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Handling credit card debt

Lots of people in New York and nationwide have trouble managing credit card debt. Often this, along with medical debt, becomes a major cause of having to seek debt relief through Chapter 7 bankruptcy or Chapter 13 bankruptcy. There are, however, some things to attempt that can help manage credit card debt.

If at all possible, it is good to try to pay a credit card's balance each month to avoid mounting interest charges. Interest charges result in you paying a lot more than the price charged for items purchased in this manner. While it may not always be possible to pay off a card's full balance, another good goal is to try and pay the balance down. This is only possible by paying more than the monthly minimum, which is often intentionally set low enough to only cover interest, or even worse, not even all the accruing interest.

High balances that reach close to the full credit line will often result in a person's credit score being reduced. That can make it both difficult to obtain additional credit and hike the cost of credit, as higher interest rates may result.

If there are several credit cards available, it makes sense to select the one with the lowest interest rate. High interest rates can rapidly put just about anyone in the red. One good thing about credit card debts is that they are unsecured, or in other words, not tied to the possession of a particular piece of property. If all else fails, credit card debts are dischargeable in bankruptcy, which can give you a fresh financial start.

Source: U.S. News, "How to Avoid Credit Card Debt" by Kimberly V. Palmer, Sep. 25, 2013

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