Credit card debt is one of the primary reasons people file for bankruptcy. The majority of Americans have some type of credit card debt and in some cases, those debts spin out of control and put a person in financial danger.
It can be tough to recognize when you have a “normal” amount of debt versus when things are heading down the path of financial trouble. What are some of the signs your credit card debts might be driving you to bankruptcy?
You’re Unable to Meet Your Minimum Payment Requirements
Most financial experts will tell you to pay more than the minimum payment due on your credit card debts each month. For many this is easier said than done. However, if you aren’t even able to meet the minimum requirement, you’re headed for trouble.
As debt climbs on a credit card, so does the minimum payment. What was once just $20 or $50 per month might now cost you $250 or $300 per month. This is a tall order for someone facing financial hardship.
You’re Unable to Make Payments on Time
Missing credit card payments is a sure sign of financial trouble and can snowball into a major problem in no time at all. That’s because late or missed payments result in high penalty fees. An extra $30 per month for an overdue payment can put you closer and closer to your credit limit, and going over that can also result in fees. Suddenly, one or two missed payments results in falling behind by hundreds of dollars or more.
You’re Juggling Payments to Make Ends Meet
Are you using one credit card to pay another? This might seem like a good strategy and it could keep you in the clear temporarily, but it’s a quick fix to a problem that will eventually be much worse. The average person must do a bit of juggling to live from paycheck to paycheck, but if you are using a collection of credit cards just to make ends meet, you need to get to the root of the problem.
If you borrowing money to pay for money you’ve already borrowed, a budget might help you get things under control. Try this budget calculator from Bankrate.com
You’re Getting Calls from Debt Collectors
If calls are rolling in about overdue bills, it’s a sign you are headed for financial disaster. Most companies do not bother calling until a bill is at least 30 days late, so if it reaches this point chances are your financial challenges have evolved from mild to moderate.
Credit cards can be an effective way to manage your financial situation, but they can also get you into a great deal of trouble. If you are feeling the pinch of credit card debt and you are not sure where to turn, we can help. Contact the Law Offices of Robert M. Geller at 813.254.5696 to discuss your situation and find out how we can help you get a handle on your finances.