Ufinance.net

If you are like many Americans you have struggled at times to get out of credit card debt. Obviously, it is best if you never get into credit card debt. But if you do get some debt you need to take it seriously and start taking big chunks out immediately. If you pay only the minimum it will take years and years to get out of debt while paying that credit card company way too much in interest on your balance.

If you are paying 18% interest on your credit card balance of $5,000 you are essentially paying $75 a month in interest (or $900/year). Is that ok with you? Because it should not be. If you interest rate is that high you need to focus on paying that balance as soon as possible. Sacrifice what you must because if your minimum payment is $100 a month on that balance and you pay the minimum, only $10 a month is going towards the principal. Here are some ideas to help:

• Try to negotiate with your credit card company a better interest rate
• Try to transfer that balance to a lower percentage rate credit card (ask for them to waive the transfer fees)
• If you have debt with lower interest rates focus on the highest interest rate, but still make at least the minimum payments on the other
• Get a second job. It sounds tough, but a couple hundred extra dollars a month an go a long way to paying off your debt.

If you have some other good ideas on how to pay off credit card debt please share with everyone.

Many people now have credit cards that give them airline miles to fly for free. There are a few problems with this:

1. The airlines are in trouble and might go bankrupt: there you lose your miles
2. It takes a while for frequent flyer miles to accrue
3. Once you have accrued enough frequent flyer miles it is often difficult to find a flight and often they are not much desired flights (e.g. redeyes)

One way to get some more out of your credit card is to get one that offers cash back for purchases. Currently the card that my wife and I use gives you 1% of each dollar spent and 5% back for gas purchases. We charge almost all of our purchases and expenses and that 1% and 5% can add up. Plus, you see the rewards quickly (the month after the current bill you get the cash back). With rising gas prices and charging most everything we do save a significant amount of money over a year.

If your credit card has a yearly fee ask for it to be waived and if they refuse say that you are prepared to take you business elsewhere (make sure to have that plan because typically you do not want to close credit card accounts because it lowers your credit score).

You can do the same with credit cards interest rates. Look online for average rates and if you are armed with a good credit score in hand and a comparison to national rates you can often get your rate lowered.

Just be prepared and have a plan before calling and asking for a fee to be waived or a lowering of your credit card interest rate. Most people never even ask.