As you leave college life behind, you're probably carrying a lot more around with you than just a shiny new diploma. If you're like most college grads, you're carrying the burden of credit card debt-lots of it. In fact, the average college graduate leaves school with over $2,000 in credit card debt. Sure, some of it might still be from the spring break trip your junior year, but most of it was probably racked up from school related costs such as textbooks, school supplies, and food. No matter, debt is debt, and the worst kind of debt is from credit cards. You need to get rid of it as soon as you can. We know funds are tight, but by setting yourself up a payment plan, you too can quickly eliminate credit card debt. Do more than just the minimum With interest rates on credit card balances ranging as high as 18 to 23 percent, credit card companies would love for you just to pay the minimum amount every month. If you do this, the interest keeps compounding, and the credit card company keeps getting fatter as your debt rises. Put them on a diet; pay at least double the minimum every month on your balance. In a crunch? Who isn't? Cut out a few of life's everyday luxuries and you'll find yourself with the extra cash to put towards your balance. Bait and Switch Credit card companies love to send out promotional offers for cards touting low or no interest balance transfers for a set amount of time. Don't be so quick to toss them. With a little crafty maneuvering, you can make them work to your advantage. If you have one or more cards with balances incurring a high monthly interest rate, consider moving these balances over to this new low rate. It can save you a ton of money. But beware, most of these cards can hit hard after the promotional period ends, with rates that may be higher than what you're paying now. But if you think you can pay off the balance within the promotion time, make the switch. Sacrifice your savings Sure, it sounds horrible, but draining your savings account is a great way to get out of debt. Put it this way: the miniscule amount of interest you're getting from your savings account is nothing compared to what you're paying in credit card interest. If only you could get an 18 percent return on your money! Pay that balance off in full, and it'll save you big in the long run. Get down and grovel If times get really tough, consider asking for help from your family. It's hard to say no to a family member, and you'll probably get a pretty reasonable interest rate from them, as well. Just don't go to the well too many times; you don't want to be known as the freeloading relative. Be professional about asking for a loan, even suggesting a written agreement to show your family member how serious you are about paying them back. Drop the "B-Word" on creditors If you still can't seem to make your payments, call your credit card companies and have a financial heart to heart with them. Tell them that your back is against the wall financially and you're going to have to declare bankruptcy unless you can work out a plan with them. Credit card companies' least favorite word is bankruptcy. If you go that route, they don't get paid. They have no choice but to work with you. Ask for a lower interest rate and a slower repayment plan. While they'll do everything they can to help, remember, you got yourself into this mess, you need to get yourself out. Paid off? Stay that way So you've begged and borrowed and somehow got your credit cards paid off. Now the challenge is to stay that way. First, rid yourself of surplus cards. You should only have one, two tops. Close out the rest of those accounts as soon as you get them paid off. You'll be less tempted to use them, and fewer cards are easier to keep track of. The next step: stop using credit cards all together. Leave them at home, cut them up if you have to, but don't use a credit card unless it's an absolute emergency.
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