Counter Debt Us

Posted onDecember 02, 2011 - 10:07 pm by Admin | 0 Comments

The U.S. Congress Joint Economic Committee stated that revolving consumer debt, which consists mainly of credit card debt, amounted to $950 billion. This meant that 13.9% of disposable income went towards servicing card debt. It is important for US consumers to seek guidance from a credit counselor in order to decide whether a Debt Management Plan, filing for bankruptcy or debt settlement is the correct option for managing and writing-off credit card debt. The right decision will help to minimise money problems.

Why Credit Card Debt is Difficult to Escape

According to Tara Siegel Bernard of The New York Times: "If you carry $10,000 on a credit card with an 18 percent rate and make only the minimum payment (say, 1% of the balance plus interest), it will take 32 years to pay it off- for a grand total of $24,834. That does not count late fees or over-the-limit charges." Also, the temptation is always there to spend more and create new credit card debt when family finances are tight.

Control Credit Card Debt with a Debt Management Plan

A single monthly payment to a credit counselor is disseminated to creditors on a pro rata basis. Rick Phillips, vice president of debt management plan services at Consumer Credit Counseling Service of Greater Atlanta, stated that: "A Debt Management Plan doesn't reduce the balance, but one of the big advantages is that the interest rates go down, usually significantly." The majority of plans clear credit card debt within three to five years.


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