Credit Card Debt Reduction
A significant number of us who set out to create goals for 2012 have a financial goal on our list.
And of the various financial goals, most of us realize we need to start with credit card debt reduction.
Paying off our credit card debt is not only a liberating feeling, it improves our credit scores so we qualify for the best rates on things like car loans or home mortgages, and it makes our monthly cash flow oh-so-much easier to manage.
The question is: What’s the best way to get our credit cards paid off?
There are several theories on this, 3 primary ones, and I’ve outlined them below. Which one you choose depends on whether you want the option that provides more psychic benefit, more financial benefit, or simplicity.
In my opinion, which one you choose is not as important as that you choose one of them, and stick to your plan until the goal is reached.
Your options:
1. Pay off the smallest balance first
2. Pay off the card with the highest interest rate first
3. Consolidate all your credit cards with a consolidation loan, and make a single, automatic payment (and cut up those cards!)
