Treat the Cause, Not Just the Symptom

Treat the Cause, Not Just the Symptom

By Christopher Scully


There are several ways to get out of credit card debt. You can do any of the following to pay off your credit cards.

Debt Consolidation Mortgage - this can be either a refinance of your first mortgage or a home equity loan or home equity line of credit.

Unsecured Consolidation Loan or Balance Transfer - Can be beneficial if the overall rate is lower and the monthly payment is lower than the combined credit card payments.

Debt Snowball Method - you pay more than the minimum balance on one card until it's paid off. Then you add the amount you were paying on the first card to the minimum payment on the next one and pay that amount each month until that one is paid off. Repeat the process until all accounts are paid.

Debt Management Program - You make a payment to a debt management organization and they in turn make the payments to your creditors. Typically will get out out of debt faster than paying the minimum payments on your credit cards.

Debt Settlement - With this method of consolidating credit card debt you are putting money into a dedicated settlement account and then when sufficient funds have accumulated you negotiate a settlement with one of your creditors to take less than the full balance to satisfy the debt. This can be a good option for those who've experienced a loss of income and can no longer afford their minimum monthly payments.

Bankruptcy - For people who are in so deep they have no other choice.
There you go. Several methods of getting out of debt and none of them actually address the cause of the problem except - in a round about way - the last three. With those three programs you will not be able to use credit for an extended period of time. This will more or less force you to get by on cash and spend less than you make. Even then, some people end up back in the same mess again.

The cause of the problem is spending more than you make, also known as living beyond your means. If you find yourself looking for ways to get out of credit card debt you also need to be looking at how you can start spending less than you make. You also can't make the mistake of thinking that as long as your basic living expenses plus your debt payments are less than your take home pay, you're spending less than you make. Not so. What you're actually spending is everything you pay for in cash, everything you buy with on credit and the monthly interest on your debts. That's how much you're spending.

Here's another incentive to deal with your debt immediately. If you have a credit card that carries a 20% interest rate or more, the debt doubles approximately every 5 years. You don't see it on a monthly or annual basis because your payments are applied to interest first and the principal second. This is why it's nearly impossible to pay off a credit card by paying only the minimum payments.If you're carrying a large amount of debt, by all means pick one of the above ways to get out of credit card debt and stick to it until you're out, but at the same time get your spending under control and build an emergency fund so you never end up back in debt again.

Christopher Scully invites you to find out more about consolidating credit card debt by visiting http://careplusfinancial.com. If you're struggling with unsecured debt and want to learn how to get yourself out of debt once and for all, enroll in CarePlus Financial's Credit Card Debt Consolidation Program at http://careplusfinancial.com/content/consolidating-credit-card-debt

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