Debt consolidations can be difficult to get if you have less than excellent credit or owe high credit card balances. Here's a method for paying off credit card debt yourself, along with tips for succeeding.
DIY Debt Consolidation: Dedication, Results and Relief
List each account balance, its APR (annual percentage rate, which includes interest and other finance charges expressed as an annual percentage of your balance owed), minimum payment due and due date. Set up automatic payments for several days ahead of each due date. Pay the most you can toward the debt with the highest APR while making minimum payments on the other accounts. When you pay off the highest APR debt, apply the amount you were paying on it toward the next highest APR debt. Repeat this until your debts are paid off.
- Technology is your friend: Schedule automatic payments online for avoiding penalty fees. Track your progress using a spreadsheet showing each account balance. Document the falling balance when you receive each new statement. Congratulate yourself for staying on track, but avoid celebrating at the mall.
- Cut up your cards, but don't close your accounts: Cutting up credit cards or freezing them in a bucket of ice may check impulsive purchasing, but closing your credit card accounts reduces your available credit. Reducing available credit also increases your credit usage, which can lower credit scores.
- You can do this: Paying off credit card debt reduces stress and family conflicts and provides more money for savings, vacations, and other things important to your quality of life.
Roll up your sleeves and get started today. The sooner you pay off high-APR credit card debt, the sooner you'll be breathing easy and sleeping through the night.
About the Author:
Karen Lawson is a freelance writer with 20 years of experience in mortgage banking, mortgage loan servicing, and home loan loss mitigation programs. She holds B.A. and M.A. degrees in English from the University of Nevada, Reno.