4 Ways to Pay Off your Credit Card Debts Fast

Even while paying off your credit card debt may seem impossible, the reality is that it is very feasible to do. All you need is determination, attention, and a plan tailored to your circumstances. There is no fast answer for getting out of debt other than obtaining a windfall, despite what lawyers and infomercials would have you think.

Pay off credit card with these debt repayment strategy

But do you know that getting out of credit card debt is easier than ever right now, thanks to the current economic climate? Despite the COVID-19 pandemic, the economy is beginning to return to normality, and the typical Filipino’s personal savings rate has surged to a new high level. Even still, a large number of Filipinos are saddled with high-interest credit card debt, a situation that is only certain to become worse as common commodities are beginning to raise rates in order to recover from the economic decline.

Even though, when it comes to paying off your debt, this is the best moment – particularly if you saved money while you are being cooped up at home, doing a work from a home job while the pandemic and community quarantine are going on.

Paying off Credit Card Debt

Credit card debt may be challenging to pay off, but there are several tried and proven strategies that will help you achieve your goal of zeroing off your amounts over time. You may either pay off each loan having minimum payments one at a time or make a single monthly payment to cover your obligations.

Let's look at four common ways to pay off credit card debt, along with some of its advantages and disadvantages, to help you determine which choice is ideal for you.

1. Consider getting a balance transfer credit card.

If you have a good credit score, you may be able to get a credit card that may help you pay off your debt faster.

Introductory 0% annual percentage rate on balance transfer credit cards may last anywhere from 12 to 18 months, although the length of the promotional period might vary widely. You have a window of opportunity to pay off your debt fast during this introduction period. Due to the absence of interest, all of your monthly payments go toward reducing your debt. Paying off your amount before the promotional time expires should be a top priority, particularly if the non-introductory annual percentage rate is significant.

While a 0% APR balance transfer credit card with no interest on purchases may seem like a great benefit and using it on buying your most coveted dress or shoes is tempting, remember that it is more crucial to prioritize your most important financial goal, which is paying off your credit card debt.

Also, keep in mind that many balance transfer credit cards have a balance transfer fee of at least 3% of the transferred balance, which may quickly add up if you owe a lot of money. Low or no balance transfer fees can allow you to put more of your money toward paying down your debt.

2. Take out a debt consolidation loan.

In order to combine several high-interest debts, you might use a debt consolidation personal loan. Another benefit of debt consolidation loans is that they might raise your credit score if you pay them back on time and in full each month.

If you satisfy the requirements, you may be able to save money on your credit card debt by taking out debt consolidation personal loans, which have lower interest rates than credit cards. You'll just have to remember to pay one monthly debt payment rather than having to keep track of many credit card bills and their due dates.

3. Have some extra monthly payments.

You're undoubtedly used to monthly billing cycles, but you don't have to wait until your payment is due to a pay-down portion of your debt, and you aren't restricted to just one payment per month. Credit card interest is accumulated daily, and the interest payments you incur are dependent on the average daily amount of your account. There will be an additional interest fee for every day that passes before you make payment.

If you are paid every two weeks or bimonthly, you may be able to make two payments a month; if you get paid weekly or are a tipped worker, you may want to consider beginning your debt-management plan by paying weekly to get started.

Trying to make over than one monthly payment has another benefit: You won't have the option of changing your mind and spending the money on anything else if you pay off your credit card amount as soon as you earn it. In order to avoid late fees and penalties, make sure you pay your credit card bill in full by the due date on your statement, even if it's less than your minimum payment.

Another great tip for this is paying off your debt rapidly will help enhance your credit score by decreasing your credit usage, which can make it simpler to qualify for a balance transfer credit card.

4. Choose a repayment plan: Debt Avalanche or Debt Snowball.

Whenever it comes to paying off the credit card balance, there are primarily two schools of thinking to be found.

In the debt avalanche method, you pay off the cards with the highest interest rates initially and then move on to the ones with the lowest. This strategy is the most logical from a mathematical standpoint, as it allows you to pay off your high-interest credit cards faster.

A debt snowball method is a second option. This is for those who find it difficult to adhere to a debt-reduction strategy when there appears to be no solution in sight. Paying off your bills in a "debt snowball" fashion has gained popularity thanks to personal finance guru Dave Ramsey. Debt reduction may be a motivating factor for certain individuals, according to some behavioral economists, if minor debts are eliminated early on in the process.

This isn't nearly as cost-effective as paying off the high-interest debt first, but if it provides you the drive to dig down and pay off your bills, it could be the preferable approach.

Get out of credit card debt fast with these payment strategy

Getting a good credit score can bring you some great opportunities and investments, just like a home investment from Lumina Homes.

Purchasing a brand new house and lot package will not be a hassle if you apply for flexible payment schemes that Lumina Homes offers, like bank financing. A good credit standing can go a long way in this case, as you can easily avail a bank housing loan from institutions if you have a good credit score.

So make sure to maintain a good credit standing and make your lifelong dream to have your own space for your family a reality with Lumina Homes and a bank home loan.