Top tips for paying off credit card debt

13-Jan-2015 4:53 PM

One in every 10 Aussie's admittted to placing their Christmas bill on their credit card over the silly season, according to research from St.George Bank.

General Manager for St.George Retail Banking, Andy Fell says starting the new year by setting a budget should be the priority when it comes to paying off any debt.

"It will help to keep track of your spending and see where there is extra room to increase your repayments,” he said.

St.George’s top tips for paying off credit card debt are:
 
  • Stop adding to your debt – the first step is to make sure you are no longer adding to your credit card debt unnecessarily. Know your limits, and think about whether or not you can really afford that your next purchase on your credit card.
     
  • Pay off the card with the highest interest rate first – If you have multiple credit cards, pick the card with the highest interest rate, focus on paying this one off first and then work your way down.
 
  • Pay more than the minimum amount – work out what you can afford to pay each month and pay this amount rather than only the minimum. Even small amounts make a big difference over a year.
     
  • Look for competitive rates on zero balance transfers – investigate and find the best deal on zero balance transfers so you can save on the interest and pay down the principal quicker. St.George actually has a 0% p.a. for 16 months on balance transfers requested at application.
     
  • Set a budget and repayment schedule create a comprehensive budget which includes all types of income, your quarterly bills, repayments and general expenses, so nothing crops up unexpectedly. This way you know how much you can allocate to paying down your debt. A budget planner on the St.George mobile app is a great place to manage your expenses. 
     
  • Consider consolidating your debt – get the right advice from your local banker to see if consolidating your debt into a personal loan is the right move for you. This decreases the temptation of re-spending on your credit card.

Topic: General News

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