Getting rid of credit card debts

6 August 2009

Any debt problem can be a worry, but when that includes high-interest debts like credit cards, the situation can be particularly serious.

Because credit cards carry a high interest rate - the average credit card interest rate is currently around 18% - the debt can grow much more quickly than less expensive forms of credit, and low minimum monthly repayments can make this situation worse.

If you find yourself in trouble with credit card debt (or any other type of debt, for that matter), you should speak with an expert debt adviser to discuss the best way of clearing those debts. To start you off, here are a few tips.

How can I clear my credit card debts?

Step one: assess your finances

You may be surprised by the difference you can make to your own ability to manage your debts, just by taking a close look at your own finances.

In some cases, debt problems are caused by simply taking the wrong approach towards your finances. If you`re not keeping a close eye on where your money is going each month, you could be greatly increasing your risk of debt problems.

Make sure you base your monthly spending around a budget. Take a note of what you spend on essentials (e.g. food and bills) each month, and make sure you put at least this much aside each month. That way, you`ll know how much you have left to spend on less important stuff.

Step two: change the way you spend

If you find that you are spending more than you earn each month, consider where you can cut back. For example, you might be spending more than you need to on mobile phone calls, or takeaway food, or nights out. Even if you only cut back by a small amount in each area, it can all add up.

Of course, not all debt problems are within your control. The above tips won`t be enough to help everyone clear their debts, and sometimes unforeseen circumstances can land anyone in trouble - which brings us onto the next point...

Step three: get debt advice

If you can`t solve your problems alone, you should get debt advice as soon as possible, before the debt can grow any further. There are a number of debt solutions that can help with credit card debt, such as debt consolidation, debt management or an IVA (Individual Voluntary Arrangement).

Even if you don`t think you`ll ever be able to repay your debts in full, a debt adviser could help you find a debt solution that could help.

For more information on a range of debt solutions, call one of our expert debt advisers on 0800 074 8639.

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