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Scura, Wigfield, Heyer, Stevens & Cammarota Blog

Overwhelmed by Credit Card Debt? What You Can Do Now

March 30, 2018 Scura Law Firm Debt Management

woman overwhelmed by credit card debtDid you know that 34 million Americans admit to paying their credit card bills late? Credit cards can be extremely useful when trying to establish credit or to use in case of an emergency. However, when they are used improperly, credit cards can plunge you further into debt than you had ever imagined. And as your debt builds up over time, it can become increasingly difficult to get your finances back on track.

If you are one of the millions of Americans who is feeling crushed under mountains of credit card debt, you are not alone. While declaring Chapter 7 or Chapter 13 bankruptcy may seem like an easy solution to your financial issues, it's important to explore all of the options available to you before you file for bankruptcy. In fact, there may be a number of different solutions out there that can help you regain control of your spending and help to reduce your dependency on credit cards.

How Can I Get Rid of My Overwhelming Credit Card Debt?

There is no perfect way to eliminate credit card debt that is guaranteed to work for everyone. But depending on your individual situation, there may be multiple avenues that you can take to pay down your debt. Whether you choose to pay off each card individually or try to work with your creditors by asking for lower interest rates, it’s best to explore all possible strategies before you’re out of options.

One of the best ways you can avoid becoming completely overwhelmed by credit card debt is to understand the best ways to use your credit cards in the first place. With many years of combined experience helping New Jersey residents navigate their debt, we recommend following a few credit card best practices:

How NOT to Use Your Credit Cards

  • Charging what you can’t afford. While this may sound like a no-brainer, many debtors are enticed by the idea of buying items now and worrying about paying for them later. One of the biggest mistakes you can make with your finances is to buy things on credit that you simply cannot afford. If you can't pay for the items you purchase in cash, you shouldn’t be paying for them with credit. This is a slippery slope that can quickly lead to living beyond your means.

  • Charging food purchases. While it may seem easy to pull out your credit card at the grocery store or to pay for a fancy dinner, charging food items on your card means that you are essentially agreeing to pay interest on disposable items.

  • Taking cash advances. Taking out a cash advance on your credit card will only result in a higher interest rate on the amount that you advanced, no grace period and additional transaction fees. Without a grace period in place, interest on the advance will begin on the day that you initiated the transaction. So even if you are able to pay off your balance in full at the end of the billing period, you'll still have to pay interest on the cash advance.

  • Paying for “special services.” Many creditors offer products that seem as if they are designed to offer an extra layer of protection to cardholders such as fraud protection or life insurance. But these services are often greatly overpriced and not really necessary for the majority of consumers.

How You SHOULD Use Your Credit Cards

  • Use your card for emergencies only. Avoiding debt in emergency situations can be very tricky. If circumstances prevent you from paying for an item or services with cold hard cash, use your credit card instead. Then once you’re back to your regular daily operations, be sure to implement a repayment plan asap.

  • Pay off the full balance. Only make charges on your credit card that you can afford to pay in full each month. This will help you to avoid interest charges and stay ahead of any accumulating debt.

  • Pay on time. Whenever you pay your bills late, credit card companies can charge late fees that may raise your interest rates to the default rates. In many cases, the default interest rates are double the standard rates.

  • Don’t open too many lines of credit. Using too many credit cards can make it extremely difficult to stay on track of your purchases and make your payments on time. Typically, consumers do not need more than 2 credit cards.

  • Leave your cards at home. Carrying your cards in your wallet only increases the temptation to spend on items you cannot afford. If you don’t have the cash to purchase something, you shouldn’t be able to whip out your credit card to cover the costs instead.


What Are the Best Ways to Pay Off Credit Card Debt?

1.  Contact Your Creditors

Establishing a good relationship with your creditors is always a smart idea. If possible, reach out to them before you see any real signs of trouble. If you have a good payment history, they are much more likely to work with you if you ever start to experience financial troubles. If you aren’t able to make an upcoming payment on time, reach out to your creditors in an attempt to work out a solution first.

2.  Pay Off the Card with the Lowest Balance

It is so much easier to pay off $500 than it is to pay off $3000. One of the best ways to start tackling your credit card debt is to pay off whichever card has the lowest balance first. This strategy allows you to build a bit of momentum by increasing your payment amount on the card with the lowest balance, while still paying the minimum on your other cards. Once you’ve paid off the first card, you can move on to the next on your list.

3.  Pay Off the Card with the Highest APR

This strategy allows you to target your credit card with the highest annual percentage rate (APR) first to avoid paying more in interest than you have to. Boost the payments on this card and continue to make the minimum payments on your other cards. But keep in mind that the only way this strategy works is to keep making those payments on time until the card is paid off completely.

4.  Speak to a Bankruptcy Attorney

If you are unable to make any headway with your credit card debt and have run out of other options, bankruptcy may be the best solution for you. Declaring bankruptcy can immediately put a stop to harassing phone calls from creditors and give you a chance to regain control of your financial future. But before you begin the bankruptcy process, it is important to speak with an experienced and knowledgeable bankruptcy attorney.

Contact the Bankruptcy Attorneys at Scura Today

While credit card debts can be very scary, with a good plan in place, you may be able to start paying off your cards more quickly. Are you struggling with overwhelming credit card debt and want to see if bankruptcy may be the right solution for you? Contact the dedicated and experienced bankruptcy attorneys at Scura online for more information and schedule a free initial consultation today.

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Whether you need to completely eliminate your debt through Chapter 7 bankruptcy, or need to reorganize your credit payments through Chapter 13 or Chapter 11, we are well qualified as a full-service bankruptcy law firm for people in these and other New Jersey counties: Passaic County, Hudson County, Essex County, Bergen County, Morris County, and Sussex County. Call us today at 973-870-0434 or toll free 888-412-5091.

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