General

How to reduce on credit card debt?

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11 Aug 2016 - General
 

Setting a Goal

It’s important to establish realistic goals for paying off your high interest credit cards as well as other consumer debt (lines of credit, vehicle loans). While it is easy to run balances up in a short period of time, it will take time and self discipline to pay them off. Monitor your progress regularly to help you stay on track and motivated to reach your goals.

Put Your Cards on Ice - LITERALLY

Sorry to say, but getting out of debt requires taking those credit cards out of your wallet so you’re not tempted to use them. Put them away, or freeze them into a bucket of ice, until you have completely paid off the outstanding balances. Paying for your purchases with cash instead of credit will help you separate needs from wants.

Trim Your Expenses to Free Up Some Cash

One way to speed up your debt repayment and get out of debt fast is by reviewing your monthly expenses and looking for opportunities to cut your costs. You may be surprised to learn that making your cup of coffee in the morning instead of buying a $3 specialty drink will save you over $1,000 a year.

Create a Monthly Spending Plan

learn how to get out of debt and to stop borrowing from your credit cards again and again, you will need to create a monthly spending plan for your money. Not only will this ensure you are living within your means (and not above your income, which is where credit card debt comes from), but it will also give you a set timeline on when you can expect to get debt free.

Speaking of how to make the best use of the credit cards, I just wanted to share another experience I had yesterday. There was a great offer for HSBC credit card holders at the Hilton hotel. (I guess you are familiar with Hilton hotels.) It was a one on one or in other words a 50% discount on the dinner buffet! I went with my girlfriend and another friend. We ate like crazy, and at the end for a bill of 60 USD I only had to pay 30 USD. That alone saved me more than the annual fee I pay for the c...
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Local banks and credit card companies are always trying to convince doctors and other healthcare professionals into getting their credit cards. I think they believe that we have a lot of money to spend, and also that our lives are so busy that we will often forget to settle the card and they will get to earn the interest. That is true in one way when you look at it. I recently got myself a credit card because for doctors they had the annual fee waived off for good! I had to pay an initial fee of...
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That is a clever way to do it Theekshana Abayawickrama. Using it to avail the perks they offer but paying it off the next day. Funny that, I receive a post yesterday from one of the banks here offering me a credit card. I read it, tore it apart and put it in the bin. It is amazing how they will try to give you eye catching offers so you will use their company credit cards. As you have all said, we just have to use...
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To live within your means, that's what my dad always says. And it's true because the problem with credit cards as Theekshana Abayawickrama pointed out is that it allows people to spend money that they don't posses. It's a powerful plastic that can be quite destructive when in the wrong hands, but it can also do a lot of good, when you know how to use it. These are good points here Alan. But true, t...
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Theekshana Abayawickrama Mark Edmon Tan thanks guys for the post. I have noticed a lot of our medical staff having this problem, and yes it is true what Mark have said-most of our people in the medical field splurge on their credit cards due to the heightened stress level. We do a lot of emotional shopping and buying out of impulse...
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Thank you for this post Alan Rosmadi . People in the medical field are really prone to making bad financial judgments probably because we do emotional shopping more due to heightened stress levels. Credit cards can be used for leverage if used wisely; however, it is simply hard for us to resist impulsive shopping during sales. The general rule with credit card is not to use it for expenses that are out of your bu...
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Credit cards were invented for one reason. To spend money that we don't possess. And if one doesn't keep track and pay cluelessly with a credit card, at the end of the day they are going to be not only in debt to a bank, but also you're going to have to pay more than you actually spent as interest. I use several credit cards, but whenever possible I make payments from my debit card, because there's no reason to accumulate credit when you have money on the other end of your bank a...
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