Credit cards can certainly be convenient, especially during times of emergency, but there comes a time when they must be paid. Having a small amount of credit card debt is not necessarily bad. When your debt becomes overwhelming, it is necessary to examine ways in which you can begin to pay it down. When you wish to reduce your debt level, it is important to understand the best methods for paying off credit cards.



Experts agree that the best method for paying off credit cards is to begin with the cards with the highest interest rate first. Many people make the mistake of trying to pay down the cards with the highest balances, but attacking those with the highest interest rate will actually give you the best benefit. Once you have the credit card with the highest interest rate paid off, you can then move on to the next highest card and begin paying it off and so on.

When paying off your highest interest credit card, it is best to at least double your payment. Remember that when you only pay the monthly minimum payment, it will take you much longer to pay off your credit card. In addition, you will continue to rack up large amounts of interest debt in the interim.

There are some limited situations when you might benefit more from knocking out the credit cards with the smallest balance amounts first. The biggest advantage to this method is that you can quickly take out some bills from the monthly amount that you must pay. This can provide you with additional funds that you need to begin doubling up on payments on higher interest credit cards. While it really does make better financial sense to pay down credit cards with the highest interest rates, it can become discouraging for many people to attempt this method. Paying off some of the smaller balance cards can provide you with gratification sooner and help you to feel as though you are really doing something to get out of debt. Once you feel like you are making progress, it can be easier to continue that momentum.

The key point is to make sure that you follow-through and take the money from those payments once you have paid off the smaller cards and apply it to the balances on your higher interest rate cards.

It is also essential that you stick with the plan for paying down your debt. Make a commitment to stick with the payment plan you have set and keep at it until you have paid off a card. Then apply the payments from that card to another card and keep going.

The most frequent problem for many people who are trying to pay off credit cards is that they start out with good intentions but fail to keep them. They start out saying they will pay a certain amount but then realize later that they just cannot afford it. Once they decide they can't stretch it that far, they forget all about their commitment to pay off their credit cards.

The best way to avoid this problem is to sit down before you even begin and set a realistic budget in order to determine what you can comfortably afford. Analyze your income as well as your expenses and determine whether there are any areas in your budget where you may be able to cut back in order to fund making larger payments on your credit cards. It's really a good idea to keep an expense journal for about a month so you know were your money is really going before you commit to making a certain payment above the minimum monthly payment.

Once you have tracked your expenses you will have a much better idea of precisely how much you can afford to pay toward your debt. Even if you can only increase your minimum monthly payments by just $50, that is still taking a huge step toward paying off your debt.

If you are not able to find enough extra money by tracking your expenses, look at other areas where you may be able to cut back to turn up the money. For example, consider bring your lunch to work at least a few days per month in order to save money. Instead of going out to the movies as often, rent a movie and pop some popcorn at home. Begin clipping coupons for groceries. Make a pizza at home rather than ordering out for delivery. Cut back on the number of coffees you have during the day. At a typical $3-$4 each, even cutting back two per week could turn up astonishing savings.

Once you have started paying more than the minimum you may be surprised at just how fast your debt levels begin to disappear. While it does take time to pay down credit card debt, with dedication it can certainly be done.