Credit Card Debt

[Vikingfan84]

I'm sure I'm not the only one around these grounds that has debt. I don't regret putting myself in this position with debt, because I enjoy having the things I've purchased. I just wish I had gone differently about the purchases rather than racking up debt. That $100 purchase could turn into a $200 purchase depending on how you handle your cards.

For those of you who were in debt and are now out of debt, what methods or goals did you set to get out of debt? How much debt were you in, and how long did it take to get out?

Obviously you should attack your highest interest rate cards first, but what other methods have you all come up with?

Do not include college as debt. Even though it is.

[TimmeH]

Re: Credit Card Debt

Everytime you get paid:

-Pay the minimum on all your bills that are due
-Then take out an strict "allowance" that will cover gas, food, and a little for personal entertainment
-Then whatever you have left over, put it on the bill of your choice. The high interest bills are likely the best choice.

I've been doing this for almost a year now, and have already eliminated $7000 of my debt. I'll have my car paid off in March, and by NEXT March, I'll be out of debt altogether(well, not counting my student loans, which I'm not TOO worried about).

It's kinda depressing seeing most of your money going towards bills every month, but as you see the bills dwindle, you'll realize it's worth it. Plus as you do it, you learn a valuable lesson in money management. You'll find yourself spending less and realizing how much more you can have if you just avoid [unnecessary] debt.

[Trevytrev11]

Re: Credit Card Debt

Everytime you get paid:

-Pay the minimum on all your bills that are due
-Then take out an strict "allowance" that will cover gas, food, and a little for personal entertainment
-Then whatever you have left over, put it on the bill of your choice. The high interest bills are likely the best choice.

Pretty much this.

My wife and I have been debt free now for about two years.

We got in debt from not being diciplined in our early 20's and then putting our honey moon on a credit card. After that, we were methodical about our spending and set a budget and stuck to it as best as possible. Every penny we had left over went towards our credit cards.

Also, if you can, consolidate your cards (transfer balances) to lower rate cards and then work on that. I think it's easier mentally to focus on paying off one bill of $10K than it is to pay off one with $5K, one with $3K and another with $2K. Even when I had debt, I never paid interest on it as I just played the balance transfer game moving it from one card company to another as soon as the 0% period ended.

Consolidation also benefits you because you min. payment on a $1Ok card would be less than the combined min. payment on the three cards.

It then became exciting seeing our credit card balances shrink and shrink.

Now we just live below our means. I've become diciplined about making random purchases that I don't need. And we still live on a weekly budget (we get paid weekly). When we want to make a big purchase, we save up for it instead of paying for it and falling into debt. We still put everything on a credit card (for points and benefits), but pay it off every month. Over the last two years, there hasn't been one month in which we were even close to not being able to pay it off.

[23]

Re: Credit Card Debt

Pay off one card by putting extra money on it

When that one is done use that money to add on to what youre paying on the next one

[fsquid]

Re: Credit Card Debt

Everytime you get paid:

-Pay the minimum on all your bills that are due
-Then take out an strict "allowance" that will cover gas, food, and a little for personal entertainment
-Then whatever you have left over, put it on the bill of your choice. The high interest bills are likely the best choice.

I've been doing this for almost a year now, and have already eliminated $7000 of my debt. I'll have my car paid off in March, and by NEXT March, I'll be out of debt altogether(well, not counting my student loans, which I'm not TOO worried about).

It's kinda depressing seeing most of your money going towards bills every month, but as you see the bills dwindle, you'll realize it's worth it. Plus as you do it, you learn a valuable lesson in money management. You'll find yourself spending less and realizing how much more you can have if you just avoid [unnecessary] debt.

bingo

[PBlast]

Re: Credit Card Debt

My situation is probably a bit different from everyone else, I went to Europe over the summer and my Visa hit just over $4000. For a few months I've done the minimum payment thing but was just getting hammered by interest charges. Lately what I've started doing (keep in mind this is easier for me as I live at home with my parents) is keeping $300 for spending money in between pay periods and just dumping the rest on my Visa. It's now down to just under $2000 and declining quickly. Simple solution, but it works. The interest rates on credit cards are just crazy, never a good idea to let that balance accumulate.

[mgoblue]

Re: Credit Card Debt

I just saved and paid it all off. Luckily i was finally able to get a job that paid me more, that made it easier.

The key is to just not buy something you can't afford to pay off now. I never let my credit card get a balance now, it's just not worth it. I've never been someone who bought a lot of things, my issue was more being underpaid and things slowly adding up over time. I was dumb and didn't cut my spending enough and it caught up with me.

[WazzuRC]

Re: Credit Card Debt

The key is to just not buy something you can't afford to pay off now. I never let my credit card get a balance now, it's just not worth it. I've never been someone who bought a lot of things, my issue was more being underpaid and things slowly adding up over time. I was dumb and didn't cut my spending enough and it caught up with me.

Bingo. I had a small amount of debt (not counting student loan) and I get underpaid big time so I just had to massively curb my spending. I set a budget to where I'd pay off all my bills as soon as I got my first paycheck of the month then just enough to get by with groceries, gas, etc. and then the second paycheck was used on rent. I still would have about $300 left over per month so I just kept applying that to my credit card and massively cut down on going out and entertainment in general.

I'm still close to broke in my bank account but I can get by every month so I'm not too worried about it. Plus, my CC debt will finally be gone by the end of the next month.

[shaneomac103]

Re: Credit Card Debt

ye i hate credit cards still paying mine off than im done with credit cards str8t cash homeyy

[fsquid]

Re: Credit Card Debt

also, don't get married is another good way to save money.

[matt8204]

Re: Credit Card Debt

Basically, I quit buying crap I don't need and never have time to use anyway. Cutting out little things that don't really improve the quality of your life really makes a big difference. I still spend on leisure items, but I'm just smarter about it now.

[tktnuri]

Re: Credit Card Debt

Depending on your balance, if your going to be paying minimum at least figure out what your monthly interest charges are and add that to you minimum. That way you cover the interest every month and actually make a small dent in the principal balance, think of it as your real minimum balance. No use tredding water when you can swim.

I actually paid off my debt a few times now. I have a monthly budget where I track all charges (atm debit), project my monthly bill payments and set a goal for the bill to be paid in full.

Some tips at cutting monthly expenses:

Check cell phone minutes and adjust to lower plan. If you pay for text messaging and have a smart phone think about dropping text unless its included and switch to sending emails from your phone. Savings $10-50 a month

If you pay for TV (cable, dish, fiber) think about stopping it for 6-12 months. Buy a $25 over the air antenna and watch local. Savings $60-$120 a month

Netflix instead of going to the movies. $8 a month of $8 for one movie? Savings $15-30 a month

Take your $85-200 a month in savings and distribute it among your bills or focus on the higher balance account.

Another option if you don't need it or its taking up space sell it. Ebay Craigslist get what you can and move on. Its extra income and you can pay debt or use it fun money. Plus you'll be glad you got rid of it instead of it sitting in a box taking up space.

[GAMEC0CK2002]

Re: Credit Card Debt

I've never had a whole lot of credit card debt, except on major purchases--laptop for school, car repairs, etc

Main thing is stay on top of your bills and pay on time. Even if it's just a day late, expect a $40-50 late fee. I've been carelesss and gotten hit with that 3-4 times. Best thing to do is set up automatic drafting if it's possible.

Lastly, cut out stuff you don't need and curb the impulse buys. I used to spend about $75 a month on blu rays...but have now cut back to renting on Netflix and only buying must haves.

A good piece of advice I've heard about "good" deals and when it's not a good deal FOR you. 1) You don't need it or 2) You can't afford it.

[GAMEC0CK2002]

Re: Credit Card Debt

Depending on your balance, if your going to be paying minimum at least figure out what your monthly interest charges are and add that to you minimum. That way you cover the interest every month and actually make a small dent in the principal balance, think of it as your real minimum balance. No use tredding water when you can swim.

I actually paid off my debt a few times now. I have a monthly budget where I track all charges (atm debit), project my monthly bill payments and set a goal for the bill to be paid in full.

Some tips at cutting monthly expenses:

Check cell phone minutes and adjust to lower plan. If you pay for text messaging and have a smart phone think about dropping text unless its included and switch to sending emails from your phone. Savings $10-50 a month

If you pay for TV (cable, dish, fiber) think about stopping it for 6-12 months. Buy a $25 over the air antenna and watch local. Savings $60-$120 a month

Netflix instead of going to the movies. $8 a month of $8 for one movie? Savings $15-30 a month

Take your $85-200 a month in savings and distribute it among your bills or focus on the higher balance account.

Another option if you don't need it or its taking up space sell it. Ebay Craigslist get what you can and move on. Its extra income and you can pay debt or use it fun money. Plus you'll be glad you got rid of it instead of it sitting in a box taking up space.

Good idea. My gf has been harping on me to sell my stuff that never gets used and sitting in boxes.

[mjb2124]

Re: Credit Card Debt

The key is to just not buy something you can't afford to pay off now.

That's the key. For me, the only reason to use a credit card is due to ease of use...it's easier to pay with a card than carry large sums of cash around. However, I will never buy what I can't pay off at that time. Never had a balance on a credit card at the end of a month and I hopefully never will (the only way I can see it happening is if my wife and I both fall on very hard times and are unemployed for a long period of time).