5 Steps To Clearing Your Credit Card Debt

by Simone Milasas

Do you shudder to think what the summer party season will do to your credit card?

Australians have more personal debt than anyone else in the world, it was reported recently*. With over $1 trillion in debt, mostly for mortgages, loans and credit cards, the average Australian has now overtaken the average American. This equates to US $56,000 for every Australian adult, compared with US $45,000 for every American adult.

Clearing-credit-card-debtImage via Gucci

But don’t despair. You can clear your credit card and create a different financial reality if you’re committed and willing to do whatever it takes.

1. Take the first step

When I was $187,000 in debt, one of the first tools I implemented was getting clear about my financial situation and taking pragmatic steps to change it.

Look at your debt for yourself, and you really have to be the one because no one else can do it for you. Then work out exactly how much you owe and what are the monthly repayments, over 12 or 24 months, to clear your credit card debt. If you have more than one credit card to pay off, what are the possibilities of consolidating your debt?

2. Create different income streams

Your job or business is not the only way you can create money. What do you love to do? If you love baking cakes or doing make-up, use that to your advantage. I have a friend who loves animals. She started a dog walking business in Santa Barbara, California. To me walking dogs feels like a chore, but she’d take between eight and ten dogs walking in the park and she loved it. And it brought in money.

Whatever you find incredibly easy is usually something you can make money from. Start writing a list of everything that’s fun for you, and then look at ways of using those skills to create more income. You create the amount of money that shows up in your life. Are you willing to receive more? Then ask for it. Literally, ask, can I have more money please?

3. Set aside 10% just for you — then watch it grow

If you have been taught to always put others first, this tool might seem rather ridiculous but trust me, it actually works. Set aside 10 percent of all the money that comes in just for you. It’s not for a rainy day or a relationship break-up. It’s not to spend, ever!

Don’t wait till you have cleared your credit card debt to start using this tool. Start today. Watching this money grow will serve as a reminder that you are valuable and you always have the ability to generate more money. Having money not only gives you a sense of peace, it is a huge contribution to every area of your life.

4. Go beyond your comfort zone

Some people actually feel comfortable with debt; it is actually familiar to them. When I asked myself, what I loved about creating debt, I discovered that I was more comfortable in debt than having money. The next step for me was changing my point of view around how much money I was willing to have. Do you have a particular sum of money that you’ve decided is within your comfort zone? If so, you will find yourself spending any money greater than that what you’ve decided is the limit for you. This may not be a cognitive sum, but once you are aware that there’s a limit to how much money you will allow yourself to receive, only then can you change it.

5. Stop judging you

If you feel sick to the stomach every time you get your credit card statement and start calling yourself all the names under the sun — stop. Every judgement you have that you’re bad, wrong, stupid and irresponsible will get you nowhere. You’re not a judgeable offence.

Judgement will stop creation and create a separation between you and money, between you and your business, between you and your generative, creative capacities. It takes a lot of energy to keep those judgements in place. What if you started to ask, what’s right about me I’m not getting? Know you’re on the path to clearing your debt and willing to do whatever it takes.

Owning a credit card is not wrong; you can use it to your advantage. Do your research properly and find out which credit card will be a contribution to you and your business. Perhaps they allow you to clock up frequent flyer points or have more flexible terms, for instance.

Always remember, a credit card is not the solution to a desperate financial situation. It should be something that makes your life easier and contributes to your business and you.

 

For more information about Australian business mentor and author Simone Milasas visit http://www.accessjoyofbusiness.com/simone-milasas

* http://www.creditcardfinder.com.au/australias-personal-debt-reported-as-highest-in-the-world.html

 

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