10 Ways to Reduce Credit Card Debt Immensely

Economists have been looking at some factors that suggest that we could be headed towards a recession, and one of those factors is credit card debt. Simply put, it’s looking like Americans are now hitting the limit that they can offer up as debt. When this happens, spending slows down, and a recession can occur.

The best way to ensure that you don’t get burned by a recession is to reduce credit card debt as soon as possible and to get a side job. Getting a side job isn’t easy, but reducing credit card debt is. Here are ten tips for anyone looking to minimize deficit before the recession hits.

1. Cut up your credit cards.

The most significant way to decrease credit card debt is to stop adding to it. Most people who are trying to cut down credit card debt keep piling on while paying it down. That’s a "two steps forward, three steps back" kind of move.

2. Transfer the balance of a high-interest credit card onto one that has 0 percent APR for a set number of months, and pay it down aggressively.

It’s no secret that interest rates tend to cause a slowdown in the rate that you’re able to get rid of debt.
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Getting rid of interest is huge. By transferring the balance to a card with no interest rate for a set amount of time, you avoid having to pay that extra cash…which, in turn, can help you pay down debt faster than ever.

3. Get a side job, and use the money to pay down debt.

There’s no more natural way to improve your financial standing than to get a side job. By having a side job, you allow yourself to free up money for a variety of different things—including debt payment.

Put that money into paying off debt, and you’ll find yourself in a far better position later on in life.

4. Use the Snowball Method.

Made famous by the financial writer David Ramsey, this method suggests aggressively paying as much as you can down on the highest-interest debt you have while paying the minimums on all others. After the high payments clear out the first debt, you move onto the next-highest debt and do the same thing.

This method is excellent for working out problematic debt and helping people free up debt quickly. Trust me; it works faster than you’d expect it to.

5. Try to negotiate your debt payments.

Believe it or not, debt isn’t set in stone. If you are under serious financial duress and have been struggling to pay anything at all, you may need to call up your debtors.
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If you haven’t been able to pay the minimums on your debt, save what you would have been paying towards them. Tell them why you’re late, and offer to give them a lump sum in turn for them writing off debt. Though it may not always work, it’s worth a shot.

It’s worth knowing that your credit score will suffer if you use this route. As a result, you should not do this unless it’s necessary.

6. Just pay a little extra every month.

It’s pretty shocking how much paying as little as $20 more than the minimum can help. It’s just a fact of math. More aggressive repayments mean that you will get rid of debt faster.

For example, if you were to have a $2,000 debt that you wanted to repay at 19 percent interest, paying $50 towards that debt will have you debt-free within 64 months. If you paid $70 towards that debt, you’d be debt free within 34 months.

7. Consider asking someone to take on your debt.

This is particularly common with cars that you really can’t afford. If you can find a buy who is interested in your car or home, you may be able to arrange a short sale or a lease takeover.
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This would rid you of the debt, but you also would have to give up the asset that is weighing you down. You might also have to get permission from your bank.Even so, this is a good way to quickly reduce debt.

8. Trim your lifestyle to free up money.

Most of us are not living by the skin of our teeth, which means that there are ways to cut out unnecessary expenses. Things like choosing to "brown bag" your lunch rather than eat out during work can make a huge difference in your budget. Guess where you can use that extra money. (Yep, your debt.)
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9. Use apps to help you curb spending and pay off debt.

New apps can help you make debt reduction easier than ever before. Some apps, such as Mint, allow you to see your pain points in your budget. Others, like Qapital, automatically save money for you and even work to pay down debt on time.

10. Consolidate your debt.

Once in a while, people end up getting themselves into debt that’s just too high-interest to be paid down really. When this happens, it’s often best to consolidate your debt by taking out a loan to pay off the high-interest debt, then pay off the mortgage in fixed installments.

It may take longer to get you out of debt, but it’s an excellent way to avoid dealing with extra interest and exceedingly long payment terms in some cases.