For whatever reason, you borrowed money with a credit card and need to pay it down before the interest get’s out of control.
I am currently in that situation right now, so I figured I would share what I am learning.
These are just tips. Everybody’s situation is different. Always evaluate your own situation, and determine if someone else’s tips will be good or bad solutions for solving your problems before implementing them.
Highest interest rate card:
It’s important to know which credit card has the highest interest rate.
- Avalanche Method: Paying extra on the highest interest rate card in order to lower the monthly amount of interest you have to pay.
The amount of interest you pay is noted on the card’s billing statement.
Lowest balance card:
It may help psychologically to have one less card to worry about as soon as possible.
- Snowball method: Paying extra on the lowest balance card, while paying the minimum on the other cards.
Balance transfer:
A new or existing card may have an offer to charge a low interest rate on any balance you transfer to it from another card.
Direct Deposit:
A direct deposit actually increases your debt. But, you might get cash quickly at a low introductory interest rate.
Ideally, that cash will be used to pay down a high interest card as soon as the next bill is due.
Direct deposit has been a much simpler process for me than balance transfers. However, many cards charge a high interest rate on direct deposits. So, I only use it when it has a relatively low interest rate.
Improve your credit score:
The better your credit score, the better offers you will receive.
More to come!
I hope you have enjoyed what I added so far. I will be adding more content later.
To support this site, check out the following links:
Home page
- Information on this site is not guaranteed to be accurate. Always consult the manufacturer info/datasheet of parts you use. Research the proper safety precautions for everything you do.
- Electronzap is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to amazon.com.