When you’re young and you first get your credit cards, running yourself deep into credit card debt is the last thing on your mind. Of course, after a few years, if you’re anything like most people, you realized that you couldn’t keep charging things forever. Sooner or later you had to look beyond the minimum payments and do something about that balance. Eventually, you might even think about applying for rewards credit cards in order to earn a little something extra on a practice you’re already very obviously committed to.
Hopefully, you’ve already started paying down your credit cards. For many, 2009’s Credit Card Act was the impetus to start getting out from under their credit card debt. The Credit Card Act required credit card companies to reveal two key pieces of information on every credit card statement:
- How much interest you will end up paying over the long run if you pay the minimums.
- How long you’re going to be paying on that credit card if you only pay the minimums.
Remarkably, a lot of people have said that this information being on their statements played a key role in helping them decide to start paying down their balances. Who knew? Maybe that little bit of extra information really does help. Now, if we could only get Americans to pay attention to cigarette warning labels and the nutritional information printed on the package of Oreos.
Paying down credit card debt isn’t rocket science. Anyone can do it. Simply look at the minimum payments and pay more than that. The more you pay above the minimum, the faster you will be done with credit card debt.
Fortunately, more and more people are catching on to the idea that carrying a large load of credit card debt is a bad financial strategy. Today, the average credit card debt is more than $1,000 less than it was a year ago. Several key indicators reveal that problem credit card debt is on the decline.
For example, the percentage of credit card users who owe more than ten grand is down 7% from this time last year. That takes us all the way down to 23%. Let’s hope that the number continues to drop.
We’re not saying you shouldn’t use credit cards, of course. When you apply for a credit card and use it to make your purchases, you make life a lot more convenient for yourself and the merchants you do business with. Still, we all need to keep our debts in check, and the best way to do that is to pay off more every month than we charge.