Getting out of credit card debt takes hard work. But many people have done it, and you can too. First, look at all your cards and balances. If you focus on one card at a time, you can make progress faster. Pay as much extra as you can towards the card you picked. Once it’s paid off, do the same thing with the next card.

When you have poor credit, it can feel impossible to get out of debt. Your high-interest rates and payments snowball, making balances grow faster than you can even chip away at them. This bad credit also stops you from refinancing to better rates. It’s a frustrating cycle.

But there are still options, like debt consolidation loans for bad credit. These loans need no guarantor and are readily available from direct lenders. The idea is simple – roll all those credit cards and loans into one new loan with a lower interest rate. This makes managing payments easier with just one monthly bill.

Strategies to eliminate debt

Here are the best strategies to eliminate debt:

Budget Makeover

Getting your budget in check is step one towards beating debt. Go through all your expenses – necessities, subscriptions, entertainment, etc.- and figure out what can be cut back or eliminated so you can put more toward debt.

For example, downgrade phone plans, axe cable packages, or cancel unused subscriptions. Try cooking at home rather than ordering in. Forego frivolous purchases like fancy coffees or clothing you don’t need.

 

Debt Avalanche Method

The debt avalanche method works great because you target those high-rate balances first. Make a list of what you owe – credit cards, loans, etc.- and put them in order, with the highest interest at the top.

It’ll likely take a while to finish off that first high-rate balance. But don’t let that discourage you! Stick with it, and soon enough, you’ll get that sucker paid off. Now, add that monthly minimum payment to the next debt payment.

Debt Snowball Technique

If you need some psychological wins to keep the momentum going:

• Try the debt snowball method instead
• List debts from smallest balance to largest balance
• Attack the smallest debt with a vengeance while making minimums on everything else

Knocking out a couple little debts gives you quick wins. These victories spur motivation to keep ploughing ahead. Soon, you’ll have an avalanche of paid-off accounts, plus a boosted can-do attitude.

Balance Transfer Cards

Opening a balance transfer credit card can lighten interest rates while you pay down debt. Lots of cards offer 0% intro periods, some as long as 21 months! Move select high-interest balances onto the new card. Then put as much money as possible towards that balance during the initial period since none of it is going towards interest.

Aim to pay it off completely before regular rates kick in. Be extremely careful not to use that card for new purchases, and cut it up after transferring balances! Balance transfer cards must be used strategically, or they, too, become debt burdens.

Side Hustles for Extra Cash

Bringing in money from a second job allows you to put 100% of that income towards debt. Side hustles like rideshare driving, food delivery, freelance writing, virtual assisting, etc, let you work flexible hours tailored to your schedule. Set a reasonable weekly or monthly income goal based on your time constraints.

Automate payments from your side hustle straight towards debt accounts so you don’t get tempted to spend it. Let family or roommates know you’ll be busier, and tackle a temporary crazy schedule knowing it expedites your debt freedom date!

Negotiate Lower Interest Rates

Don’t be afraid to call creditors and negotiate your interest rates! Engage politely and persistently. Explain financial hardships and a desire to pay off your balance with them. Often, showing good faith initiative sparks sympathy. Ask about hardship programs or discounted rates. Be willing to secure lowered rates in exchange for closing accounts.

Landing even 2-4% better rates across accounts saves big money in the long term. Keep calling back every 3-6 months to renegotiate again as financial situations improve. Consider consulting a nonprofit credit counsellor, too – they have insider tips for dealing with creditors.

Utilise Windfalls Wisely

When surprise money comes your way, use it wisely to catapult debt progress. Any tax refunds, work bonuses, cash gifts or insurance payouts should get thrown directly at debts.

These sporadic windfalls let you take huge chunks out of balance without adjusting monthly budgets. Don’t get tempted to spend them frivolously! Once debts are demolished, windfalls can fund other dreams. Stay disciplined now to reap the rewards later.

Create a Payment Calendar

Don’t leave payments hanging in the back of your mind. Create a physical or digital calendar noting every single due date for every debt. Set email, text or app reminders to avoid any chance of fees or jumps in interest from missed payments.

For ultra diligence, automate fixed payments. By scheduling them, forgetful days won’t derail your goals. Calendar diligence also helps detect inaccurate or faulty payments sooner.

The Power of One More Payment

Increase your repayment speed by making one extra principal payment yearly on top of the 12 monthly minimums. This goes right towards the principal, lowering how much interest accrues each month.

On a 5-year loan, that single extra payment each year shaves a whole year off the end date! Skip takeout one week per year to put that cash towards bonus payments instead. Small, consistent extras add up over time.

Cut Your Card

The best way to avoid more debt is to refuse access to it! Take credit cards out of your wallet after transferring balances away or paying down to zero. Put them somewhere inconvenient as cold turkey motivation to not use them.

Rely on debit cards or cash linked directly to your bank balance. With no swiping room, you can’t overspend. Cutting your card quickly cuts off temptation and self-sabotage.

Looking into personal loans in the UK from direct lenders can provide another path to tackle existing debts. Consolidation loans allow you to bundle debts into a single lower payment each month. And by dealing directly with lenders versus brokers, you save money on fees while working directly with the decision-maker.

Conclusion

When debt feels hard, remember why you started. You want financial freedom! Debt causes stress and holds you back from meeting other goals. Stay focused on the light at the end of the tunnel.

Most importantly, don’t get down on yourself. If you have a setback, get back on track the next day or week. Persistence is key – just keep making mindful money choices. Debt freedom is so worth all the effort. Be proud of any progress made; it’s bringing you closer to your dreams.