Many consumers know the problem with using credit cards is that oftentimes you end up paying for purchases after you buy. The average interest rate on a credit card is 13.51%- if you carry over a balance. As of September 2016, cardholders carried on average a balance of $7,527. When you pay off your credit cards in full or have your debt discharged in bankruptcy, you have more disposable income for your financial goals and can better plan for your future. But how do you get there?
Here are three simple steps to eliminating your credit card debt.
Step one: The obvious- Stop using your credit cards. Pay in cash for all of your purchases. For online purchases use PayPal or your debit card. Using a “cash only” system allows you to spend what you have.
Step two: Make extra payments toward the principal. Lenders are required to show you how long it would take to pay off your credit card if you only made the minimum payments. Request your statements be mailed to you, online you may not be able to see this number. It will certainly give you a wake-up call. For example, the average American with $7,527 in debt, would spend 11 years paying the card off if they only paid the minimum balance. The interest would cost you $2,869!
Step three: Set financial goals and SAVE for them. Set up savings accounts for your big purchases. For example, if you are going to need a new car in the next 6 months or are planning a family vacation this summer.
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If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.