Credit Card CPR: How to Survive?

Rakstars, have you ever used a credit card? Just joking! I know you have. These rectangular pieces of plastic are the absolute best thing invented. Take it wherever you go and spend as much as you can, so long you don’t hit your limit. But wait, amidst the excitement of purchases and the fact that most credit cards, you get rewards (Bonus – why not shop? It’s like rewarding after a reward, right?), there are some pitfalls. Most importantly, debt!

Welcome to Credit Card CPR, saving lives one credit card a time. 

 I am a survivor. I am a thriver! 

The Minimum Payment Trap

Have you ever noticed on your credit card statement, there’s always a minimum payment, which we see (cue in the sign of relief). But wait, no! Don’t snooze or you will lose. Paying the minimum can lead to debt! DEBT is no good. Why? Interest accumulates and the balance left on the credit card will increase and increase, like a never ending treadmill. 

Credit Card CPR

Health is important but so is your financial health. Rakstars, paying more than the minimum payment required is beneficial. Here’s why: 

Say bye to the Interest Tap

If you can pay more than the minimum, you are able to chip away at the principal balance. Principal balance is the amount due – the amount you used to pay for your shopping with the swipe of the rectangular plastic. By paying more than the minimum or if you can, the whole amount once the credit card bill comes due, you can reduce and minimize that interest which lags on overtime. Interest is like a stalker – it keeps following.  

Accelerate Repayment

If you can make larger payments – this allows you to pay off your credit card debt faster thus, allowing you to reach financial freedom sooner than scheduled. Rakstars, you are regal – so reclaim that control over your money. After all, this is a monarch. 

Did someone say Credit Score?

You bet right, we did. When you pay off more than the minimum, this is shown positively on your credit score. Credit score is like a report card which shows how good you are with money aka financial responsibility which means when you need a loan, you can receive it easier. 

Saving $

Interest accumulates – it increases like there is no tomorrow, so the more you pay now, the less you pay later. Saving money on your interest payments, allows you to use that money for other items in your budget allowing you to achieve your financial goals. 

Start Credit Card CPR

Remember your Budget

Yes, your budget. Take a look at your monthly budget and see how much money you can allocate to your credit card payments. See if you can cut back anywhere so that you can have an effective payment strategy. 

High-Interest Debt

Rakstars, do you have more than one credit card? Well, if you do, focus on paying more than the minimum on the credit card that has the highest interest rate. This can help you save a lot of interest on those payments. 

Payment Automation

Do you misplace credit card bills or just easily forget about them as you don’t want to deal with them? Don’t worry, you are not alone. You can set up automatic payments so that you can pay more than the minimum allowing you to stay on track and away from those interest penalties. 

Celebration

Along the Credit Card CPR route, make sure you do celebrate your victories. Whether it’s paying slightly more than the minimum or a ton load than the minimum, each payment you make is one step towards financial wellness. Keep on thriving. Rakstars, we know you got this. 

Next time, you see your credit card bill, try Credit Card CPR and reach your financial empowerment. Stay committed and soon you will be in control of your financial destiny.