Did this past holiday season spending cause your credit card balances to increase? Maybe it wasn’t the holiday spending but other expenses that now makes you wonder how you can quickly lower your credit card debt. No matter how the balances increased, you now have higher monthly minimum payments due. You may have been struggling to pay the minimum before these most recent charges.
I typically write about slow and steady approaches. This article will discuss how you can quickly lower your credit card debt by making radical and dramatic changes in your budget.
Acknowledge You Have Debt
While it’s unpleasant to think about your outstanding debt, you must admit there is a problem before you can do anything about it. Not only must admit there is a problem, you need to recognize it is an emergency. Putting it off won’t make the debt go away.
Suppose you had chest pains and the cardiologist told you needed to have bypass surgery, immediately. Would you wait to have the surgery and see how things will turn out in a week or two? What is going to change in the next in the few weeks with your outstanding debt? Stop making excuses.
Determine What You Owe
Gather all of you outstanding debt and list (either on a spreadsheet or on paper) every single outstanding debt you have. Include the balance, minimum monthly payment required, due date of the month, interest rate. The hardest part will be totaling the balance due and the minimum monthly payments.
What Large Monthly Expenses Can Reduce
You may be able to address your debt issue by changing one or more large monthly expense, rather than a series of smaller changes.
Typically, automobile loans are one of highest monthly expenses. What type of car are you driving and how old is it? Large SUVs are expensive cars to be driving. They cost more to buy, more to maintain (for example cost of new tires), and are not fuel efficient which means you spend more on gas.
Other Expenses to Eliminate or Reduce
Here are other expenses that you can eliminate or reduce in order to quickly lower your credit card debt:
- Monthly subscriptions and fees. Examples are gym memberships, and monthly online music and audio subscriptions.
- Stop eating out completely for a month or two. Or only eating out once a week.
- Don’t buy alcohol, soda, other drinks that have little or no nutritional value.
- Make your main meals from ingredients from your cupboards and freezer. It is likely you can prepare many meals without buying too many extra ingredients.
- Have no spending weeks. These are weeks where you only spend on necessities such as gas for the car.
While it can be difficult to face, the only way you will be able to reduce your outstanding debt is to first acknowledge you have an issue. The next step is to know what you owe. While there are different approaches to quickly lower your credit card debt, sometimes making radical changes rather than more subtle changes can give you the jump start you need.