In the era of digitalization, credit cards are becoming an important way to make the payments especially when we run short of cash in an emergency or getting lucrative offers from merchants on purchases and from Banks on card utilization. Earlier, the entire process of getting a credit card was not that easy and the customers had to submit detailed information while submitting an application but now the entire process of getting a credit card has become easier and every other Bank is offering a credit card to people even with lesser monthly salary as well.
Extensive dependency on credit card to meet regular expenses can result in a debt which can affect your monetary health, especially when you are unable to pay the dues on time.
In case you have many credit card debts to pay then consider some of the beneath strategies to stay out of debt:
Balance transfer: Use your credit card balance transfer facility and shift the due amount to a lower-cost equated monthly instalment repayment structure. The cardholders can utilize the balance transfer method and can repay the debt each month which reduces the burden of paying the amount in one go while avoiding the exorbitant interest rates charged by credit card issuing Banks on card balance beyond free credit period.
Clear Debt with Highest Rate of Interest First: When it comes to debt reduction, it is always advisable to pay those dues first that have a higher rate of interest attached to them. In case you are also facing issues while repaying the debt, make sure you focus towards those credit card debts that come with higher rates of interest so that you can save yourself from paying huge amounts of interest.
Personal Loan: The credit cardholders can opt for a personal loan as well, though this is generally not advised but in case you are left with no other option to pay the debt, then you can take personal loan to repay the credit card due amount that attracts higher interest rates.
Snowball: This is also another way to repay the debt. Through this way, cardholders can pay the dues (in full) one after the other which further eases the repayment burden. You can pay smaller dues first so that pressure of repaying multiple accounts gets reduced greatly. By clearing the dues from a single card, the card holders can improve their overall credit score and can get some relief from the debt as well.
Smart Utilisation of Your Card: Every technology has its own advantages and disadvantages as well. It entirely depends upon us how we understand things. Credit cards are a wonderful way of making payments in case we use it judiciously; all you need is a smarter way of use it so that you can repay the debt on time. In case you have a habit of forgetting about the important dates related to paying the debt, you can use the auto-debit facility so that you don’t miss any payments.
People can also use peer-to-peer (P2P) lending services which allow them to take loans directly from other individuals and this way cuts down the need of the financial institution and the middleman. P2P lending online platforms connect borrowers directly to the investors and it is now being considered as one of the most preferred ways of getting loans.
Also, people can take the help of credit counsellors in controlling their credit card debt and get familiar with the pitfalls of accumulating too much debt. So trust experts while taking loans. A credit counselling expert will help you to get rid of debt. They will offer the best counselling and Credit doctor services to you.