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Help! I'm in Credit Card Debt and I Can't Get Out!

Help! I'm in Credit Card Debt and I Can't Get Out!

It is no secret that we are a credit-happy nation. A quick perusal of the statistics on reveals some information worth raising an eyebrow or two.

  • In 2015 there were 176.8 million credit card owners.
  • The average American consumer has 13 creditors.
  • Credit card late fees average $28.19.

So basically, lots of people have at least a couple of credit cards and chances are, if they're late on payment, it's going to be a hefty charge. With almost all of us having credit cards, it begs the question of how many of us use them responsibly? How, when and why does credit card debt become out of hand?

Seduction with a sexy rate

If our credit is at least halfway decent, we often find ourselves sifting through piles of credit card offers promising us 0 percent interest for a year, no annual fees, etc etc. The allure of a low APR is enough to make many of us begin to dream about that outfit we've been wanting to buy, but just don't have the money for right now. Or maybe it's the big screen TV our hubby has been hinting at for a few months. Or maybe the gas bill has been torture this winter and the kids need new shoes but there simply isn't enough money. Each one of us has a reason as to why we choose to charge anything, however unfortunately, not all of us realize that it might not be the wisest choice.

Credit card companies thrive on giving us an opportunity to spend money we don't have, and bank on that satisfaction of instant gratification or hard times. They offer temporary low rates to lure us in, allowing ourselves to believe that we really will pay it off as soon as possible and most definitely before the promotional rate is up. However, life often has a few surprises up its sleeve and pretty soon we find that paying the minimum balance is all we can afford. Soon a year has gone by, the balance has been reduced by a few dollars and now you're paying at a 17 percent APR. If you couldn't pay down the balance before, you're sure going to have an ever tougher time now.

But the truth of the matter is that sometimes we all need a little credit to lean on. The important thing is to read the fine print and ask a lot of questions. And get the answers in writing.

Okay, I have to charge. Now how do I pay it off?

In an article written by Liz Pulliam Weston, the average American owes over $8,000 in credit card debt. The article, "The Truth About Credit Card Debt," goes on to explain that that figure may not be a completely accurate portrayal of credit card debt in this country, as 55 percent of Americans owe nothing on their credit cards. What does this mean? Forty-five percent of Americans have a lot of debt.

In 2009 President Obama enacted the Credit Card Accountability, Responsibility and Disclosure Act which stipulates that credit card companies present a payoff timeline for its customers. If you've looked at your latest credit card statement, you may notice a box that lists the time and final amount paid if only paying your minimum payment or if you paid another, higher, amount. It is too often that we as consumers do not take our fiscal responsibilities seriously and as long as we can scrape together that minimum payment every month, we're happy. However, we overlook the actual suffering we are putting ourselves through, with often a large portion of that minimum balance going toward the interest rather than the principle, resulting in a painfully slow pay off.

Elisabeth Leamy, author of "Better-Smarter-Faster Ways to Pay Off Credit Card Debt," lists a number of options to help consumers battle the double C's. First, being by prioritizing your credit cards from highest to lowest interest rates because "the debt with the highest interest rate is costing you the most money." She warns against paying off the smaller balances for the sake of satisfaction in seeing a balance eradicated from the monthly stack of bills.

Another tip Leamy offers is to make two half payments per month instead of only one full payment upon due date. She explains that since many of us are paid every two weeks, if we make a half payment with each paycheck, we will end up making more payments, thus squashing the debt even faster.

This is all fine and good, but what if times are just too hard?

Unless you've lived under a rock for the past couple of years, you might have heard the terms "recession" and "economic depression" thrown around a time or two. With unemployment rates high, consumer confidence low, people who never thought they would ever have to struggle are getting in the bread line. Fortunately, there are options for those of us who are finding it difficult to keep up with our monthly obligations due to job loss, illness or any number of other financially debilitating issues.

Help is out there, but you might have to do a little digging to find it. One option, according to Leamy in another article, "Credit Card Companies Forgive Some Debt," is to check and see if the bank is willing to absolve some or all of your debt. This may not be the likeliest of scenarios, so you may want to also check into credit counseling or debt management programs. The key here is to find a non-profit, government organization that is willing to take on your case either for free or for a minimum fee. Do not allow yourself to be further scammed by companies promising the world but only if you pony up a considerable amount of money first or each month. These companies are not interested in helping you get out of debt and get your life back. The Federal Trade Commission has a website devoted to helping you find the right company to help you and offers information on staying unscathed from scammers.

In time, it will be okay

Financial issues are one of the biggest stressors in our lives. However, it's important to take stock in the other positives life has to offer and realize that nothing is ever completely out of our control. Credit card debt can make some people feel guilty, depressed, ashamed or even suicidal. It is crucial to realize that there is an abundance of help out there for those of us who have found ourselves in over our heads before we even knew the wave was coming.