If you find yourself drowning in credit-card debt and searching for a solution, the best thing you can do is start at square one. For most, this means learning more about credit-card debt and understanding the steps you can take to make progress in paying it down.

In the event that you have debt spread across several credit cards, you’ll first need to make a priority list. In other words, you should know which debt to tackle first.

Here are some tips for helping you prioritize credit-card debt:

  • Focus on the credit card with the lowest balance: Psychologically, it feels good to completely eliminate a debt. Once you get the lowest balance out of the way, you can then use that money to begin paying down the next credit card.
  • Know the interest rate: The higher the interest rate, the more money you’re paying each month to carry the debt. Along with the balance, this should also come into play.
  • Think about the emotional return: Is there a particular credit card that you despise? If so, don’t hesitate to pay off this debt first. There’s something to be said for the emotional return.

At some point, you may come to find that prioritizing your credit-card debt is not doing you any good. No matter how hard you try, you’re still treading water and unable to make any real progress.

If this happens, you should learn more about Chapter 7 and Chapter 13 bankruptcy. You may come to find that filing for bankruptcy is the best way to eliminate your credit-card debt and start fresh in the near future.

Source: Nov. 30, -0001

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