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Avoid high credit card debt with these strategies

Whether consumers in Florida use a credit card as a matter of convenience or necessity in an emergency, they must be mindful of the details of their credit account. Awareness of the interest rate on unpaid balances is essential. This rate usually falls between 13 and 20 percent, which means that interest charges can add up quickly.

When people want to pay off debts, balances on credit cards should be their top priority. The interest rates on credit cards generally exceed those on mortgages, auto loans and student loans. Because finance charges accrue rapidly on credit card balances, people should pay those bills first.

People should also avoid only making minimum payments. This action leaves most of the balance untouched so that interest then applies, which increases the debt. Ideally, people should pay the statement balance every month to take care of all purchases made during the billing period. Another rule of thumb for those who want to rein in credit usage is to not use more than 30 percent of available credit. This tactic prevents the maxing out of an account. Using multiple credit cards also creates the risk of running up debts. People need to resist tempting offers of rewards for opening new accounts.

When a person does run into trouble with excessive debts, a lawyer might help develop a strategy for pursuing debt relief. Depending on the person’s income and debt levels and employment status, a lawyer might recommend filing for a Chapter 13 bankruptcy. This action could result in a manageable payment plan that allows a person to pay down balances while avoiding creditor harassment and collection activities.

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