Top 10 ways to cut credit cards from your life

By Your Mortgage
Fantastic plastic makes it easy to purchase what you want, when you want ­– but do you ever get the feeling that you're drowning in credit card debt?
New “paypass” technology, which allows you to quickly swipe your credit card without having to sign for your goods or services, makes it even easier to spend without thinking your purchase through.
If you feel like your Visa or MasterCard bills are getting out of control and you’re keen to cut them from your life, here are some simple techniques for slashing your credit card debt – even if you don’t have loads of extra money to throw towards the problem.
1. Leave your card at home
You can’t rack up transactions on your card if you don’t have it on you! Just be sure to store it somewhere safe: “Keep it away from magnetised objects, like your work security access pass or other credit cards, and loose change, or it may become deactivated,” advises Aussie Home Loans.
2. Work out a plan
The best way to change your credit card habits is by working out a plan to eliminate them altogether. It’s almost impossible to cut credit cards from your life if you keep charging expenses to them, so the first step is designating credit cards as being there for "emergencies only", not everyday spending.
3. Consolidate your credit card debts
If you have several credit cards each with their own limit, try to consolidate all of your debts to one card (ideally, the card with the lowest interest rate) and then cancel all of your other cards.
4. Pay credit card debt in order of priority
“It makes sense to pay off the debt with the highest interest rates first,” suggests debt reduction strategists, Fox Symes. “If you have three cards, all with the same balance but with varying interest rates of 10%, 15% and 25%... it makes sense to pay more off the 25% card. This will reduce your overall interest payments dramatically. Once the higher rate card is paid out, then you have smaller debts that are easier to manage.”
5. Apply for a new card
This sounds counter-intuitive, but hear us out! If you apply for a new card with a promotional balance transfer rate, you will save hundreds of dollars in interest, allowing you to pay off your overall debts even faster. “Credit card balance transfers allow you to choose a reduced interest rate credit card for a honeymoon period of between six months and the lifetime of the debt,” explains “Just bear in mind that this is really only an option if you intend to pay off the card within the honeymoon period, otherwise you'll end up paying hefty interest rates, which will increase your debt.”
6. Get a personal loan
If you have three or more credit cards, it may make sense to get a personal loan to consolidate all of your debts into one low monthly repayment. Make sure you cancel your credit cards afterwards, so you don’t end up with a stash of credit cards AND a personal loan debt.
7. Forget cards linked to rewards programs
Many credit cards offer rewards schemes as an incentive to use them, but these care usually attached to a hefty annual fee and a higher interest rate. “Often, you have to spend in excess of $20,000 per year to make any reward scheme worthwhile, and then the rewards are not commensurate to the amount of money you have spent,” warns Fox Symes. Ditch this card in favour of a low-rate credit card account, and you’ll significantly reduce your interest bill.
8. Cut up your credit cards
Drastic times call for drastic action. If your credit card spending is getting out of control, remove the temptation to spend by cutting your cards up into tiny pieces and throwing them away.
9. Reduce your credit limits
If you’re planning to keep your credit cards, then trim your credit limits to the bare minimum so you can avoid the temptation to spend. Remember that $5,000 worth of credit can lower your mortgage borrowing power by around $25,000, so it’s vital that your trim your cards if you’re planning to buy a home.
10. Speak to your bank
If you find yourself struggling to keep up with your credit card bills, speak to your bank and find out what options are available to you. They may be able to move you to one of their lower rate cards, or perhaps consolidate all of your loans into a personal loan. Be sure to talk to them before you fall behind on your repayments, so you don’t impact your credit score.