How to Escape Overwhelming Credit Card Debt

Even for those without a credit history, it's easy to get a credit card, and even easier to get in trouble with it. Before you know it, you can find yourself drowning in credit card debt, saddled with astronomical interest rates, and in a seemingly hopeless situation when it comes to repayment. It is sooo tempting to make purchases you can't really afford, and in the end, you could be paying twice or three times the purchase price in interest alone!

How can you keep from getting sucked into a credit card vortex?

The first thing is to avoid overspending, and this means spending less than you earn. Easy enough to say, but so many American families are spending more than they earn, especially in today's economy. To get out of credit card debt, however, you'll need to take this first step and do it ASAP.

Get-Out-of-Debt Techniques that Actually Work

Now that we've stated the obvious, what else can you do to get out of credit card debt? Take those cards out of your purse or wallet and start using cash or debit only. We all know that self-discipline can be a big challenge, so why not avoid the temptation of impulse purchases by leaving your credit card at home?

Don't cut up your cards, but PUT THEM AWAY. If you really don't trust yourself, put your credit card in a Ziploc, fill it with water, and put it in the freezer. (Don't cheat by writing down the number to use for buying online!) This will give you time to reconsider your purchase and you may just find your impulse is iced before your credit card thaws. And - stop right there - microwaving will crisp the magnetic strip!

How About a Cash Advance?

Also stay away from cash advances. You'll be charged interest rates that can be twice as much as the APR on purchases. To make things worse, your payments are usually applied to the cash advance amounts last, so you'll be paying this higher rate on the cash advance amount until you've cleared the balance There's also typically no grace period for cash advances, so you'll be paying interest from the moment the ATM spits out the cash.

After you curb your spending habits, apply any extra money to the card's balance so you're not just paying the minimum.

Consider this: If you owe $5000 on a credit card with a 14% APR and make minimum payments only (interest plus 2% of the balance), it would take 22 years to pay off the card and you would end up paying almost $6000 in interest!

Finally, avoid paying fees. These could be late fees, cash advance fees, or over-the-limit fees. This represents money that you could be applying towards the balance. Simply scheduling automatic payments could save you hundreds of dollars in late payment fees.

These tips (plus a little common sense) will go a long way in helping you begin to work your way out of credit card debt. It may seem overwhelming, but with the right game plan it's not impossible!

However, if you find that you have over-stepped your credit card purchasing limits and need some help obtaining a secure footing once again, Lexington Law can help. Their legal experts can assist you with all phases of credit repair.  Give them a call today!

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