When it comes to help with credit card debt, we recommend Dave Ramsey’s 7 Baby Steps. Dave Ramsey is one of the most popular personal finance gurus in the United States, he is renowned for his no nonsense approach to personal finance. Dave say’s “You will get out of debt the same way you learned to walk—one step at a time”.
Here are Dave’s Ramsey’s Seven Baby Steps To Financial Freedom.
1). Start a $1000 Emergency Fund.
Your emergency fund is for life’s unexpected events, like losing a job, a car repair, a trip to the Doctor. It’s not if these emergencies will happen, it’s when! What you’re trying to do here is to stop adding new debt to the pile while you are paying off the old. Your $1000 emergency fund is to keep you from more borrowing and break the cycle of debt!
2). Pay off all debt starting with the smallest balance first.
Yes you have a pile of credit card debt, cards with big balances, some with smaller balances, some with higher interest rates, and others with rates that aren’t too bad. Dave recommends you pay off credit card debt using the debt snowball by paying off the small balances first, regardless of the interest rate. Dave say’s “You need some quick wins in order to stay pumped up about getting out of debt”! Plus, as you pay off each smaller card, you have more money to throw at the remaining ones. Please note that step 2 is key for help with credit card debt.
3). Build your full emergency fund of 3 to 6 months of expenses in saving.
As you pay down your debt, start saving for 3 to 6 months of living expenses. Again, the goal is to break the cycle of debt and learn how to pay for everything in life with cash.
4). Invest 15% of household income into Roth IRAs and pre-tax retirement funds.
Now that the debt is gone, it’s time to look to the future. Try to save 15% of your household income into tax saving Roth IRA or company sponsored deferred compensation plans.
5). Grow your children’s college fund.
Give your kids a great start in life with a college education.
6). Pay off your mortgage early.
By the time you are ready to retire, have that mortgage paid off.
7). Build wealth and give to charity.
While getting help with credit debt, continue building wealth through the years but please do not forget to give a percentage to your favorite charities. You may also want to check out Dave Ramsey’s Total Money Makeover book. It provides you with helpful charts and graphs to help you keep track of your debt reduction progress while following the steps in the book. When it comes to help with credit card debt, Ramsey provides the hard truth about what it takes to become debt free.
Help With Credit Card Debt
Bottom line, you must know how much money is coming in and how much money is going out. You won’t build a higher credit score without doing this first.
Know Your Credit Score
Your Credit score is fluid and can change anytime your credit report file is updated with new information. As you work on the building credit steps listed in this article, you will discover your credit score will quickly be on the rise.
Get An Updated Copy of Your Credit Report
In conclusion, viewing your credit report file is allowed by both state and federal laws. You can request your annual free credit report once every 12 months from each of the three consumer reporting agencies, Equifax, Experian and TransUnion. It only takes a couple of minutes to view and print your credit report so there isn’t any reason not to do so. Remember, help with credit card debt is not that far away.