When Dealing With Debt
ByWhether you are dealing with bad, lower or good debt it’s important to have a game plan when working towards paying it off. No matter where you stand with your credit, your plan needs to consist of starting with the smallest balance and paying that off first. Beside consolidate your debt as much as possible I wrote before, here are some methods you need to know:
Start with the smallest balance first
Being able to pay even one card off can feel like a life changing event. Whatever balances you have not consolidated, begin with the smallest balance first. Even though it may not have the smallest interest rate, it is still best to get at least one card paid off. This gives you the option to request another balance transfer and transfer your balances again when the original deals expire.
Rinse and repeat
That’s just my way of saying keep going. Consolidate the balances you can, and then pay off the smallest balances right away. Keep asking for lower interest rates, and keep pressing your luck.
Do try and keep your nose clean
While it may seem tempting to go out and keep charging up a storm, if you truly want to get out debt, you need to spend as little as possible during this period. Whatever you do charge on your cards, pay it all off each month plus whatever extra you can spare.
By using the cards instead of your checking account, then paying everything in your checking towards your credit card, you create a good payment history on your credit reports and you lessen the likelihood of bouncing any checks.
