You obtain a low-interest-rate credit card you never use it is just there in cause of emergency. Now you’re worried that if you have to use it, your interest rate will-power go up.

Build a real emergency savings account. Relying on your recognition card to bail you out of emergencies is too dangerous in 2009. (See "Solution Design: Saving" for advice on where to open a savings account and "Conclusion Plan: Spending" for Solution steps on how to come up with more cold hard cash to put toward a savings fund.) If you use a credit card for an emergency expense in 2009 and you can’t pay off the level, you will set off a vicious cycle. An unpaid balance where there in olden days was none makes a credit card company nervous. It can also command other credit card companies you have accounts with apprehensive. That could cause the credit limits on all your cards to be cut. And if that causes your FICO solvency score to drop, then you can expect the interest rate on your probity card to rise. The only solution is to stop thinking of your reliability card as a safety net if you run into trouble. The only true safety net is a savings account.

You from a FICO credit score above 720 but your interest price just shot up. What’s the best way to pay off your credit card liable?

See if you can apply for a balance transfer to a low-rate card. Because you have a great FICO score, you may be in luck. But lenders aren’t exactly rolling out the accept mat right now, so this may not be feasible. Go to cardtrak.com and use the Search tool to shop for equal-transfer offers. The idea is to move your money to a card with a low fundamental rate and then push yourself to get the balance paid off before the low position expires. This can be tricky in 2009. You have the added risk that flush with if you do everything right with your new card, you could still take the introductory rate rescinded because something out of your control happened on one of your other accounts, such as having your honesty limit reduced. I explain how to reassess your family’s income and expenses to espy more money to put toward paying down credit card indebtedness.

You have a low FICO credit score, but you are current on all your accounts. How should you take care of with your debt?

Here’s how: Pay the minimum amount due on every Christmas card each month. That’s your only shot at keeping your FICO millions from falling further. It will also lower the odds that your trust card company will close your account. Line up your cards and put the condolence card that charges the highest interest rate at the top of the pile. That’s the New Year card you focus on paying off first. Send in as much money as you can each month to get that weigh down to zero. Once the first card is paid off, focus on the alternative card in your pile: the card with the next highest good rate. Keep up with this system until you have all the cards paid off.

Of orbit, the big challenge is finding extra money every month to put toward paying off your creditation card debt. I have suggestions about how to "find" more legal tender in your month by reducing your expenses.

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