How to Cope with
Credit Card Debt
Jeanette Joy Fisher
As interest rates rise and the
economy slows down, many people find themselves in
over their head, especially when it comes to their
credit cards. Here are a few tips for coping with
your credit card debt.
First, cut up your credit cards and don't use them
again until you've regained control of your
situation! Then create a budget for yourself and
your family. Be realistic and totally honest in your
appraisal of what you really need to spend money on,
and how much money you're bringing in every month.
Make trade-offs wherever you can to bring the income
and expenditure columns into agreement. And don't
forget to include saving, if it's at all possible.
If you're already in deep, contact your creditors.
They'll actually appreciate your effort, since most
folks turn and run scared when they begin
experiencing financial difficulties. Tell your
creditors what you can pay, but be honest and then
stick to that proposal. You'll find that they're
generally quite willing to make special arrangements
to help you regain control of your financial life.
Try to work out repayment plans with your creditors
before they turn your account over to a collection
agency. That means they've given up on trying to get
their money from you. If your account has gone to an
agency, there are Federal regulations that prohibit
them from bothering you excessively, threatening
you, or making false assertions in order to collect
your debt. Even when you've that far in arrears, you
still have rights.
Regardless of where you are financially, it's
worthwhile to contact a credit counselor for help
and suggestions on how to approach your problem
creatively and responsibly. Many of them can help
work out deals with your creditors that you might
not have been able to accomplish on your own.
A word of caution about credit counselors: never pay
a monthly fee to a counselor for their services, and
never believe that someone can repair your bad
credit in a simple, easy way. It can be dangerous,
both for your pocketbook and from a legal
standpoint, and the repercussions can be severe.
If you're simply too far in debt to get back on your
feet again, bankruptcy can help, but it should
always be your last resort. A bankruptcy will stay
on your credit report for seven years, and can
affect your ability to get loans and credit cards
for a long time to come.
Nearly everyone gets into financial trouble at one
time or another, but if you face your own money
problems head-on, you can regain control of your
financial life.
Copyright © 2006 Jeanette J. Fisher
Credit
Cards vs. Debit Cards
Jeanette Fisher teaches how to get out from
under credit card debt, how
to use credit to make money, and six ways to build
strong credit to finance your first home and
multiple investment properties. For a free credit
advice and free ebook "Credit Tips for Mortgage
Financing," see
Worry-Free Credit Information: Free credit card debt
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