If you’ve been struggling to find ways to reduce your debt levels, you might have already considered some of the debt reduction options available. In most cases, you’ll read tips that encourage you to pay more money on your minimum repayments, or to find ways to make your own lunch and stop buying lunch. These tips rarely make much of a difference to your overall budgeting attempts and won’t really help you get out of debt quickly.

So how can you really start to eliminate your debt quickly and effectively on your current budget?

Here are some debt reduction tips you may not have considered:

Debt Consolidation Options

Most people are aware that debt consolidation loans can offer a way to roll together any credit card debt, store card balances or even outstanding personal loans into one convenient loan.

The object of a debt consolidation loan is to help you reduce the amount of interest you pay on your outstanding debt. If you take a look at your credit card statement, you should see that you pay a high rate of interest on your outstanding balance each month.

While a debt consolidation loan might still have a higher interest rate than perhaps a car loan or mortgage, it still should be cheaper than the standard credit card interest rates.

Debt consolidation loans also have their repayments calculated differently to credit cards. The amount you pay on your credit card is usually made up of an amount designed to cover the interest charges accrued to your account, with a little extra to come off your balance. You’re charged interest only on the amount you owe.

By comparison, a debt consolidation loan is calculated so that each payment you make has an amount to cover interest and an amount designed to reduce your balance. Each repayment you make will effectively reduce your debt levels a little further each time.

Balance Transfer Credit Cards

Of course, while a debt consolidation loan can help you save some money on the amount of interest you pay, it’s possible to reduce your interest charges even further again.

Many of the banks and lending institutions around Australia are now offering great deals on ”˜balance transfer credit cards’. These are simply credit card accounts where the bank will offer you a greatly discounted interest rate for a limited time in order to win your business.

The object of a balance transfer credit card is to roll your outstanding balances over from your existing high interest charging credit card over to your new balance transfer card. If you shop around, you should easily find that several banks, including Citibank, are offering a 0% interest rate for the first six months on any balances you transfer over from other cards.

This can save you a lot of money on interest charges. It also means that every cent you pay in repayments comes straight off your balance and isn’t eaten away by those high interest charges. This gives you the opportunity to work on your debt reduction goals much faster.

Keep in mind that the really low 0% interest rate offers for balance transfers usually only extend for up to 6 months. If your current credit card debt is much higher than you can realistically pay off in 6 months, you should shop around a little further and find a low interest rate offer that extends for 12 or 18 months.

Money Magazine awarded the BankWest Lite MasterCard with the award for ”Best Balance Transfer Credit Card” for 2010, even though they aren’t offering a 0% balance transfer option, as ANZ or HSBC Bank have both offered.

The key to choosing the right low interest credit card option for your debt reduction purposes is to be realistic about how much you can afford to repay off your debt each month. Then work out how many months it will take you at those payment levels to repay the debt. If your answer is 12 months or more, opt for a balance transfer option with a longer introductory term.

If you’re struggling with your own debt management issues and can’t find ways to put your plans to reduce your credit card or personal loan balances into motion, consider how some of the debt consolidation options could help you get ahead. If these options are outside your reach you should contact a debt consolidation expert like Debt Fix Pty Ltd.