Learning to see when the debt that you are accumulating, is starting to take up more of the repayments just trying to cover the interest that is being added monthly. If paying say £100 a month to your bill, take a good long hard look at your statement and see how much of this is interest and how much is actually going to pay back the original debt.
Most credit card company’s used to ask for a minimum payment of £5 or 5% of the total amount owed, but are now asking for as little as 2% in some cases because of the 5% minimum was meaning people were finding this a struggle to pay back.
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If you are getting to this stage the best advice is to stop using the card that has built up these debts and start to look for ways of reducing it. Balance transfers are the best way of trying to give yourself a little bit of breathing space, search for one of the 0% deals that some lenders are offering at the moment. But make sure that the card that you plump for has a low Standard Rate once the 0% introductory rate has expired, and cut up the previous card and cancel it because a card with a zero balance will only act as temptation and you will end up in an impossible situation.
Also make sure that you keep up with the minimum payments on the card that you have transferred your balance because if you don’t charges and penalties will then be added to the total balance.
Once you have got the debt under control and at an amount that you feel is manageable, the next step is to try and curb the spending and clear the debt completely and get back on an even keel, then you can enjoy the spending freedom that a credit card brings you, but under your terms.
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