Debt Management Services, Managing Credit Card Debt and Tips on Paying off and Getting out of your Debt
Should you consolidate with a debt management service?
If you are deep in credit card debt and you are getting collection calls or if your account charged off, yet you can't make the payments, you may feel like you don’t know what to do. Every month you don’t make payments your debt keeps increasing with the added interest fees on your account. When you don’t make payments creditors charge fees and increase your interest rate putting you in even more debt. Thankfully, there are a few ways to pay off your debt.
1) Stop spending! Every second you are about to spend a penny ask yourself: do you really need this? You definitely do not need those things that you decided to buy only because they are on this huge sale!
2) Log in all your debt into a reputable money management software. I have been using Mint.com for a while now and I am very happy with it. It is very easy to use and has really allowed me to see all my accounts at once and put me on a plan at a point when my credit card debt grew without noticing.
So, how will you pay your debt?
2) Do you have anything you can sell? Selling books on Amazon.com is more lucrative than you think. Check out craigslist.com ‘s free section. A lot of people are donating their books that you can then sell on amazon, you can also buy and sell, at library sales. If you are in a big city, then you know that lots of bookstores keep shelves outside for books they sell for $. You may be able to sell a lot of those books nationwide for good profit.
3) Go through your clothes and other belongings. Whatever you don’t use. You don’t need. Little amounts can add up quickly. Think about selling that designer jacket you never wear on a second hand store, on ebay or craigslist. Remember every dollar counts.
Reality of Small Numbers
4) Try to get an extra job. If you wait tables at the café in your neighborhood an hour a day, you could easily make $15. Think of it as socializing. $15 a day makes $450 a month. Make that two hours and that is $900. That is almost 11k a year. That is in fact a lot of money for a couple of hours extra work , and keep in mind that you will probably make more than $15 an hour. If you make $20, that will translate into 14.4 k a year. These are rough numbers, but you get the idea. A little a day can add up to big over time.
Negotitate your future debt
5) Call your credit card companies and ask them to lower your rate. Say you always make your payments on time, you are going through a rough patch and ask if you qualify for a better rate? Don’t get discouraged. If you get no for an answer ask again.
6) Ask your credit card company if they can offer you promotions. Promotional aprs, and balance transfer offers can save you a lot of cash. If you have good credit, even if you have a lot of debt you may qualify for credit cards with a 0% balance transfer fee for as long as 21 months giving you the time to recover.
7)If you feel none of these will be enough for you, then consider getting in touch with a debt management company. One legitimate one that Chase hooks up their customers with is Money Management International. Basically, they negotiate with credit card companies for you and save you the interest rate you would need to pay them over time. If you feel this amount would only accumulate such debt management companies may in fact bring relief to you, upon their services they charge about 40$ for each month you get service from them. In other words, you will need to compare the total amount of interest your debt would accumulate in a year and see if it is worth consolidating. Your credit score should not be affected by this, but it will sort of be visible in your credit report, so it is really only a last resort. If you don’t need to worry about your credit report it might make more sense.