The average credit card rate is currently above 17%, significantly higher than almost all other consumer loans, and may reach 19% by the end of the year, which would be an all-time high.
Reducing balances is “crucial for financial health”
“Reducing credit card debt is always crucial to financial health,” Amadin said. “However, now more than ever it is critical that Americans survive everyday expenses and can continue to set aside money for savings.”
Here are his top three tips for paying off credit card debt, once and for all:
Budget: To start, using a spreadsheet or online tool can help you see where you’re spending money and how best to disperse those funds. That will also help you identify regular expenses that could be taking money away from your long-term goals.
Cut expenses: When trying to reduce debt, be sure to temporarily cut out any unnecessary expenses, like streaming subscriptions, dining out, or impulse purchases. Cutting those expenses will help you stay on budget, stop adding to your revolving balance, and pay off more debt.
Pay more than the minimum balance: Paying credit cards on time will allow you to avoid late fees and penalties. But do not limit yourself to paying the minimum required: that will not do much to avoid high interest on the balance. Paying just more than the minimum will reduce the amount of interest you have to pay each month and help you reach your goal.
In conclusion, the most important thing is to organize your finances and know how much you can spend while stabilizing your economy.