Sullivan suggests keeping two credit cards: one "clean card," used for everyday purchases and paid off in full every month. This card will still allow you to take advantage of the 30-day grace period and keep boosting your credit score, without racking up interest on your balance. The other card is a line-of-credit card, only used for big, emergency purchases that you can’t pay off in full.
The real advantage to Sullivan’s strategy is eliminating "revolving debt" — balances that you’re constantly adding to and subtracting from, not to mention paying interest on. You’ll still be making monthly payments on your line-of-credit card, but you’ll be able to pay the balance off relatively quickly and you’ll always know exactly how much debt you have.
How do you plan to tackle your credit card debt in the new year?
Source: Flickr User Andres Rueda