Ways to cut credit card DEBT!

CALL the credit card company directly!  I am not against third party interventions (consolidation companies or consumer credit counseling).  But before you go that route, try working with the credit card company yourself!  Many times by going through a third party, it can affect your credit score.  It’s not the company that helps you with consolidation or mediating an agreement, it’s the credit card company that reports to the credit bureaus that you had a third party intervention for your debt.

KEEP all your credit card solicitations from the mail for a few weeks! If you have debt on a high interest credit card and you receive an offer for a lower interest rate card from a different company, WAIT…don’t transfer your debt yet.  WAIT…don’t go and open another card account yet.  Call your current card and tell them you are looking at leaving their company because you have received an offer for a lower rate.  Many times your current card will match or at least drop their current rate for you.

BE honest with your credit card company!  Come on, don’t call your card and tell them the payment is in the mail, when it’s not.  God calls us to be honest and responsible for our debts.  If you or your spouse have lost their job or have an unexpected financial hardship, call your card and explain the situation.  Sometimes they may be willing to waive the late fee or lower your rate.  BUT talk to them in a respectful and nice manner.  It’s not their fault you are in this bind.

STOP viewing the credit card company as your enemy! You must take responsibility for your own actions of running up this debt.  Yes, the companies pursue people but you still have a choice in the matter.  I have experienced SEVERAL nice conversations with credit card companies over the years.  MOST of the time, they were willing to work with me.  Years ago, all but one of our cards dropped their interst rates for us.  In recent years, (we only have one personal credit card) I paid a bill late on-line and afterwards, when I called the company, they credited back the late fee since I was such a good customer of paying on time in the past.

CAN you handle a credit card? In today’s world, there are many occasions where a credit card is required or safer than using a debit card BUT if you do not budget nor manage your finances wisely, you should not have a credit card.  That may sound harsh but after experiencing credit card debt and taking 2 years to pay it off, I never want to be in that situation again…so we budget and stay strict with our ONE credit card.  When I did budget counseling with people, it broke my heart to see how many had worked so hard to pay off credit card debt only to run it back up again.  If a credit card will tempt you to buy something you can’t afford or to not live on a budget, then you should not have one. 

Lasting thoughts:

Pay your credit card off monthly.  Do not take cash advances on your credit card.  Do not charge something if you do not have the money in your bank account.  Pay your bill on time. 

Any other thoughts?  Please feel free to let us know!  Thanks and have a great week!  Dana

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Credit Card Debt

My husband and I started our marriage off several years ago with 7 credit cards and $12,000 in credit card debt!  Several of the cards had a high interest rate of 14% to 21%.  Marriage is hard enough without the stress of debt so I went on a mission to cut this debt as fast as I could.  I had not heard of debt consolidation centers such as Consumer Credit Counseling so I started calling the credit card companies directly.  Out of the 7 credit cards, 5 of them lowered their rate for me and 1 gave me a 6 month 0% interest!  The last card company refused to lower my rate.  So after more phone calls, one of the lower rate cards offered to do a transfer balance from the high rate card.  Back then credit card companies did not charge a transaction fee for balance transfers but even if they had, it still would have been to my advantage to transfer from a 21% card to a 8% card.

Check back tomorrow and I’ll give you points on dealing with credit card companies directly rather than through third party companies.  DANA