Do Not Stick To Your Minimum Monthly Payment

This is something that we should all never tire of telling people who only pay the minimum monthly payments, if you only pay the MMP you will end up with a debt that you will have for years to come and will cost you more than the original price of the purchases that you made on your credit card.

You could conceivably be adding thousands to the debts that you have run up and find yourself in a situation that you just cant get out of, no money, bankrupt, a credit rating of zero, therefore no chance of any future credit. All this and you never missed a payment and you had it in your own mind that you were paying the debt off.

If you feel that you may be heading down this road, then it could not be too late for you to change the way that you pay off your debts. The first thing that you should do is cut back on your spending and try to pay back what you are saving, towards your debt.

Most credit card companies set a minimum payment limit of 2% of the balance that is owed with a minimum of £5, but if you can adjust your payments even slightly and pay back say 5% of the total balance, then you will pay the account off quicker and save yourself a fair bit in interest charges. Though the golden rule through all this is not to spend on the credit card, until you have cleared the bill in full and then you should have the experience never to let yourself get back into the same position financially again.

What you really have to remember is that there is no such thing as free money, even though a credit card can give you that illusion because you are not paying for it straight away, but by paying the minimum monthly payment you can be putting yourself in a position of a possible lifetime sentence of debt.