Tips for eradicating credit card debts

With the high cost of living nowadays in Florida and throughout the country, a great deal of people may find it difficult to get by without using credit cards. In fact, because most credit cards carry interest rates of up to 30 percent and steep penalties for missed payments, credit card debt ranks as one of the most expensive types of debt.

One solution is for paying off the debt is through a low-interest personal loan from a credit union or bank. However, this may not work for cardholders who have poor credit and thus may not be able to qualify. Another way to quickly eliminate a credit card debt is to transfer it to a low or no-interest credit card. In many cases, a credit card company will offer a low introductory or zero percent APR rate on balance transfers to attract customers. Some credit card companies even offer no fees on balance transfers, but many of them will charge at least 3 percent interest on the transferred amount.

Other solutions to paying off credit card debts include using a 401(k) loan. This obviates the need for a good credit score, because people are essentially borrowing from themselves, but it can reduce the value of the retirement plan.

Credit card debt may leave people feeling overwhelmed because they might feel as if they have no way to get out from under. People who are in this situation may want to meet with a lawyer to see if filing for bankruptcy would be an appropriate solution.

Source: Wisebread, “5 Ways to Pay Off High Interest Credit Card Debt”, Jason Steele, Sept. 7, 2016