Get organized: Begin by gathering all your credit card statements and bank statements. Make a budget. List your credit cards with balances, from the highest interest rate card to the lowest. Make goals for how much you want to put toward each card, each month.
Negotiate for a lower interest rate: One by one, call the customer service center for each credit card and ask to get a lower interest rate. Often, companies will work with you and grant you a lower interest rate in hopes to retain your business.
Don't accept new credit card offers: One key to getting out of debt is to stop acquiring new debt! One to two credit cards is usually the maximum amount any individual or family needs. Eliminating one debt, and adding another, only gets you falling back into the same pattern. While department stores might offer you incentives-such as 10% your current purchase, or 0% financing for 12 months-avoid adding to your debt at all cost.
Make a budget: Making a budget helps you identify how much money you are able to spend each month to pay off your debt. It also helps identify areas in which you could cut spending or increase savings. Once out of debt, a budget is a great tool to help you meet your goals without falling back on credit cards.
Pay cards with highest interest rate first: As a general rule, it makes sense to pay the cards with the highest overall interest rate first. Since debt grows exponentially, the idea is to hit the biggest ones first to decrease the overall amount of interest you will pay back.
Proper insurance: A large portion of debt is caused by large medical bills, or other difficult situations caused by an emergency. It pays to make sure you are properly insured. Check your health insurance, car insurance, life and homeowner’s insurance to make sure you are adequately covered for emergencies.