Summary: Who doesn't want to lead a debt-free life? The key to this is learning to be financially responsible, and that includes being a sensible credit card user. But then, very few people know how to responsibly use their credit cards, and so they find themselves buried in debt, unable to get out of it. This 690-word article provides 5 steps to follow for those who want to free themselves from the burden of credit card debt.

Normally, all that is needed for financial empowerment and living a debt-free life is practicality. Learning how to be truly responsible for your finances and to be sensible in using credit cards can spare you of the same huge debt problems that many other people are contending with. However, if you have already amassed some credit card debts, you can still use common sense in paying them off. There are some companies that offer professional service to help you eliminate your debts. If what they propose will require you to pay more than what you can meet, then it does not make sense to join their program. On the other hand, if they can reduce your repayment period, slash your interest rates, and spare you of the stress, then it becomes practical to engage them. Nonetheless, you should know that there are certain steps you can take to help free yourself from the burden of credit card debt.

 

1. Decide on and set a target period within which to eliminate your debts.

 

Rather than setting the monthly amount that you will need to pay to settle your debt, you should do the reverse and set a target time frame instead. To illustrate, let's say you are currently paying only the minimum amount and if you continue to do so, it will take you about five years or more to fully settle your debt. If you wish to pay off your debts much earlier, your move should be to increase the amount you pay each month to cut down the payment time.

 

2. Choose the more flexible debt elimination program.

 

Financial emergencies happen when you least expect them, even when you’re in the process of settling your debts. Thus, it is to your interest if you decide to go for a credit company that offers flexible payment options. It is very important for debt payment plans to allow changes in cases of exigency.

 

3. Find sources of cash that you can use for other purposes.

 

When looking for a debt relief program, you should be aware that some credit companies will allow you to use your money in cases of emergency. Hence, you should make this a primary factor in making your choice. You do realize that the unavailability of ready cash during financial emergencies can aggravate your already precarious finances. Choose the debt elimination program that will free some funds for your use during emergency even as you work towards the full settlement of your credit card debt.

 

4. Analyze the impact of debt relief or settlement programs on your credit score.

 

Most approaches in debt settlement are recorded in your credit history. Therefore, you will have to choose one that is going to help you get rid of your credit card debts without impairing your credit status any further. If there are adverse remarks that may lower your credit rating, choose other options that would be supportive of a higher credit score in the short term. Your options may include prompt payments or paying twice the required minimum amount. So discuss with the credit company and explore further means that would eliminate your debts and improve your credit rating at the same time.

 

5. Find out more about related fees and charges.

 

While there are some groups that offer free programs for credit card debt management and elimination, most professionals demand payment for their services. Therefore, it is important to understand what it would cost you to engage their services before finalizing any arrangement. Most likely fees include attorney’s fees or upfront fees and processing charges. Try to negotiate if you learn of any hidden charges. Do remember that your objective is to lighten your financial load so paying exorbitant charges to your credit company will only defeat the purpose.

 

Strive to acquire some negotiation skills that you can apply in the early settlement of your credit card debts. Try to come up with favorable terms acceptable to your creditors so you can quickly get rid of your debts and gain full control of your finances once again.

 

By Nick Bregozzo