It’s very easy to get overwhelmed with debt these days. Credit cards. Personal loans. Mortgage refinancing. Store financing. The opportunities for getting credit are seemingly endless!
And once the debt starts building up, it’s hard to stop. High interest rates can cause your debt to multiply faster than you can make payments. So, how do you know when it’s time to get help, and take action — so you don’t end up way over your head in credit card debt?
Your Credit Card Debt: 5 Warning Signs It’s Out of Control
Here are 5 warning signs that your credit card debt is out of control:
1) You need to keep getting more credit cards to make ends meet. If you reach this point, realize that you’re spending money that you don’t have. So you need to find a way to make more money. And you need to find ways to cut your expenses. And if this doesn’t get you back on track, then it’s time to get help.
2) Your interest rates are mostly (or all) over 20%. This is a sure sign that you’ve missed some payments. With interest rates this high, there’s no way you’ll ever make any real progress in paying off your bills. So call your creditors, and ask them to lower your interest rates. If they won’t, then focus on making your payments on time for 3-6 months, and ask again. Note that lower personal loan rates do exist, and may be something to look into if you are ever considering debt consolidation as an option out of your predicament.
3) You are losing hope and don’t know what to do. Struggling with debt is stressful and discouraging. You need to do everything in your power to make a commitment to getting out of debt, and start taking action. Letting the problem linger will only make you more miserable. No matter how bad your situation looks, it won’t get better if you don’t try to make it better.
4) You don’t know how much you owe. Be honest, if you don’t know how much you owe, how can you ever hope to get out of debt? You don’t need to know the amount to the last penny, but you should know at least a “ballpark” estimate. Knowing won’t make life easier, but not knowing is like hiding from the truth. And you can’t deal with the truth if you don’t know what it is.
5) The creditors are calling you regularly. Nobody likes to get these calls. But the absolute worst thing you can do is ignore them. If you can pay anything, no matter how small, answer the phone and tell the creditor how much you can afford. If they can’t help you, or you truly can’t afford to pay anything, then you need professional help.
Kris Bickell is the owner of www.Debt-Tips.com. If you’re having trouble paying your bills, find out if credit card debt negotiation is the right debt reduction strategy for your situation.