Five Ways to Reduce High Interest Credit Card Debt
Credit card companies make credit cards seem so appealing. We live in a day and time when everyone loves instant gratification and that is exactly what a credit card is. If we can buy that trip that we want to go on now and pay for it later, that’s great, right? Of course, having more cash flow at the time is great, but you have to think about the interest that you are racking up in the end, which makes it even more expensive and harder to pay off in the end.
In addition to that, when you don’t have to pay something off, do you really want to spend your extra shopping money on that? No. Instead, most people pay the minimum balance every single month, which unfortunately is not a good way to tackle debt head on.
Experian says, “Credit card spending is more popular than ever with Americans. According to Experian data, American consumers carry, on average, $6,354 in credit card debt.
As the Federal Reserve continues to increase interest rates, consumers who carry a balance on their credit cards will likely pay more money in interest. Credit card interest rates are adjustable and typically increase when the Fed raises the federal funds rate. The most recent increase was in September, and all signs point to continued increases in the next 12 months.”
So, instead of paying tons of interest on credit cards, we want to pay them off (or mostly off) each month. But, I know that sounds impossible when you have high balances, or quite a few cards with balances, no matter how small they are. That’s why today, I want to talk about how to pay off your high interest credit card debt quickly! Let’s jump in:
The first step to any pay off plan is to create a budget. Your first order of business is to find out how much you are spending each month, and find out why you are spending that money. You can easily go through your bank statements, receipts, and financial files, if you have any. Make sure you include expenses that are intermittent, such as car insurance payments, since those are typically every six months. What I would do is figure out your average spending over the course of six months, in order to create more of an accurate spending report and budget. You will add up everything you spent for the last 6-12 months and then divide by the amount of months, which will give you your average monthly expenses.
Once you know how much you spend and what you spend it on, you can create your budget. Keep in mind that you will want to create a realistic budget, that will allow you to save more and make sure you are putting enough in savings for any unexpected expenses. A good rule of thumb is to add 10-15% into savings. This can definitely be hard at first, but you will get the hang of it in no time with a little bit of practice and hard work.
Now, this is where it gets real: you need to spend less and trust me, this is not an easy feat. I absolutely love to travel, go out to dinner with friends, and buy new clothes, but when you are trying to tackle credit card debt quickly, you need to cut all (or at least most) of this out. Now, keep in mind that you can still go to wedding and baby showers – just budget those gifts in!
Transfer The Balance
A lot of people swear by doing credit card balance transfers. This is when you take the balance from a high interest credit card and transfer it to a credit card that has a period of time with no interest, or low interest. This is a great way to start your pay off experience, but when you do it, you want to make sure you are taking advantage of the time when there is no, or a small amount of interest, so pay as much as you possibly can towards the card then. One thing to consider with a balance transfer is that there are usually fees associated with the transfer, but weigh the pros and cons to figure out if it is a smart, financial decision for you.
Short-term Collateral Loans
Another great way to tackle that debt is with a short-term collateral loan from Chapes-JPL. A collateral loan is typically a short-term secured loan against valuables (primarily jewelry). In layman terms, it is a loan that is secured by presenting a valuable or valuables as collateral. If you have some extra jewelry laying around, you may be wondering where you can get a collateral loan and I have the answers for you.
Located in the heart of Buckhead in Atlanta, Georgia, Chapes-JPL has been offering low-interest collateral loans on gold, silver, diamonds, platinum jewelry, and other valuables (purses, cars, etc.) for over 38 years! They are known for having the lowest interest rates in the industry and the best part about it is that you are able to leave with your money in as little as 15 minutes since they do not need to run credit reports. Chapes-JPL operates out of private and highly secured business offices located in Buckhead, so your privacy is of the utmost priority and your collateral is insured and stored in very safe bank vaults for free. While Chapes-JPL issues loans in 30-day periods (which is great for paying off high interest credit cards!), you can also extend your credit with Chapes-JPL for an additional 30 days.
Make Extra Money
Last but not least, make extra money whenever you can. In addition to collateral loans, Chapes-JPL will also buy your jewelry, so if you have any valuables laying around, you know what to do with them, in order to make extra money! Also, babysit and do side jobs as frequently as possible, in order to make some extra cash to put straight towards your cards. Be creative and make that extra dough!