Debt Consolidation: Good Intentions Are Not Enough

By Debbie Wilson
LoanPage.com Columnist

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So you're ready to embark upon a debt consolidation resolution by ridding yourself of credit card debt? Be forewarned that good intentions alone aren't enough. To kick the credit card debt habit, you'll need to break your underlying patterns of behavior.

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Consider Plastic Surgery

You don't have to cut up all your credit cards to rid yourself of credit card debt, but you will have to stop using them on a routine basis if you're serious about debt consolidation. Try carrying around cash (you know, the green stuff!). You're less likely to make impulsive purchases when you have to fork over cash. Just leave the credit cards at home. Don't close the accounts, since having unused credit available from lenders can boost your credit score.

Reduce Your Interest

Reducing what you currently pay in interest is a great way to tackle credit card debt and shift your focus to true debt consolidation. Start by doing some comparison shopping. Consider a balance transfer to a 0% introductory rate. Or, call your current credit card company and see if they'll match the rate with the lower credit card insurer.

Develop Credit Card Balance Payoff Strategy

Finally, develop a true strategy for paying off your existing credit card debt balances. In order to do this, get an accurate picture of what you really owe, and the minimum payment and interest rate for each card. This will help you determine which card to pay off first. You can also go online to debt consolidation calculators to see how long it will take you to wipe out those balances. Start with the highest interest rate card and work your way to lower interest rate cards. Pay off the entire card balance before moving on to the next credit card debt.

Soon, you'll do much more than simply make good on your debt consolidation resolution. You'll conquer your credit card debt and reap the rewards of a financially sound future.

Sources
www.CNNMoney.com

About the Author
Debbie Wilson owns and operates a lakeside resort. Her previous experience includes profitability consulting for a national healthcare company. Debbie holds a B.A. in Business Management with a minor in Physical Education.

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