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I have six credit cards and I need to consolidate what is my best option?
I'm a recent college grad, and I made the terrible mistake of when I turned 18 to open a ton of credit and max it out. I'm not making great money and only have a part time job so I have only been paying minimum on my cards and they haven't been going down. I can't get out of debt this way. I need help and advice. :( I'm drowning in it.
Asked by
xemptynights
1 year ago
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The best way is to do what is called snowballing your debt. Pick the one with the least amount you owe and pay any extra you have on it. Only pay the minimum on the others. Then when the one with the least amount is paid off, you will use the payment for it to add to what you were paying on the next lowest that you owe. You keep doing this until you reach your last one. You will be surprised how quickly you can pay off your debts this way! You can read books by people like Dave Ramsey or attend Primerica meetings near you. Primerica is a company dedicated to seeing people free themselves from debt. I learned a lot from the meetings I attended and have nearly paid off all of my debt. Feels good!
WVWoman57
Rlhissam 1 year ago
One of the worst things you can do is to close any of your cards. What you want to do is to get your debt to a manageable state.
I'm not sure what your credit score and overall situation is exactly, but with only a part-time job, you are unlikely to be able to get a loan that you can use to consolidate and maybe get a lower rate.
The best approach to take is to target one credit card at a time, and come up with a goal for utilization to get them under control.
To start, I would target bringing them all to 50% utilization. Pick your card with the highest rate of interest, make minimum payments to the others, and use whatever extra you can afford to pay this one down. As you lower your balance, your minimum for it will also fall. When you hit 50% utilization (which will help your overall credit score), pick your next highest interest rate and do the same (pay minimum on the rest, and target that one with anything extra you may have until you reach your utilization target).
Once you get to 50% across the board, pick another target, say 30%, and go for that.
It will take time, but as long as you try to look at all of them, you won't make any significant progress. Target one, and you will find that it will go a little faster.
After you get your overall utilization down, your score will go up. This is the approach I took many years back, and once you start bringing down the first balance, things do start moving along.
phnxangell 1 year ago
After you pay off your debt you must comitt to never using a cc again. I have closed three cc's and my score is 150 pts. higher than before.
jte1958 1 year ago