paying off your cards. Credit card companies generally determine the minimum payment to be 2 - 2.5% of the outstanding balance. So if you owe $1,000, for example, your minimum payment will be 20 - $25 per month. Some part of that $25 goes to the interest on the balance, some to pay off the actual balance. How much goes where depends on the interest rate. Your credit card statement will give you the exact numbers. Let's say that $20 of the $25 goes to the actual balance. To pay off $1,000 at $20 per month will take 50 months. Just over four years. You'll also have paid $250 in interest alone. Here's how you pay them off: Look at the interest rates on all your credit cards. Take the one with the highest rate. That's the one you're going to work on first and we'll call it card #1. After examining your spending you may have found some money to put towards your payments. All of this extra money to pay off your card debt goes to this one card. The idea is to pay as much extra to card #1 as you can. Until it's paid off. Pay the minimum balances on all the other cards until card #1 is done. Then take the card with the next highest interest rate and add to its payment the total of the payment you were making to card #1. In other words, send the regular monthly payment you used to send for card #1, plus any additional amounts that you used to pay on card #1, plus the monthly minimum for card #2- all to card #2. Do this until card #2 is done. Then take the total you were paying to cards #1 and #2 and add that to the payment on card #3, and so on. Here's an example: Let's say you have four, maxed out, credit cards. Each with a balance of $5,000 ($20,000 total.) Say the minimum payment on each card is $100 (yours may be different) making your monthly minimum payment total $400. Now let's say you have $500 per month to pay these off, which you found through analyzing all your spending. Card #1 has the highest interest rate and you'll send $200 per month to that card and pay the minimums ($100) on each of the others. And you're not adding any new spending. The extra $100 you're sending in to card #1 goes to the actual balance of the card, not the interest. This will let you pay that card off a lot faster. You might be able to kill this card in two years, instead of 5. Eventually, card #1 is dead. The entire payment, $200, that you were making to card #1 gets added to the payment on card #2, for $300 total. ($100 minimum plus the extra $200 from card #1.) The balance on card #2 will be less than $5,000 since you've been making your minimum payments all along. Adding the $200 from card #1 to the payment of $100 that you've been making to card #2 will make this card go away much faster than the first card did. When card #2 is gone you take the $300 per month that you were paying to #1 and #2 and add it to the payment on #3, which will now be $400/month. When #3 is done you repeat the procedure for card #4, but now you're sending the whole $500/month to that one card. Obviously this system will take years, but at the end of that time you have: * Four dead cards (hopefully you cut most of them up,) * Spending and budgeting discipline earned from going through the whole process, and * $500/month to put into a savings account or where ever. Good luck! Greg has a degree in biology so, naturally, went into teaching martial arts. Now he builds websites on whatever topic happens to be of interest. For more articles on easing your credit card debt, visit Credit Card Debt Help.
MORE RESOURCES:
Debt-Relief - Google News |
|
|
|
RELATED ARTICLES
Debt and Your Dreams You may not realize what that credit card bill is doing to you?Bob is a 27 year old truck driver. He dropped out of college after one year and got a job. Life After Debt - Strategies for Dealing with Problem Debt Honorably and ethically rid yourself of burdensome debts using the little known Negotiation Strategy, without having to experience the loss of control and privacy associated with filing for bankruptcy, consolidation, or credit counseling.The inability to reduce debt and saving money are the two biggest obstacles preventing Americans from living financially sound lives. Craving For Financial Freedom Have you ever felt trapped in a Rat Race and wished to retire quickly but rich?Have you ever felt that you are spending way too much time working with your boss at your office instead of with those you love? Your spouse, children, friends?Have you ever felt frustrated because you are so deep in debt that you think you won't be able to retire because as soon as you do, the money will stop coming and thus you won't be able to pay off your mortgages and credit card?Have you ever felt that you have no control over your life anymore in terms of time? Think about it: can you take a vacation just anytime whenever you want/ need it and as long as you want/ need it?Have you ever wished that you can work whenever you want and wherever you want?You are not the only one!Too many people are trapped in a Rat Race because they have to. There are too many bills to pay, and too many dreams to fulfill. Tips To Take Control Of Debt Collection Yes, debt collection tips can help. You may think you have no power when the debt collector comes calling, but think again! Creditors don't like losing out on the ability to collect money owed them. Start Small and Your Wealth Will Get Bigger We've all heard the phrase, "You have to start somewhere." Nothing could be truer of creating wealth and prosperity in your life. Debt Handling Solutions Sometimes debt can seem overwhelming. In those instances, or even before things get that far out of hand, get back to basics and try some of these debt handling solutions. New Bankruptcy Law - Where's the Consumer Protection? On April 20, 2005, President Bush signed into law the Bankruptcy Abuse and Consumer Protection Act, a piece of sweeping legislation that brought about the most sweeping changes in personal bankruptcy law in the last quarter century. This bill, which takes effect in October 2005, passed with the overwhelming support of both parties of congress, claims, through its very name, to offer "consumer protection. Free Quick and Easy Money Saving Tips - Part 2 Although many consumers would argue differently saving money doesn't have to be difficult. In fact by making just a few changes in your normal lifestyle you can find ways to free up extra cash that can be put to better use in a savings account or an investment account. Bankruptcy As An Option If your financial worries are preventing you from sleeping at night, then you may have considered bankruptcy in hope of a little relief. Usually, consumers only turn to bankruptcy if there is no other hope for them to get out of debt. Credit And Debt Relief--A One Stop Solution Amy Wright, 34, was extatic when her realtor showed her the three bedroom townhome overlooking the lushious golf course. It was exactly the home she was looking for. How to Get Money When You Are Broke (Money You Don't Have to Pay Back) 1. One way to get money is to have a yard sale and sell itemsthat you are getting ready to toss away because you don't wantthem any longer. Individual Voluntary Arrangements- A New Alternative to Bankruptcy This May, the Department of Trade and Industry in the UK found that there were 10,091 bankruptcies in the first quarter of 2005. This represents an increase of 24. Are You SURE Your A Bad Debt? Many people who seek the advice and guidance of debt counsellors are driven to them in the first place by fear and ignorance - two powerful emotions which often mask the real scale of the problems.In many cases, what you made have been led to believe is a 'bad' level of debt, may instead need only some careful reorganisation and a new set of mortgage priorities. Turning Bad Debts into Good Debts through Investing Fundamentals If you've ever earned enough money to put some aside, like most people you've probably invested it with an eye toward security - since, perhaps, you can't imagine yourself ever getting rich."Most people dream of becoming rich, but it isn't their first choice," Rich Dad said. New Bankruptcy Law - Five Essential Things to Know Last April, Congress passed the Bankruptcy Abuse and Consumer Protection Act, the most sweeping reform of our nation's bankruptcy laws in more than twenty-five years. Proponents of the bill argue that most consumers who file for bankruptcy do so simply because they do not wish to pay their bills. Benefits and Drawbacks of Bankruptcy Outlined below are some of the benefits and drawbacks of bankruptcy. It should be noted that bankruptcy is not to be entered into without first having sought professional advice. How to Negotiate Debt Settlement People over extend themselves financially as a result of a change in their lifestyle. In today's economy were company mergers, and such; creates a displacement and hardship to the major of the workforce. Fast Track Out of Debt You go to the mail box and scan - a couple fliers (nah), your magazine subscription (yes!) and bills (groan). Every month the bills show up and as you sigh and take out your check book you wonder if you will ever be free. Bankruptcy - Is It The Right Choice For You? Bankruptcy is one of the tougher choices we as adults face in today's society where it is the norm to be in debt, albeit some more so than others. Credit card offers materialize whether you are looking for credit or not. Bankruptcy Interest Increases as Deadline Approaches Congress recently passed sweeping legislation that will significantly reform American bankruptcy law. Designed to eliminate the "convenience bankruptcy" of compulsive gamblers and the financially irresponsible, this legislation will make it more difficult for those seeking bankruptcy protection from the courts to have their debts relieved.
|
| home | site map |
| tons-of-articles.com © 2006 |