Aside from bad spending habits, unforeseen circumstances such as unemployment, illness, or death in the family can put your finances in a spin. If you’re living pay check to pay check, emergency expenses can force you to skip bills and max out your credit card just to get by. Once this happens, credit card debt becomes an unavoidable part of your life, as well as debt collectors who won’t stop hounding you because of your unsettled bills. Fortunately, you do have options to get your finances on track. Here are some tips to help you pay off credit card bills faster:
Talk to your creditor about your financial situation
What most people might not know is that if you get stuck with debt because of unforeseen circumstances, you can always talk to your creditors. Trying to explain your situation to a creditor isn’t 100% guaranteed to get you lower interest rates, but it’s a good start. After all, you can’t control emergency expenses, and everyone gets into tight situations once in a while. Some creditors might ask for proof of unemployment, death, or illness, so be ready to provide the necessary documents. When creditors are informed of your situation, negotiating for lower interest rates or a decrease in your current rate becomes easier.
Enquire about a 0% interest balance transfer credit card
Another possible option is to transfer all your credit card debts into a single credit card account that has a 0% interest introductory rate. This way, you only have one credit card bill to deal with, and you don’t have to pay for interest rates. However, these cards come with transfer fees, so be sure to do your research first and see if you’ll save more if you do a balance transfer. Also take note that the 0% interest rate only lasts for a few months or a year, so be sure to pay off the debts before the introductory rate expires.
Consolidate your loan
Getting a personal loan to pay off credit card debt is one way of dealing with multiple credit card bills. Just make sure you do your research first when looking for a personal loan lender. When looking for a lending company, look for one that offers a reasonable interest rate, one that’s lower than the total interest rates of all your credit card bills. Also, consider the flexibility of the repayment options. The more flexible the terms are, the easier it will be for you to pay off your bills on time. By consolidating all your credit card bills in a low-interest rate account, you’ll be able to save money. You also don’t have to remember multiple deadlines and deal with different banks, helping you save time and effort too.
Find ways to increase your cash flow
From yard sales to getting a second job, there are several ways to increase your source of income. If you have old clothes, accessories, or furniture you don’t use anymore, hold a garage sale. Who knows, that old rocking chair might get a second life in your neighbour’s vintage-themed living room. Getting a part-time job during the weekends is also a good idea. If you have the time and energy, you can babysit your neighbours’ kids or take the neighbours’ dogs for a walk in exchange for a fee.
Dealing with credit card debt can be a long and tiresome process, but you do have options. Talking to your creditor, getting a 0% transfer balance card, applying for a consolidated loan, and increasing your cash flow can all help you pay off debts easier and faster. Do some research first to figure out which plan is more applicable to your needs. Once you’ve figured out which tip works best for you, paying off your debts will become more manageable.
Words by Katrina Daez