OKLAHOMA CITY- Oftentimes, it can seem like you are always paying on your bills but they never really go away.
Americans’ total outstanding credit card debt recently rose above $1 trillion for the first time since 2007. At the same time, auto and student loan balances also went over $1 trillion.
The Oklahoma Society of Certified Public Accountants has some practical tips to follow if you’re feeling overwhelmed.
- Take stock- Calculate how much you owe and what you pay every month to create a realistic budget. Also, find out how much interest you pay on each balance and rank your balances based on the interest rate. Typically, it is best to pay off the highest rate loans first, but getting rid of smaller debts may help you feel accomplished.
- Check your credit score- The lower your score, the more likely it is that you might be denied a loan or that you may have to pay a higher interest rate. You’re eligible to receive a free credit report once a year from each credit agency.
- Pay on time- The largest single portion of your credit score is based on your past payment history. If you’ve missed payments, it will drag down your score and you may be hit with a hefty fee. To stay on track, set reminders about your payment due dates and avoid splurges that could leave you short when it’s time to pay your bills.
- Negotiate payments- It can be intimidating to contact credit card companies, but it is worth letting them know that you’re having some difficulties and are trying to stay current. Many will be willing to lower your monthly payments or make other accommodations.
- Cut some costs- If your budget is squeezed, it is time to look for any unnecessary expenditures in your budget.