Dr. Oz: Credit Card Debt
Dr. Oz has been talking to Leah, a woman who has racked up more than $13,000 in credit card debt across eight credit cards and can’t stop spending money, about how she can control her spending. He’s also been talking to expert Ric Edelman, author of the book The Truth About Money, who had some advice for Leah.
Dr. Oz: Ignore Budgeting
Ric Edelman said we should ignore budgeting. He said budgeting is a waste of time. No one sticks to them. Unexpected things come up and that will break our budget.
Instead, he suggested during a One-Week Reality Check. Track your spending for a week and then tally it up. You’ll discover where your money is going and you’ll find out what you’re really spending. People who do this might be shocked to discover they’re spending 10 percent of their income on coffee and donuts. Common sense will then tell you to stop doing this.
Dr. Oz: Focus on One Credit Card at a Time
The average American has six credit cards and most people are overwhelmed by them. It becomes daunting to keep track of them all. Ric Edelman suggested we pick one and focus on getting that debt down first.
The one you should pick isn’t the one with the least amount of debt on it. It’s the one with the biggest interest rate. That’s the one that’s causing the biggest charge. Make the minimum payment on the rest of the credit cards and focus the money you have leftover on getting that credit card with the big interest rate down.
Dr. Oz: Don’t Always Make the Minimum Payment
However, you don’t always have to make just the minimum payment. When you can, pay off credit cards as soon as possible. If you have a credit card with a 17 percent interest rate with a $2,000 debt, it’ll take you 21 years to pay it off if you only make the minimum monthly payment. But if you make twice the minimum payment, you’ll get rid of it in two years.
Do you think this advice will help you with your credit card debt? Let us know in the comments!