Credit card debt is a trap, where many individuals fall without even realizing. The main reason to pile a credit debt is ignorance and un managed credit cards.
Also, high-interest rates with many fees and charges from the credit card companies will only help to increase the worries.
tempting offers, discounts, and easy payment options will make any one to overspend especially the younger generation who are not aware of the coming consequences.
Here are some ideas on how to tackle the debt in simple ways:
1) Balance transfer
A balance transfer is a process in which a credit card holder moves his outstanding credit card balance from one card issuer to another.
This method can help to reduce Annual Percentage Rate (APR) charges, usually from a high APR to a low APR issuer. However, this facility also involves payment of fees to the low APR issuer.
2) Convert outstanding balance into EMI
One can convert their outstanding balance amount into an EMI where the payment can be made in monthly installments. The interest rate applicable here is between 1.49% to 1.99% per month depending on the bank. It does not affect your credit score.
3) Pay from the savings
There is no point earning on deposit and paying high-interest amount on credit card debt. It is better to use some funds from savings to make payments. It is better to pay off high paying debts first.
4) Pay more than minimum
Many individuals follow this method of paying an only minimum amount. But this will only increase your outstanding amount as the balance will attract interest rates of as much as 36% per annum
5) Know your billing cycle
If you have multiple credit cards, it is better to know your billing dates and amount and one can take advantage of credit free period to make payments.
6) Control spending
Along with all the above tips, it is also necessary that you control on your luxury spending. The saved amount can be used to make payments.
7) Other simple ways
Avoid using multiple cards, track bills periodically, talk to your credit card company. Make sure to keep track of your CIBIL score and try to improve it.