subject: Where to Find Money to Pay Down Credit Card Debt [print this page] Where to Find Money to Pay Down Credit Card Debt
Credit card is one of the highest interest rate credit resources that can causes serious debt problem if you let it snowball to an amount that hits beyond your financial capability. Therefore, you should always pay in full to clear off credit card balances before their due date each month; or at least pay more than the minimum payment if you have hardship to make full payment. The question is where to find extra money if you have just enough money to make the minimum payment?
It may seem as there is no way to squeeze extra dollars out from your pocket, but you might be surprised where you can find extra bucks to apply toward clearing your credit card debt. Below are a few options for you to use as reference to start your exploration to find more money for your credit card payments:
1. Cash out or borrow from your life insurance policy
If you have cash value life insurance policies that costing you money each year, you might want to consider borrowing from the cash value or even surrender them to cash out money for your credit card debt payment.
Although life insurances are important for protection on future unforeseen incidents that may happen through out your lifetime, but cash value insurance policies that carry minimum death benefit are always bad investments since the cash value is earning very little interest comparing other types of investment. So, if you are paying credit card debt at interest rate of 10, 20 or 30 percent, then keeping the cash value insurance policies may do more harm than good for you financially. There is more affordable term life policy that you can buy to keep you protected if you plan to cash out the cash value life insurance policy to pay your credit card debt.
2. Cash out from non-retirement investment
If you have made some investments either in term of savings, bonds, mutual fund or stock over the past years, you might want to consider selling some of them to cash out some money for debt payment. Although you may gain profit over the years with investments, but if your credit card interest rate is over 15% and you are paying the minimum due to meet the ends, cash out from your investment to apply toward the credit card debt may save you more interest down the road.
3. Sell off unused items
You may have things that you kept in garage or the basement that just collect dust for years. You may make some money out of these items by selling them off. You can either list them to sell at eBay or conduct a garage sale to earn some cash out of these unused items and you can use the money earned to reduce your credit card balances.
4. Cancel subscriptions
Are you subscribing 800 mobile phone plan, but you never go beyond 500 minutes? Are you receiving weekly newspaper edition, but you only have time to read newspaper during weekend? Are you spending $5 here and $20 there on various subscriptions? Try to add up these subscribe fees. The $5 and $20 dollars here and there may look like small amount, but if you add them up, they might be causing a serious drain of your budget. Could you see the opportunities to squeeze some money out from these subscriptions? You can either downgrade the plan or cancel them so that you can free up some money that can be used for debt payment.
Summary
Use the above information as references to start brainstorming for the potential ways to find money for your debt payment. Don't stop there and try to be creative, you should be able to find ways to squeeze extra dollars to clear the credit card debt faster.
