How to Reduce Credit Card Debt, and Be Finally Debt Free!

By Adi Hartono

Ever since the economy went down many people have lost their jobs. Credit card companies have realized that a huge number of people are not able to pay off their full debt, so in hope of getting at least a part of the money owned they have been negotiating deals and cutting interest rates like never before. So this would be a good time to reduce credit card debt.

The first and most important step is STOP using your plastic money. If you already owe money and keep spending money on stuff that you can't afford you bury yourself in debt. If you can't afford something, don't use your credit card, just don't buy it.

Do whatever you can to keep yourself from using your cards. Freeze them, shred them or anything that will keep you from spending more money. An unpaid debt can have devastating results in your future. It can keep you from getting a car loan, school loan, house mortgage or even a simple department store credit card.

One mistake that most people make is they keep spending more and more money hoping that their debt will magically be forgotten or forgiven. Don't keep spending money on stuff you can't afford if you don't want to ruin your credit. It is important that you keep a clean record, and one way you can do so is when you reduce credit card debt.

Write down all of your credit cards, how much you owe to each one and the minimum payment for each month. Staying on track with your payments will help you reduce credit card debt faster.

The way credit card companies work they reduce your monthly minimum payment as your balance goes down so that it will take you more time to reduce credit card debt. Always pay more than the minimum payment.

If you cannot afford to make the minimum payments and you're trying to negotiate a deal with the company then stop making payments. If you creditors see that you are still making payments while trying to negotiate a deal, they'd obviously have little interest in reducing your debt.

After 60-90 days of not paying any money to your cards, start the negotiation for a deal. Tell them that you're going through financial problems and if they want any money at all from the debt you owe, they will have to settle for a deal.

Start low. Your first offer to reduce credit card debt will probably be refused, that's why you should start negotiation with a lower number than what you can truly afford.

It is important that if you come to a deal with your creditor to get everything in writing. You should always keep documentation for proof in case something goes wrong in the future.

Don't forget that most debt collectors are trained to be mean and intimidating, but don't be nervous when talking to them. Always stay calm and cool. Have a plan of what you're going to do and what you're going to say. Speak loud and clear and the chances of them agreeing to a debt negotiation with you will rise dramatically.

Another important factor is to keep track of your progress visually. This may help a lot of people stay on track and get rid of that debt for good. Try to write down all the payments you made and put it somewhere where you will see it many times during a regular day, like on your fridge.

Always remember to stay calm and focused. Create a list of your personal debts and what you can and can't afford. Don't leave everything for the last minute, act now. Use these tips and you might be surprised how easy it will be to reduce credit card debt.

Find more ways to solve your personal debt problems in http://www.SolvingDebts.com.

Eliminating your debts may not be as difficult as you may think.

Article Source: http://EzineArticles.com/?expert=Adi_Hartono
http://EzineArticles.com/?How-to-Reduce-Credit-Card-Debt,-and-Be-Finally-Debt-Free!&id=3715259