4 Simple Steps to Cutting Credit Card Debt

NEW YORK (MainStreet) – Despite slow progress in managing their household budgets, continued economic difficulty means Americans still wrestle with credit card debt, even though they know how harmful debt can be to their long-term financial health.

So just how bad is it? According to the Federal Reserve, total U.S. consumer credit card debt amounts to about $793 billion, and paying it down can be a Herculean task.

Obviously, when you're carrying debt from month to month, the interest payments alone are enough to swallow up most your budget. This can easily lead to a vicious cycle whereby you end up putting more and more purchases onto your credit cards, driving up your principal and interest even more. And if you're only making minimum payments, it might seem like you'll never be able to pay it down.

If you're one of the many Americans struggling to make headway on your outstanding debt, these four steps can help cast a brighter light on your financial future.

Stick to Cash

Cash is great for a lot of reasons, but the fact that it won't add new debt on top of old makes a convincing case to convert yourself to using cash only.

Let's face it: If you keep using credit cards much of the time, you're bound to wind up with more and more debt. Regardless of the convenience, making purchases with credit cards removes an important level of self-awareness and self-control in consumers. That’s where debit cards and old-fashioned cash can – and do – help your cause. Use them and put your credit card away in a desk.

Just remember not to close the account, because that will hurt your credit score, and you must always protect your credit score.

Double Up

Now is the time to go full throttle with your repayment schedule. Your immediate goal should be to send in at least double the minimum payment on your credit cards every month, starting with the card with the highest interest rate.

The interest on your cards fuels your debt, so every bit you can shave off the principal helps. A great way to help with this is to set up automatic payments through your bank: You don't have to remember to write checks every month and you'll be sure you're sending consistent, prompt payments. You can also make payments more than one time a month – say, sending in $50 every two weeks, instead of $100 at the end of the month. Use the BankingMyWay credit card repayment calculator to figure out a schedule for getting rid of your debt.