Debt Consolidation Advice.
The best way to pay off debt, if you do not have the funds to pay it all off, is to do a debt consolidation.
There are moments in life when you have to pay for something that you cannot afford. It can include student loans, food, and other important material things.
Once you do this without sufficient income, the credit companies will charge you a high interest rate. They know that a person can slip some day, so for them it is important to have you as their client.
Having a credit card is definitely not a bad thing. There are many benefits to them, like double miles for travel, cash back on purchases, and credit of course, which can help you build your credit score.
Once you do not have enough cash to pay things in full, you will, for the most part, pay about a 9%-26% interest rate. Then, on top of that, if you forget to give at least a minimum payment, most banks will charge a $35 fee, which you can call and ask to get pardon for. This usually will be done only one time a year.
Of course the best way to not get into this situation is to pay everything in full as I mentioned earlier. This builds your inner strength of purchases. You will think before buying something. Do I truly need this item? That is a very important question to ask yourself.
My advice, if you do not have a compulsive shopping problem, is to make a balance transfer to another card. For instance, usually there will be a 0% balance transfer for 12-18 months. You will need to pay the fee of at least 3% for your transfer. This kind of debt consolidation will ease your life.
As an example, you would like to have a $1000 debt transferred from Chase to Discover for a period of 12 months. Discover’s fee would cost you $30. So you will have to pay $1030/12 months. This would be an average of about $86 a month for 12 months, which is better than paying a minimum payment AND your Chase (for this example) interest rate.
Your problems will not be solved of course unless you pay everything off. But, this is a good tactic to prolong paying a huge amount right off the bat. You can save money during this time. This is when a balance transfer makes the most sense. Debt consolidation will make it easy to pay one bill for your debt.
Good Luck to you all and be knowledgeable about your finances. Remember, frugality is not a bad word.