First thing first, credit card debts are the worst. It is no surprise that credit cards come with a high-interest rate; thus, credit card debt is the most difficult to pay off.
Not to mention, credit cards encourage impulsive buying. When paying through a credit card, you tend to purchase more than you need. Such practices eventually lead you towards credit card debt and the vicious cycle continues.
In order to break this cycle and get rid of your credit card debt, here’s what you need to do:
One of the most effective ways to pay off your credit card debt is a balance transfer. In this method, you’ll transfer the outstanding balance of your credit card into another card with a lower interest rate.
After that, you’ll keep paying your credit card debt using another credit card. On the face of it, you won’t be using your own money to pay off the debt. However, you’ll still need to pay regular credit card bills, only this time with a lower interest rate.
If you’re unable to pay your credit card debt or in case you have lost your job, have a minimal amount left in your savings account, debt consolidation can help you out. It refers to taking a consolidation loan to pay off your existing debt.
While it may seem odd to you but credit card debt usually doubles in a few minutes due to high-interest charges on it. Therefore, paying off your credit card debt is like a ‘my way or highway situation.’ Debt consolidation is the only way to get rid of the interest fee.
Since you pay the entire amount at once, it saves you from the interest fee that would otherwise have doubled your outstanding amount. Plus, a consolidation loan comes with a low-interest rate, so paying it back won’t be an issue.
Switch to Cash
It’s great to find a debt arrangement strategy and stick to it when paying off your debt, but what about the future? Have you planned anything yet or are you looking into getting trapped in this vicious cycle again?
If not, then you must switch to cash, once and for all. As you know, it’s not possible to carry a lot of cash at once. Due to this reason, one tends to buy only things that one needs, saving the rest of the money. Not to forget, it’s the best strategy to save those extra bucks for your rainy days.
Get a Passive Income Source
The price rates of basic commodities have increased post-Covid-19 worldwide. In this situation, it has become difficult to survive on one job. When you don’t have enough after paying the monthly bills and rent, you turn towards using your credit card more and more.
To treat this issue from its root cause, you need to have a passive income source. Of course, you cannot work at two places together, but how about investing your savings into a profitable company and taking your monthly share into the profits?
What do you say about freelancing? Or setting up a small side business? There are so many possibilities. All you need to do is look into the right one. I wish you well, my friends!