How would you like to erase credit card debts this year? If you’re like a lot of Americans, you probably accumulated more debt because of the pandemic. According to reports, around 28 million people have admitted that their credit card debt grew because of the pandemic.
It’s not surprising because the pandemic happened at the same time as the recession. Businesses were forced to close because of the lockdown that hoped to prevent the COVID-19 health threat. This made companies lose revenue and it affected their ability to pay their employees. When the recession happened as well, some businesses had to close permanently. That meant more people lost their source of income.
Without an income, how can these people survive? Sure, they can look for other ways to earn money. But that would take time. Even if you have an emergency fund, with the way the pandemic and recession stretched out, your savings would eventually run out.
That how a lot of people were left with no other choice but to use their credit cards.
How to erase credit card debts from the pandemic
If you’ve accumulated a lot of debt because of the pandemic, that’s okay. You can do something about all the high-interest credit card debts that you currently owe. There are strategies that you can use to erase credit card debts – no matter what the amount it.
Here are some of the things you can do to make this happen.
Start with a plan of action
No matter what you’re trying to achieve it should always come with a plan. It’s the best way to ensure that you will succeed. Creating a plan will force you to look ahead and consider what you have to go through in order to achieve your goal.
So if you want to erase all your credit obligations, you have to create an actional plan that you can follow. It will make things easier and it will give you a guide as you try to reach your goals.
There are many options to do this. Research the different repayment plans that you have. Among your debt relief options include debt consolidation, debt management, credit counseling, debt settlement, etc. You have to get to know what each one can do for you so you can make the right choice. Make sure you consider your specific debt and financial situation before you choose. Consider the amount you can afford to pay each month and how you want your finances to look like once you get out of debt. Some of these repayment plans have an effect on your finances so make sure you’re aware of them.
Revise your budget
Once you have your plan of action, it’s time to look at your budget. How much are you earning each month and what are your usual expenses? This will give you an idea of how much you can afford to pay for your debts. If your extra money can’t meet your debt payments, then you need to make adjustments to your budget. Think about what expenses you can cut off? That’s the fastest solution that you can apply. Free up money so you can pay more debt.
Your budget plan will also allow you to determine the debt relief program that you can afford to use. Like if you don’t have a problem with your usual payments, you can use debt consolidation. But if you can’t afford your usual payments and you need a debt reduction, you can use debt settlement.
Earn more money
After you’ve worked on your budget, you now have a better idea of how much you need to earn to erase credit card debts. If you want to get out of debt faster, you have to strive to earn more. That way, you can increase your monthly debt payments. It’ll help you save money if you can shorten your repayment plan.
But how can you earn more money? You can get a part-time job. Set up a freelancing career. There are more than 57 million Americans who tried freelancing to make ends meet.
You can do the same. Find a career that you can do on the side. Focus on what you’re good at and see how you can use it to earn money. Maybe you can do consulting jobs. Or you can write online content. You can learn how to manage social media accounts and let others hire you to manage their accounts. Explore your options because it’ll help you get your debts and finances in order.
What’s great about this option is you can continue to earn extra money even after you paid off your debts. Use it to improve your financial position significantly.
Hold off borrowing
Finally, you can erase credit card debts if you hold off borrowing. If not, it’s just like trying to empty a pail of water while it’s under a running faucet. You can keep scooping out water but it won’t run out. So the best thing for you to do is to turn off the faucet before you scoop out more water.
That’s what you have to do with your debts. If you want to completely pay it off, you have to make sure that you stop borrowing for now. It’s not forever. You just have to make sure that you get your debt situation under control. Once you’ve paid off your debts, you can choose to borrow again. Just make sure that you learn how to use credit wisely this time.
How to succeed in erasing credit card debt
Now that you know the different ways that you can erase credit card debts, how can you make sure that you can stick to it?
Here are a couple of tips that’ll help you become successful.
Don’t miss a payment
Let’s admit it, committing to your monthly payments can be hard. Especially when you have a lot of other expenses to pay on top of your debt payments. But as we all know, ignoring your debts and failing to meet your payment obligations won’t do you any good. This is why it’s usually wise to create a debt repayment plan.
When you have a specific repayment plan, you have a guide in paying off what you owe. Make sure that when you’re creating one, it should follow your specific financial situation. This ensures that you can afford your debt payments. That means you won’t have to struggle to meet every payment and it increases the chances that you’ll complete your repayment plan.
Change your financial priorities
Another tip that’ll help you erase credit card debts is by making sure your financial priorities are clear. Sometimes, it’s difficult to stick to your debt payments because you’re just not committed to it. You don’t feel like it’s a priority. So when something comes up, it’s easy for you to give up the payment.
Make sure that you put your debt payments as one of your top priorities. Of course, your basic necessities will still be important. But apart from that, don’t pay for new expenses if you know that it’ll compromise your debt payments.
Feel good about yourself
Finally, if you want to erase credit card debts, you have to learn to celebrate your wins. Every time you are able to meet a debt payment, congratulate yourself. You have to make yourself feel good about what you’re trying to do. That’s one way to motivate yourself to keep going with your payments. When you’re motivated, it’s easier for you to overcome any struggles or temptation that can compromise your debt payments. You’ll be in a better position to complete your repayment program.