When it comes to reducing debt, there’s a disconnect between desire and action. Did you know that more than 53% of Americans say debt reduction is their top financial priority, but the average personal debt in 2018 is more than $38,000 and climbing? 13% of Americans believe they will be in debt for the rest of their lives. But it doesn’t have to be this way! Here are some tips to tackle your credit card debt.
Avoid “the urge to splurge.” Do you really need the newest iPhone, or is your current phone still working? This is also true when going grocery shopping. Eat before you go, otherwise everything looks and sounds good. Make a list of what you need and stick to it.
Know what you owe. Get statements from all your accounts. Find out what interest rate you are paying and how much you owe on each card. You can’t make a plan until you know what you really have. Rank balances from highest to lowest interest rates and decide which one to tackle first. Some will choose to work on the highest balance or highest interest rate first, while others may want to knock out a smaller balance and get it down to zero. It’s a great feeling!
Give a little more. When possible, pay more than the minimum balance due. Every little bit helps.
Look into balance transfers. There are usually some good deals out there that will offer 0% interest on balance transfers for a specific amount of time. Take your time and research to see what will give you the best option. If you find a card that will give you some time to pay down your balance without charging interest, it’s a chance for your minimum payment (or a little bit more) to go further in whittling down that balance. Always read the fine print and see if it makes financial sense for you.
Consider a personal loan. Try to avoid payday lenders, as they will charge you more than 100% interest. Look into your credit union and see if you are able to qualify for a personal loan to pay off some of your credit card debt. You’ll have a reasonable, fixed interest rate, and you won’t have to make several payments to multiple creditors each month. You’ll have one payment you can afford. Most credit unions do not have early payoff penalties either, so when you can, make that extra payment and try to reduce that overall debt as fast as you can. If you are interested in a personal loan with your credit union, you can apply online here, and one of our loan officers will contact you to find the best solution.
For more financial tips, visit your local credit union. HealthNet Federal Credit Union has proudly served Baptist Memorial Health Care employees and the health care community throughout the Mid-South for more than 60 years.