Escaping Credit Card Debt

The belief that it is better to have it now and pay for it later leads millions of Americans to buy things they can’t afford, only to leave themselves crippled with debt. There is a saying that unsecured debt is a perpetual cycle of debt. Otherwise known as the “credit card trap”, many people find they can only afford make the minimum monthly payments on their credit cards; which can lead to financial failure.

How Can I Escape Credit Card Debt?

If you have found that credit card debt payments are overtaking your monthly income and putting pressure on your ability to effectively manage your money, time is of the essence. Although unsecured debts like credit cards might lead creditors to garnish your wages for repayment, the credit card debt trap can reach further into your pockets than planned. Here are a few strategies for ending the cycle of credit card debt traps:

1. Track your spending. It can be easy to utilize an out-of-sight, out-of-mind mentality when it comes to spending on credit cards. Purchases via credit cards are often made impulsively, or because cash wasn’t readily available. To form a plan to eliminate credit card debt, you need to first know where it’s going. Take advantage of free budgeting tools in your online banking platform or an app on your phone. These tools also have goal setting features which help to reach your financial goals, or alert you when spending is reaching a limit. .
2. Stop the spending. If you want to pay off your credit cards, you need to stop using them. Put at least one card aside and commit to not using it until the balance is paid. Use cash or your checking for purchases. If you are unable to meet your monthly needs on your income without credit cards alone, you may need to speak with a Modesto bankruptcy attorney sooner than later regarding your options for eliminating other debts.
3. Prioritize and pay off one or more cards at a time. When choosing one of your credit cards to prioritize and pay off first, consider the card with the highest interest rate. This will help you save money in interest as you pay down the balance. Additionally, pay more than the minimum payment each month. 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 are struggling to repay your credit card debt or want to learn more about how bankruptcy can eliminate credit card debt; contact our team of Modesto bankruptcy attorneys today at 916-459-2364.