7 of 24

Write now Article Tools

According to the Federal Reserve, credit card debt is projected to reach a figure exceeding $900 billion in 2008. That was not a typo. Consumers in the United States really need to re-think what they put in their wallets and perhaps leave home without those handy little plastic cards.

So what do you do when your credit card debt feels as out of control as the national debt?

The first and most important thing to do is to take a deep cleansing breath, then remove ALL of your credit cards from your wallet. You can cut them up if you want, or you can put them in a safe place. You know yourself best. If you are already maxed out on your limits, it may be in your best interest to cut them up to remove the temptation of charging once there is a balance available.

Second, gather up all of your bills and your pay-stubs, then clear your calendar for a couple of hours so that you can figure out what you have coming in and what you have going out each month. In other words, figure out what your current budget is. You don't need a fancy software program or ledger book. A pad of notepaper, a pencil, and a calculator are sufficient. If you must do something on a computer, an Excel spreadsheet will also work for this. And if you set up the formula bar correctly, you won't have to worry with adding and subtracting!

Third, take a hard look at your outgoing expenses and trim off anything that is a "nice to have" leaving only your necessary expenses. Now take another look at your budget and make sure you understand exactly what you have to work with. Be sure that you do account for the little things that come up like co-payments for routine medical visits, prescriptions, dry cleaning, and transportation costs.

Fourth, stop dodging the collection calls if your situation has gotten to this point. If you have fallen behind on your bills and are receiving collection calls, answer the phone and see if the company will work with you. You may feel depressed or ashamed that you have found yourself in these circumstances but focus on the fact that you are taking steps to rectify the situation and you are not alone. The person on the other end of the phone is just doing a job and the majority of the time they will do whatever they can to work with you. If you aren't receiving calls from bill collectors, take steps to make sure you do not get these calls.

Last, develop an action plan for addressing your debt. This plan will depend on how much you owe, how far behind on your bills you are, and

• 1
• 2
• next page >>

Add your voice

Know something about Getting control of your credit card debt?
We want to hear your view. Write now!