Keep paying the same amount, and your debt will shrink faster and faster. Eventually, the credit card company will lower the required minimum - but don't reduce your payment. Use the debt cascade method if all you can afford right now is the minimum payments on your credit cards. ![]() Like the debt snowball, the total monthly payment for all your cards should remain the same until you are debt free, and this method requires that you have more than the combined total minimum payment of all your cards to put toward your debt. Once you pay off the highest interest rate card, shift the payments to the next highest interest rate card while continuing to pay the minimums on the remaining cards. The debt avalanche method is like the snowball method, except you focus on paying off your highest interest rate card first while paying the minimum on the remaining cards. This method requires that you have more than the combined total minimum payment of all your cards to put toward your debt. The total monthly payment for all your cards should remain the same until you are debt free. Continue to do this until all your credit cards are paid off. Once the lowest balance card is paid off, shift that payment to the next lowest balance card. To reduce your credit card debt using the debt snowball method, focus on paying off your lowest balance credit card first while paying at least the required minimum on your other cards. Did a few big items or events lead to the balance you're carrying, or is it because of a steady stream of daily purchases that add up to more than your income?īy evaluating how you spend, you can pay off your debt and make more intentional spending choices. Because those occasions come up every year, you can decide if you're spending the right amount and include them in your budget.Īs you look at your expenses, see if you can determine the source of your debt. Look back at your spending for recurring special occasions, too, like birthdays and holidays. Sometimes deals are hard to resist, and a online shopping can make it easier to spend. Maybe your favorite coffee shop appears on your expense list more often than you realized, or maybe you're paying for a subscription for a magazine you haven't read in years. Thinking about where and when you spent money can reveal whether you have been spending more than you want to. This exercise is also helpful if you do a lot of online shopping and want to make sure items you ordered were delivered. If you bought several items online from the same retailer, you can often check your order history on retailers' websites. ![]() If you charged purchases, you can review them on your credit card statement or look them up on your credit card company's website. This includes monthly essentials, like utility bills, and fun expenses like gifts and entertainment. Start by making a list of everything you buy and the prices.
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