While it's tempting to just make the minimum payments possible on your card, this is exactly what the credit companies want you to do. They get a steady stream of long term income coming in, well above and beyond what they lent you. Interest of 18% can end up working out to as much as 40% of the total credit amount by the time the debt is finally paid off. That's a lot of extra money out of your pocket that doesn't need to leave it.



In 2007, it was estimated that the average American household owed $6,600 in credit debt, and to be sure, this amount is beyond what many of them initially borrowed.

Credit card debt is of course the worst kind, as they charge interest rates as high as double what you would be charged on a home or car loan, with additional fees to boot. It's also the debt that's easiest to go overboard on, as consumers become hooked on the power of their plastic.

By eliminating that costly credit card debt and reinvesting the future savings from it, you're really helping your bottom line two-fold. Biting into that chunk of debt is not easy though, and takes sacrifice, a sacrifice most are unwilling to make. And let's face it, if luxury and lifestyle weren't an issue, you probably wouldn't be carrying around that debt in the first place.

Short of resigning yourself to a life of high interest and debt which you could remedy with a balance transfer card, you need to start somewhere. The first recommended step is to get rid of that high interest loan immediately. Instead of making equal payments on loans with varying interest rates, make a large payment on the loan with the highest rate. Even if incurring penalties on your other loans by doing so, you'll likely be saving yourself a lot of money in the long run.

Setting goals for yourself is important. Coming up with a concrete and realistic plan and sticking to it is the best means of achieving success. Not having a plan makes it easier to waffle when the decision comes as to how much money to spend on paying off what.

The beginning is the toughest stretch. Once you start biting into that debt it has the same snowball effect in a positive direction that the debt normally has in a negative one. You'll find once you get ahead that it's easier to take bigger and bigger chunks out of it each month, as the effects continue to pile on exponentially.

Eliminating credit card debt could save you thousands of dollars a year for many years, all of which could be better spent planning your retirement and ensuring your kids get the education and opportunities you want them to have. It just takes that first difficult shove to get the ball rolling.