Blast the debt

Unpaid credit card can rapidly become expensive and reach a point of ludicrously expensive. You need to blast the debt!. The majority of interest rates charged on credit cards is tied to the Federal Funds rate controlled by the Federal Reserve (Fed). Thus, it can go up or it can go down. The Consumer Financial Protection Bureau noted in a recent report that if the Fed’s projections for the target interest rates pays out, then the rise in interest costs to consumers with credit card debt would be about $30 billion over three years!

If you are carrying credit card debt, you need to start viciously attacking it. Did you know that if you are paying 12%, 15%, or higher interest on your cards, when you pay them off it is equivalent to you earning that same interest rate on an investment? Why, because you no longer are paying out that rate to the creditors. You are putting that money to work for you.

Blast the debt in these way:

  1. Stop feeling bad about the debt. Yes, you have it. Now, deal with it. Don’t beat yourself up about it, as it could depress you. Be positive that you can and will get out-of-debt.
  2. Consolidate your debt into a single credit card by using a balance transfer. Having a strong credit score of 740 or higher will enable you to get a card with zero interest for 12 to 18 months. Also, the card will not charge a fee for the transfer. Make sure you search for “no fee balance transfers” to find the right card. Before you do this, you need to make sure you either cut-up, freeze, or destroy your existing credit cards. Otherwise, you’ll free up the credit on those cards and will feel the urge to charge them up again. CONTROL your credit card spending and don’t take on any more debt.
  3. If you are unable to secure a no-fee transfer and still have a high credit score, ask your credit card issuer for a lower rate. Let them know you have credit cards with better terms, so if they can’t help you out you will make your new purchases on this other card. Of course, you don’t want to make any new purchases, but they don’t need to know this.
  4. Make a list of all your debt, ranging from higher interest rate to lower interest rate and include a column for minimum payment.
  5. Look at the debt list you made. Start blasting the debt by paying  at least $50 or more above the minimum on the first debt. This should be the one with the higher interest rate. If $50 is not doable, then pay whatever you can above the minimum about. The key is to pay this debt off as fast as possible.
  6. Ensure that you pay the minimum on every card you have every month. Don’t fall for the new lower minimum show on the next statement. Keep paying the same amount as on the first month. This way, you’ll actually have some money going to pay off the principle and not just the interest.
  7. Repetition will be your key to blasting the debt. Once that first debt is paid-off. Take the monthly amount you were paying on that debt and add it to the minimum payment on the next highest interest rate debt. When that debt is paid-off, take the amount you were paying on that debt and apply it to the next highest interest rate card. Continue adding the amount from each paid-off debt to the minimum on the next highest debt until you are debt-free. This is just like the shampoo instructions apply, rinse, repeat. Of course, you’re not rinsing anything, but you are repeating the process each time.


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