Afraid you'll find credit card bills sitting in your mailbox? We know, they're not fun to open. BUT, you can tackle paying off those debts pretty easily. It'll only take a couple steps. Promise.

OK, this step may be the hardest: Walk to the mailbox, gather your credit card bills and bring them back inside. We'll wait.

Back already? Wow, you're a fast walker. OK, let's get started.

## 1. Make a list of all of your debts and debtors

We need to get a total number for your debts. It won't be too painful. List the debtor in one column, the total debt in the second, the interest rate in a third column, and the time needed to pay off the debt in a fourth. You'll find all of that information on your statement.

Sample credit card debts
Card Balance Interest rate Months to pay off*
Credit card No. 1 \$15,000 18.75% 311 months
Credit card No. 2 \$25,000 19.00% 351 months
Credit card No. 3 \$10,000 15.50% 189 months
Totals \$50,000 n/a 851 months

*If these were your real debts and you just paid the minimum due (assuming 3.5%) every month, it would take 70.9 years to get rid of them, and you'd be paying thousands in interest.

Ouch. But there are MUCH quicker and easier ways to dump that debt.

Get a total for your debts. Try this debt calculator:

## 2. Know your options for paying off high-interest debts

So now we know where we stand. As G.I. Joe says: Knowing is half the battle, and he's right.

With \$50,000 in debt, there are a couple good options for consolidating and conquering it:

### Balance-transfer credit cards

Today, more than two dozen 0% balance-transfer and debt consolidation credit cards are available, with introductory periods lasting 15 to 18 months.

### Personal loans

A quick look at personal loan offers shows several offering 3-year terms with interest rates between 8% and 22%. With a 15% interest rate, your monthly payment would be around \$1,700.

### Home equity lines of credit

HELOCs have variable interest rates - meaning the rate can (and likely will) change over the course of the loan repayment, but current HELOC offers range from 2.5% to 5% for a \$50,000 HELOC.

## 3. Make the best decision for your finances

With lenders offering low-rate ways to pay down debts quickly, you could be one application away from a better deal.

### Stop paying interest on your credit card debt

Balance-transfer credit cards can be great if you know you can pay off the balance before the introductory periods ends - usually anywhere from a year to 18 months. You'll get to lower your interest rate for that time period, but when it ends, watch out: The rate will likely jump to more than 15% after the intro.

Who should choose a balance transfer card? Choosing this option can make sense if you know you'll be coming into excess cash pretty soon.

### Pay less interest with a set (shorter) payoff schedule

Personal loans are appealing in that you get cash pretty quickly, the interest rates are lower than most credit cards and you'll have a set payment amount with end date - for example, with a \$50,000 personal loan, you may have a \$xx monthly payment for five years.

Who should choose a personal loan? Choosing this payoff option can be good because you can pay off your higher-interest debt and you know the finish line on the personal loan is a mere 36 months away, but you'll be on the hook for more than \$1,700 in repayments per month for that time.

### Low-interest option for homeowners

Have equity in your home? A HELOC, or home equity line of credit, can be a good low-interest option for paying off debt.

Who should choose a HELOC? With interest rates around 4 percent, HELOCs can help you save hundreds in interest. The catch: These are only available for homeowners who have equity and can pay closing costs.

Don't let it take forever to pay off your credit card debt. Try one of these three methods to dump that debt quickly!

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