Reducing credit card debt & improving your credit score

MONTGOMERY, AL (WSFA) - If you're like most people, you spend more money than you save. That's a dangerous prospect since relying on credit can actually cost you more in the long run.

Alabama's non-profit Consumer Credit Counseling Service has some tips when it comes to saving money while you're spending money. The first is monitoring your credit score.

"It should be 700 plus," said credit counselor Roger Knauff.

Customers with scores below 700 will be charged more interest when applying for loans and credit cards.

Your credit score is available on the Internet for a fee. You can get a free copy of your credit report online as well. The web site is

If your credit score is below 700, the best way to raise it is to pay off any outstanding balances. But don't close the accounts, especially if you're about to apply for a loan.

"You don't want to go close a lot of accounts if you're going to apply for a mortgage for example," Knauff said.

Knauff says using cash instead of credit cards is another tip.

"If you use credit cards just to get by, your 'e running up additional debt just paying for living expenses, which is going to cost you in interest for months to come," he explained.

He says try saving just 10% of your income per month. After three months, you'll have enough in savings for emergencies. And after that, you can start buying the things you want with cash.

If you do use credit cards, pay them off every month. At least pay more than the minimum payment, or you'll get yourself into a hole. And make sure you send in your payment well before the deadline.

"When the payment posts a little early, you save a few days of interest and you avoid the possibility of a late charge.

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