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6 Most effective ways of reducing credit card debt

Credit card debts can severely damage your finances if left unattended. Gradually it'd grow enormous and leave you battling with debt. But it can be kept under control by following some simple methods. Here are certain tips for reducing credit card debt effectively.

• Pay more than the minimum amount: This is the most effective method of reducing credit card debt. Always try to pay little more than the minimum amount on the bill. Not only this would help you in keeping the debt under control but also it would look good on your report if you can maintain the outstanding balance on the card below 35% of the credit limit.
• Avoid using high interest rate cards: If your bank increases the rate of your card or asks for annual fees, you must know that it's time to shop around for a lower rate. You may also let your bank know that you are looking for better rates from other banks but since you are in good terms with them, you're interested in giving them a chance first. This trick often works and you're most likely to get better rates.
• Balance transfer: Transfer balance of high interest rate credit cards to lower rate cards. However, you must try to pay off the entire balance before the low rate expires.
• Fewer cards, lesser debt: Yeah, it's true; more number of cards would lead you to more debt. An average American carries around 6 to 10 credit cards. Often it becomes difficult to keep track of all the purchases that you make on these cards. Hence, chances of missing payments on some of them become high.
• Prepaid credit cards: Prepaid credit cards would restrict you from going over board. Hence, it helps you in managing debts better.
• Use cash instead of cards: Credit cards are necessary evils but we can limit their uses by transacting more frequently on cash. This way you wouldn't accumulate debt and also wouldn't have to worry about repaying it in the future.

• The importance of reducing credit card debt is pretty evident in the present economic situation. Hence, it's time to take action before sinking into the quicksand of debt from which there is no way to recover.