Monday, January 16, 2006

Minimum Payments Accumulate Maximum Debt

With the Credit Cards starting to mount after the Christmas shopping rush, many people will choose to try and keep everyone happy by paying the minimum payment on their credit card balance.

While this might sound like a great idea, the interest quickly accumulates, forcing you into greater debt and extending the time for you to pay off your bills.

January is the time to make a concerted effort to consolidate your consumer debt and start out with a financial plan that will get you out of the cycle of high interest payments.

If you lack the cash to pay off your credit card bills, consider a home equity line of credit that bears a lower interest rate AND cut up your credit cards.

If you really need a credit card for personal use, look into reducing your limit or a prepaid card.

This strategy will get you lower interest payments and reduce the likely hood that you'll be in this sort of bind again.
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