It’s hard to recognize when you have a credit problem, but as we’ve seen in the news for the last several years, people have an issue with putting down the plastic and saying no to credit card debt. Of course, the best way to control your debt is through a preemptive approach, but not everyone has that luxury. If you’re looking for credit advice, it’s likely that you have at least some portion of debt. Here are some quick tips to help you regain control over your credit.
Making A List
You need to figure out how much you bring in each month. Then take that figure and create an itemized list of all your monthly bills. Add it all up and figure out how much you’re bringing in versus how much you owe. This will give you a good idea of how drastic the situation is. Once you figure this out, you’ll then start to see some of those monthly expenses with a little more importance. It’s a good start at understanding the difference between a need and a want.
Cut It Up
If you find that you’re having difficulty paying off your credit cards, and one of the reasons why is that you keep putting more money on your card, then you need to cut up all of your cards, save one. You want to get rid of all your cards with the highest interest rates, keep the lowest balance and lowest interest card. Next you have to stop using it. Credit can be like a drug and if you’re not watching it, you can find yourself in deep water with a credit agency.
If you’re having difficulty making the minimum monthly payments, then you’re going to have to change a few things. Cutting costs wherever you can is the first step. Reducing your bills, going out less, and switching to prepaid phones are all good first steps. Basically, anything that’s a luxury you need to get rid of. This is often difficult for people because they’re used to a certain standard of living, but desperate times call for similar measures. You might have to do a little downgrading but it’s worth it to keep you out of debt.
As is often the case, after people crawl their way out of debt, which usually takes them years to do, they eventually find themselves right back in it. That’s because they’re treating the symptoms and not the cause. The cause of the problem is the card holder themselves. You have to completely reexamine the way you spend your money. If you’re not actively working to keep your expenses down, you’ll repeat this process over and over until get weed out all those bad habits that got you into debt in the first place.