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Paying Off Debt With A Credit Card – Being in debt as a kid was terrifying. In high school, our microeconomics teacher, Mrs. Bennett, warned us about the dangers of credit card debt. That’s the worst, he said.
Soon after college, I moved across the country, settled in one of the most expensive cities to live in, and managed to pay off $5,500 in credit card debt. Let me explain before the court: I am not a compulsive shopper and I do not have unhealthy thoughts about money.
Paying Off Debt With A Credit Card
For me, balance is the result of working low-paying jobs in an expensive city while keeping up with the hard-working, active lives that New Yorkers are naturally born with.
How Long To Pay Off A Credit Card Balance?
Even though I made the minimum payment each month, after rent and groceries, I had nothing left to pay off.
FWIW, my personal debt is even higher when you include my $30,000 in student loans. The $35,500 debt created anxiety and feelings of helplessness.
Enter 2020. I swear it’s a chance to refresh and start over. This year I’m one step closer to living a real life, and financial empowerment is a big step in that direction. Any financial expert will tell you to get out of high-interest debt as soon as possible. So I decided my first goal was to delete my credit card account. Ironically, 2020 is the perfect time. Here is what I did.
A balance transfer card allows you to transfer high-interest debt from one credit card to another for a period of time, interest-free, so you can pay off the balance without incurring more interest-bearing debt. After this period, the higher interest rate of the new card will start.
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I think getting a balance transfer card is the best way to achieve that goal. I chose BankAmericard through Bank of America. I already have a relationship with this bank and the contract I will sign includes 15 months interest free on my balance. Since January, I have applied and been approved for two old credit cards with BankAmericard.
Unable to pay the debt on my pre-pandemic income ($1,650-$1,750 a month), I began working every Saturday at the Union Square Farmers Market, selling locally made goat cheese. At the beginning of March, I paid $900 at the farmer’s market and paid $100 from my base income toward my credit card debt, for a total debt of $4,500. It’s a great feeling!
A week later, the outbreak became so severe that New York City went into lockdown to slow the spread of COVID-19. Unfortunately, that means my farmer’s market position is gone. Additionally, my primary employer has drastically reduced my hours.
At the time, it seemed like my annual financial plan would have to wait. But a friend of mine told me that I could get partial unemployment benefits. Then I found out that the CARES Act passed later that month entitled me to an extra $600 a week. I filed a claim and my monthly income went from $1,700 a month (not including the odd job at the farmer’s market) to $3,400.
How To Get Out Of Debt
When I got my balance transfer card in January, I completely stopped using credit cards and relied entirely on cash. I’ve saved a lot of money with this habit, and with bars and restaurants closing due to COVID-19.
Then in May I moved to Georgia to live with my parents until the end of June. When I lived alone, I spent about $400 a month on groceries and groceries. That means I doubled my salary and saved an extra $800 on groceries over the course of two months. To the parents! You are the best!
Of course, I have to pay rent and bills in Brooklyn, which is less than $1,000 a month.
By the end of May, all of my credit card debt will be paid off. When my mother realized how much my debt had affected me in the long run, she burst into tears and was proud of herself. I’m a big believer in rewarding yourself (within reason) for doing well in all areas of life, so I did some retail therapy. I bought Lugged Converse, Doc Marten 1461, swimwear from Aerie, some swag from Madewell, and overalls from Warp + Weft. Total spent less than $500.
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As my hours continued to dwindle, I continued to receive Care Act help. That means I have extra money. So I decided that building an emergency fund was the next step in my financial wellness journey. [Editor’s note: Most experts recommend saving eight months of salary or expenses to cover a job loss or financial emergency. ]I don’t have a specific savings goal, so I put any extra money toward rent. , utilities and other needs are converted into savings.
Additionally, I received a $1,200 bonus check due to my paycheck in May. But because of my savings strategy and my unemployment income, I never needed to use it. By July 15th, I had $5,500 saved up in my emergency fund.
I fully agree that it would have taken longer to pay off credit card debt if the pandemic had never hit. It seems strange to see a glimmer of hope in such dire weather, but I’m thankful it helped me. And someone who didn’t have my financial advantage would not have been able to achieve my immediate success. I have no dependents, and I have a family that I can rely on for any additional support (buying me food, living with them, etc.).
On July 31, more than $600 in weekly unemployment benefits expired. Another stimulus bill stalled in Congress could extend those benefits. However, his future is bleak.
Paying Down Debt
Luckily my prime time started again at the end of July. Since we work remotely (another bonus of course), I decided to move back to Georgia to live with my parents when my lease was up in August. While living rent-free, I plan to build up my emergency fund and pay off my student debt while saving for my next move.
Now that I know how good it feels to reach a monetary goal, I definitely put in the work for the paycheck.
Chinazor “Chichi” Ofor is a writer, model and content enthusiast. Listen to her on IG and Twitter to talk about toxic, Eurocentric beauty standards or just push them hard.
Read an exclusive excerpt from Vivian Tu’s book $$. The new C-suite of 2023 is shaking things up. Isoken Igbinedion Offers Fara Allen Impostor Syndrome Treatment For Failure Benefit.
Ways To Pay Off Credit Card Debt
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What do secretly arranged sex scenes in movies really look like? How to manage money and mind? How to apply for new C-suite management? Why should you leave your bad boss as soon as possible? Revolving lines (like credit cards) are needed. tools used responsibly. However, this can lead to credit card debt. Getting out of credit card debt isn’t as easy as snapping your fingers and hoping it goes away, but there are strategies for paying off debt faster.
This may seem like the first step, but it is a very important one. If you make more purchases on your credit card, your total debt will increase. If you carry your balance over to the next month, you’re spending more than you can afford.
Do not store or shred credit cards in an inaccessible drawer.
How To Pay Off Credit Cards To Lower Your Debt?| Debtfix
We’ve mentioned debt settlement strategies at the gym a few times. It works by ranking credit card interest rates first. You’ll be devoting a significant amount of your financial resources to paying off the balance while paying off all other debts at a minimum. After the first bill is paid, the funds used on that account are directly deposited to the card with the second highest APR.
By paying off the card with the highest APR first, you can save money in the long run by reducing high interest payments.
This is another debt settlement method that relies on “direct rewards” to get out of credit card debt faster. With this strategy, you’ll pay more on your credit card payments
In theory, you’ll be able to pay off your account balance faster, which will give you an incentive to pay off the next highest balance. Although you won’t save as much interest
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