To Pay Down Credit Card Debt, Focus On Persistence, Not Gimmicks
You have made it to the end of January with your New Year’s resolution to pay down as much debt as possible in 2023 still intact. Improving your credit score to qualify for bigger loans and lower interest rates is a long, slow process, however. You read personal finance advice to stay motivated, plus the occasional grumpy screed by a curmudgeonly economist, saying that it is pointless to try to save money when you are young, and the only way to get rich is to have rich parents and inherit their money when they die. It is no wonder you pay more attention to the personal finance hacks that focus on improving your financial situation as much as possible with the resources you have. Perhaps these personal finance videos on social media should come with a disclaimer that they are for entertainment purposes only. It doesn’t really matter which debts you focus on first or which day you make the monthly payments; the only way to get out of debt is to keep paying and to reduce other expenses to free up more money for debt repayment. Of course, if you are really in over your head, you may need to consider debt consolidation or filing for bankruptcy protection. To find out whether you should stick to your New Year’s resolution or consider a more radical solution, contact a Boca Raton debt lawyer.
Phooey on the 15/3 Hack
One popular personal finance trend is the so-called 15/3 hack. This strategy involves paying half of the minimum payment on your credit card 15 days before the payment is due and then paying the other half three days before the due date. Proponents of the 15/3 hack claim that dividing your credit card payment this way enables you to improve your credit score more than if you had paid the entire minimum payment in one installment. The trouble is that it doesn’t work. Whatever credit score boost you get comes from the total amount you paid toward your credit card debt during the billing cycle, not when you paid it.
The 15/3 hack can be useful in another way, however. If you get paid weekly or biweekly instead of monthly, it can be easier to ensure that you pay at least the minimum payment on your credit card each month if you pay a portion of it with every paycheck.
A Manageable Goal: Paying 10 Percent Above the Minimum Payment
Your credit card repayment goals should focus on how much, not when. You will see a noticeable increase in your credit score if you pay more than the minimum payment each billing cycle. An attainable goal is to pay 10 percent more than the minimum payment each month. For example, if your minimum payment is $80, you should pay at least $88, and if the minimum payment is $300, you should pay at least $330.
Work With a Debt Lawyer to Pay Off Your Credit Card Debt
A South Florida debt lawyer can help you strategize about how to pay off, settle, discharge, or consolidate your credit card debt. Contact Nowack & Olson, PLLC in Boca Raton, Florida to discuss your case.