Most students are bombarded with advertisements for free credit cards as soon as they enter college. These credit cards make life easier when classes and studying make it harder to work. A lot of your expenses (food, clothes, books and gas) may have been charged to your new credit cards.
You may find the debt you built on your credit card makes it harder to pay off your student loans after college. Knowing how to relieve your credit card debt is just the first step to focusing on your student loans. Here’s what you should know:
Restrict any extra purchases
You may think it’s time to replace your old college couch, the one you and a few friends recovered off the side of the road. Your credit card can make your purchase easier, but you may consider holding on to that couch to reduce your debt.
You can get into a nasty habit of buying extra stuff when you don’t need to immediately pay for anything. You may still be using your credit cards for extra purchases after graduation. One way to reduce your debt is to focus on what you do need to buy. Separating your needs from your wants makes it easier to focus on paying off your credit card debt.
Look Into Chapter 7 or 13 bankruptcy
You may wish you could wipe all your credit card debt at once. The closest thing you can get to a full debt wipe is a Chapter 7 or 13 bankruptcy. Chapter 7 is often referred to as “total” bankruptcy, while Chapter 13 is a reorganization plan for your debts. Either can leave you in a much easier financial position.
Your student loan debt may still be around after a Chapter 7 or 13 bankruptcy, but it’ll be easier to focus on it once all your credit card debt is gone. You should know your options when choosing from a Chapter 7 or 13 bankruptcy.