Constant Credit Card Payments
Constant Credit Card Payments
By Terry Rigg
I recently completed a Debt Elimination Summary for a couple that had $46,500 in credit card debt on 6 credit cards. Most people would be considering filing bankruptcy in that situation but this couple were determined to pay it off.
Here are the results of the Summary:
They were already paying $785 per month on the credit cards. They decided they could afford to pay another $200 to eliminate their debt sooner.
Minimum Payments – The credit cards would never be paid off.
Paying $785 per month – $78,761 total payments – 8 years 5 months
Paying $985 per month – $66,059 total payments – 5 years 8 months
Would you have thought that you could pay off over $46,000 in credit card debt in just 5 years and 8 months? I’ve seen this done dozens of times. It can and it does work if you stick to it and quit using your credit cards.
If you have multiple credit cards and would like to pay them off as quickly as possible the best way to do this is to write down your credit card name, balance, interest rate and minimum monthly payment.
Then you must decide which credit card to pay off first. There are two schools of thought on this. Most experts believe that you should pay off your highest interest credit card first. You would definitely pay less in the long run.
However, if you need to see results quick to give you an incentive to keep going you could start with the credit card with the lowest balance.
Which ever way you choose, simply add as much money as you can spare to that credit card until it is paid off. Then take the amount you were paying to the first credit card and add it to the next credit card payment and so on until they are all paid in full.
Interest, late fees and penalties are wasted money. The only way to avoid this is to use cash to make your purchases when ever you can.
Terry Rigg is the author of Living Within Your Means – The Easy Way http://www.homemoneyhelp.com/ebookadpage3.html and editor of the Budget Stretcher web site. To Subscribe to The FREE Budget Stretcher Newsletter and receive The Complete Budget and Bill Organizer absolutely free just visit his home page at http://www.homemoneyhelp.com