Credit Card Debt Payoff Spreadsheet
Credit Card Debt Payoff Spreadsheet for Calculating Your Credit Card Payoff Schedule
According to Experion, one of the three major credit reporting agencies, the average American has slightly over $6,000 worth of credit card debt. But even this doesn’t show the complete picture.
For example, ValuePenguin, a company that helps people choose the best credit cards reports that the average household with only $5,000 to $10,000 in total assets, has nearly $5,000 worth of card debt, and those in the $1 to $4,999 worth assets own almost there total net worth in credit card debt of around $4,000, many of them, presumably Credit Card Debt Payoff Spreadsheet Being college students.
It’s fundamentally clear, therefore, that many people are heading for a fall, sooner or later with their credit card payments, and in order to get on a solid financial footing, they need a tool such as a Credit Card Debt Payoff Spreadsheet.
A Credit Card Debt Payoff Spreadsheet helps you calculate interest-only credit card payments (strongly not recommended because paying only the minimum amount may extend the total amount of you own by 3 or 4 additional years of payment,) months to payoff making a standard payment based upon what you owe, and payoff goal, the latter being the most critical.
For example, if your goal is to pay off a particular credit card within 36 months, it will calculate for you exactly how much you need to send in each month to retire the debt.
It is important to note that all Credit Card Debt Payoff Spreadsheet excel sheets make the assumption that your interest rate will remain the same throughout the history of your loan, and also that they don’t take into account any late fees.
So a Credit Card Debt Payoff Spreadsheet excel payoff sheet isn’t perfect, but as a guide, it can help point out the best strategies to handle your credit cards.
The snowball technique
One of the techniques financial advisors recommend is called the snowball technique.
Let’s say you have a total credit card debt of $6,000, spread over 3 credit cards.
You owe $2,000 on each credit card.
Credit card A has a fixed rate of 12 percent. Card B has a fixed rate of 14 percent, and Card C. has a fixed rate of 18 percent.
If you paid credit card A at a rate of $100 per month, it would take you 23 months to retire credit card A., and you would pay $242 in interest. Making the same $100 payment with Card B. It would still take you 23 months to retire the card, but you would pay $290 in interest. Retiring Card C however, would take you 24 months to pay, and you would pay a whopping $395.
Using the snowball technique you would pay the minimum payment, which is around $40 to $43 for Cards A and B each, but pay $220 a month towards Card C. Doing this, Card C would be completely retired in 10 months, and you would pay only $166 in interest.
Once Card C was retired, don’t use it anymore, or even consider canceling it, and then continue making minimum payments for Card A. but pay $260 a month towards Card B. By following this plan Card B would also be paid off within 10 another 10 months, and you would pay only $107 interest on it.
Within 20 months, you could be well on your way to credit card stability using a Credit Card Debt Payoff Spreadsheet template.
Of course, a Credit Card Debt Payoff Spreadsheet template is only as good as your determination and willpower.
1. Make a determination to pay off your credit card debt
2. Call and ask for a better interest rate
If you inform a company you plan on retiring their card and never using it again unless they lower your interest rate, you may be pleasantly surprised to find out they will do it. However, even if they drop it, continue to plan on retiring it unless the rate goes below your lowest credit card.
3. Shred-it if you have no willpower
Your payoff plan won’t work if you have no willpower, and keep using the card up to its maximum limit. If necessary, use scissors and shred it to pieces. Then keep it in a scrapbook as a memento of your resolve.
Don’t cancel it though, because that may lower your credit score. Just don’t use it.
4. Budget your payments
Get an overall budget spreadsheet as well and plug it into the budget. At the same time, look for other non-essentials like your inflated cable bill or your cell-phone bill to see if there isn’t even extra money to send each month.
5. Pay it
Pay it each and every month until it is zero, and don’t slack off after you have one or two cards retired. Keep your credit card borrowing to a minimum.
How to use
Simply download the spreadsheet and plug in the numbers. Even a child could follow the instructions. Everything is completely laid out for you, and then all you need to do is calculate it and budget your credit card expenses.
When you see how much money you can save by following the snowball plan, it’s relatively painless.