Strategies for Paying Off Credit Card Debt
Credit cards are a convenient method of paying for goods and services that allows someone to purchase an item now and pay later. Many individuals have several credit cards, and therefore several credit card bills and debts to pay. It is reported that 1 in 4 individuals have revolving credit debt, or a balance that carries over from month to month. This cycle of debt can become dangerous, resulting in additional fines and possibly even jail time. There are three main strategies when paying off credit card debt: start with the smallest balances, pay off the largest interest rate, or pay at equal intervals.
Factors of Credit Card Debt
Each credit card company will have different interest rates and policies to consider when choosing which balances to pay off. Factors to consider when choosing how to pay off multiple credit card debts include the following:
- Interest rate of card
- Balance of debt on card
- Credit limit
- Credit score
- Rewards that card offers
Paying off your credit card is important to maintaining a healthy credit score. By bettering your credit score, the rates for renting and purchasing cars, houses, and even gaining employment may improve.
Contact an Austin Accountant Today
Financial planning can be a stressful and confusing process for many people. With the help of a personal accountant, the process of paying off debt becomes simpler and virtually painless. If you are struggling to pay off credit card debt and are interested in the aid of an experienced accountant, contact us today to learn more information about how we can help you.