Tackling Debt and the Poverty Cycle
For many, tackling debt and poverty that can come of it, can prove to be a very difficult, exhausting, and sometimes headache-inducing achievement. Are you someone that has a large outstanding balance on a credit card with very high interest rate?
Then you know just how difficult this can be, and the poverty cycle that is often a result. Fear not – you do have options, and can take direct, proactive action to tackle debt. And to ultimately end and demolish a poverty cycle your debts have created for you.
Tackling Debt and Poverty Caused by High Interest Credit
Do you have a line of credit with a credit company or credit card – or even a student loan – that has interest that is higher than normal? The debt incurred can easily be overshadowed by high monthly finance charges that quickly eat away at your minimum payment. The immediate result of this is that you’ll see that your full balance on your credit line or debt is only decreasing by a small amount each month.
This creates a loop or cycle of debt. Luckily, there are a few different options available for you to tackle debt and poverty once and for all. Freeing your financial burdens and thus increasing your quality of life.
What are my Options for Tackling Debt and Poverty Cycles?
Request lower interest rates. You have the option to ask your creditor if they are willing to lower their interest rates on your credit line. However, this isn’t something you should expect creditors to easily grant to just anybody. Creditors are more likely to award cardholders who are their top consumers. The creditors who have only missed two or less payments, or none.
You do have the option to barter. And a bargaining chip you can use to your advantage are any alternative offers you may have received from other credit card companies.
Balance transferring to lower interest cards. If you’re stuck in a strong cycle, yet are someone with good credit and pays on-time, you have options. One way to tackling debt and poverty from high interest cards quickly is to simply get that line of credit, or some of it, transferred to a lower interest credit card (or loan).
Or better yet, the first few interest-free months of a new balance transfer credit card may be all you need. These interest-free months help to completely pay off that original balance. Look at your options for balance transferring on all types of cards. As some of the best transfer rates are sometimes actually found on rewards based credit cards.
Start small when tackling debt and poverty predicament. Take on the smaller debts you may have first and foremost, and this can prove to be an effective strategy for next eradicating your high interest debt with the extra money available you just freed up more quickly.
Jumping right to paying off high interest rate debt first can sometimes be more burdensome and a longer process to tackling the full problem more quickly. If possible, transfer the high interest debt to something more manageable, and then get rid of the smaller debts to focus more exclusively on the newly transferred high interest debt.
Give yourself a breather month or two. It’s harsh being stuck in a cycle of high-interest debt without the income to pay it off. Sometimes taking a step back for a month or two means tackling debt and poverty overall in due time.
While doing this, you’ll of course continue to keep making any minimum payments. This is so you won’t see any drop or decrease in your credit score. All the while, you can grow yourself the extra income needed in a short period of time to supplant a more substantial payment. It is a more practical way of tackling debt and poverty caused by the strain of high interest over a much longer period time comparatively.
The poverty cycle is incredibly difficult to break sometimes. But with these tactics you should have a much better shot at it. And it will help get you one step closer to being debt-free, and thus, dependency-free!