Credit cards and debt

It’s never easy to manage credit, but regardless of a person’s level of income, doing so is a required skill.

Credit affects many aspects of life, even things consumers may not consider. Beyond affecting things like loan eligibility and interest rates, it also determines whether a consumercan buy goods and services on credit.

Any consumer with a bad credit history can tell stories of how it got between them and the things they wanted. Employers have been known to turn down applicants they may have otherwise hired because of a bad credit history, and landlords certainly don’t want to accept a tenant that has a history of trouble when it comes to paying monthly bills.

For consumers whose bad credit is the result of credit card debt, the problems are even more pronounced. Debt piles upon debt quickly and it can be overwhelming for anyone. The key is knowing where to start.

The first step any consumer who finds himself or herself deeply in credit card debt should take is to stop using their cards to make purchases unless they are absolutely vital. Adding more to the deficit they would like to cut into is the worst thing they could do.

Consumers should also start paying their credit card bills on time every month, and to try to pay above the minimum payment. A large portion – 35 percent – of a consumer’s credit score is payment history, and the sooner on-time payments start being made the better. Paying more than the minimum has two positive effects: It helps lower the total amount of debt – another 30 percent of a credit score is how much debt the consumer carries – and also reduces the amount of interest the consumer will accrue.

Unfortunately, when consumers get themselves deeply in credit card debt, there is no quick fix. The average American carries thousands of dollars in credit card debt and even if they stopped using the card, it could take years to pay off their entire debt alone.

Consumers often look for help from debt settlement, credit counseling or debt management services to learn how to climb out of their card debt. By gaining valuable insight into the debt relief services available, consumers can learn how best to approach tackling the debt that could be causing them considerable stress and keeping them from getting the things they want from life.