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How to reduce credit card debt

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How to reduce credit card debt
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Create a plan that fits your budget to reduce credit card debt

If you have debt with multiple credit card companies, figuring out how to reduce credit card debt can seem like an uphill battle.

You diligently make payments month after month, but your balances never seem to decrease.

And every time an unexpected expense arises that you have to cover with a credit card, the problem deepens even more.

So how do you reduce debt effectively when you’re already living paycheck to paycheck?

The secret to reducing credit card debt lies in reducing or eliminating the APR applied to your balances.

By minimizing the interest charges added to your debt each billing cycle, you can focus on paying down principal; that’s the actual debt that you owe.

How to Reduce Credit Card Debt in 4 Easy Steps

  1. Call your credit card companies to negotiate lower interest rates.
  2. Review your budget to free up as much cash flow as possible.
  3. Prioritize your credit card balances to eliminate them based on your budget.
  4. Focus your cash flow on eliminating one debt at a time to get out of debt.

Find the best way to reduce credit card debt in your situation

When deciding the best way to reduce credit card debt, there are two basic tactics you can use.

The strategy we outlined above remains the same no matter which alternative you choose.

The difference is how you prioritize your credit card debt for a reduction in Step 3.

We’ve detailed each step below so you know exactly what to do at each stage.

Avalanche method: start with the highest interest rate first

This is the fastest and most cost-effective method of reducing credit card debt because it targets high APR debt first. If you owe $ 1,000 on a credit card with a 20% APR, it will cost you more money each month than the same balance on a card with a 15% APR. To eliminate high APR debt, the total cost of getting out of debt is first reduced.

Here’s how to reduce credit card debt with this method:

  1. Use a credit card debt worksheet to list all of your debts. Specifically, you must list each current balance and the APR.
  2. Call each credit card company to see if they will negotiate to lower your interest rates; If so, adjust the interest rate on your worksheet accordingly.
  3. Prioritize the list from highest to lowest APR.
  4. Now, review your budget to reduce unnecessary expenses; This maximizes the cash flow you have available to pay off debt.
  5. Make minimum payments on all your debts except the one with the highest APR.
  6. Then, make the largest possible payment on the debt with the highest APR.
  7. Continue like this until the debt is gone, and then move on to your next higher APR debt.

As you eliminate each debt, you free up more money to pay off the next debt. This speeds the payment down to zero on all of your balances. This acceleration to the bottom is why this method is commonly known as a debt avalanche, a term coined by financial expert Dave Ramsey.

Snowball method: start with the lowest balance first

If your highest APR debts are also your highest balances, the avalanche method may not work to reduce your debt. This is especially true if you can’t free up extra money because your budget is tight. In this case, you may not be able to address your largest debts first. Instead, you need to get rid of your debts by starting with the lowest balance first.

All the previous steps remain the same, but in step 3, you prioritize your debts based on the current balance. Start with the lowest balance first, releasing money little by little. Each debt you eliminate frees up more money to pay off the next debt.

Each debt you eliminate gives you more financial power to pay the next one. When you reach your highest balances, you will have the monetary power you need to eliminate them.

How long should it take to reduce credit card debt to get rid of it?

This depends on the debt reduction method you use. But a good rule of thumb for making a debt reduction plan is that it should never take more than five years to get out of credit card debt. That means you should be able to pay off all your credit card balances with 60 payments or less. If you can not eliminate your debt completely within 60 payments, no matter how much lower your budget, then explore the options for the debt relief s.

Find better ways to reduce debt quickly

If you can’t pay your debt in 60 payments or less, don’t panic. There are other ways to reduce debt quickly that won’t hurt your credit score. The best way to reduce debt quickly when traditional payment methods work not by debt consolidation.

Debt consolidation works on the same principle as debt reduction. Reduce or eliminate interest charges, so you can focus on paying off principal quickly. But instead of trying to pay off one debt at once, it rolls them all into one payment at the lowest possible interest rate.

There are three ways to consolidate debt:

  • Target balance transfer to Credit
  • Personal debt consolidation loan
  • Debt management program

Either of these options will consolidate your debt so that you can pay it off efficiently with a single monthly payment. The first two options work by obtaining new financing that pays off your existing balances, be it a credit card or a loan. The last option is a professionally assisted form of debt consolidation. You still owe your original creditors, but credit counseling helps you set up a payment plan and negotiates on your behalf to minimize the APR.

Tips for reducing debt

  • Increase your income. Although debt reduction strategies can work without extra money, they work faster when you add additional funds.
  • Stop using credit cards! Any new credit card debt will only delay your plan to lower your balances. Avoid making new charges to your credit cards until you have paid off your balances.
  • Incorporate savings into your budget. Unexpected expenses are one of the leading causes of credit card debt. Try to complete your budget with at least some emergency savings. If you live check to check, pay a balance, and then divert the cash you save to an emergency savings fund.
  • Avoid solutions that put you in a more vulnerable financial position. If you are looking for solutions to a traditional debt reduction plan, avoid options that increase your financial risks, such as a home equity loan, or that damage your credit, such as debt settlement.

 

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Trish Lorenz wins the 2021/2022 Nine Dots Prize

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German-based journalist Trish Lorenz has won the 2021/2022 Nine Dots Prize for her essay about the immense significance of youth populations in Sub-Saharan African countries.

 

Now in its third edition, the $100,000 prize is awarded every two years to a 3,000-word essay that tackles societal issues, written in response to a question set by the Prize Board. The question for the third edition was: What does it mean to be young in an aging world? The prize also entails a book deal with Cambridge University Press, says a statement issued by the Nine Dots Prize.

According to the statement, the prize money (US$100,000) enables the winner to “spend time researching, developing their ideas, and turning their essay response into a full-length book which is published by Cambridge University Press.”

Also Read: The Nine Dots Prize: Extracts from the winning entry

The third edition saw a record 700 entries submitted from 92 countries and was judged anonymously by the Prize’s twelve-strong Board of leading academics, journalists, and thinkers.

Talking about western perceptions about African countries, as shaped by western media, she terms a New York Times report “regressive” and “based on ignorance and a mix of systemic racism combined with post-colonial conceptions of superiority”.

Lorenz argues that no question of what it means to be young in the 21st century should overlook the significant youth populations of sub-Saharan African countries including Nigeria, Ghana, Kenya, Rwanda, and Ethiopia. Focusing on Nigeria, she discusses how a new generation “is employing technological solutions to become self-sufficient and solve pan-African and global issues.”

Chair of the Nine Dots Prize Board, Professor in Greek Literature and Culture, and Fellow of King’s College, Cambridge, Professor Simon Goldhill said: “The Nine Dot Prize questions allow entrants to define the terms for themselves so that they can approach the question in the way they feel is most interesting. The Board was thoroughly convinced by Trish’s compelling and well-evidenced argument that the 2021/2022 question could only be answered in this way, and by the authenticity and rigor of her approach. We very much look forward to reading the book she will now write on the topic.”

Indian writer Annie Zaidi won the second edition of the prize for her essay, “Bread, Cement, Essay”, which was later expanded into a book published by the CUP.

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Classic Disney Songs That Will Have You Bippity-Boppity-Booing Everywhere

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Classic Disney Songs That Will Have You Bippity-Boppity-Booing Everywhere
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To my 90’s and 2000’s babies, this is your kind of Disney throwback playlist.

Lately, I have been on a wave of listening to old Disney music. The best, most classic movies and songs were released so long ago at this point that it’s super nostalgic to go back and listen. It’s amazing how one old song can take you back to a specific time and place where you first heard it or have a fond memory relating to it.

That being said, I wanted to throw it back for the Millenials and the Gen Z-ers with some oldies, but goodies. Sorry to the younger kiddos, there’s no ‘Frozen’ or ‘Moana’ tracks on this list.

Here are some of Disney’s most classic tunes that will bring back all the nostalgia:

1. “The Bare Necessities”

The Bare Necessities of life include Disney, Disney songs, and Disney movies. That is all.

2. “Colors of the Wind”

This song captures the hearts of so many Disney fans, not only for its contagious melody but for the fact that it addresses inclusion in such a sweet and child-friendly way.

3. “I Won’t Say I’m In Love”

I have to say every version of this song is spectacular and this song is genuinely one of my favorites that Disney has ever done, but the Cheetah Girls did that. They did not have to go this hard on the remake.

4. “Almost There”

Truly just an innocent and happy song of encouragement from the spunky movie ‘The Princess and the Frog.’

5. “Hawaiian Rollercoaster Ride”

This Hawaiian jam brings back so much nostalgia for those of us that would sing it even though we didn’t have a clue what any of the Hawaiian parts were saying.

6. “A Whole New World”

This is a song I grew up belting this out all the time, so I know there had to be others out there singing with me.

7. “Go The Distance”

This is another one of those songs where the Disney Mania cover just might outdo the original. Long live Disney Mania!

8. “I’ll Make a Man Out of You”

There’s nothing quite like a girl pretending to be a guy and not getting caught for it (until the end) to promote some girl power!

9. “Part of Your World”

Jodi Benson has this iconic tune on lock. With ‘The Little Mermaid’ being one of my favorite Disney movies, as well as regular movies of all time, this song was always a classic for me.

10. “Hakuna Matata”

If the song break that goes “when I was a young warthog” doesn’t make you laugh every time, did you even grow up in the early 2000s?

11. “Zip-A-Dee-Doo-Dah”

Yeah, the original version of this song might be iconic, but there’s nothing quite like an Aly and Aj collab and a truly banging Disney Mania album with so many spectacular covers on it.

12. “Supercalifragilisticexpialidocious”

The name of this song alone gets me excited to sing.

13. “Friend Like Me”

Aladdin’ is my second favorite princess movie, so I’ve always loved this truly classing song, but as a child, my sister was in performance to this song and she was the genie. I’ll now never look at this song the same and I’ll never not love it.

14. “When You Wish Upon A Star”

15. “You Got a Friend in Me”

This movie is very gender-neutral, leading a lot of kids to love it and this super popular feel-good song.

16. “When Will My Life Begin”

This song just genuinely has the happiest vibes and makes me smile every time I hear it. The beat is what gets me I think, it’s infectious.

17. “Beauty and the Beast”

Although the Ariana Grande x John Legend version rivals the original so closely, I gotta give it to the classic here. Go give the new version a listen though, it’s pretty spectacular.

18. “Spoonful of Sugar”

This movie is an oldie that has some pretty good music, and no one will argue with me on this one.

19. “Kiss The Girl”

OG “Kiss the Girl” is one of the best songs Disney ever put their name on. Although despite this, Ashley Tisdale did do a good job on the Disney Mania cover though. I think the cover is definitely worth a listen too.

20. “Stand Out”

I really hope everyone else remembers this song from ‘The Goofy Movie’ as vividly as I do.

21. “Be Our Guest”

“Try the gray stuff, it’s delicious” was so iconic that Disney made “gray stuff” in real life and currently sell it at Disney parks.

22. “Heigh-Ho”

This is one of Disney’s older movies as well, but this song has very happy memories attached to it; probably due to the fact that most of the dwarves are just so happy!

23. “A Dream is a Wish Your Heart Makes”

Okay yes, this song is one of the songs the Disney franchise prides and founds itself on from the movie ‘Cinderella.’ Should I put the original version here? Maybe, but I was obsessed with this version and still am so, Disney Mania wins again.

24. “Two Worlds”

Writing this article inspired me to watch ‘Tarzan’ as I finished this up and “Two Worlds” made me stop typing and just enjoy the song. It has that kind of power.

25. “Life is a Highway”

I’m into country music now, but this was probably the first country song I ever liked. Rascal Flatts, you’ve outdone yourself with this timeless banger.

26. “Belle”

There is something so pure and innocent about the song and this scene in the movie. Who doesn’t love a good cartoon version of fresh-baked bread and a bookstore?

27. “Under The Sea”

When Sebastian said “Ariel, listen to me. The human world, it’s a mess,” I felt that.

28. “I Wanna Be Like You”

I think my rewatching of this movie is long overdue. This is one of those Disney songs and movies we all sleep on, but it’s so good.

29. “Zero to Hero”

I love me some ‘Hercules’ songs. I genuinely think every song on the ‘Hercules’ soundtrack deserves a chef’s kiss, this one being no exception. Sing it to me, Muses!

30. “Just Around the Riverbend”

All of the songs from ‘Pocahontas’ have a special place in my heart because they’re inspiring and truly different than most other Disney/princess movies.

31. “Prince Ali”

It doesn’t get better than a street rat turned royalty!

32. “Reflection”

Christina Aguilera does a cover of this song (Disney Maina, are you shocked I brought it up?) and it’s phenomenal. I honestly like it better than the original, but the original is too good to not put it here.

33. “Cruella De Vil”

Everyone’s favorite person to hate might be Cruella De Vil, but her song snaps.

34. “I Just Can’t-Wait to Be King”

Everyone has their inner young Simba. We all love being in charge and can’t wait to be king.

35. “Can You Feel The Love Tonight”

A song started by Disney in the ‘Lion King’ but was adapted in so many different scenarios. A true classic to round off the list.

P.S. Elliott Yamin does an insane cover of this song on Disney Mania six, 100% worth the listen.

I think my conclusion from this is that number one, I need to binge-watch a lot of Disney this weekend. Two, I may need to write an article just about Disney Mania covers because they’re so good.

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