Credit Card Debt

The mentality of having it now and paying for it later appeals to millions of Americans.  This mentality leads many to buy things they can’t afford and cripples them with debt.  The “credit card trap” where people barely make the minimum monthly payments on their credit cards makes life stressful, more expensive, and ultimately, leads to financial failure.  This leaves these individuals vulnerable to unexpected events and stops them from reaching their financial goals.  It is reasonable to ask, “Can I escape credit card debt?” and the answer is: yes.

How Can I Escape Credit Card Debt?

Staying determined and disciplined will be essential to getting out of credit card debt.  There are several things you’ll have to do:

1. Organize, plan, and track.  Take advantage of a free budgeting app on your phone.  https://mint.intuit.com/ is great for keeping track of credit card debt and helps you track your spending.  Figuring out the problem is half the battle.  These apps also have goal setting features which help to give you vision and direction.
2. Don’t spend money you don’t have.  If you want to pay off your credit cards, don’t incur new debt.  Use cash or debit cards to make payments.  Identify unnecessary spending and minimize it.  This will take discipline, but the results will show.  If you find that you don’t make enough money to pay off your debts even after cutting out unessential spending, then filing for bankruptcy might help you keep your secured property and could be your best option.
3. Pay off higher interest rates first.  Mathematically, this one just makes sense.  Interest rates tell you how expensive holding debt is.  If you pay off debts that are more expensive before those that are cheaper, you’ll end up spending less money in the end.
4. Look into doing a balance transfer.  A balance transfer is a transfer of your old debt to a new card.  Look for promotional offers with low interest rates and no transfer fees.  You can save a lot of money if you do this right.
5. Keep it up! It can be very easy to slip up.  Stopping spending can be like curbing an addiction.  Remind yourself of your goals and motivate yourself to stay disciplined and focused.  This can be the hardest part of ridding yourself of credit card debt.  Check your payment history every 6 to 12 months to track your progress.
6. If you’re completely overwhelmed, contact an expert.  Financial coaches and bankruptcy attorneys have years of experience when it comes to getting rid of debt.  And while both are valuable, attorneys can offer legal advice that financial planners cannot.  Most bankruptcy attorneys offer free consultations and are an invaluable resource when tackling debt.  Contact your local Yuba City bankruptcy attorney at (530) 797-4402 for a free consultation to get back on top of your finances.