Credit Card Debt Recovery
by Evan Kubitschek
Dealing with significant credit card debt can be a monumental task, and many consumers do not know where to start. By taking incremental steps toward debt recovery, you can put yourself on the path toward a clean balance sheet.
According to www.mymoney.gov, the first step toward debt recovery is creating a budget. An accurate budget keeps track of how much money is coming in and how much money is going out, allowing you to pinpoint where you can cut expenses to help pay down your debt.
Contacting your creditors immediately and explaining your situation can result in better rates and an improved repayment plan. Once creditors turn your debts over to collectors, they can become a huge problem.
Credit counseling organizations exist for those that are not disciplined enough to create their own budgets and repayment plans. According to mymoney.gov, credit counseling organizations "can advise you on managing your money and debts, help you develop a budget, and offer free educational materials and workshops." Be wary of organizations with no face-to-face interaction and upfront fees, as they are often scams.
By working diligently to recover from credit card debt, you can save thousands in interest charges from creditors. Using the Credit Card Repayment Calculator (See Resources), you can calculate how long it will take you to pay off your balance with only the minimum payment, and how much interest it will accrue.
Make no mistake about it, paying off credit card debt takes a long time. Do not be discouraged that you are not getting immediate results. Small, incremental successes will eventually lead to big changes.