5 Ideas to Pay off That Debt!
Any topnotch homemaker knows that keeping sparkling books is essential for cutting down stress and maximizing savings. Unfortunately, most of us aren't on top of this the way we think we are or we'd like to be. I consider myself to be better than average with finances but found at one point that I had payed two thousand dollars in credit card fees just because I didn't pay attention over a period of time. Since then, I've been working to keep an eye on my finances and to spend my money in more meaningful ways.
Here's the problem: credit cards are a psychological trap that most people fall for easily. There wouldn't be credit card companies if they weren't raking in obscene piles of cash money from (disproportionately poor and working class) folks. It's like gambling: if gamblers were winners, the Las Vegas strip would be tumbleweeds and dive bars. This sh*t is rigged - if you haven't already, do not fall for it. If you have, here are some ideas to help you get out of high interest debt:
- Call your credit card company and ask for a lower interest rate - Most people don't realize that this is a thing you can do. Generally, if you call them up and say 'I'd like you to give me your best rate' they will lower your rate to keep you as a customer. I'm sure this depends on your standing with the company, but even if you can get a small decrease in your interest rate, this can save you big time.
- Transfer your balance to a 0% card with $0 transfer fees - High interest payments on your balance make it really hard to feel like you're making any headway paying down your card. Luckily other credit card companies want you as their customer so they'll offer introductory rates in order to get you to transfer. This is a fabulous opportunity to look at your balance and divide it by the number of months that you have 0% for in order to pay it off without paying interest. Even if you can't pay it off, you can make a way bigger dent in your debt this way. WARNING: This is not an excuse to acquire more debt. This 'introductory rate' tactic is a also a trap but if you don't fall for it, it's a great tool for you to get your debt in order.
- When you want to impulse buy, wait 3 days - The first time I really started saving money was when I got an ING Direct account. It was an account that automatically deducted a set amount from my paycheck but when I needed money, there was a 3 day transfer delay which meant that I had to actually give thought to what I was spending money on and meant that I spent way less. Here are some good questions to ask yourself before you buy something that you very likely don't need: After I pay my bills and necessities, do I actually have the money (not credit) to make this purchase? How many hours would I need to work in order to buy this one thing? Will buying this improve my quality of life in a meaningful way (not in a shopping-induced endorphin kind of way)?
- Change your spending and put savings towards debt - Make your coffee and breakfast and either eat it at home or on your way to work. Make your lunch and bring it to work. Both of these things will save money and likely be healthier. If you are pressed for time in the morning, do this stuff at night and have it ready for a grab-and-go morning. Skip Whole Foods and go to the farmer's market - for most produce, it's cheaper (and you're supporting your local farmers). Invite your friends for community dinners, potluck picnics, music nights etc. instead of going out. As you change each habit, take the money you would have spent, and send it to your credit card company (e.g. lunch out everyday @ $10/lunch (that's pretty cheap for lunch) is $50/week and $200/mo you could be using to pay off your debt).
- Reprogram your consumer trance - This is a big one. We live in a society where it is the full-time job of every marketer of every company that wants our money to make us feel unworthy, insignificant, unclean, abnormal, unsettled, envious, not pretty enough, not skinny enough, not smart enough, not rich enough, not good enough, so that we will buy their sh*t to fill the void that they are actively digging in our psyche. The bad news is: it is a trap. The good news is: it is a trap... and the sooner we recognize this, the sooner we realize that people, passion, learning, nature, building, teaching, compassion, helping, meaning, laughing, community, music, gratitude and love... are the kinds of things that will help us realize that the void was an illusion to begin with. I realize that I sound like a raging hippy (and I am) but I'm not advocating that you go live naked in the woods and never buy anything again (unless that's your thing), I'm just saying a little mindfulness goes a long way in consumer culture. If you spend more time with your friends and your passions and less time trying to fill an imaginary void with stuff that's going end up in a landfill, you'll probably be way happier and you're unlikely to get back into credit card debt.