Welcome to Debt Guide
. For a permanent link to this article, or to bookmark it for further reading, click here.
Stop Swimming in Credit card debtfrom:
As of 2005, the Americans have incurred over $735 billion in credit card debt. Why the large number? It’s because credit card debt accumulates easily. Credit card debt happens when a client uses his credit card to purchase an item. For every month that the client fails to meet the required payment, late fees and penalties are charged. Also, as long as the debt remains unsettled, the interest gradually increases the amount of the debt. This is how credit card debt accumulates.
People keep on swiping their credit cards even though they still have outstanding payments. Before they know it, they would max out the credit card and they would find that they are thousands of dollars in debt. In order to afford the things they want, they will get a new credit card. The same cycle may happen and that’s when people start drowning in debt.
However, we should be clear in saying that credit cards are NOT bad. In fact, these shiny plastic cards provide convenience to the consumer. For example, credit cards can help pay for emergency expenses like when you have a sudden car repair or when you have to make an emergency flight back home and you have no cash for a ticket. While you may not have cash yet, credit cards can help you accomplish the things you have to do. Another good thing is that credit card companies do keep comprehensive records of your financial activities so you always have a document to refer to. Credit cards are also a good way of paying for certain necessities while you wait for your monthly paycheck to arrive.
However, the very convenience of credit cards can cause a lot of abuse. The important thing to remember is that once you realize that you can no longer meet the payments of your credit cards, you can approach the credit card company and ask for negotiations regarding your payment procedures.
There are a lot of other things you can do to get out of credit card debt. Here are some of the steps you can take.
The first step in getting out of credit card debt is to stop using that credit card altogether. If you have a lot of credit cards, assign one card as an emergency card and make a commitment to use it only for that purpose – for emergencies. You can cut the rest of the credit cards or put them in bags in the freezer.
Analyze all your credit cards and see which ones have the highest interest rates. Prioritize those with higher interest rates. If you postpone payments on these cards, the interest will make your debt balloon. Pay more than the minimum. If you really want to eliminate debt, make the commitment to pay as much as you can on the cards. This way, you can eliminate the debt faster and you don’t risk penalties.
Related Articles for Debt
A third of Americans delinquent on debt - USA TODAY
A third of Americans delinquent on debt
That means the debt is so far past due that the account has been closed and placed in collections. This typically happens after the bill hasn't been paid for 180 days. It also means the debt has been reported to credit bureaus and can affect someone's ...
Study: 35 Percent in US Facing Debt Collectors
Past-due debt prevalent across US, with South the highest
Argentina Delegation to Continue Debt Talks In New York Tuesday - Wall Street Journal
Argentina Delegation to Continue Debt Talks In New York Tuesday
Wall Street Journal
BUENOS AIRES—Argentine officials say they will meet Tuesday in New York with a court-appointed mediator to continue negotiations in a dispute with a small group of creditors that could see the South American country default on some of its bonds this ...
Argentina to hold last-gasp debt talks with mediator Tuesday
Argentina pays $642 mn of its debt to Paris Club
Argentina Seeks to Avoid 2nd Debt Default in 13 Years
JP Morgan Sells $1.3 Billion Debt Portfolio to Sankaty - Wall Street Journal
JP Morgan Sells $1.3 Billion Debt Portfolio to Sankaty
Wall Street Journal
People pass a sign for J.P. Morgan Chase at it's headquarters in Manhattan on October 2, 2012, in New York City. Getty Images. HONG KONG—Sankaty Advisors, an arm of private-equity firm Bain Capital LLC, is to buy a debt portfolio from J.P. Morgan ...
Sankaty to buy JPMorgan debt portfolio for $1 billion: FT
Bain's Sankaty Advisors buys $1.3 billion debt portfolio from JP Morgan
Bain Capital's Sankaty Advisors buys JPMorgan's debt portfolio for $1B
Study: Millions have debt in collections - Press Herald
Study: Millions have debt in collections
This is the first time the Urban Institute has calculated the collections figure, but Americans may have been struggling with debt for a while: Researchers noted that the 35 percent figure is basically unchanged from when the Federal Reserve studied ...
Dollar Tree Obtains $9.5 Billion Debt Commitment for Deal
Take on more debt — it's the American way - MarketWatch
Take on more debt — it's the American way
In 2006, Muhammad Yunus won the Nobel Peace Prize for his idea to use debt — as little as $200 or less — as a path out of poverty. Families that needed capital but were frequently shut out of traditional banking find a way to new economic ...