How to reduce your credit card debt.

Reducing your credit card debt can save you a lot of money in interest paid over the life of the debt and it can improve your credit score. It's important to keep a close eye on the total debt held on our credit cards. Reducing your credit card debt comes down to two very simple things that must be done together in order to reduce the overall credit card debt.

The first thing that must be done to reduce credit card debt is to increase the amount of money paid towards the balance of that credit card. If you owe a total of $4000 on your credit cards, increasing your monthly payment by just $200 spread over the total number of credit cards you have may help to reduce overall credit card debt. Alternatively, you could pay off the highest interest card first by adding that $200 a month to it while paying the same amount on the other cards, to efficiently reduce the amount of money spent in interest while effectively reducing your credit card debt. Additionally, if you can, add more money to the amount paid from time to time, from one-time increases in your monthly income. If your grandma sent you $50 for your birthday, put half of it on your credit card bill. If you sold your old tiller on Ebay, put all of the net proceeds on the credit card bill. Adding money to the bill from unexpected sources of cash will help to reduce your overall balance and total credit card debt faster.

If you can't find extra money to pay off your credit card debt faster, it may be time to liquidate some resources. One of the quickest ways to raise cash in the summer time is to have a yard sale. An easy way to know what should be sold is to ask which items have I not used in the past 12 months. If you haven't used it in a year, you can sell it and not miss it for the most part. Another way is to ask which items do I hate, but I keep in order to keep other people happy. That ugly sweater grandma bought you two years ago that you wore once sell it. The knick knack your mom gave you from her vacation in Cancun, sell it. That guitar you swore you were going to learn how to play in high school, but you still haven't learned to play, sell it. These are items clogging your space, collecting dust, and keeping you from your financial freedom. Use the net sales from the yard sale to pay down a little extra on your credit card debt. If having a yard sale doesn't garner enough o make a large dent in your credit card bill, try selling many of your old items on Ebay. Use all of the net proceeds towards reducing your total credit card debt.

If selling off your possessions doesn't work, it might be time to look into a second or third part-time job. Finding work is difficult in today's economy, but it is a quick way to ensure you have a regular payment for your credit card coming in. If you can't find work, freelancing on the internet may be a way to pull in an extra hundred or two hundred dollars for your credit card payment. Do you like to take photographs? There are ways to monetize your favorite hobby and make some money out of it. Whatever you decide to do, paying more towards your credit card is the goal.

However, just paying more money to the credit card isn't good enough, fi you keep using it! The second part of reducing your credit card debt is to stop using your credit cards for a while. How long depends on how much you owe on your credit cards and the percent of your total credit line that is owed. If you owe over 20% of your total credit line, you should be in emergency mode trying to pay off your credit card debt. How do you know how much you owe as a percent of your total credit line? Add up all of your credit limits, then add all your total balances. Divide you total balances by your total credit limit. This will give you a decimal. Then move the decimal two places to the left and you will see how much percent of total credit limit is used. If that number is over 20% or .20, you need to pay down those credit cards as fast as you possibly can.

How can you keep from using your credit cards though? If you have automatic payments withdrawn from your cards, stop them and have them withdrawn from your bank accounts. It is cheaper to have automatic drafts from your bank account and most businesses offer this service now. If you use them for groceries, household items, and gas, stop and make a household budget for these items so that you don't need credit to pay for day to day items. Sometimes, it seems harmless to get an extra $50 in food for our family or $30 in the gas tank on you credit card, but it all adds up at the end of the month when you get your new statement. If you use your credit cards on impulse to splurge on things when shopping with friends, leave them at home when you go out for fun. If you find yourself having trouble leaving them at home put them on ice. In fact, put them in a cup of water and literally freeze your credit cards so you cannot use them on impulse.. If you really want to use them after they thaw out completely, then go ahead. If you use your credit cards for little extras that you would never pay cash for, limit yourself to paying only cash for those little extras you indulge in from time to time.

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