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If you are serious about paying off your credit card and have the extra money in your budget, I have found this simple solution very helpful and effective but you have to be serious about paying them off and stay on track.
I have 2 credit cards in my name only. I did this because I wanted my own credit score to go up and stay up. I have decided I wanted to pay them off in 18 months. I simply check the box that has your credit card payoff amounts in it. Usually there is one that says by paying the minimum, you can pay such and such amount every month. The next box gives you the option to pay it off in 3 years. I take the 3 year amount and divide it by 2 and then add the amount back into it and that is the amount I need to pay every month for 18 months.
To clarify: say I have the option of paying the minimum with $20.00 every month for 29 years. The 3 year payoff is $102.00. Divide the $102 in half and it gives you $51.00. Now add back on the 102.00 and you get $153.00. If you stick with this plan and don't use the credit card for the entire 18 months you are completely debt free.
Should an emergency arise and you have to use the credit card then try this: Say the amount you added to it was $40.00. Take the $153.00 and add the $40.00 back in and you have $193.00 that needs to be paid off from your emergency. This way you can stay on schedule and pay the complete debt off in 18 months. You have to be very sincere in your quest for being debt free in order for this to work. And in the end you will feel so much better knowing you do not owe anything to anyone and your credit score has just popped up some extra points.
Good luck to you.
By Gem from Gordonsville, VA
I've been reading "sticky-notes" ideas and was reminded of one of my own uses. I use the smallest notes (and I divide them in half). Then I stick them to my credit cards with a notation of the available balance remaining on that card - just dollars, rounded up, no cents, no dollar sign. I also have a notation of the interest rate - they all seem to have different rates!
Whenever I use a credit card, I remove the note to run the card. I then re-stick the note upside down to remind me to update the amount, approximating the most recent expenditure and rounding the dollar amount up. That is, if the purchase was, say, $13.29, I would subtract $15 from the existing available amount, then cross out the old number, and write in the new.
When I check into my account at that card's website, I can verify the balance. Meanwhile, I have a good idea of how much I can still use, if I need to, that is! I try not to use credit cards, but sometimes it is necessary. This way, though, I'm not caught unawares with the "card denied" embarrassment and frustration!
By AuntieBim from Tehachapi, CA
If your credit card debt is getting out of hand, the first thing you need to do is stop using your credit cards. Many people get into the mindset of "I'll pay it off later" or "I'm already in debt, what will a little debt hurt?". They keep using credit cards for everyday expenses so they don't feel broke and don't have to change their spending patterns. Retire your credit cards, set up a budget and start paying with cash.
When paying off credit cards, always round up payments as much as you can. If the minimum payment is $25, try to pay $30. Credit card companies set minimum payments to maximize the amount of interest they can earn from you over the life of the debt. Paying more, even a small amount, significantly decreases how much interest you will end up paying.
To avoid late payment fees and possible interest rate increases on your credit cards, make sure to send in your payment 7-10 days before the payment due date. Late payments on one credit card can increase fees and interest rates on your other credit cards.
By Terri H.
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I'm new to this site and I've read the other posts on this subject but still can't find help. I'm 26, disabled and only receive a monthly income of 777.00. Before, (when I was stupid with money) I racked up a lot of charges and now I am in debt for about $4,000. I am having a lot of trouble paying even the minimum payment after bills, rent, food, etc. I don't have it.
The interest rates are at 27-29% on 2 credit cards. I get calls constantly but feel so bad that I don't answer anymore. I don't know what to do. I have tried to get state services for rent but still pay 400.00. I have no help from family or friends.
Is there a way that I can eliminate the interest charges altogether and only pay what I charged? I was told I had to have at least 9 months of minimum payments on time for them to even consider lowering the interest rate. The cards I do get approved for in the mail never have a low rate for balance transfers and I supposed the limit wouldn't be the amount I owe.
Thank you for your help and responses in advance,
Stacey from Texas
You may want to check out the following sites, they have been of great help for me and built my confidence up in dealing with collectors
do you have to pay for thier services? I've heard of places where you end up paying alot of "fees" for them to consolidate your debt. Are there any free ones.. totally free?
thanks for the sites though
Stacey, I assume from the disability amount you get that you are on permanent disability. This means a couple of things...your income is not going to change unless you get HUD housing and get a big break there....so you will never have enough to make the payments the credit card companies want you to pay. The good news is that they can't do much about the lack of payment. Disability can not be attached to pay a debt.
So you have a choice at this point, to not pay anything, or write a letter explaining your situation, and make whatever small payment amount you can. Your credit is already messed up, and with that low disability income, it is not likely anyone will give you credit again. The credit card companies are going to want to know what payments they can get, since they are pretty much stuck at this point.
I am sorry to hear you are on disability at such a young age, that is a tough break. Email me if you would like, I have some other stuff to tell you. Levada firstname.lastname@example.org
Get the Sunday paper and in the glossy coupon pullouts, there are always ads for 0% interest with a new card. If you don't qualify (I don't know the terms) give your local credit union or bank a call. They may be able to set up a loan and their interest is much lower.
Never, ever pay for debt restructure or anything like that. Find your local Consumer Credit Counseling and they will help you for FREE.
Best to you
You want to go with a Consumer Credit Counselors affiliate agency. They are a non profit agency and most credit card companies will honor their plans. They will help you set up a repayment plan that stops/reduces interest on the cards as long as you pay each month. Here is a website for the Dallas affliate: http://www.cccs.net/
As far as the calls go you can and you should tell them not to call anymore. By law if you tell them that they must stop calling. They can still send letters but no calls. If they call again after you have told them not to report them to the FCC.
I was in the same spot you are. I was being harrassed so much by creditors that I was becoming badly stressed and not helping my medical problems. I finally went bankrupt. I had to pay the attorney a little each month for the amount of only $250 to go bankrupt. There is no shame in going bankrupt, you ran up the bills at a time you could pay them. You cannot help what's happened since then. I urge you to go ahead and do it. You'll sure sleep better afterwards. I know I did.
You don't have to pay for anything on those links below- they are free and the forums are great for help. Don't pay anyone for what can be done yourself with effort.
You will be glad you did
I am currently using CareOneCreditServices for my debt reduction program. It's over the internet, but free (if you can't afford to "contribute"). They managed to cut my interest rates down from 25% to 8%, so that I'm actually paying the principle amount.
Their website is:
https://cesi.ca … it.com/Home.aspx
If the $4,000.00 is from credit cards if you do not pay eventually the credit card companies will sue you. And if you pay the 25% on $4,000.00is $1,000.00 and then you debt is $5,000.00 and add another $1,250.00 for interest that is of course less any payments made. Filing Bankruptcy under Chaper 7 would discharge those debt and give you the protection of the automatic stay which after you file means those creditors cannot contact you again. Forget the debt consolidations, just add more debt in terms of fees.
I would recommend that you try to work out some kind of repayment plan with the cc companies if they are willing. However, if they refuse, you may want to consider filing for bankruptcy since you are unable to pay of the cc debt and do not have income the cc companies can go after. Also, if you have been disabled for 24 consecutive months you may be able to have the cc debt discharged if you have disability protection on those accounts. Good Luck.
A credit counselor can get the rates lowered and also cut your bill in half. Search the internet, Care One, is a good one. They can definitely help you. Good luck!
I owe 20.000 in credit card debt. I was out of work for 2 years and paid My bills with cash advances. Just got back to work?
Here is the life saving organization. In a second they can take all your pain away.
i'm 30,000. in credit card debt. i'm 100% disabled do to diagnoised combat related ptsd & major depression by the veterans administration & social security disability.
what should i do? please help
I'm disabled and my husband is retired. We have very low income. Our credit card debt is about 100.000.00. We stopped paying creditors. So far they call all day and ask for money. How long they will be call? What happens after few months if they not received payment? What will be the next step what they can do to us? Our house, no market, is worth less what we own to the mortgage company. Please give answer. Thank You. DAN.
When working on repaying my credit cards faster than minimum payments, am I better off paying $10.00 a week more or the same amount once a month? Thanks.
Penny from Michigan
If you have internet banking so you don't pay postage, then definitely pay the $10 every week. The interest is charged every single day, so you will save some money, also you won't have that $10 so you won't be tempted to spend it.
Internet banking is free, and so easy. I even pay my brother and sister that way, to distribute a small inheritance that comes in every month. You don't have to set it up as an automatic payment if you don't want to, it only takes a few seconds to go in and order the payment every week.
Congratulations on doing this. Being debt-free is an amazing feeling. Do you get the Debt-Free Living free newsletter? If not, sign up for it. It's got good info and motivation.
The quicker you reduce the amount the better as the interest is charged on the amount left over at the end of the month or payment cycle - I would recommend being flexible depending on what other payments you need to make that month - have a set amount that you won't go below but like say $10 or $15 over and above the minimum but then if you can afford it put more in do so. If you just keep paying the minimum amount the debt never gets paid and any savings made at sales using the credit card is negated
Credit cards are "revolving" monthly. So I don't think that making a payment every week is going to help; however, if that's the only way that you're sure to make the extra payments, by all means go ahead and do it. But adding up your extra money every week and sending it in monthly with the bill would be the same. But then again, you might want to check with your credit card company. Because it seems that with some companies interest might be charged on a daily average and if you're paying week by week, your daily average would be smaller.
If you get offers in the mail, occasionally you can transfer your balance over to a 0% interest that can last for a whole year. Sometimes there is no transfer fee. If there is one, it is usually 3% of your balance. And depending on how much you owe, sometimes the transfer fee is cheaper than paying your current interest for a year. You must make sure that you are never, ever, ever late though with a payment for the 0% rate to stay in force.
I transferred a balance once and paid the transfer fee and made one payment. The next month was when we had our famous ice storm of 2007 and even though I had the money in our account to pay the statement when it came, with all the confusion of the ice storm, I totally forgot it. I was two days late and the company upped my rate to something like 15%. They refused to "forgive" the lateness.
Luckily the very next month I received another offer with 0% interest and no transfer fee (they do not come along very often), so I took advantage of it.
It is nice to know that 100% of my payment goes to pay off the principle of the balance for the time being.
It will depend on each card and how much extra you can swing a month ...
Let's say you have four cards and each have a balance due of $1,000.00 and each card is asking for a minimum payment of $50.00 per month ...
Card one charges 18 APR, the next, 20 APR, the next 22 APR and the last 24 APR ...
Based on those figures, what I did in the past was to add at least an 'extra' fifty to each card PLUS the added charged in interest for that month ... This way, I was 'getting ahead' as far as reducing the amount owed and the interest charges went down immensley in no time at all ...
Those bills were completely paid off in just a little over a year based on the debt amounts I mentioned above ...
No matter what, pay as much extra as you can above the requested minimum payment or else you'll be paying on those cards for years and years to come :-(
I now only use those cards in case of an emergency or convenience and pay them in full each month so not a penny of interest is charged :-)
Most credit cards charge interest on the remaining balance, each month. When I need to pay them off over time, I look for the interest & add as much as i can, usually, for me, it's $100 plus interest so whatever amount u add to the minimum is to the good.