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There are few good options for eliminating your credit card debt immediately unless you have enough savings to pay off the cards in one fell swoop.  That probably isn’t an option for most of us.  If we had the money to pay off our credit cards in full we probably would not find ourselves in card debt in the first place.

The most drastic action would be to file bankruptcy.  If that is a consideration, see a qualified bankruptcy attorney in your state.  The rules vary from state to state and only a qualified attorney can properly advise you.  If that is a consideration be certain that you are looking for an attorney who is qualified.  Attorneys specialize in different areas of practice, just as doctors do these days.  As you wouldn’t go to your family doctor for brain surgery, you shouldn’t go to an attorney whose practice is criminal defense to file a bankruptcy.  Everyone specializes in something these days.  Find a specialist!  That’s the best advice we can give.

The other options will take a little more time and discipline, but paying the price now will be worth it in the long run.  The satisfaction that comes from having the courage to face your financial truth will be talked about in an upcoming post.  Chances are you have already realized that you would be happier without the debt.

For now, we are offering suggestions on how to get out from under our credit card debt.  If you should choose to pay off the debt without filing bankruptcy (we are not advocating bankruptcy except in the more dire circumstances) there are several ways to go about it.

If you have several credit cards, and most people do, look at each card, determine the balance on the card and the rate of interest.  The options are really up to you.  Financial experts are all over the board on where to start.  Some suggest that you try to make payments (more than the minimum) on the card with the highest balance until you get it paid off.  Others suggest that you attempt to pay off the smallest balance first to get one out of the way.  Still others suggest that you pay off your cards by paying more than the minimum balance each month on the cards with the highest interest rates first.  And, each of the “experts” stands behind his or her method.

Our suggestion is that you look at your cards and the balance due and the interest rates.  Then, you decide.  What will make you feel better?  Would paying off a single card make you feel better than starting paying more on the card with the highest balance?

One cautionary word.  If you have one card that you have missed a couple of payments on, or if you have late fees, it can affect the interest rates on your other cards.  This information is shared among credit card companies.

• Call your credit card company and try to negotiate a lower interest rate.  It must be said that at the present time you may not be able to get a lower rate.  It seems that the companies are raising rates whether you have ever been late on a payment or not and whether you have maxed out your card or not.  But, it is worth the try.  And, don’t give up!  If you don’t get results on the first call, pay for a month or two and then call again.
• If by chance you do get an offer for a new card that promises a 0% interest on balance transfers for a full year, you may want to consider transferring the balance of one of the higher interest cards.  However, you must read the fine print!  Be sure you can pay on time and don’t charge anything to that card.  You are looking for a 0% interest loan that you can pay off before the regular interest rates apply at the end of the year.  Again… READ THE OFFER CAREFULLY!  And, remember you are not going to use this card for charges, but are going to take advantage of 0% to pay off an existing debt.
• Check your cards carefully.  If you have a credit card that charges a fee even if you don’t charge anything during the month and some do require a $6.00 or more fee per month whether you use it or not, pay it off and get rid of it.  You don’t want to pay for the “privilege” of carrying that card.
• If you find that you are being charged late fees, usually around $39.00, plus an increase in interest rates, call the credit card company and try to get the late fee removed.  That fee added to your balance will be charged interest once it becomes part of your balance.
• Now decide which card you are going to pay off first.  Determine if you can pay twice the minimum payment.  If so, pay as much as you can to reduce the balance, while being sure to pay the minimum payment on all your other cards. 
• While you are paying down the cards, try to stick a few dollars into a savings account.  Open a new account and put $20 a month or more into that account.  This particular account is for paying off your debt, nothing more, nothing less.  Once you have built up a sufficient amount as you are paying down your credit card balances, call the credit card company and negotiate a pay-off.  Most companies will take 65% of the balance as a pay-off.  In some cases, you can do better.
• You do not want to cancel all your credit cards.  Contrary to what is often said, we feel that it may be in your best interest to keep one or two… no more than two… credit cards that you can use in case of emergency.  And, you need to keep one or two cards to prove your credit worthiness and build up a good credit history.

These are only a few suggestions, but the most important suggestion is have the courage to face your financial truth and take action. 

You can become financially solvent even if you feel that you are drowning in debt today.  But, you must take action.  Putting it off another day will do no good for your financial future.  Bite the bullet now.  Take action.  This is the first step towards financial independence.