Credit Card Debt Trap

: Reese Baker & Associates

  Filed under: Debt

Millions of Americans like the appeal of having it now and paying for it later.  This mentality leads many to buy things they can’t afford; only to leave them crippled with debt.  There is a saying that unsecured debt is an endless cycle. Otherwise known as the “credit card trap”, many people only make the minimum monthly payments on their credit cards which can lead to financial failure.

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 tools in your online banking platform or an 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 where you overspend is half the battle.  Most often, these apps also have goal setting features which help to reach your financial goals.
  2. Don’t spend money you don’t have.  If you want to pay off your credit cards, stop using them. Do not incur new debt.  Use cash or debit cards to make payments.  Identify unnecessary spending and stop spending.  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.  Interest rate charges are often the closing of the door to end the cycle. If you only pay minimum payments, you are likely only paying for the interest that accrued that month; not making any headway on your principal balance.   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. 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.  Most bankruptcy attorneys offer free consultations and are an invaluable resource when tackling debt.  Contact your local Houston  bankruptcy attorney at (713-979-2279 for a free consultation to get back on top of your finances.