Home » Debt » Five Tips to Shred Your Credit Card Debt

Five Tips to Shred Your Credit Card Debt

*Editorial Note: This content is not provided or commissioned by the credit card issuer. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.

This article was last updated Feb 02, 2015, but some terms and conditions may have changed or are no longer available. For the most accurate and up to date information please consult the terms and conditions found on the issuer website.

With the New Year in full effect, many have begun to implement their New Year’s resolutions. If you’re like many Americans, one of those resolutions likely involves paying off that credit card debt you racked up over the holidays.

According to the Federal Reserve, total credit card debt in the United States reached $882.6 billion as of October 2014, up 3.09 percent from October 2013. That’s an average of $7,283 of credit card debt per household!

That number alone can seem overwhelming, however, there are a few things that you can do to start shredding your credit card debt.

  1. Knowledge is Power: The first step is to know what you owe and to whom. Make a list of all of your credit cards, the amount you owe on each, the APR associated with each card, and the amount due. Once you have that information handy try our Credit Card Payoff Calculator to determine how long it will take you to pay off each credit card.
  2. Lower Your APR: If you have a credit card with a high APR, there are a few ways that you can try to reduce this number so that you don’t end up wasting a bunch of money on interest charges. This can often be done with a simple phone call to your bank or card issuer asking them to lower your APR. If they are unwilling to change your rate, another option would be to transfer your debt to a balance transfer card that offers 0% APR for an initial period of time. Look for cards that accept balance transfers at no cost. Just make sure that you are able to pay off the majority, if not all, of your debt before that initial offer expires, as many balance transfer cards have fairly high APRs that will kick in after that time is up.
  3. Budget: Look for ways that you can cut a few extra dollars here and there by shopping generic brands, using coupons, and taking advantage of sales. Only spend your money on the bare necessities. Remember, it’s only temporary. Once you are debt free, you can enjoy splurging every now and then without the guilt.
  4. Strive for More Than the Minimum: Find a way to pay more than the minimum payment, even if it is just an extra $10 per month. Check the back of your statement to see how much you will need to pay each month to pay off your credit card bill in less than half the time it will take by paying the minimum.
  5. Cash is King: If you find that you overspend because you can't see the limit of your credit line, you may want to stop using your credit cards and use cash only. This way you will be able to see exactly how much you can spend, you won't incur any more interest charges, and you can always return to using a credit card with rewards when you're ready.

In addition to the tips listed above, we would like to join the fight with you to help ease that financial burden and shred your debt so that you can get your New Year started off right with a little less stress! We will be awarding two lucky winners a prize in the amount of $2,500 or $1,500. All you have to do is answer a few simple multiple-choice questions regarding holiday spending and debt to be entered to win. All answers will remain anonymous and winners will be picked at random. Check out the details on our Shred Your Debt Sweepstakes page and enter for your chance to win!

For more information and tips on how to shred your debt, check your credit score for free and find ways to improve your credit, check out our free Credit Concierge service.


Recommended Posts:

Read More

Debt Reduction: The Pros and Cons of the Snowball Strategy

The so-called “snowball” strategy for reducing debt is a popular one, often touted by financial gurus and motivational speakers such as Suze Orman and Dave Ramsey. The approach can be a very effective tool to help you trim down your debt and eventually become completely debt-free. There are also variations on the strategy like the “avalanche” […]

Read More

Debt

February 2, 2016

Read More

Shred Your Debt Sweepstakes

Every year we tell each other that we will not be caught off guard with the holiday season. Year after year we tell ourselves that we’re going to start shopping earlier, save more and spend less. Year after year American consumers seem to spend more than the year before. The 4.1% increase in the holiday […]

Read More

Debt

February 12, 2015

Read More

35% of American Consumers Have Overdue, Unpaid Debt

Despite an improved economy and some tough lessons learned from the Great Recession, Americans are still saddled with debt, although there has been a great deal of emphasis on returning to prudent money management. Many organizations are offering classes and other resources to impart financial literacy. Still, perhaps because a prolonged period of serious unemployment […]

Read More

Debt

September 25, 2014