4 steps to eliminate my credit card debt

We know how difficult and frustrating it is to have credit card debt. The high interest rates charged to us mean that, despite making payments month by month, it seems that our debt does not decrease and that it will be impossible to pay it. The good news is that it is possible!

When we have a credit card debt, we must have a financial priority number one and eliminate it and we must make a specific plan to achieve it.

eye! As a general recommendation to keep your debt from growing, we recommend that you stop using your credit card until you regain control.

Yes now! These are the 4 steps that will help you be free of your credit card debt:

Identify your current situation very well

Identify your current situation very well

It is important that you first identify exactly how much money you owe and what interest rate you are paying for your debt. If you have more than one debt (credit card or any type), clearly identify how much you owe to each of your credits and what is the annual interest rate you are paying on each one. This will be the first step that will help us determine our payment strategy.

 

Determine your monthly payment capacity

debt payment capacity

Make a budget in which you include all your fixed expenses and basic needs that you must cover each month (includes expenses such as food, housing, education, etc.).

After you are very clear about the exact amount you need to cover your basic needs each month, subtract this amount from your monthly income to calculate how much money you can use to pay off your debts each month.

While doing this step, it can be very useful to identify in which additional expenses you have been using your money, which of them you can eliminate and / or decrease and thus be able to dedicate more money to settle your debts. Remember! It is worth making small sacrifices to be debt free much faster.

 

Find better conditions to pay your debt

pay your debt

Since you are clear how much you owe, what are your most expensive debts (those of higher interest rates) and how much you can allocate to pay debts each month, it is time to look for better conditions to eliminate your debt. This means that you should try to get a better interest rate and transfer your debt to fixed payments to keep it from growing.

There are several options in the market (like your digitt credit !) That allow you to transfer your debt or consolidate it (if you have more than one debt) obtaining better conditions. Remember that if you transfer your debt to a loan with a better rate and fixed payments, you must ensure that the monthly payment capacity that you calculated in step 3 is sufficient to cover the monthly payment of the new credit.

 

What if I have more than one debt ?

debt  problem

If you have more than one debt or failed to transfer your debt or one of your credit card debts to a loan with better conditions, we recommend that you allocate most of your monthly payment capacity to your most expensive debt, that is, the one that It has a higher interest rate, while still paying at least the minimum payment to your other credit cards (to avoid collection costs, other penalties and to avoid affecting your credit history).

We recommend you follow these steps to get out of your credit card debt! We know it is not easy, but it is possible! You can! Count on digitt to help you achieve it!
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