One of the greatest obstacles that many people experience when trying to pay down credit card debt is how to find money to pay off debt. For you to pay back your creditors, you have to pay more than the minimum payment amount, but this is often difficult to do when you are having trouble simply making ends meet every month.
Where do you find money to apply to your credit card bills each month? Here are a few thoughts:
Income tax refund: Do you normally get a big tax refund every year? If you do, then you can apply some of your income tax refund to your credit card bills. Furthermore, it is advisable to change your withholding so a lesser amount of income taxes are coming out from each paycheck; you'll get a smaller income tax refund, however you'll have additional money to pay towards your credit card debt payments each month. The thing you don't want to do is give Uncle Sam free use of your money when you need money to pay off debt!
Savings: Nobody likes to spend their savings to pay off debt, however when you have credit cards that are costing you 20% and up in interest each month but your savings account is only earning 4% (or less), then it is just smart to utilize some of your savings if you want to eliminate that nasty credit card debt.
Part-time or temporary work: For anyone who is definitely in a debt emergency, you should consider applying for a part time, seasonal or temporary job. It won't have to be forever, just long enough to pay off or at least make a dent in your credit card debt.
Sell stuff: An additional alternative is to sell items to help you raise money. Have a garage sale or maybe auction off items you no longer use on Craigslist or eBay. Sell books that you no longer read on Amazon or Half.com. You'll be shocked by how much some things can go for on an online auction!
Reduce spending: Though mentioned last, this is really the first strategy you should really take to find extra funds to pay off debts. You should review your budget to find out if there are any areas you can reduce to come up with additional cash to be used towards your credit card debt. Some typical areas that might be reduced, at least for the short term, to help pay off debt include food (both groceries and dining out), entertainment (gym memberships, magazine subscriptions, cable TV, internet, trips to the book store) and personal care (haircuts, clothing, housekeeping, etc.).
These are only a couple of thoughts on how you can get money to pay off debt. There are actually hundreds of additional ways you can generate money to use towards your debt should you be encouraged to search for them.
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