Credit Card Debt Elimination Secrets

credit-card-debt-elimination-secrets

Use these credit card debt elimination secrets to develop your own debt elimination program and get rid of your unpaid credit card debts faster. Here's the basic financial principle behind any accelerated debt elimination technique:

"The lower your principal balance, the less interest you pay and the faster you get out of debt."

It's that simple!

For example, one little known credit card debt elimination secret is to use your improved credit scores to eliminate your debts faster. How? By improving your credit scores, you can reduce your monthly expenses and use the monthly savings to make extra payments on your credit card debts each month. This lowers your principal and gets you out of debt faster.

With improved credit, your insurance scores may qualify you for lower insurance premiums. Or you may qualify to transfer your credit card debts to lower interest rate credit cards. You may even be able to refinance to a lower interest rate mortgage loan or refinance your car loan.

The point is, by lowering your monthly expenses you can use the monthly savings to make extra payments toward your credit card debts.

Remember, the basic accelerated debt elimination principle is "the lower your principal balance, the less interest you pay and the faster you get out of debt." So making extra monthly payments on your credit card debts can help you to get out of debt faster.

These credit card debt elimination secrets are all based upon this basic financial principle. With that in mind, let's talk about selecting the best accelerated debt elimination technique to apply.

Credit Card Debt Elimination Secrets
Accelerated Debt Elimination Techniques

There are actually quite a few accelerated debt elimination techniques available. However, the primary difference between each accelerated debt elimination method has to do with determining:

  1. Which of your debts should you pay down first?
  2. How much should you pay toward your principal balances?
  3. How frequently should you make principal payments?

In his book The Total Money Makeover, Dave Ramsey provides some pretty good credit card debt elimination secrets. He argues that it's better to list your credit card debts from the lowest balance to the highest balance and then pay them off in that same order. This is called the snowball accelerated debt elimination technique.

Others may argue that a better credit card debt elimination secret is to list your debts in the order of the highest interest rate to the lowest interest rate and then pay them off in that same order. This credit card debt elimination secret is called the highest interest rate accelerated debt elimination technique.

The benefits, of the highest interest rate accelerated debt elimination technique includes paying less interest in the long run, thereby getting out of debt faster. By paying the principal on the highest interest rate loans first, you eliminate more interest faster.

However, if you believe you will have trouble staying motivated to be debt free, the snowball accelerated debt elimination technique might be better debt free resource for you. Why?

Because that credit card debt elimination secret will help you to payoff your smaller debts first and make you feel like you're making progress faster. This may help you to stay motivated to stick to your credit card debt elimination program. Here's more credit card debt elimination information for you to consider:

Credit Card Debt Elimination Examples

Snowball Accelerated Debt Elimination

Debt Principal Balance Interest Rate
Visa $500.00 14%
Auto Loan $1500.00 22%
Student Loan $2500.00 16%
Master Card $3000.00 9%
Dept. Store Card $3200.00 11%

Highest Interest Rate Accelerated Debt Elimination Technique

Debt Principal Balance Interest Rate
Auto Loan $1500.00 22%
Student Loan $2500.00 16%
Visa $500.00 14%
Dept. Store Card $3200.00 11%
Master Card $3000.00 9%

If you need help developing your credit card debt elimination program - like calculating how much and when to make your principal payments - there are several accelerated debt elimination software programs you can use.

The software program will calculate how much you should pay against your debt principal balances and how frequently to make the principal payments in order to optimize your accelerated debt elimination plan. All you have to do is to follow the instructions the software program provides and make your payments.

Regardless of which accelerated debt elimination technique you choose, you should first develop a budget and develop a debt elimination program. Then stick with it.

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