How to manage and reduce credit card debt
Florida residents may be interested to learn that the average household has $5,700 in credit card debt. That number increases to around $16,000 if a household doesn’t pay off its balances in full at the end of each month. The first step in paying off a credit card debt is determining how manageable the monthly payments are. One rule of thumb is that an individual should be able to pay off a credit card balance within six months without liquidating assets.
Debt levels may also be too high if a person cannot take a vacation or leave a job because of high monthly payments. To gain control of credit card and other debts, it is a good idea to create a budget to reduce the odds of falling further into debt. It may also be a good idea to review the balances and interest rates on each card to determine how much money can go toward paying those balances each month.
Those who have high levels of debt may want to spend time finding out why they spend so much to begin with. Doing so may prevent a debt relapse after the original debt is paid off. Ideally, an individual will carry only one card with an affordable credit limit to reduce the odds of falling back into unmanageable debt territory.
Individuals who have high levels of credit card debt may benefit by filing for bankruptcy. Doing so may make it easier to reduce and pay off high interest debt in a reasonable amount of time. In some cases, debt balances may be discharged completely within a matter of weeks or months. Those who are interested may want to meet with a lawyer to learn about the eligibility and other requirements.