Credit card debt is something that many Americans deal with on a daily basis. Yes, these bills may only need to be paid once a month, but if someone has developed a significant amount of debt then it is likely they are faced with decisions involving a card’s use every day. Choosing to face the reality of a situation and then putting a plan in place in order to help climb out of the seemingly never ending hole is a first step toward being financially free in the future.
It is going to take some time. With average annual percentage rates (APR) hovering between 16 and 22 percent, the interest paid on live balances can accrue significantly over time. Paying the minimum payment does eliminate any additional interest and fees that may be applied but continually using the same card will typically only make your due payment increase - a step back in the process. To get ahead, follow some of these simple first steps in the process.
Pay Down Lower Balances First
If you have multiple credit cards and are able to put a stop to buying on credit, then move forward with a plan. If you need a credit card for emergencies, research which of the one’s in your possession have the lowest APR and use this one - ONLY in the case of emergencies.
Pay the minimum balance due on this one or any others and attack the lowest balance remaining first. For example, if you have three cards and typically used $300 to pay over the minimum due on each previously, then consider using the same amount but in the above described method. You may pay the minimums on two at $75 each and then use the remaining $150 to attack the lowest balance. Soon this amount will begin to reduce and if the card isn’t being used, ultimately it will be paid off without increasing the amounts you were previously putting toward these cards. Not only will this give you a sense of accomplishment but you can then reduce the amount of cards you have to a lesser number.
Request a New APR
Ask and typically you shall receive, in addition, all the credit card company can say is no and more often than not they will negotiate to lower your current APR provided you have been a loyal customer for a given period of time. Negotiating a better credit card deal can save you an enormous amount of money in the long run.
Make On-Time Payments
Not only will being a loyal customer help in your negotiation process but by making on time payments you can establish the reputation as a quality customer. This helps to both eliminate any additional fees and or penalties that may be issued due to a late payment and also adds leverage when attempting to secure a better interest rate.
The tax and financial experts at Bloch Rothman and Associates
are ready and willing to assist if you should need help assessing your current financial situation, paying taxes, or any other wealth management issues. In addition to providing a quality tax service, including navigating the intricacies of an audit, our group can also complete tax returns or answer any other factors associated with financial issues or concerns you may have. Serving in Denver and all of the surrounding areas for 35 years, our firm has an extensive history in helping clients with any and all of their tax issues or dealings with the Internal Revenue Service. If you have questions about your personal, business, estate or any other filings, don’t hesitate to contact us today. Available for all of your tax needs and filings, there are also a number of bookkeeping and payroll services offered to assist you and your business. We look forward to meeting you and serving whatever your needs may be soon!