It is far too easy to pull out a credit card when paying for items. Whether it is a large purchase or a small one, adding to the outstanding balance on a credit card can be risky. For those unable to manage their debt, it can create a growing problem that they feel they cannot regain control of. Thus, it is vital that those overwhelmed with credit card debt fully understand their options when it comes to addressing this debt and avoiding similar pitfalls when regaining financial control.
Credit card debt issues
Having credit card debt has become a norm for many Americans. While it can be a problematic situation, it tends to grow more and more, as individuals believe they can manage a high credit card balance. The problem with a high credit card balance is that an individual will lose more money due to interests. Additionally, they will have a higher credit utilization ratio. This means that their credit score is likely to go down. Thus, it is ideal to carry as low of a balance, if any, on a credit card.
But paying off credit card debt can be challenging, especially for those that have had to turn to their credit card to just get by and purchase necessities. Based on current data, the average credit card balance in the U.S. is $6,194.
Addressing credit card debt
If one is unable to budget and make life changes to work down their credit card debt on their own, it might be best to consider debt relief options. This includes filing for bankruptcy. While this may not be a person’s first choice, it is often a reliable option, as it could help eliminate certain debts or help one establish a workable repayment plan.
Whether one is considering a Chapter 7 or Chapter 13 bankruptcy, it is important to note how these processes could help one address credit card debt. While filing for bankruptcy may not be an easy decision to make, it is a decision that could help one overcome growing debt.