![]() That’s why you start with the smallest balance first. You attack your debt one credit card at a time by going after the one you can get out of your life soonest. The debt snowball method is all about motivation and momentum. Okay, we know what you’re thinking- What about those interest rates? Listen: What you really need is a win. Use the debt snowball method to start paying off those credit cards, starting with the smallest balance. After you pay off your debt (more on that in a minute), you’ll want to build that starter emergency fund into a fully funded emergency fund (3–6 months of expenses). I know $1,000 doesn’t sound like a lot for emergencies, but it’s just a starter fund. And while no one likes to pay for emergencies, using your own money means you won’t have to pay interest on that brand-new A/C unit. Leave it in your savings account as a buffer between you and those “life happens” moments. It’s time to get yourself an emergency fund.įirst step? Save $1,000 as fast as you can. Borrowing money for emergencies only leads to more disaster. If getting rid of those credit cards freaks you out because you use them “for emergencies,” then it’s time to come up with a new plan. What does this mean? It means you get to start paying for things with your own hard-earned money in the form of cold hard cash (or your debit card). Listen: If you stop using credit cards and finally pay them off, you’ll never have to worry about your credit card balance. Goodbye.” Then take those kitchen scissors and cut them up so you won’t be tempted to swipe them again. You’re bad for me, my finances and my future. Just put them on the table and say, “It’s not me-it’s you. They weren’t your type (and we heard your mom didn’t like them anyway). Yep, break up with them and never look back. If you’re finally ready to end that toxic relationship in your life (aka your relationship with credit cards), you’ve got to kick them to the curb. (That means your income minus your expenses equals zero.) 2. Stop using your credit cards. If you have money left over, put it to use paying off credit card debt! If you’ve got a negative number, it’s time to tighten up those other budget lines until you get a zero-based budget. Once you’ve got all your expenses accounted for, subtract them from your income. Start with your Four Walls (food, utilities, shelter and transportation). Pay off debt fast and save more money with Financial Peace University.Īnd you want to tell your money to go toward paying off credit card debt, right? So, get on a budget! Start by listing your income (everything coming in). It’s up to you to tell your money what to do and where to go. ![]() If you don’t plan out where your money is going, you’ll never know where it went. Why? A budget is a plan for your money-Every. Money goals can’t become money realities without a budget. ![]() Here are seven of our favorite proven ways to pay off credit card debt fast, once and for all. But it doesn’t have to be that way-starting today. If you’re not careful (and sometimes, even if you are careful), it can suck you in and keep you stuck in the cycle of debt for what seems like forever. How to Pay Off Credit Card Debt Fastĭebt sucks. And if you’re wondering how to pay off credit card debt fast, you’ve come to the right place. It’s time to drop that debt like a bad habit. But you don’t have to let yesterday’s purchases hold you back from winning with money today. So, if you’re carrying a balance every month and feeling the squeeze between meeting your minimum payment and trying to keep up with all your other bills. And Experian found that the average American carries a credit card balance of $5,221. According to the New York Fed’s latest numbers, America’s credit card debt is sitting at $841 billion. ![]()
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