Having credit card debt that you are unable to pay off each month can be a scary and overwhelming feeling. While we recommend only using credit cards for expenses that you are able to afford, the unexpected happens. So what do you do if you overcharge a credit card? Here are some of our suggestions:
Write out your list of expenses
Similar to creating your own budget, write out the amount you spent last month and how much you made. Figure out exactly where you’ve fallen short. Next, try to approximate your income for the next month. Of your remaining money, subtract your living expenses (rent, groceries, utilities) and see what’s leftover. Figure out how much you can afford to put toward the balance of your credit card each month to pay it off in as little time as possible.
Pay off your balance as soon as you can
If you’re carrying a balance, you’re going to pay interest on it. Depending on interest rates and your total balance, that interest can cost you. Try cutting back on some of your extra expenses. Maybe you don’t eat out for the next month or maybe you cut your grocery budget back a bit. Do what works for you and your personal budget. The important thing to remember is that sacrifices can help you pay off your balance more quickly, create additional flexibility in your budget, and alleviate finance-related anxiety.
Make more, spend less
Both will help you reach your goal of paying off your credit card debt. If you have certain expenses you cannot avoid or if you’re already living paycheck to paycheck, you might consider picking up an extra job. If that’s not feasible, try crafting and selling what you make or selling items you no longer use, such as clothes. If you want to spend less, try cutting back in areas you don’t absolutely need, such as cable. It may not be ideal, but it will help you pay off your credit card debt faster. Once you’ve done that, you can reassess your budget and determine if you can afford some of the expenses you eliminated.