Though the recession has prompted many of us to become better savers, we’re still struggling to get back in the black. Collectively, Americans now owe more than $2.5 trillion. The average credit card balance per household last year rose to an estimated $8,329. If you’re sending in the minimum each month, it could take years to pay off that kind of balance, especially when you’re being charged an interest rate of 12 percent (the average rate right now). But there are simple steps you can take to pay down your debt faster and save yourself a lot of anxiety -- and money -- in the process. Here’s how:
“A lot of times, clients aren’t even sure how much they owe and what they’re paying in interest,” says Kim E. Jones, founder of Jones Strategic Financial Planning in Broomfield, Colo. If that’s you, dig out your most recent statements now. Then, write down how much you owe each creditor, how much interest you’re paying and what your minimum monthly payments are. Just seeing those numbers can provide a powerful incentive to stop using your cards and start making a priority of paying off the balances.