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America’s Credit Card Debt

July 9, 2011 By Jason Leave a Comment

It is difficult to find credit card debt statistics because they are not widely known. It is also hard to measure and analyze the data of credit card debt statistics as there is no good system in place for doing so. However, the lack of statistics rivals the amount of people struggling to manage or get out of their debt. A great resource for those looking for numbers on credit card debt in America is the US Census Bureau Report.

Millions of US citizens have accumulated a combined $886 billion dollars in 2010 and the projections for 2011 are only worse. The average cardholder has approximately five thousand dollars in credit card debt. This figure is a direct increase from 1990 where the average credit card holder owed around three thousand dollars. After almost doubling, the national credit card debt seems to only intrinsically increase over the years. It is imperative for credit card users to know the options available to them for credit card debt relief.

The most logical and sure-fire way to reduce or avoid credit card debt is to learn new ways to save money. Saving money before you allow yourself to secure any type of debt, be it mortgages, car loans, student loans, or credit cards, will give you an alternative plan that will save you from financial ruin. Research different methods to save money by reading online articles or talking with successful close friends and family. Once you have figured out the best route to save money, employ those practices and avoid debt in its entirety.

For those who have already accrued a sufficient amount of debt, there are many different options for getting out. By putting forth all your efforts to pay off a debt, you are sure to eliminate all of your debt at a quicker and less-stressful pace. Talk to your credit card companies and attempt to renegotiate the terms of your debt repayment. Creditors and debt buyers are willing to work with those who are willing to work with them. Settling or negotiating your debt is a safer way to remove debt without filing bankruptcy. Be sure to use bankruptcy as a last resort and only for an extreme situation where no alternative is available.

Americans will consistently find themselves in debt unless they decide to do something to change it. Credit card debt will follow an individual where ever he may be go, so it is vital to understand the methods and resources to avoid credit debt entirely.

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Facets of Credit Card Debt

July 1, 2011 By Jason Leave a Comment

Debt seems to be a natural part of everyday life in America. It seems as though almost everyone has some sort of debt they have accumulated over the years. From medical debt to student loans to credit card debt, the astounding amount of money used through credit can be felt everywhere. One of the most incapacitating is credit card debt. Without having good saving money advice and license to push a credit line to its limit, it is easy to see how many people fall into the trap of credit card debt.

The first step to eliminating credit card debt is to avoid credit card debt to begin with. This is hard to do if you have multiple credit cards continually available for use. Cut up or hide your credit cards so that they cannot be used for daily items or unnecessary purchases. Make the decision to use a credit card only in the case of a extreme emergency. Otherwise, leave the card at home or in pieces so that you are not tempted to use it. Avoiding credit card debt is the easiest way to stay out of debt.

If you do find yourself in debt, there are many different resources available to get you out of debt. These resources are free and only require your time and an internet access. By researching different methods for getting out of debt, you can choose which option is best for you.

A great free tool available via the internet is a credit card calculator. The credit card calculator is a starting point to help you manage your debt and finances. Once you have located a credit card calculator that you wish to use, input your credit card amounts with accompanying interest rates. The calculator will help show you where your money needs to go first and when. Most calculators give you the option to choose to make only minimum payments on the cards or a customized amount of which you are able to give. You can then see how long it will take for you to pay off your credit card debt by making the payments you are truly able to make.

There are some other debt calculators that include, not only credit card debt, but other debt as well such as, outstanding medical and school loans. Using an all encompassing credit card debt calculator will help get you debt free faster. Credit card debt collection is easier if you do the research and use free tools to manage your credit card debt.

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Texas Credit Card Debt

June 30, 2011 By Jason Leave a Comment

Americans are governed by federal and state laws. Sometimes this means laws will change from state to state. In doing so, it is important that you keep in mind your own state’s rules and regulations because it may different than that of the federal or neighboring state law. A law that people in Texas may find surprising  has to do with credit card debt and debt collection.

Texas credit card debt is just like all other state’s credit card debt. The manner in which it develops and grows is common behavior across all credit card debtors in America. The simple inability to pay back large, or even small, amounts of money to a credit card company after having used a line of credit, results in having credit card debt. The credit card company then charges the debtor more money in the name of late fees or penalties. These penalties are how the credit card companies make their money and make it hard for you to get out of debt.

Thankfully, reducing debt in Texas is a little bit easier than other states. Since special laws were passed in order to protect consumers living and accruing debt in Texas, citizens of the state can find greater relief from persistent debt collectors. This credit card debt law takes the power of harassment from collectors by disallowing the practice of garnishing wages from an individual who finds himself in debt. Garnishing wages is done by credit collectors that arrange for a portion of the debtor’s paycheck to become automatically withdrawn and paid towards a debt. These garnishes can be up to a quarter of a person’s entire paycheck and can put a huge burden on the debtor.

Additionally, it is important to note that in an attempt to garnish wages, the credit card company has to go through a lot of work to secure these funds. After lengthy and costly court proceedings and the final ruling is to garnish wages from a debtor, the debtor must have bank account of some sort. Otherwise the company cannot withdraw funds automatically. While most people have some type of bank account (checking, savings, etc.) it may be prudent to eliminate it in cases of extreme financial distress.

Credit card debt in Texas is just as terrifying as it is in other states. But due to the laws imposed by the state government, Texas citizens should feel safer when it comes to credit card debt collection.

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The Stages of Credit Card Debt

June 28, 2011 By Jason Leave a Comment

Credit card debt does not just happen overnight. There is a process that everyone with debt experiences. Knowing this process will help you stay out or get out of credit card debt.

The process begins with poor money saving habits. Finding money to save seems to become harder and harder as time presses on. However, it is absolutely necessary that you stay on top of your finances in order to negotiate credit card debt. By employing different strategies such as cutting back on frivolous spending and carpooling to work, you will be engaging in habits that will keep money in the bank and off of your credit card. If you do not have one already, get a savings account and start putting money in it immediately. If you are unable to set aside money with your current job, get a second job to supplement your income. Having good ways to save your money will enable you to you stay away from credit card debt.

Other ways to avoid credit card debt is to only have one card that is used for emergencies only. This may feel counter-intuitive or unsafe to some people but the truth remains that most people do not require any credit cards at all. The people without credit cards are most likely the ones without debt. Additionally, the credit card company is going to require a minimum monthly payment that you must be able to pay. Be sure to pay this or the full amount each month if you must use your card.

There are millions of different credit card debt stories out there. Some people use credit cards as a source of income and pay for daily items with their card. At the end of the month, they are unable to pay since their only source of money is their credit card. This may be especially true of those who are recently or long-time unemployed. Other debt situations may be caused by a family with a good credit standing and an unexpected medical expense. The range of credit card debt stories touches all types of people and situations.

Occasionally, these stories settle the credit card debt by filing for bankruptcy. Filing bankruptcy is a long, drawn-out, and public process. It can also be very confusing as there are different types of bankruptcy for different types of situations. The consequences of bankruptcy are a poor credit rating and ten years of difficulties before your credit can have a good rating again. Avoiding bankruptcy begins with understanding credit card debt and how it can be controlled in your life.

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Learning About Credit Debt

June 26, 2011 By Jason Leave a Comment

What is Credit Card Debt?

Credit, or revolving debt, comes from having an outstanding or unpaid line of credit.  Debt of any kind is troublesome and fatiguing worry but credit card debt seems to be the most prevalent and damaging. Avoiding credit card debt starts by understanding the many different facets of credit cards and their purpose.

The most fundamental knowledge one should have when it comes to understanding credit card debt is understanding how credit cards work. The process begins when a bank or credit union offers a line of credit to a consumer. When the consumer accepts the bank’s offer, he is then given the opportunity to use his line of credit to make purchases with his credit card. The credit card will have a limit that he must adhere to until the bank decides to change his limit. After a month, the bank issues the consumer a list of the items purchased with a total dollar amount that he must pay. The consumer can either choose to make the payment in full or he can make a minimum payment decided by his bank.

Why Avoid Credit Card Debt?

When a person cannot repay the bank for his purchases or make his minimum payments, he is subject to late fees and penalties. These fees add up very quickly, causing the person to go into further debt and allowing the bank to make money. While the process may seem simple to understand and avoid, there are millions of Americans suffering from credit card debt. In 2010, the national debt for the United States was $886 billion with a projected 1.177 trillion for 2011. The average card card holder debt was $5,100 for 2010 and is estimated for $6,500 for 2011.

With such a large amount of debt, everyone must be in some type of credit card debt. This is not true however. Only 46% of people in America are in debt. Of this 46%, 33% have debt less than ten thousand dollars. These credit card statistics, found from the 2011 Census Bureau Report, are even more impressive considering only one-third of Americans even own a credit card. That means only 46% of one-third of Americans have credit card debt which is a lot less than people may expect. Debt is frightening but it is comforting to know that it does not have to be a part of daily life. For most people it already is not! Knowing credit card debt facts, drastically increases your chances of avoiding and staying out of credit card debt.

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Keeping a Positive Net Worth

June 26, 2011 By Jason Leave a Comment

Having a positive net worth in today’s economy is difficult for many Americans. With constant temptations to use credit a source of finance, it is no wonder that people find themselves in debilitating debt. In some instances, people find themselves left with no option other than bankruptcy. It is important to know how to avoid bankruptcy so that the necessary steps can be taken to avoid repossession of property, a ruined credit history, and a negative social status. Talking to an attorney specializing in debt relief and looking into debt consolidation or settlement are great resources for debt problems. However, the best solution is controlling credit card debt.

Stay Out of Credit Card Debt

Staying ahead of the game is the best option for credit card holders. Credit cards are sometimes a necessary component to building good credit. Yet, they can be detrimental if not used properly. In order to responsibly maintain a credit card,  you should have a budget and self control. Only use a card if you can pay back your purchases at the end of the month. The best method to ensure timely repayments in-full is to use your credit card for emergencies only. Also, there is no need to have more than one card if its only purpose is to help you in extreme situations.

If you do find yourself with a hefty amount of credit card debt, there are several essential steps you need to take. Cut up all of your credit cards and start a new budget. Figure out what is owed on each card and how much the interest rate is. Start making larger payments to the highest owed card while making minimum payments to the remaining cards. Continue this process until all of the cards are paid in full. During your debt elimination process, remember to pay all of your priority bills first so that you do not lose your home or car.

Eliminate Credit Card Debt

After your credit card debt is eliminated, you need to take measures to prevent a relapse into debt. Learning how to stay out of credit card debt can be just as difficult as getting out of credit card debt. Keep your only credit card at home so that you have to work to use it. The more effort you have to put into purchasing something will give you the opportunity to really consider the purchase. Also, do not apply for more credit cards even if they have tempting low-interest rates. And talk to a close friend or family member about your future purchases so you can have a third opinion.

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Protect Your Credit Score by Preferring Debt Management to Debt Settlement

June 16, 2011 By Jason Leave a Comment

When you’re drowning in a sea of debt, anything that resembles a lifeboat can be your life-savior. But you must make sure that you don’t jump onboard without determining the ins and outs of a particular option before taking the plunge. While it is important to reduce your debts and pay them off, you must also take care of the credit score so that you can remain creditworthy in the near future. Debts can have a detrimental effect on your personal financial life and if you want to avoid such an impact, you must get your debts consolidated through a debt management program. Have a look at 3 financial moves that you must consider while managing your debts.



Start organizing your finances while opting for debt management: Debt management is just a way of reducing your debt burden. It is not that your debts will soon get reduced as soon as you opt for debt management. You have to take care of your personal finances so that you don’t hurt your credit score while making the monthly payments. If you enroll in a DMP, you have to write single monthly payment checks to the credit counseling agency that will be disbursed off to your creditors in due course of time. Here, if you make late payments, you can trash your credit score.

Stop spending much and save money: This might be an obvious advice but there is no alternative to saving money. Financial experts usually suggest people to save at least 10% of what they make in a particular month. Without a frugal budget, it can be difficult to make sure that your expenses are less than your monthly income. Create a savings account so that you can easily make your money grow and boost your income resources.

Get help from a financial counselor: If you don’t have much confidence on your personal budgeting skills, you can get help from a financial counselor. He will assess your current financial state and determine whether or not you’re making timely payments and taking the right steps.

Make the monthly payments on time: When you’re repaying your creditors through a DMP, you must always try to make the payments on time. As you make the payments, your debt consultant will disburse off the payments to your multiple creditors but if you’re late, you can easily hurt your score and become unworthy of getting credit. It may become difficult for you to get loans at an affordable rate.

Thus, if you want to get back a firm grip on your personal finances, repay your debts through debt management options and become debt free. Wealthy financial tips must be considered so as to protect your credit score and also eliminate high interest credit card debt.

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How To Get Out Of Debt Quick: There really is no secret to it.

June 12, 2011 By Jason Leave a Comment

 

Over the past few years the economy and credit world has taking a huge down turn. If you live on this planet then you surely have noticed it in some fashion or form. Be that your 401k took a beating or you credit rating took a dive. The majority of us including me have been impacted in some way with the credit crisis.

With this said the number one thing people ask when it comes to this subject is how to do I get out of debt quick or fast? Well the answer is the same no matter how you ask it. You can ask how do I get out of debt? Or how do I get rid of this credit card debt? No matter the question around it the answer is the same. There is no really fast way unless you really are not in debt and just pay it all off with funds you have in your savings or stocks etc. Or you could file for bankruptcy if you qualify but what good does that do for you other than letting you start from scratch with zero credit. Now that may be some peoples only option but we are going to try our best to keep you out of that. So for now it’s not an option unless its keeping your from eating or having roof over your head.

The truth is that it takes patience, guts, and some planning to get out of debt. You have to truly want and desire to be debt free and adapt to what it’s going to take. Since everyone has different situation’s you are going to have to put what we suggest in a means to work for your personal situation. All we can do here is provide you with the road map and support that you need and you will have to do the rest. Below is just a few things you will have to do along the way to being able to say your debt free. And I will be the first to admit that I am still on my journey as well to being able to say I am completely debt free.

The first initial step has already been taken care of and that is taking action. By you being here means you are already on your way to getting yourself out of debt. But there are a few more things that you will have to do and I will try and give a brief idea of each and later will go into details. The first thing you need to do is know your exact income and the exact about amount of money that is going out. The only way you will be able to do cut costs etc is to be able to see it all on paper so that you can start planning a budget. Once you have done this and know exactly what you have to work with or what you dont have we move on to creating a budget.

This is not something that is easy for people or anyone for that matter. Having to cut down your living style is something most people don’t want to do but it may be what it takes to get yourself and your family out of debt. You have what is called must have items, and what is considered luxury items. Luxury items are the things you could live without like the smart phones that cost you a hundred bucks a month etc. While you need food and water and electricity which are the must haves. You need to make a list of what your must haves are and what your wants or luxuries are. To do this you will take your budget that you have created and list out what, the must haves are, and then the ones that are the luxury items. And you can even reduce your the cost of must have items but we will get more into that on another post.

Once you have done this you should see what you can cut out of your budget either by reducing your cable package or whatever you have for television. And you can also reduce your phone or maybe even downgrade the car. There are a lot of ways to reduce the luxury items depending on how bad your situation is and how committed you are to getting out of debt. Remember once you are out of debt you will have knowledge to manage your debt better and these items will once again return but in a smarter fashion. Once you get through this and cut the fat of and see how you stand it’s time to line up your debt that you have be it the credit cards, loans, mortgage, etc. There are a couple ways you can go about this but I like to put my debt in order from the highest amount that needs to be owed to the lowest. That way you can see what you have to owe and how much you owe on each etc. You will also want to get the what percent rates they are at for each month etc so that you can make the best judgment when it comes to which one you are going to pay off first.

I personally would target the highest monthly payment with the lowest amount owed. You will start to generate what is called the snowball effect. It allows you to open up more money for paying off debt and at the same time giving you the satisfaction of clearing a debt of the list. The sooner you are able to knock out your first one the more motivation you get to do it to the next one. You just go back to the list and do that same thing again and find the next costly one with the lower debt amount and knock it out. Once you are on a roll you will see that you pay it off faster than you think you can.

Now something I didn’t talk about was if you had some savings should you use it or not? Well this gets tricky depending on how much you have saved up. The average person doesn’t have much so we recommend that you always have a security blanket in your savings. So if you have a few thousand just hang onto it unless you have a high loan that will open a great amount of money that you could just pay off. If you have this situation pay off the loan and just use that money you saved each month and put it right back into savings until you get it back to a safe balance. We will go over this more fully in a later post but I just wanted to get it out there that it’s important to have an emergency fund.

Well I know this is not what you wanted to hear as to the quick or fast way out of debt but its the only true way of getting there. We only briefly gone over the basic idea, but honestly its not rocket science. It’s just something that takes patience and while power to get done. But once you can say your debt free you will love life even more because the stress of making payments or rather trying to stretch the paychecks will be over. I will be posting a few times a week in hopes to leading you in the right direction and providing resources to help you get out of debt.

Jason

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Credit Debt Solutions: Simple ways to reduce your credit debt

April 24, 2009 By Jason

Are you finding yourself in over you head with credit debt? Don’t worry because your not alone and there is a way out. Credit debt solutions is not as hard as people think it is but yes you have to have it in you do get out of credit debt. With one out of four people now days with over 10 thousand in credit debt and just making the minimum payments many people have leaned to the internet for answers. You can also find it easy to find loans for bad credit that can help consolidate your debt.

Credit Debt Solutions

Some simple ways to start riding of your credit card debt is to look at all your credit debt as a whole. Find out which ones have the highest interest and payments for each month. Check to see if your able to transfer the balance of one to another that has a lower interest to help reduce the amount of interest your paying.

Another thing you can do is look into consolidating them using an consolidation loan. With this your able to spread it out and you can drastically reduce your monthly payments and allow you to get rid of your credit cards. This option is sometimes better for people who have trouble of not using their credit cards. If you don’t have them you cant use them right? So by getting a loan instead you can pay off your debt over time and stop creating more by being able to cancel the ones you have.

These are just some simple credit debt solutions that you can use to help reduce your overall debt. Just remember there is light at the end of the tunnel and you can and will make it if you put your heart into it.

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How To Get Out Of Credit Card Debt: Simple Ways Of Erasing Credit Card Debt

March 12, 2009 By Jason

People are often asking themselves how to get out of credit card debt. The answer is really simple actually. All you have to do is follow some simple guidelines and you will be well on your way of getting out of credit card debt.

Your first step to getting out of credit card debt would be to stop using the credit cards. So many people are trying to get rid of their credit card debt but they never stop using them. If you don’t stop using them your just going to be finding yourself right back where you started off in the first place. I would recommend as far as cutting them all up and throwing them away so that you cant use them. You may one to save one for emergencies but I would put that away somewhere and not carry it on you.

Credit Card Debt

The next step is to go through and find out how much money you have extra each month. Once you find this out you will know how much you can pay off each month on top of your monthly payments. The idea to this is to go through your credit cards and find the ones that have the highest rates and pay the one that is costing you the most first.

Once this one is paid off then you take the money you were paying towards that one and start paying off the next one. You will find that you can pay off your debt much faster than you think by compounding your payments that you used for paying off your other debt. Before you know it you will be getting out of debt and well on your way to a stress free life.

So see learning how to get out of credit card debt is not so bad and its not going to kill you to do so. All you have to do is put forth some effort and you will find yourself debt free in no time.

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Debt Solutions: Fixing Your Credit Report

January 16, 2009 By Jason

Many people ask how to fix my credit? To be able to get rid of a collection from your credit report you are going to first need to educated yourself on what a collection is. If you have a bill that you suddenly stop paying on the company will continue to send you monthly statements each month waiting for payment. Normally after six months has passed without a payment your account will be sent into collections. There are some companies that will wait longer then that however six months is the usual time frame.

When an account is sent into collection it is usually the creditor’s last chance at trying to retrieve the money that is owed to them. It is at this point in time that the creditor has tried calling you to try and set up some type of repayment schedule and has also sent several notices through the mail to inform you that your bill is past due. There are many creditors have their own in house collection departments while other creditors will outsource their collection needs to outside collection agencies.

There are many occasions when an account that is overdue is sold off to collection companies for pennies of the dollar. Normally if the account is still maintained by the original creditor and they are working with a collection service they will be paying the collection service a portion of what is recovered.

Ok now that we have gone over that information let’s discuss how to remove a collection from your credit report.

To be able to remove an entry from your credit report that has gone into collections you are going to need to dispute the account. To do this you need to write a dispute letter to the credit bureau or bureaus that are reporting the account. You need to make sure that you are sending basically the same letter to each of the bureaus that are reporting the account that was in collection. The letter needs to identify the item that you are disputing and why you are disputing it.

When your letter reaches the credit bureau they will be opening an investigation. The bureau will then be contacting the creditor that made the entry and let them know the reason that you are challenging the account entry. The credit bureau will then ask the creditor to prove that the entry is valid.

If the debt that is being challenged is fairly old then the creditor may not have the documentation readily available. The documents are likely to be in storage somewhere. If this happens to be the case for your debt it is very likely that the company will not want to spend anymore time or money on your account. If this is what is occurring they will most likely not reply to the credit bureaus inquiry and the the credit bureau will then take the entry off of your credit report.

Now if the company does send the credit bureau proof of the entry that you are disputing this is what is referred to as being verified. This does not mean that you are out of luck 9in getting it removed from your credit report. What it means is that you are jus going to have to pay it off or attempt to negotiate a lower payoff amount. In order for you to be able to remove the entry in this case you need to negotiate it being removed from your credit report as part of the payoff agreement.


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