Credit cards provide you with the convenience of paying for and enjoying your purchases now without necessarily worrying about the actual cost. You feel confident that the equal monthly payment terms of your credit card purchase is easy to settle. However, like many individuals, they tend to downplay some of the signs of overdependence on credit cards such that the mounting interest rates on top of your credit remain unnoticed. Until, of course, your credit card debt is way over your head.
Here are a few tips on how you can pay less interest on your credit card debts
1. Consider seeking the services of a debt consolidation or debt management company. They will be the one who will argue your case to your credit card companies with the aim of lowering the interest rates on your credit card debt. If this is not possible, they can at least negotiate with the credit card company to provide a slightly lower monthly payment amount. This way it will be a lot easier to pay your credit card debts.
2. Consider looking for a personal loan the proceeds of which you can use to pay off your credit card debts. This way, your debt problems shift from your credit card to the personal loan. Choose a loan facility that will offer you considerably lower interest rates than all of your credit cards combined. This is one sure way to pay lesser interest on your credit card debt. One good way to start is looking for peer to peer lending companies.
3. If you have several credit cards, focus on paying the interest of the credit card that charges the highest rates. Check the calculation of interest charged on your credit card billing statement and prioritize your payments. You can also pay off your debt first on the credit card that has the smallest balance before going on to the next in the line. However, you want to pay your credit card debts, it is often a lot better to pay at least 5 percent more than the minimum amount on each of your cards.
4. You can also try leveraging on your home equity. Applying for a home equity loan is sometimes more fiscally sound in paying off your credit card debts and not only its interest rates. Additionally, by consolidating your debts to a single loan, payment becomes a lot easier as the interest rates are significantly lower. Furthermore, payments made on home equities are tax-deductible offering you additional advantages.
5. While consolidating your credit card debts might bear fruit, you need to be more frugal in your purchasing decisions, especially in the use of your credit card. It simply makes no sense consolidating or paying off your credit card debts if you cannot stop the urge to splurge on unnecessary expenses. In no time at all, your debts will be over your head again.
6. Always save some for the rainy day. While you may be paying significantly lower interest rates for your credit card mess, you need to save some of your cash for those emergency purposes. Living way beyond your means is something that you need to control. Cut back on things that are not necessary. Be disciplined.