Credit card debt stressing you out?
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Credit card debt can grow out of control quicker than you realize. Most Wilmington consumers start out swiping their cards and paying off the balances at the end of the month. Then an unexpected expense crops up or your paycheck is smaller than usual, and you carry over a balance. From there, things can snowball, and you may discover you’re going to be in some real trouble if you don’t do something about it.
If your credit card balances keep you awake at night, the chances are that it’s time to address the issue. Fixing the underlying problem is first and foremost, and then you can tackle your mounting credit card balances before you lose control of your financial situation. Check out these tips to reduce credit card debt.
Control your spending
This might seem obvious, but it’s a frontline measure. Have you looked at your spending to see where you can cut back, even if it stings a bit? Things you see as necessities may, in fact, be luxuries. Cable TV, cappuccino, and eating out are all things you don't really need. Most of us need internet at home, but beyond that, you can slash lots of other services such as cable.
Pull out your credit card statements and go through line by line, circling what was extraneous. Add up the total of frivolous expenses and take a look at how much less debt you’d have if you were more conservative with the plastic. Let this be your guide on where to cut back and start immediately. If you have kids, explain to them you’re belt-tightening for now.
Create a timeline
Every war needs a strategy and battling your credit card debt should be done strategically. Look at your balances, your disposable income, and how you can chip away at what you owe. If you’re expecting a tax refund, make a plan to apply it to the debt – do the same thing for any windfalls like work bonuses, birthday money, and other cash influxes.
Take them one at a time
While you need a master strategic plan on how you’ll defeat your credit card debt, you also need a month-to-month tactical approach. You can choose to tackle your highest balances first or your highest interest rate cards first. Many financial experts recommend going after higher interest first to minimize how much you’ll pay in fees to your card issuers.
For some, tackling the highest balances first might be preferable because you’re eliminating a mountainous balance. For some Wilmington consumers, though, paying off the smallest balance cards first works better because they get a psychological boost from zeroing out cards and smaller debt is easier to defeat. As long as you’re making progress in the right direction, it’s a good thing.
Build and keep an emergency fund
One common reason that people get in over their heads with credit card debt is an unexpected expense, suddenly reduced income, or both. By establishing and keeping an emergency fund on hand of a few thousand dollars, you should be able to avoid swiping plastic when the unforeseen occurs. Even if you only set aside a few bucks a week towards this fund while paying off your debt, it’s important to get started.
What if you can’t conquer the debt?
In some cases, you might not be able to deal with your debt without an intervention. If you owe more in unsecured debt (credit cards, medical bills, et al.) than you can pay off in three years or that exceeds one year of your gross income, you might be in a situation that’s unrecoverable without assistance. Wilmington bankruptcy wipes out unsecured debt within months and offers a fresh start.
If you’re struggling with credit card debt, why not come in and talk to an experienced North Carolina bankruptcy attorney to find out if you’re eligible for fast, legal debt relief? Read reviews from satisfied clients then contact the Law Offices of John T. Orcutt. Call +1-919-646-2654 to schedule a free Wilmington bankruptcy consultation at one of our convenient locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington.