Many people find it a nightmare to look for a way to end credit card debt. There remains no quick-fix solution to make debt disappear. Coming into a large windfall like an inheritance or the lottery would be the closest options. To reliably and successfully clear debt, you will need to pick a sound strategy. Stick with a Visa prepaid card as your primary form of payment and use effective money management tools until you become debt-free. For those who are paying off their credit card debt, the 4 techniques below are recommended:
1.) Pay the Most Expensive Balance First
If you have multiple sources of debt, list them from highest interest rate to lowest. Doing this will help you get out of debt as cheaply as possible. Pay the minimum payment required on each, and take the reminder and start paying the highest-interest debt. This method of repayment is called the “debt avalanche.”
Following this method is the cheapest because once you’re all paid up, compared to other methods, you will have saved yourself a lot on interest. With this strategy, the key is to maintain a set monthly debt payment, and once one card is repaid, the payment isn’t eliminated, but rolled over to the next piece of debt to accelerate the payoff.
2.) Use Prepaid Visa Card as Your Main Payment Method
Stopping the creation of new debt is another crucial step to successful debt repayment. Avoid using traditional credit cards as they can seem like a good method of spending and allow you to think that you can afford an item when you cannot, but this will only lead you deeper into debt. A Visa prepaid card ensures that this never happens. This is because credit facilities are not linked to prepaid cards. You will have to load up a card with funds prior to making purchase. With the funds on the card depleted, further transactions will be rejected until reloaded again.
Visa prepaid cards can be used to make in-store and online purchases, even cash-withdrawal at ATM machines worldwide much like traditional credit cards. The chip and PIN security systems also protect prepaid card; therefore, security is assured. And with no line of credit linked to these prepaid cards, in the event a card is stolen or lost, potential financial damages are isolated to what is in the card and have no bearing on your credit score. A traditional credit card provides convenient payment advantages and the use of a prepaid Visa card affords users those benefits while helping some speed up the process of eliminating debt. Visit www.t24blackcard.com to kick start your prepaid card application today.
3.) Do a Balance Transfer
With a good-to-excellent credit score (obtained from making monthly payments on time and maintaining a low debt-utilisation ratio), you will qualify for low interest rates on loans and balance transfers. Low interest on balance transfers will afford you the opportunity to transfer high-interest balances to a different account, giving you a chance to get out of debt quicker.
4.) Get Spending Under Control
Due to bad luck, like a health problem or a loss of a job, sometimes people may get into credit card debt. At other times, debt may arise due to a chronic problem of overspending, this may mean that you aren’t aware of how much you are spending and making. A budget will help you to gain awareness.
As you embark on your budgeting journey, it is a good idea to separate money for debt-repayment and that for spending. This money that is set aside for different purposes can be loaded onto Visa prepaid cards. Using the prepaid card for daily expenses has proved to be a great habit to follow as it mitigates the opportunities of accidentally dipping into other accounts.
What’s Next?
Armed with a better understanding of how to eliminate your debt efficiently and effectively, it is time to practice these methods. Obtain a prepaid card and adhere to a strategy for your budget until you are debt-free.
Please visit www.t24blackcard.com for more information on how Visa prepaid cards can help you with debt elimination.