Drowning In Credit Card Debt: What To Do

Many Americans are literally drowning in a sea of credit card debt: in fact

, they may have 10,000 dollars or more stacked up on as many as eight separate accounts. The chickens of easily available credit have finally come home to roost and millions of consumers were simply left unprepared when the economy went south. If this sounds like your situation, there is some comfort in knowing you're not alone; however, these problems will not go away on their own: when you are drowning in credit card debt, here's what to do.

Stop Using Your Cards Immediately

This requires a huge amount of self-discipline and determination, but it is an essential step toward avoiding any future debt. Many people choose to cut up their existing cards; any new offers that may come in the mail are immediately shredded, otherwise destroyed, and put in the trash. Period. You simply cannot continue to charge and keep treading water: throw yourself a life preserver immediately.

Try to Negotiate

You absolutely need to get your interest rates down. Swallow your pride and spend some time contacting your credit card companies and see what they can do for you in terms of lowering your APR. The majority of your payments go toward paying high interest rates, so any change in rate will be helpful. With so many card holders defaulting on payments right now, companies are more willing to work with those who are actually interested in paying off their debt.

Pay Off The Highest Rate First

If you have only moderate success with negotiating down your different cards' rates, make sure you put the majority of your efforts towards paying down the card with the highest rate: it could save you hundreds or even thousands over the long term.

Use Your Debit Card Only

As you work toward keeping a handle on your finances, start using your debit card regularly. Keep a close eye on your balance as well as your monthly statement: it could be a real eye opener in figuring out where you money is going. Make a commitment to never spend more than you have, and it will really help you to change your lifestyle to avoid future drowning episodes.

Get Professional Help

If you are really struggling to get your financial life in order, getting professional credit counseling is a great option. You will learn how to get your spending under control, deal with your credit card debt, and work towards restoring your good credit rating.

The worst thing you can do is nothing: be proactive in taking control of your credit card debt, and you'll soon have your head above water again.

by: Art Gib

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