It has been estimated that private American citizens are carrying nearly $700 billion in revolving credit card debt. At the same time, the recent recession has affected a huge percentage of Arizonans. These two factors alone may explain why Arizona has one of the highest bankruptcy rates in the US.
While bankruptcy offers a fresh start for those who simply can no longer pay their obligations, some people may be able to avoid bankruptcy by taking steps to better handle their credit before they run into trouble. The following five steps can help you manage your credit more effectively and could save you from disaster if an unexpected economic emergency arises.
1. Pay more than the minimum required. Most credit card companies require you to pay such a small amount each month that it will take 30 years to pay it off and quadruple the item’s original purchase price in interest payments. Paying twice the suggested payment will get you out of debt in three years.
2. Know what you owe. It may be hard to face, but to get control over your finances you need to make a list of all of your debts along with the minimum monthly payments and interest rates.
3. Prioritize payments. Pay off the balances with higher interest rates first, while maintaining the minimum payments on your other balances. Try using the debt evaluation tool at MSN Money to help you prioritize your payments.
4. Make a budget. Look at how much money you are taking in and how much your credit card bills are each month. Be realistic about what you can spend once you’ve upped your payments, and consider switching to only using your debit card.
5. Decide if you need more drastic measures. Sometimes getting a handle on your budget is as easy as being honest with yourself and making a plan to get out of debt. But if you’re one of many Arizonans who simply cannot afford your debt payments, it may be time for more serious help.
At The Pew Law Center, PLLC, we believe that your life shouldn’t be defined by debt. We have helped hundreds of people just like you find the relief they deserve from harassing bill collectors, paycheck garnishment, foreclosures proceedings, and – most importantly – the constant worry about money and what to do about your debts.
We are a dedicated debt relief law firm. We help people from Phoenix, Mesa, Gilbert, Queen Creek, Chandler, Scottsdale, Apache Junction, Tempe and throughout Arizona file for bankruptcy or work through tough tax problems every day. We can help stop the debt cycle and give you relief from your overwhelming, burdensome, and crushing debt. Please don’t wait another moment. Call us right away – our attorneys will help get you the fresh start you deserve.