Aug 17 2008
Nix That Credit Card Debt
Tired of your credit card debt, well let’s get rid of it. When I was in college I had about $13,000 in credit card debt not including my college loans. For now we will discuss how I got rid of my credit card debt within two years while making only $27,000 a year.
First, determine how many cards you have. I know this sounds weird but some people forget about that Nordstrom credit card. Okay, now that you have them line them up on the table from lowest annual percentage rate (APR) to the highest. Second, write down on a paper the maximum credit amount of each card and what you owe below.
Third, you now know what your total credit card debt is at this moment in time so keep that number in your head. Your first objective is to get rid of your highest APR credit card, physically. Get your scissors out and cut your highest APR credit card in twelve pieces and throw it in the trash. Your highest APR card or trash card will be the first to get down to zero.
1) If you are maxed out on all cards this will require less thinking for all of us. Pay the minimum amounts the non-trash cards and put as much money as you can on the highest yielding card (trash card). Depending on how much you owe on your trash card your debt for this particular card should be gone within two to three months. I know that sound like a long time but nobody said it will be easy. It’s time to ask yourself ‘how strong am I’. Once your trash card balance is gone you will call the customer service line and ask to CANCEL your card with them.
2) When you call your credit card company they will probably ask you to stay on because you are now such a good customer. The credit card company will then give you a better rate for your loyalty. If the rate is lower then your next highest APR then take it. And when you take ask for a new card to send you (since you shredded it) and ask for some transfer checks.
Tomorrow, I will tell you what to do with those transfer checks.
