3 Steps To Get Out Of Credit Card Debt

Gerard Cutting Up His Credit Cards

Fortunately, we do not have any debt. However, before we were married, Gerard had lots of credit card debt that I didn't find out about until we were engaged and were applying for a loan to buy a house! I was shocked and actually considered calling off the engagement. He assured me that I could handle all the money so we forged ahead. We paid off his credit cards with money from his investments and from then on, he just used his Discover Card. It was nice we were able to pay them all off right away; however, many people are trapped and can't do that. That is why I thought I'd share this post with you that I got from our sermon notes on Pastor Dan's series, "Four Steps To Financial Fitness." Here are the three steps you can use right away to get you out of credit card debt:

1. Stop acquiring new debt. If you don't have the cash for it, don't buy it.
2. Save a little from each pay to establish an emergency fund of at least $1,000 to cover unexpected expenses such as repairs.
3. Implement the debt snowball. I loved this! Here's how it works: First, list all of your credit card debt from the smallest balance to the highest balance. Second, Make the minimum payment on all debts, but put all the money you can toward paying off the smallest debt first. Third, when the smallest debt has been paid off, roll over the amount you were paying into the next largest debt, repeating until all your debt is repaid. 

For example:
       credit card                total Balance           Minimal Payment       New payment

Kohl's                                $ 150                            $15                                   

Macy's                              $ 250                            $10                          $ 25 

Sam's Club                         $ 500                            $ 75                          $100 

VISA                                 $1500                           $ 90                          $190 

Car                                    $4000                           $210                         $400 

Getting rid of your debt using these steps won't happen overnight, but it will certainly move you in the right direction and as you see some paid off, it will motivate you to carry on. "Success breeds success."

Before looking for stocks or mutual funds to invest in, ask yourself the question, "Do I have any consumer debt?" If so, you have a wonderful investment opportunity.

• It's guaranteed.
• It's tax free.
• It's immediate.
• It offers a high rate of return on your investment.

Pay off your credit card debt!

Good Sense Budget Course 

Are you in the 46% of Americans who have credit card debt? If so, I wish you success in paying it off by following the above steps I have shared here.

Source: Taken from Jan. 22, 2012 sermon notes by Pastor Dan Barfell at Parma Heights Baptist Church. Follow the link to listen to the whole sermon.

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