High debt can make you feel stressed, worried, and a little discouraged. Just remember, where there is a will, there is a way to pay. One of our goals as a credit union is to help you become financially stable. Take a deep breath, create a timeline and think how you can reduce your spending.
Then use some of the following tips as a guidance to help you pay off your high debt.
- Get rid of high rate credit cards first
What does this mean?
Your credit card interest rate vary between financial institutions. Allowing your spending to increase unconsciously. For example let’s pretend you spend $450 in credit card A with a 29.99% interest rate; and you spend $475 with a 12% interest rate in credit card B. In time, the $450 spent in credit card A may become more expensive due to its higher interest rate. You must avoid falling into this trick.
First, go over all your credit card statements and create a list starting with your highest interest cards and ending with your lowest. By increasing the payment on your highest interest cards you are saving money and avoiding high interest charges.
TIP: Remember to continue paying the minimum amount due on the rest of your credit cards.
- Take advantage of Balance Transfer Promotions.
If you have high interest rates on another credit cards think about moving your debt to your BrightStar Credit Card—especially during our Balance Transfer Promotion period. Keep in mind you must be strict with your payments in order to take advantage of the promotional rate before it expires.
- Stop spending so much on your credit cards.
If you’re trying to pay off your high debt, credit cards are NOT your best friend. Remove all credit cards from your wallet, and start budgeting your expenses with cash. Don’t worry, this change is only temporary, only while you get more financially stable.
- Put work bonuses, or other incentives toward debt.
We get it! Taking that work bonus and using it on a nice vacation is tempting. However, sometimes we need to put temptation aside and start thinking of our financial future. If you receive a bonus for a good sale, holiday, or other use it to pay off your debt. Your wallet will thank you later.
- Sell unwanted items online.
A good way to make some extra cash is to clean your house from unwanted items. Sell those old presents collecting dust and start fattening up your wallet. After all, one man’s trash is another’s treasure.
High debt should not affect your well-being. Go on, change your habits, make some smart choices, and reward yourself in the future.
You can do it!