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The first time I tried to get a credit card, I was in high school. The day I asked my mother to go with me to the bank to help me get one, however, she fervently refused. “You have no idea how much responsibility a credit card requires,” she said to me. It wasn't until I was in my mid-twenties that I realized how right she was.
When I took my first post-college job, I started getting credit card offers in the mail all the time. I, unfortunately, was naïve and didn't understand the dangers of high-interest rates, so I took out three credit cards – all with a twenty-five percent interest rate. You can imagine my surprise at how long it took to pay them off. Luckily, I managed to learn a number of significant life lessons from that experience that I like to share with others.
If you're in the midst of credit card woes, here are three tips on how to simplify
your financial stresses.
Pay off the highest interest credit cards first and then negotiate lower rates
The last thing you want to do is let interest payments pile up on you. Before you know it, you'll be paying more in interest than you did on the actual items you purchased, and that is absurd. If you're struggling to pay off a few credit cards, focus on paying off the ones with the highest interest rates first. It might be a difficult task at first, but once it's accomplished, you'll have a giant weight lifted off your shoulders. If you can't fathom how you'll afford the payments, call your bank or credit card company and negotiate lower interest rates. Believe it or not, this can easily be done. The last thing a credit card company wants to do is lose you as a customer, so once you get someone on the phone, be assertive about the need to lower the interest rates on your card so you can make progress towards paying off your card.
Always pay more than the minimum amount due
It's so tempting to just pay the minimum amount due every month, but that's never a good idea. Not only will you be making little financial progress, you'll also psychologically and emotionally feel as though you're hardly making any progress. Sure, no debt collectors will be chasing after you if you're making consistent, small payments, but you probably won't feel very good about the fact that you still owe a significant amount of money. Even if it's just five dollars more than the minimum amount due, go ahead and contribute extra money each month towards the minimum amount due. Before you know it, you'll be making much more progress in paying off your debts.
Oftentimes, I'll have extra money coming in through my freelance writing and part-time work that I'll use to put towards paying off my credit cards. I know how tempting it is to use that money to buy something frivolous, but if you're really in a financial pickle, you should put that extra money towards good use. Micropayments are a great way to make progress towards paying off your credit card, and, remember, every penny counts.
Credit card woes can cause significant anxiety and stress. If you're looking to lessen your financial strain, try utilizing these three helpful tips.
About the Author
Eliza Morgan is
a freelance writer and self-help blogger. She often writes for businesscreditcards.com where she specializes in writing about topics related to small businesses and getting out of debt. If you have any questions, email her at firstname.lastname@example.org.