Credit card debt

Before the recession and the whole credit crunch I wrote an article on Helium about credit card debt, the pitfalls of it spiralling out of control and how to eliminate the debt. I believe this to be equally important a topic today as it was then and have decided to share parts of that article with you on my blog.

How to eliminate credit card debt.
In today’s world where banks and financial institutions think more about their own income than the welfare of its customers, it’s important to be skeptical when they give you credits and loans without you ever requesting them. Even more important is to question the credit cards that you get even if you already have a few. Did they ask you about your financial situation or did they just process you request in a few seconds? If you have been given a number of credit cards without them checking your financial status you more than likely have a risk of running up a debt too high to cope with.

So, what do you need to do? First and foremost, it’s important not to acquire any more credit cards. It’s often a spiral where another card can solve the problem you are currently facing. Especially if you can transfer old debt onto the new card interest free for a few months. However, this is a very short-sighted solution as you soon will have to pay back on this card too and then feel the need to ask for yet another one. Additionally, the credit card company might have lured you in with an interest free option for a while but might later charge a higher rate for the old debt. How do I get out of this bad habit you might ask?

One way is to consolidate all cards into one and have only one sum to pay back. Alternatively, to take out a personal loan to clear all credit card debt and only have a standard loan to re-pay. If that would be impossible, the second alternative is to use some of the credit cards to pay off a few others. It’s a long journey but with planning and less spending you will sooner or later end up with one or two cards. If you decide then not to use them anymore, but just have them to repay current debt then you have gotten yourself out of the dangerous situation you were in.

What if you are so up the walls with debt that you can’t see the problem and not understand where to start? Then you need help from an outsider and there is great help to get. There are financial advisors not connected to any of the lending institutions who can give you independent advice and get you started on your journey to being debt free.