**New Series** Wednesday Wealth

Welcome to my new series, Wednesday Wealth.  I have found out so much information, that I can’t possibly fit it all into a single post, so credit card debt, and tips will be broken out into several posts as well. There is just so much out there on this topic, that to put it all into a single post might in fact make my computer crash! Here are some shocking statistics that I was able to dig up:


 36% of people polled, didn’t know what their APR’s on their most used credit cards were.

 51% said that in the past 12 months, they carried over a balance and was charged interest on a credit card.

 41% of cardholders from the ages of 18 to 29 made only the minimum required payment on a credit card in some of the past 12 months.

 43% of American families spend more than they earn each year.

I also found out that the credit card debt stories vary a great deal depending upon which article you read, some state that credit card debt is falling, and have reached historic 10 year lows, other state that the numbers are skewed quite a bit, and even more state that the average US family still carries roughly 5K or more in credit card debt.

Okay, so who or what do you believe? The answer is none of them. Believe what you see when you open your own monthly bill. Don’t believe for one minute that you are below the national average, or above the national average. In fact throw those numbers right out. If you spend your time thinking that you are okay with what you owe, because you’re below the average, you are wasting a great deal of your time. You should be thinking how you are going to manage your credit card debt, you should be thinking whether or not you want to carry a credit card balance, or if you want to completely eliminate your balance all together. First and foremost you must have realistic goals. To say that you will never again use a credit card may be a reality for some people, but unfortunately that’s just not a reality for others. What works for one family, may not work for you, so I am not going to waste your time with what my family has done.

If you’re looking to eliminate your credit card debt all together, here is a list of options , ideas, and tips for you:

 Get all your credit card bills and lay them out so you can see them. Create a simple sheet and put it where you will see it each day, like on the fridge, along with a picture of what your goal is, like for instance a picture of a vacation home, or dream home, or a dream renovation you may have. A constant reminder of what you owe, verses what you want will help some to achieve their goals. Your sheet should be simple like the example I listed below:

 You will need to find ways to cut your everyday expenses in order to pay down your debt quicker. Say you save about $20.00 per week by using coupons. Try to use more coupons each week, and use the additional amount you save, paying down your credit card debt. By saving an additional $20.00 per week, you could essentially pay down an extra $80.00 per month on a credit card.

 Many experts will tell you to pay down your credit card that has the highest balance. While in theory that is probably the smartest thing to do as far as finance charges are concerned, it may actually have a negative effect on your attitude. By paying off credit cards that you owe the least amount on, you can quickly see the effect, and have a greater sense of accomplishment quicker, which in turn will keep you inspired to pay off the rest of them.

 Once you pay off your first credit card, if you are getting by okay, and not neglecting other bills, instead of thinking you now have a slightly larger income each month, try applying the amount that you were paying on that first card to your second card in addition to your normal monthly payment. Or, you can split your monthly payment from your first card in half, apply half to your second card in addition to your monthly payment and take the second half and put that directly into a savings account. If you choose the later, add your total savings to the bottom of your list on the fridge, so you can also see your savings grow each month. Visual aids are extremely effective for many people. Don’t take your first card off your list, instead, just cross it off, and write the words, “PAID IN FULL” next to it.

 If you know that you need outside help, there are lots of Credit Counseling groups available today, however, many companies, will state that they are not for profit, contain certain fees, that apply, check your Better Business Bureau before committing to any one company. The last thing you want to do is go from bad to worse when dealing with your credit. There are companies that will help you to reduce your monthly payment, and even eliminate your interest charges. Though it is entirely possible for you to do this yourself.

 Call each company up, explain your situation, and if you are in a position to pay off a card all together, ask if they would take a reduced payment. Yes this will affect your credit rating, however, if you’re already in a bad situation, there is no harm done, you can always rebuild your credit, it may just take some longer. If this is the road that you are willing to take, by all means low ball them first. If you owe say $3000 and can actually afford to give them $2500 in one lump sum, call and ask if they would accept $1000. They may in fact say yes, and consider it paid in full, or they may say, No, can you pay $1890? Well then you can still pay it off, and you would still have $610 left over, to apply it to another card. By doing this, you also are cancelling out your card, and will no longer be able to use it. This is not really the recommended way of paying off credit cards, but it will work, especially if you haven’t been making regular monthly payments. With so many people not paying their credit card bills, and filing for bankruptcy, credit card companies want whatever they can get. Use that to your advantage.

Have you paid off your credit cards?  Leave a comment and help others to do the same!