How can i pay off my credit card debt in half the time? - need advice

Being in debt is not a very nice feeling, trust me. I’ve been there and feel as though you’re shackled to a tremendous weight that you have to carry wherever you go; it stops you from really pursuing your dreams and looking forward to the future.

I remember having sleepless nights worrying about debt and dreading the post the next morning in fear of seeing a court order or something along those lines, every time the phone rang my anxiety levels went through the roof, it was not a good time in my life. It took time but I did manage to turn my life around and in the process learned some great ways to pay off debt quicker.

I read many personal finance books and really started to follow blogs like the Simple Dollar which helped me get into the right frame of mind to tackle the debt head on. I’ve listed below five principals that I learnt which helped me overcome my debt quicker, if you’re thinking about taking a sledgehammer to your debt then check these principals out as they might help you as much as they helped me.

1. Freeze Your Credit Cards

This is a great tip I picked up from the Simple Dollar Blog on personal finance, I literally cut my credit cards up and then froze them in a plastic container in my freezer, it was a great feeling to overcome the hold these cards had on me, every time I felt down or needed entertainment I would grab my credit cards and then go shopping without worrying about the consequences, I thought everything would work out eventually and it was important to enjoy your life, I bought into the concept of instant gratification and you only live once philosophy.

Once I froze the cards I did go through a period of withdrawal, I overcame this withdrawal by constantly reminding myself of the debt I was in, I also had a list next to the debt reminding me of the court orders, phone calls from creditors, I even had a picture of the ceiling to remind me of the sleepless nights that I had. I was really determined to pay off my debt and taking this step stopped me from sinking further and further into debt.

2. Know What You Owe

I always avoided checking my balance; I would just check the minimum payment and then write a check to the credit card company. I was just avoiding the problem and getting myself into further debt, I even started paying my credit cards with other credit cards, this is when the real problem started. You’ve heard about the benefits of compound interest, by paying by minimum payments with more credit cards I was compounding my problems.

I finally gave in; those sleepless nights really took its toll. I finally added up all my debt and I was absolutely disgusted with the balance I had found myself in, even three years later I still remember the figure and pen I wrote the balance in, it came to a whopping £42,398, most of this money was spend on small things, things that I don’t even care about now or can remember. I wish I had spend the money on more useful things like furniture, appliances or making home improvements as it would have had a greater worth.

3. Balance Transfer

After reading a handful of personal finance books I came to the conclusion that had to do something about the interest, I made a list of all the balance outstanding and the interest and minimum payments I was paying.

I called every credit card company up and explained my situation to them and to their credit they were quite sympathetic. Some of the cards offered my lower rates and some of them even stopped the interest altogether. I even managed to shift some of the debt from a higher interest credit card to a lower interest credit card.

Taking this step really helped, I managed to get a handle on the speed at which the debt was spiraling out of control. I was able to lower the interest rates and minimum payments significantly which gave me space to breathe and I was no longer worried about making ends meet.

4. Budget Effectively

Sometimes even the obvious is so eluding, I remember my parents always telling me to spend less that I earn when I was younger, as I grew it seemed my brain started to shrink and I started buying into the concept of debt as everyone was doing it, what’s the worst that can happen?

I started to budget religiously, my expenditure could not exceed my income; in fact I really wanted to slash it. I remember looking at all my payments and then cancelling them one by one and even leaving my wallet at home and making my own lunch at work. It was hard at first but having that debt figure in my head convinced me to keep on going. I managed to really slash my bills over a period of three months and I had a decent sized surplus at the end of the month.

5. Tackle Your Debt Head On

Most of the personal finance books that I read recommended that I pay off the debt with the highest interest; I then came across a book by Dave Ramsey which offered an alternative. Rather than paying off the debt with the highest it was better to pay them off according to the size of the debt starting with the smallest. The smallest debt would be the easiest to tackle and would act as a continuous motivator to pay all debt.

I made a list of all my debt according to size and then only paid the minimum payment on each one, I then took all my disposable income and then started pumping all the money into the credit card with the lowest balance, I quickly paid the smallest balance off and suddenly had more disposable income to tackle the next biggest debt and so on. I eventually went on to pay off all my debt and become debt free using this method.

If you're facing financial hardship or are suffering anxiety and depression caused by the debt you could ask the creditors for a partial debt write-off. A lot of members in this forum have used this strategy to reduce their debts by upwards of 75%. Its always worth a try!