How to Pay a Credit Card Off With $0 Additional Income or Increasing Payments

Hi, I wanted to give you an example and show you on the Whiteboard so you can see exactly how the math works out of how you can reduce and pay off your credit card bill faster without making a larger payment and without making more money so potentially if someone’s on a fixed income or whatever the situation may be, and I’ve seen this method shown before, but I’m going to point out a couple things that sometimes are missed and a couple things you can learn from this method and apply whether you just use this method or not.

So first let me explain the idea behind what’s going on here. Let’s say that you have a credit card statement balance of $10,000, so you owe $10,000, and let’s just say for the sake of argument that you make every month $5,000 after taxes. This method works regardless of your balance regardless of what you’re making; these are just numbers to show you how it works.

Now let’s just say for the sake of argument that you have to pay out for your mortgage and car, roughly $2,000 is what you’re paying, alright, so what are you left with every month? You’re left with $3,000. The reason we look at this in terms of taking out things like a mortgage or a car from this method is that typically you can’t pay your mortgage or your car with a credit card without them charging an additional fee to cover it, so that’s why we’re going to take that out of the equation.

So now what does that mean? It means that you’re basically paying all your monthly expenses, and let’s say you’re spending every dime and you’re paying. You’ve got $3,000 to work with every month, and you owe $10,000. So let’s just say that option one is what you’re currently doing. You might have a 20% card, and they might say, “Okay, your minimum payment is $200.” It’s usually 1 to 3% of the total, so it’s either $100 a month, $200 a month, $300 a month; we’re just going to go with $200.

Watch the entire video for detailed instruction.