5 Ways to Dig Yourself Out of Credit Card Debt

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How do you stop digging yourself deeper into debt?

Americans carry a lot of debt, and it is easy for mounting debt to grow. Sometimes, it grows faster than you can pay it off, and that can be very stressful.

Here are five surefire strategies to help you help yourself:

1. Give yourself a 'time out.'
Parents know the "time out" routine. You can do the same with your credit card. Vow to wait 48 hours before you buy anything. If you still must have it in 48 hours, then buy it -- with cash. Don't have the cash? Don't buy it.

2. Stop using your credit cards.
Yes, this is the obvious one. If you're in the habit of leaning into your credit cards, this can be tough.

Some ways that people have gone cold turkey:

  • Give your cards to a trusted friend to keep.
  • Start carrying cash when you go out, and do not take your cards with you.
  • Get professional help if you can't stop using them...

  • 3. The $100 key rule.
    Actually, this can be the $50 or $25 rule, as well. Commit yourself to never spending more than X amount when you go to the store for something else.

    Say you go to the store to buy a new shirt for work. You estimate a new shirt will cost you $40. Do NOT leave the store with any additional purchases that add up to an additional $100 (or $50, or $25). Set your spending target amount BEFORE you go shopping. Do not change this magic number.

    Here's the key: that's $100 (or $50, or $25) you're not spending in CASH. We're assuming you've decided to listen to Rule 2. This rule helps keep your cash flow flowing -- so you've got an extra $25, $50, or $100 to put toward your credit card payment.

    4. Delete your cookies!
    Those who prefer the twice-gratification of online shopping (once when you buy, another buzz when you get the item) ... delete your browser cookies! These "helpful" cookies remember your credit card numbers. Delete them so you must dig out your credit card in order to purchase something (after your 48-hour time-out rule is observed, of course).

    To delete cookies using the Firefox browser, go to Tools > Clear Private Data... > check "cookies" and hit the "clear personal data" button. Browsers such as Internet Explorer and Mac Safari offer similar solutions.

    5. Count to five.
    If you can't seem to wait 48 hours (and that should tell you something!), at least count to five. Tick off five good reasons why you must purchase this item. Hint: the reason "because I don't have cash" is not acceptable. Count to five with all your cash purchases, too.

    Ask yourself whether you can get the item used, for free, or cheaper elsewhere. Also try asking yourself whether you'll still want and use the item five weeks, five months or five years from now.

    Simply put: Look carefully at every purchase. You cannot dig yourself out of debt without curbing your spending habits.

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