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New Years Goal Getting My Finances Together closetsamples
Over the past few years between COVID, higher prices, and some unexpected expenses, I have gotten myself into some debt with credit cards. I am sure I am not alone as many are in similar situations.
My goal for the new year is to lower that debt and cut back on credit card use as much as possible. To achieve this goal, my husband and I actually consulted a financial advisor and I’m going to share his suggestion to us to help us achieve this goal.
First, I made an excel spreadsheet of all my credit cards. I included the total debt and the APR percentage. From there, I organized the debt starting with the highest APR. Now, I am going to focus on paying down the highest APR cards, one at a time. Obviously, if you have more income coming in, the faster this will be achieved.
So rather than continuing to pay above the minimum payment on ALL my cards, I am only going to pay the minimum payment on ALL cards EXCEPT for the one card I am working on. I will pay over the minimum on its due date in addition to additional money over the month.
For example, if I have a JCPenney card with a minimum of $25, I may normally pay $50 to help keep the debt down. Well, now, I am going to pay only the $25. I will then put the remaining $25 towards the highest APR card I am working to pay down. Make sense?
Another option, if you are able, get approved for a 0% APR credit card, and transfer your debt. That way those cards are technically paid off and now you have one debt. With a 0% APR card, your full payment goes towards the card and not mainly the interest rate.
In addition to doing this, I will be making more purchases using my bank card rather than my store credit card. While those are great for getting rewards and such, debt is debt. My goal is to have my credit cards free in the event of an emergency or on special occasions – not as my main source of spending money.
Sometimes figuring out expenses and such can get confusing and overwhelming if I am being completely honest. If that sounds like you, I recommend using calculator.me. They offer a wide range of financial calculators; which can be useful when trying to figure out your debt and budgeting!
How have you lowered your debt? Feel free to share in a comment below!
XOX Signature
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