Pay off your credit card bills - Average savings: $65 per month.
On average, people who have a credit card balance owe $2,200 on their account on which they are paying 15.2 percent in annual interest charges. You can eliminate that debt as well as your monthly interest charges and by doing so save up to $30 per month. Some 15 percent of all consumers have credit card balances of over $10,000, according to Fair Isaac, the credit-scoring company. These consumers can save over $125 per month by paying off their outstanding credit card debt. Then you will be able to apply those monthly savings to other everyday living expenses that you might have. It is always much better to pay off high interest credit card debt rather than to save money or invest it in a 401K. So if you invest money and earn say 8% annual returns, that means you are still paying more in monthly interest then you are gaining by saving or investing.
As most people known paying off your credit card bills is easier said than done. First thing, you need to stop charging and start to pay for basically everything in cash. It may be a good idea to even tear up your credit cards and dispose of them. Then you need to starting paying more than the minimum required each month until the outstanding bills and credit card debts are paid off in full. Use any extra cash you have to pay these bills from your U.S. Treasury stimulus check, income tax returns, extra part time work, or even money raised from garage sales. The bottom line is that it is imperative to get rid of all of those debts if you ever want to have any chance to improve your overall financial situation. Also, look into consolidating your bills to help eliminate them as taking that approach will reduce your interest rates and allow more of your payments to go towards reducing principal. Read more consolidating your bills.
While the items above are more do it yourself tips and tricks, you can also get professional counseling for this particular issue. Many non-profit, free credit counseling agencies operate across the nation. Some of the organizations are local and only operate in a state or two while other credit counseling agencies provide services to all 50 states and can deal with a multitude of consumer issues. Qualified lower income consumers can call one of these non-profits and often times speak to a credit counselor free of charge. From time to time they may enter you into some type of debt reduction or management program, and those may have a nominal fee involved. But they are still very effective at paying off your bills.
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