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How to Pay Credit Card Debts Without Hurt Your Credit Score

How to Pay Credit Card Debts Without Hurt Your Credit Score

Credit cards prove to be a lot helpful in cushioning your finances at times of emergency. The moments when a monthly budget cannot fund purchases or any kind of expenses, you can help yourself with this little piece of plastic. But then, it comes to paying off the monthly bills on defaulting which you will invite hefty charges. It is in the best favor of one to have credit card debts cleared before they make life an enemy of sleep. And if anything worse that comes out of not paying credit card bills is poor credit score. Scary. Isn’t it? Let’s cut to the chase and read this section to find out how to pay credit card bills without spoiling your credit score

How to Pay Credit Card Debts Easily

Credit card is better useful when you need to make an urgent purchase rather than walking on to a shopping spree. Doing this opens the door to heavy bills which can turn your budgets upside down. But what to do when you are stuck in such circumstances? To answer your dilemma, we have listed down 5 tips on how to pay off your credit card debts and prevent your credit score. Read on and find out what suits your ease.

Make a List of Your Debts

If you are wondering how to pay credit card bills easily then here is our firstmost tip for you. Taking your time to list down all of your dues help you put them into different categories. 

When you have more than one credit card bill, listing them down helps you categorize them based on the rate of interest and the total amount due which you can then compare. 

On the other hand, when you have a single credit card bill to clear, the first important thing you must do is break them into multiple amounts which can help you manage the payments. 

Prioritize Your Dues

Now that you are aware of all of your credit card dues with the eyes wide open, you will be able to make a priority list for paying them in the most efficient way possible.

Know that your debt with the highest rate of interest will cause the most charges in the future and thus, the amount with the highest interest rate is the one  you need to pay at priority.

If you are in a financial situation good enough to do that then the least you should try and do is pay off the minimum dues. 

Note that paying off the minimum amount due is a good idea in worst financial situations only and doing it every month can impact your credit score pathetically.

Make a Budget

Making a budget to pay off your credit card is a decent favor you can do to yourself, given that paying off debts is not the use you have to make out of your income.

Have a refreshing sip of your coffee and get a calculator. Plan your budget taking your income into account and track all the necessary expenses you have to make with it.

Once you have set aside the monthly expenses that are unavoidable, you need to create a room of the remaining amount to pay off your debts. 

Take the Benefit of EMIs

One of the best steps you can do to pay off your credit card debts is to convert the outstanding balance into monthly installments and avoid receiving the bigger-sized bills. 

Know that most banks offer the facility to convert credit card outstanding balance into EMIs at quite a nominal rate of interest.

If the credit card outstanding balance is bigger than you can afford to pay at that time then you can consider breaking it into EMIs with a suitable tenure.

Take a Loan to Help Yourself

Apart from converting your credit card outstanding balance into EMIs, another thing you can do is avail a personal loan to clear the debts. 

It doesn’t sound good to welcome new debts to clear the existing ones but know that many banks offer personal loans at lower interest rates as compared to the interest charges on credit card dues. 

You can check which bank can avail you a personal loan at low interest rates with suitable tenure. This way you can prevent the scary interest charges on your credit card outstanding balance. 

Additional Tips

Here are some quick tips for you to manage your credit card and maintain your credit score:

  • Pay off your credit card outstanding balance every month without skipping a single payment. Doing this, you will ensure a healthy credit score.
  • Set the credit card bill payments to the auto-pay option. Most banks provide auto-debit facilities in which the credit card outstanding amount gets automatically deducted from your account. It makes a great option when you cannot keep track of time and is a great way to make sure your credit score is maintained. 
  • Understand the difference between your needs and wants. Only use a credit card when your necessary expenses cannot be met with your budget. Avoid going on a shopping spree every now and then with your credit card. 
  • Keep a track of your credit card transactions. Looking into the logs will help you see if using your credit card unnecessarily and manage accordingly.
  • Don’t use all of your credit limit. Just because you have a handsome credit limit, you don’t have to give yourself the opportunity to go on spending all of it. 
  • Do not live on paying the minimum amounts due forever. Know that paying only the minimum amount will only threaten your credit score.
  • Keep tabs on the credit card reward points and cashbacks. Use the reward points to enjoy discounts or cash benefits. For best, you can redeem credit cards reward points to pay off the outstanding balance. This option is offered by most banks. 

Final Thoughts

While it all seems smooth and pleasant to have a credit card to go shopping, dine out and enjoy many other comforts without worrying about the wallet, receiving a statement every month with hefty interest charges can shake your financial stability. The worst scenario happens when your credit score starts appearing red. If you want to protect your credit score against such a threat, the best thing you can do is be careful with your spending and only use your credit card at times of emergency. After all, financial freedom is a thing.