According to a 2019 credit card study, the consumer debt for American households continues to rise. Revolving credit card debts are among the top five types most incurred.
If you are a part of these statistics, do not despair. There are credit card debt settlement steps you can take to regain financial freedom, and more importantly, keep it.
Settle your debt
The first step to getting out of a huge credit card debt is to find a way to settle it. It may seem mathematically impossible, but do not fear. Credit card companies recognize that at this point, the best thing they can do is to get back as much of the balance as they can, even if it is less than what you owe them.
Approach your credit card company to work out a payment plan which is agreeable to both sides and something you can commit to. Although being in debt would not land you in jail, portions of your wages, properties, and assets can be taken away if the card company decides to pursue legal action and wins.
For a higher chance of being approved, hire a credit card debt settlement company to negotiate on your behalf. With lots of experience and financial expertise, they are in a better position to leverage the best deal possible.
Having no money to pay them off is not a problem as no upfront fees are collected. Payment is required only once a deal with the credit card company has been reached.
Set aside a fund for emergencies
The most common reason people get themselves into huge credit card debts is emergency expenses like sudden hospitalizations, car repairs, and other such emergencies.
These are impossible to predict, but this does not mean you cannot prepare for them. Ideally, your credit card should not be your sole weapon against sudden and unavoidable expenses. Set aside a part of your income every month or whenever is doable, and gradually build up an emergency fund you can fall back on whenever you need it.
Pay your bills in full, on time, all the time
It is vital to develop a healthy financial habit once you have gotten out of debt. Review all your expenses and get rid of everything you can do without. Being mindful of your monthly payments puts you in a better position to be debt-free from month to month.
This is especially helpful as it is easy for a credit card debt to snowball out of control if you miss payments. From late charges to exorbitant interest rates, you could be right back in the hole you already dug yourself out of.
Keep your monthly credit bill to a minimum; pay it on time, repeat.
Simplify your finances
Keep only one to two credit cards. This makes it easier for you not only to track your expenses and keep them to a minimum but also root out erroneous charges. Keep all the receipts of your purchases at least until the credit card bill comes out, and you have balanced them out.
Getting out and keeping out of a huge credit card debt is hard but not impossible. It would take a lot of discipline and ingenuity, but in the end, the financial freedom you get would make it all worth your while.
