Credit cards leads you into a false sense of security. When they offer you a 0% interest rate over a period of 3,6 even 12 months, then when the low interest period is finished they hit you with higher credit card rate, which can be anywhere between 9 to 30% or more.
When using your credit card and paying the minimum every month can only cause more problems. Paying the minimum payment barely decreases the amount off the balance. This is due to the amount of interest charged to the card after the payment is made. Also if you keep on spending, you will soon find yourself with a big bill and a bigger minimum payment every month. But you can get control of debt.
When you eventually realise that your debt is getting away from you and managing your bills is not as easy as it used to be. You try to get a bank loan or get another credit card to pay off the old card. At this point you see that this is a downward spiral and you just find yourself with more debt. But you can get control of debt with a list.
To get control of your debt you need to know the monthly income and expenses. Make a list of everything that comes in and out each month.
Here's an example of a list you might want to use. At the end of the expenditure list calculate all of your outgoing and compare them to your income. You will then get a realistic amount of what cash you have available at the end of the month. So you can get control of debt.
Income per Month:
Salary
Other Income
Outgoing per Month:
House or Rent Payment
Car Payment Credit cards and other loans
Savings
Household and Auto Insurance
Food and Household Goods
Clothes and Dry cleaning
Gas
Utility Bills
Telephone (including mobile)
Health and Life Insurance
Prescriptions Public transportation
Car maintenance
Children's education (Meals, Uniform, Trips or Nursery fees)
Gym or Club Membership
Pets (food, Vet bills)
Hobbies
Misc.
Monthly Outgoing Total:
You will be surprised on what you can save on when you cut back. You need to take a look at what you really need and what you want. It is easy to save money on things you don't really need. Take a good look at the item you are going to buy and ask yourself do you really need it? Maybe you could get by with only half of what you need.
You just need to make a list of your wants and your needs, once you have the list you can work on one thing at a time. So you can get control of debt and get on the fast track out of debt. You can live debt free it's not that hard, you can do it.
Get Control By Id
One of the worst feelings is that of being out of control with your finances. Money is something that we all need to survive, but with a little distraction, or some unfortunate circumstances, it's something that easily can be lost control of. If you've lost that control and are ready to gain it back and plan for a financially sound future, it's time to consolidate bills.
There are several options available to you if you are ready to consolidate bills. You may decide to wait for your next 0% APR offer to come in and transfer your balances to one of these. You also may choose to get a debt consolidation loan in which you take out a loan for the specific purpose of paying of credit card bills. Another option is to refinance your home and take a home equity loan in which you cash out some of the equity in your home and consolidate bills that way. Any one of these you choose, it's important to know the pluses and minuses of each on your path to consolidate bills.
Choosing to consolidate bills through 0% APR credit card offers can be a great way to handle your finances. As long as you pay your monthly bills on time, your debt will stay down and you will be paying your bills at a lower monthly rate. You must be very conscientious about paying your bills on time and knowing when you transferred to each credit card. A credit card offer with a 0% APR is an introductory offer and usually ends at either six months or a year. Before the introductory period ends you will want to make sure to transfer your balances to a new card with a 0% APR offer otherwise you will end up paying regular interest rates of 14% and up.
A debt consolidation loan is a way to consolidate bills through a loan that is specifically designed to pay off bills. These loans are usually offered to those that have relatively good credit in order to help them pay their balances down. This is another loan that you will be taking, but it will take all of your credit card bills and turn them into one lower monthly payment. A consolidation loan will usually have a lower interest rate than a credit card, but the interest rate will go up if you make late payments or default on the loan.
A home equity loan is the final way to consolidate bills. If you are a homeowner and your credit is pretty good, you should not have a problem acquiring a home equity loan. Through this type of loan you will take the equity in your home and use it to pay those credit card bills off. In this way your payments will be lower. The interest on a home equity loan is lower than that of a credit card. And your monthly payment will be rolled into your mortgage so there will be only one monthly payment. The only downside to this is that if you are late or your payment becomes too much to bear, you run the risk of losing your home. But as long as the payments won't become too much to bear, this is a great way to
consolidate bills.
Whichever is best for you, debt consolidation will certainly help you pay off your credit card debt. It can be the beginning of a debt free future. It will certainly help you grab hold of your finances and put you back in control of them.
Both William Onedge & Thomas Erikson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
William Onedge has sinced written about articles on various topics from Finances, Options Trading and Finances. We have many budget plans, systems and free advice on how to become Debt Free. For more Info go to
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