Tips for Paying Off Summer Credit Card Debt

Tax Planning

We’re halfway through the year! How have you been doing with your finances? If you’re behind on some of your goals, that’s okay. There’s plenty of time to get back into the swing of things! One goal many people have is dumping their credit card debt. If you’re looking to reboot and knock that out, here are some tips to make the process easier.

  1. Stash Away or Cut Up Your Credit Cards: Don’t sink yourself further down the hole. Not having easy access to them helps you resist the temptation to use them again. Instead, keep it locked away somewhere safe or, if you want to go the Dave Ramsey route, cut them up.
  2. Get a Clear Picture of Your Debt: If you haven’t checked recently, go through your accounts and see the balances and interest rates you’re carrying on your cards. You may be shocked to see that low-interest rate you had last year shot up past 20% this year! Staying on top of your accounts empowers you to make better decisions. If the thought of logging into several sites seems like too much of a hassle, you can save yourself time by using apps like Mint to link and pull all that data for you. You can just log in once at home or on your phone and know your balances.
  3. Choose Your Pay Off Plan: There are two main schools of thought when it comes to tackling your debt. You can knock them out one by one by interest rate (debt avalanche) or you can pay them off based on their balance (debt snowball). There’s no right or wrong answer, just choose the one that fits you best. The key with either method is to focus and pay as much as you can on one debt while paying the minimums on the others. Once that debt is paid off, you take that money you were using and put it to the next debt.
  4. Build Up Your Payments: If you’re looking to speed things up, you have to grow your payments. Easier said than done, right? One of the easiest ways you can get things rolling is by selling stuff you don’t or hardly use. My sister made some extra money on the side with eBay years ago by selling collectibles. You can also unload locally with a yard sale or through Craigslist. If you have a ton of clothes, try online options like threadUp or go local and work with a consignment shop. If you’re looking for recurring income, you can take advantage of the upcoming school year and become a tutor. You can work reasonable hours, help others, and make some extra cash.

For some, it’s easier to cut back on expenses. A few of my favorite “low hanging fruit” are:

  • Cell phone: More and more options are becoming available and more affordable. Republic Wireless and Ting are two competitors that can help you slash your bill while still keeping your smartphone.
  • Insurance: Many of us have to pay car, home, and or rental insurance. Having the coverage is smart, shopping around for the best deal can save you big bucks.
  • Cable: For some, cable is an inexpensive way to unwind. Just double check to see if you’re getting a great deal if you decide to keep it. Of course, there are options like Sling TV that will allow you to keep what you truly want and save significant money.

To make sure that money is going towards your cards, make sure you automate those payments. It’ll help you stay on track and reach your goals faster!

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