GUEST POST BY: Josh Wilson, author of www.familyfaithfinance.com
If you want to annihilate credit card debt, you are not alone. In fact, I was once in your position, and I just could not wait for that debt to disappear. If you have a lot of credit card debt, then you already know that you are paying a ton in interest. If you don’t shape up, then you are basically throwing your money away.
If you maxed out your credit cards, then you can quickly see your statement balance grow, but you never have any available funds either. Just like the Death Star, I wanted to annihilate my debt and say goodbye to it once and for all. As Obi-Wan Kenobi says, “Use the Force, Luke”, but in my case, it would be “Use the Force, Josh.” Okay, so you have credit card debt. How much do you have? When I first attempted to tackle mine, I had $1,500 racked up on a credit card which was all accumulated before I met my wife after college. I was ashamed of it, but at the time, I was proud to have that plastic in my hand and it showed. Whether you have the same amount of debt, a smaller amount, or a larger amount, I will explain to you below just how I eliminated my credit card debt once and for all and how I got my finance in check.
A Balance Transfer Was My Friend
“May the Force Be with You!” This is definitely how I felt when I learned about balance transfers and their benefits. Okay, so I know they would work for you too, but you need to make sure it is in your best interest before you do it. If you make a balance transfer and the new credit card has a higher APR, then you will likely find yourself deeper in
I found and was approved for a card that had an introductory rate of 0%. I had plans to pay off this $1,500 balance by the end of the year, so a one-year intro rate was enough for me. I made the balance transfer, so I virtually removed the interest rate that I was paying on that balance. Phew. That saved me some serious cash because I would have paid about half that in interest over the span of the pay off.
I would only suggest doing a balance transfer if you can get a good introductory offer and can pay the amount off within the time frame. Otherwise, you will find yourself in the same position and still stuck with debt.
Use Side Hustles to Pay Down the Balance
I’ll always advocate side hustles, and that is because I believe in them and they have helped me pay off my credit card debt. The trick with your side hustle is it must be something that you enjoy doing, so it will not feel like work and you need to have the discipline to send the money to your credit card provider to pay off your balance.
The very first time I completed a side hustle, it was nice to hold that money. I can tell you that I wanted to keep it and buy myself some new shoes and accessories, but I knew I couldn’t. I was able to put my future first and apply the money towards my $1,500 credit card balance. I am now glad I did that because I am able to enjoy a life free from credit card debt. If you are wondering what my side hustles were, they included selling baked goods at community events, mowing lawns, selling things on eBay, and freelancing in IT. I still do some of these side hustles to help supplement my income month to month.
How I Keep My Credit Card Balance Low
The hardest part about paying off your credit card balance is making sure that you do not get back into the position where you have a bunch of it again. This was difficult at first, especially since I was so used to using that credit card and I counted on it. Once I was used to the card being unavailable, I was able to sustain myself and now I do not even think about it.
If I do need to use the credit card, I never make a purchase that I cannot afford, and I always make sure to pay off my credit card balance when the bill comes. I know that you can pay off your credit card debt too. Remember, balance transfers are your friend when you can find a 0% introductory offer, and side hustles can help you quickly pay down the balance.
Keep in mind however, I’m using the Death Star as a reference here. If you know about Star Wars, then that should tell you something. The Death Star came back! It was a recurring problem in a sense. This applies to credit card debt. You can end up doing the dirty work and setting yourself free from the repression of the Empire (debt, metaphorically speaking), but a few years later you could find yourself back where you started if you’re unlucky.
About the author: Josh Wilson is a Millennial working to become his generation’s personal finance thought leader. Check out his blog at FamilyFaithFinance.com