Chip, Chip, Chip Away

At this point, you have made the necessary phone calls to lower your interest rates and even to pay off your balances "at pennies on the dollar." The latter may not be possible for you, but the former, the lower interest rates, are certainly possible and, in many cases, essential to getting yourself out of debt in a reasonable amount of time. Time truly is money when it comes to debt repayment.

How many credit cards do you have? How many of them have outstanding balances? You will see that some of your cards have lower balances than others. Which card has the lowest balance?

Your next assignment is to make a list of all of your credit card balances. Write the list from lowest balance to highest. It doesn't matter how many cards you have at this point. The goal is simply to get this list on paper. And actually the grand total of your credit card debt isn't very important at this point, either.

Right now, we simply want to get a list on paper so you see what you are dealing with on a card-by-card basis. Ideally, we want to train your eye to go to the top of this list where the lowest balance appears. This balance will get the majority of your attention and money until it is paid off. You will pay the minimum on the other balances, but you will put as much money as you can toward the card with the lowest balance.......until you see a balance of zero! Of course, you will not be using this card (hopefully you will not be using any of the cards - you can't get out of debt by debting).

Once you pay off the card with the lowest balance, follow the same process for the card with the second-lowest balance. Continue to pay the minimum on the others, but now put as much money as you can toward this "new lowest balance card." And here's some good news - put the amount of money that you paid on card #1 on this card plus as much other money as you can.

Ultimately by doing this, you will accelerate the pay off of this card. In other words, the more you can put towards the balance, the faster you will pay it off. That's common sense, but many people don't realize it, nor do they discipline themselves to stop using their credit cards.

Keep this process going until all of your balances are paid off - whether you have two cards, five cards, ten, twenty, less, more.

Remember that it takes about twenty years to pay off a credit card with a $2,00 balance at an interest rate of 18%. By following the system listed above, you will cut years off your debt!