Very recently I was able to pay off my car loan and pay off and close two of my four credit cards! When it comes to managing finances, there is not a one size fits all solution. However, I want to offer you some practical advice by sharing how I was able to overcome an obstacle millions of people are dealing with, overwhelming debt.

Understand Your Expenses

Knowing how much money your paycheck is and how much your monthly bills are is simply not enough. In order to truly get a grasp on your financial situation, it is important to know how much money you spend a month, on everything. Each time you make a purchase, pay a bill, or give money to your kid for lunch, write it down. You are likely to be very surprised by how much you are spending.

Analysis Your Expenses

On a weekly basis (start this process weekly but as you make progress with your debt spread it out to monthly) review your expense list. Think about each item you purchased and asked yourself, if you really needed to make that purchase. Some purchases of course are absolutely necessary, so focus on the purchases you could have really lived without. Then, total up the costs. If that number does not scare you, and you still had money available at the end of the week, then good for you. You have a long road ahead of you but it won’t be as difficult as it will be for the person who does not have any money left over and is completely amazed by their spending.

If you follow this process as I did, you will start to think about your purchases before you make them. In time, you will stop spending on items you didn’t really need in the first place.

Stop Using Your Credit Cards

As silly as it sounds, this advice is truly fundamental in becoming debt free. If you continue to make purchases using credit, you will never be able to break the cycle and get the debt paid off. Most people I have talked too, and myself included, try to pay as much over the minimum monthly balance as possible each month. This of course is solid advice if you have the money, if you don’t have the money, when you need cash it’s not available forcing you to pull out the credit card, further perpetuating the cycle.

Get Help When You Need It

These days, it seems like everywhere we look, another company or person you know is filling for bankruptcy. Granted in many cases this is the best option, however most people are trying to find a way to avoid bankruptcy. Most people want to try to pay back as much of their debt as they can but are not able to do it alone.

There is no shame in asking for help. However, if you’re considering this option, be very careful, you have to be a very smart consumer. There are several types of debt assistance programs available and there are pros and cons to each. This is a very personal decision not to be taken lightly.

It’s also important to get specific information about each of the companies you are considering. There are no federal regulations on the debt settlement industry, so basically any one can put an ad on T.V., charge a fee and make a lot of false promises. This is not say there is not there is not legitimate, viable companies that can truly help because there is, it’s just important that for the sake of you and your family you do your research. Your research should be impartial and without prejudice. To learn more about how to distinguish good companies from bad, I recommend visiting www.dstruth.com.

If you would like more information about how Debt Settlement USA can help you achieve your goals of becoming debt free, please call 1-888-444-4550.

Although most credit card companies allow a grace period during a billing cycle - when consumers are not charged a finance charge - your low interest rate can be affected if you don’t mail your payment in on time.   In fact, most credit card companies will default automatically to a higher interest rate just after one missed payment even if you are still in the introductory period. 

Not everyone qualifies for an introductory “teaser” rate, even if the mailing you have received indicates you are “pre-qualified”.  In reality, the actual rate is calculated based on your credit score.  So once the introductory rate has expired, the APR can jump to standard rates (or higher).  Do you know your credit score?

Some credit card companies charge a fee as high as 4% when consumers move their balances from one credit card to another, and this fee is in addition to the interest, which is added to an account. On a $5000 balance, the fee could be as high as $200 just to move your balance from one account to another.

Balance transfers are often a tool used by creditors to seemingly help customers manage their credit card debt.  However, if an offer seems too good to be true, it probably is.  Read the fine print on those balance transfers, which entice the unsuspecting public to move the balances from one credit card to another. 

If you owe an average credit card balance of $5000 at a standard 18% APR, the average minimum payment is approximately $125/month.  That seems manageable, doesn’t it?  However, if you continue to make only the minimum monthly payments AND you never add another charge to this balance, it will take you 26 years to pay back the amount you owe.  

But that amount doesn’t include interest!  So in addition to the $5000 charged on the credit card, you will pay the credit card company an additional $7115 over the next 26 years in interest.

In today’s world, knowing your credit score is as important as knowing your social security number and your birth date.  In fact, your credit score can reveal more about you to banking institutions, mortgage companies and even employers than you thought possible.  It is terribly important for you as a consumer to know your credit score which is reported from the top three credit report agencies:  TransUnion, Experian, and Equifax.

Many people struggle with out of control credit card balances.  Despite the pressure you feel from your credit card burden, you are not alone. Did you know that Americans have approximately $800 billion in credit card debt? 

Debt Settlement USA is pleased to provide you with some helpful information about managing your credit card debt.