Credit card companies love the fact they we only pay the minimum payment every month. Why? because they are raking it in while the interest rates are crippling us. So what started out as a small credit card bill could escalate into thousands of pounds. Say your credit card statement arrives your balance is 2000 the minimum payment is 40 which is 2% of your balance, if you keep paying just the minimum payment its the interest that most of your 40 is going to and not much to your bill.

The minimum re-payments have dropped as the credit card companies and banks originally charged 10%, but they found that customers where paying their debt back a lot quicker with the 10%. So the way for them to get more interest out of us was for them to reduce the percentage of the minimum payment, making us think that they where helping us but in fact they where just getting more money from us by adding on more interest, as it will take longer for us to pay of the credit card bills.

So what to do if you find yourself in this situation:

Stop using your credit card, better still cut it up (in case you get tempted) Sit down and workout how much more you can pay than the minimum payment theyre asking for, once you have worked out how much stick to it even when you see the minimum payments going down dont be tempted to reduce your payment or your be back to square one.

If you have more than one credit card the best way to reduce your debt is once again stop using them. Work out which one has the highest interest rate and make the highest payment to that card. Keep paying the minimum payment on your other cards and once the card with the highest interest rate is paid off, go to the next highest card and so on until all your cards are paid off.

You may have to tighten your belt in for a while but this will save you a lot of money in the long run. Yes we all need credit cards and if you use them properly they are fine, but if you cannot afford to pay them off at the end of the month then this is when you get yourself into all sorts of trouble.

The temptation to use credit cards repeatedly a fact that is also supported by the reward systems and lower monthly payments – will often lead to debt problems. Here are a few tips that will help you use your credit cards more wisely and enable you to prevent the unpleasant situations of having to pay off credit card debts: Set your budget create a framework for a monthly budget, as this will enable you to get a better sense of what your earning and spending balance is. Much notice that they simply can’t stick with the planned budget in this case you should leave your credit card at home when going shopping, and use cash instead. Try to pay as much of the balance for each month. Don’t settle for the minimum payment, as that will gradually develop into credit card debt as you are loosing quite a lot of money to interest rates.

Always remember that your credit card is a cash substitute, nothing more. You can either carry a balance, which comes with a high interest loan or you can make the minimum payments. Although the amount of the minimum payment seems insignificant (it is usually around 3% of the entire balance), this approach will gradually put you in debt. The credit card company accepts such low payments because they get their money back from keeping you in debt for an unlimited period by using high interest rates.

Many studies have been carried out on the psychology of the credit card owner. We tend to spend more than we can afford, own things that are above our financial reality levels and gratify an immediate need with a debt that might take years to pay off. Try to adapt your spending habits to your life style and earnings. If you can’t pay off the balance on a monthly basis, then you are going into a vicious circle of overspending and credit card debt. Don’t use the credit card anymore, until you pay off the outstanding balance. You should also make sure to pay it off on time, as there might be late fees and different other financial penalties that will further complicate your debt problem. Your credit record will also get damaged if your payments are inconsistent and you are often late with them.

Prevent credit card debt by making sure to keep your finances simple. Use only one or two credit cards, if possible. The more cards you have the higher are the chances that you will not be able to pay them off in time. Never pay off one credit card balance with another credit card. If this happens, you need to drastically change your spending habits and come up with a good credit card management plan. Cash advances might sound attractive, but the truth is that they come with higher interest rates and you don’t get a grace period. There are also transaction fees to worry about.

The credit industry is extremely dynamic, and credit card issuers are always trying new ways to convince more people to sign up with their services. Different forms of rewards, life insurances, protection plans or point systems were created to make the credit card plans more attractive. Make sure you don’t let your emotional side dictate when you make a credit card related decision. Getting free gifts or free air miles sounds amazing, but is it really worth it? Try to base your choice on hard facts and a realistic financial plan, not on an advertising created fantasy.

Yep-minimum payments if you only pay the minimum payment on your monthly balance, what once was a small credit card bill will turn into a very costly one youll end up paying back thousands, and will take years to clear.

How can I help myself sort out this problem!

Well if you have more than one credit card and you pay the minimum payment on them all, then this is what to do get the credit card with the highest APR and pay the most to this card, keep paying the minimum payment to the rest of your cards once the credit card with the highest APR is cleared go on to the next highest APR and so on until all the credit cards are paid off.

Another way to help is balance transfer deals try switching your card with one that has this on offer, they also offer 0% interest free period for 6-9 months great way to save some money.

People with only one credit card try not to use your card if thats not possible monitor what you spend youll be amazed at the silly things you put on your credit card, including groceries, petrol, and nights-out youll be amazed at how much interest is added on. People tend to forget about money I agree that credit cards are handy but they dont have to be used all the time, I guarantee if you monitor what you spend for a few months you will see the difference.

I know these things sound easy but its amazing how many people just use their plastic friend to pay for everything, and really when you sit down and think it really is just common sense, hopefully following these simple steps will get you back on track.

Word Count:Article Body:
Have you succumbed to the lure of credit cards and found yourself in a bit of a pickle because of it?

Pull up a chair and have a seat – Welcome to the ever growing club of consumer debt. Your biggest challenge now is to dig yourself out of this situation and avoid having to pay anyone to help you do it.

The options at this stage are usually as follow (depending on the level of credit card debt):

Consolidate into a loan.
Debt Management.
Bankruptcy.
Do Nothing.
Just pay off the cards over as long as it takes.
Make the minimum payments and keep spending.
Make an effective DIY plan.

The more popular solutions – such as consolidation loans and debt management -we see being touted everywhere are the ones that put your money in other peoples pocket. I dont know about you but for me becoming free from debt should not involve spending more money, or *borrowing your way out of debt*.

So how does a DIY system work?

To break it down into 5 steps it looks something like this:

1. Address your spending habits and why you are in this situation.

To ever win with money and have a comfortable financial future you have to control your money not the other way round. Take complete control and set yourself some realistic yet desirable goals for the future.

2. Know your options, the ins and outs of how they work and why they are not for you.

Along the way you will be tempted by quick fix make it all better solutions like consolidation loans and debt management. As mentioned already there is a multibillion dollar industry making a very healthy profit from consumer debt. Your DIY plan does not involve *paying to get out of debt*.

3. Know your situation.

Any debt relief system requires a bit of budgeting. As long youve followed the rest of the plan so far, have desirable goals and no intention of taking an easy -and expensive way out you wont have trouble budgeting.

The other thing to know is your credit score. There are a staggering amount of mistakes found on credit scores that result in people paying more interest than they should. If you are eligible for lower rates and 0% APR cards to move expensive balances on to you need to know about it.

4. Minimise outgoings, Maximise income and leverage your cash flow.

If you could be paying less for utilities and day to day expenses you should. There is a very fine art of money saving that you will become very good at if youre going to be successful at this.

Home economics, consumer education and bargain hunting can save you incredible amounts of cash that can go toward paying off your debt quicker.

If youre really serious you can take it a step further and create a secondary source of income. Be it a second job, or using a natural skill/strength you have that can earn you money in your spare time.

With the opportunities available online its never been easier to find those who are seeking out some knowledge, experience and skills that you have and that they would pay you money for.

5. Form your system and put it into action.

Having followed the first 4 steps and laid some sturdy foundations you are now in a position to develop a quite powerful snowball plan. That is a system that gains momentum as you execute it.

This step is completely dependant on the first 4 steps and generating an extra figure that you can assign to snowballing your credit card debt. As the debts get paid off the figure grows and subsequently clears the rest of the debts a lot quicker saving you a tidy amount of interest in the process.

It is very possible use a DIY plan and enjoy great success from it, yes it takes a bit of hard work and discipline on your part but the alternatives just cost you more and keep you in debt for longer.

Its your money, its your life if you want to truly own them both then you have to take control not give it over to someone else. Control or be controlled, the choice is yours.

This is when you start to realize that you are just unable to cope. You face stress and worry each month when you receive the dreaded statements from your credit card companies and your banks. Then, you begin to panic when you receive calls from the loan recovery department of your banks. Increasingly, you find it hard to keep secret your debt situation from your family members.

What can you do? So how about considering credit card debt consolidation as a possible solution to get you out of this mess?

Credit card debt consolidation simply means taking all your outstanding balances and turning them into one payment. Normally this payment is lower than if you paid all of them individually.

This is what happens in a credit card debt consolidation process. After you agreed on a plan with a debt consolidation company, the debt company pays off your debt to your creditors. You make a single monthly payment to the consolidation company each month. You get to also pay a lower average interest rate than previously.

All credit card debt consolidation loans require some form of credit card and debt counseling. You and your family have to cutback on your lifestyle while you get things back in order. However, the aim of debt consolidation is to have you debt free, with a roof over your head!

With Consumer Debt at a National high, many Americans are faced with increasing credit card interest rates, minimum monthly payments, etc. It is becoming harder and harder to meet our monthly obligations each month and many consumers are looking for answers.
This article will give you a brief run-down of the options that are available today to help make the decision a little easier.

The first option is to keep doing what you are doing now. Make your monthly minimum payments, pay increasingly high COMPOUND interest and lose thousands of dollars over the course of several years doing so. According to Bankrate.com, the average household has approx. $30K in unsecured debt. Did you know that paying the minimum monthly payments will cost you $112K in interest and it will take you approx. 59 years, yes you heard correctly, YEARS to pay off? That is a definite financial choice that will put you in the poor house quicker than anything else. When you are paying interest like this, it does not even benefit you to save your money in a savings account, because the interest would not gain fast enough to offset the interest you are paying on your credit cards. So, what should you do? Consider the other options!

The next option is a Debt Consolidation. This is a generic term now being used but true debt consolidation is taking your current debt load and rolling it into a new loan, with interest over a longer period of time. You will either need some security like a home or bank account. You will pay interest that is non-compounded, which is definitely better than compound interest; however, you will spread your debt over a longer period of time and therefore shell out more cash than necessary. If you have a small debt load, under $10,000, This may be a good option for you if you dedicate yourself to making larger monthly payments than are required, paying off early if possible.

Another option is Consumer Credit Counseling . You will recognize these companies because they usually have a non-profit status. They are actually sponsored by the credit card companies themselves and they have what is called a fair share arrangement, meaning the credit card companies pay these companies to keep you paying them. Your money is not dispersed into an escrow account, but the cccs companies disperse it evenly amongst your creditors how they see fit. You will not experience any relief from your monthly payment since they will stay pretty much the same. Interest rates are lowered most often, but are not completely eliminated. I have heard many complaints that payments are skipped and facts show that most enrollees in this type of program quit after the first 12-24 months. The reason being is that your credit report is negatively affected closely to that of a bankruptcy. When lenders and loan companies see an account managed by CCCS, they view it the SAME as a BANKRUPTCY. These types of programs usually take about 5-7 years to complete. Once the program is completed, the creditors release comments about CCCS on your credit report. To Sum it up, you have no monthly savings relief, you still pay your entire debt plus interest and your credit is negatively impacted for 5-7 years.

The last option I will outline is Debt Settlement. This type of program is becoming increasingly popular because of its many benefits to consumers. Debt Settlement Companies are experts at negotiating your debt down, on average for all cards/accounts, to 40% to 70% of what you owe. One card may settle at 80%, even 100% in some cases, the next card could be 30%. The end result is an overall total average of 40% to 70% of all the cards. This will be based on who your creditors are and their criteria. Creditors are directed to speak only to Certified Debt Mediators once enrolled and the process begins. Enrollees are set up on monthly payment plans, usually at a savings of 50% out of pocket providing immediate cash flow. You will be set up with one monthly savings amount, which will be deposited into a secured trust account at a Bank. Savings amounts are YOUR money. Settlement Companies have no access to it, beyond their fees, and neither do the creditors. It is a secure, protected trust account. This is the money, as it accumulates, that will be used to settle your debts. The consumer will have control of their own funds throughout the whole process. The average time a consumer is in the program is 12-36 months. During this time, the creditors will be reporting late pays on the consumer’s credit report while this process is going on. As settlements are reached with each creditor, the creditors will report a settled in full, paid with a zero balance. So, ultimately, at the end of the program, then your debt to income ratio will have improved and your credit will begin to heal itself for the future. In addition, you will not have the long term effect of a public record as you would with a bankruptcy.
Debt Settlement Companies do charge fees for their service, because creditors are not in alliance with DSC’s and do not give them kick backs for payments like in Consumer Credit Counseling programs. The fees average 15%-18% depending on which company you choose and the quality of service they provide. Most established firms will offer an online back office in which you can track your payments and settlement activities. Often times, fees are looked at in a negative light. But if you actually do the math, the savings still add up to substantial amounts and your credit gets back in shape pretty quickly. For instance, for $30K in debt and fees at 15% or $4500.00, you will still have an average savings of approx. $10,500. That is nothing to sneeze at! If your credit is a concern, then you must weigh your priorities.

Becoming debt free will give you many more advantages in your long term financial path, then two years with some late marks on your credit report. You may even consider credit repair after you are out of this type of program.

Learn to understand your statement if youre paying more than 15% of your monthly salary to your credit card bill then now is the time to take some action. If you pay the minimum payment and the interest charge takes up a lot of your monthly payment, not much is actually coming of the balance. For example say you pay 100 a month now take a look at your statement and see how much actually goes on interest.

Avoid minimum payments

The minimum payments are a nightmare they are costing you a fortune and will take years to pay of the debt. Credit card companies used to take 5% as a minimum payment of the total money owed, but now ask as little as 2% as people where finding it hard to pay back the 5%. This has in turn created a debt problem for many people.

Here are some ways to help you reduce your credit card debts! Try to stop using your credit card and if you cannot, monitor what you spend. Balance transfers are a good way to save you money, lookout for the ones that offer 0% interest free periods for 6-9 months; this will give you a bit of breathing space. Make sure you check the APR rate once the 0% interest free period is over and cut up the previous card, as you do not want to be tempted again and end up in more debt.

You can move your debt to a credit card with a lower APR

There is nothing that says once the 0% interest free period is over that you must stick with this card, if you watch what youre doing you could then change to another card that has the same offer on. Just be careful and make sure you have your dates correct, as you do not want to be getting charged for any late payments.

Once you feel that you have got yourself on an even keel the next step is to try and clear up your debt completely. The way we do this is to start with the credit card that has the highest APR rate, pay the most to this credit card and just pay the minimum payment to the rest of your cards, once this card is finished then go the next highest APR card and so on until all your credit cards are paid off.

Credit cards are a great thing and we all need them, but they must be on our terms and we must be able to pay them off, if possible at the end of every month. If we cannot, this is when the problems start as minimum payments only get you into more debt and will take years to pay off.

Remember

1) Try to stop using your credit card
2) 0% balance transfers can help you pay off your debt
3) Pay off the debt with the highest APR first

Once you have got the debt under control and at an amount that you feel is manageable, the next step is to try and curb the spending and clear the debt completely and get back on an even keel, then you can enjoy the spending freedom that a credit card brings you, but under your terms.

Word Count:Article Body:
Low interest credit cards can provide you with the answers you are looking for when it comes to getting free of debt. If you are like millions of Americans, you are probably having difficulty keeping up with the minimum payments on your credit card. In fact, almost 70% of Americans keep a balance on one credit card or more. Similarly, 45% of those with balances pay only the minimum payment every month. Unfortunately, paying only the minimum on a credit card balance can mean taking years to pay it off.

A Glimmer of Hope

Low interest rate credit cards can provide you with the debt-relief you have been looking for. As an intelligent consumer, you can turn credit cards around and make them work for you rather than against you. Since credit card companies are in such fierce competition to acquire and to keep customers, many offer outstanding introductory offers. In fact, there are several cheap credit cards that offer an introductory APR as low as 0.00%. When used wisely, these low interest credit cards can be your ticket to financial independence.

Finding Cheap Credit Cards

Luckily for you, it is not particularly difficult to find low interest credit cards. In fact, a number of major credit cards send mailings directly to your home to offer you a card membership. On the downside, sorting through all of these credit card offers can be confusing and time consuming. For this reason, one of the best ways to find low interest rate credit cards is visit a web site offering side-by-side comparisons. Here, you can view introductory rates, annual fees, and how long the introductory rate lasts. You can also view the long term rate after the introductory rate is complete in order to determine which of the low interest credit cards will best suit your purposes.

Taking Advantage of Low Interest Rate Credit Cards

After selecting and applying for the low interest credit card of your choice, the first step to getting yourself debt free is to transfer your balances from high interest credit cards to the low interest credit card. This will help you start saving money immediately. In fact, a credit card balance of $9,000 with a 19.99% APR will cost you over $1,600 more per year than a credit card with an APR of 1.9%. Be sure, however, to look into possible balance transfer fees or other fees that might be associated with moving your credit card balance from one card to another. Also, low interest rate credit cards may have a higher interest rate on balance transfers, so be sure to be certain of the APR associated with the transfer.

After saving money with the lower APR provided by low interest credit cards, it is important for you to take advantage of the savings to become debt free. Too many people look at the savings as an excuse to spend more or they use the money elsewhere. Instead, you need to send the money you save back to the credit card in order to pay down your balance. After using the saved money on principal rather than interest, you will gradually start to see your balance disappear.

Creating a Budget

Of course, low interest rate credit cards are not the only answer for getting out of debt. Rather, they are one tool to help you get there. To get out of the red, you will need to create a budget that involves sending regular payments to the credit card that exceed the minimum payment amount. In addition, you need to either quit spending money on your credit card or make sure you have enough money coming in at the end of the month to completely pay for the additional debt placed on the card – and this money needs to be above and beyond what you already have set aside for your regular credit card payment.

If you have a balance, and most people do as the average credit card debt is now between 9 and 10 thousand dollars, make a plan to pay it off as quick as possible. Finding a solution to this problem requires you to not only develop a plan, but you need to stick to it. Always plan a budget according to your income and spend accordingly. If you have a problem with the plan a debt management agency can assist in making one that can work for you. On average, debt management agencies can reduce your monthly payments up to 60%, and help you become debt free within a few years.

Credit card debt consolidation loans help consumers to roll all their debts into one single loan. This leads to cutting down high interest rates and can make the loans tax-deductible. Debt consolidation loans are always beneficial for consumers who are reeling under the burden of credit card debt. Information on debt consolidation loans can be obtained by visiting credit card debt consolidation services and also online.

Having poor budget management and credit control will simply make your debt elimination strategies futile. Now you know why Credit Card Debt Management is essential. Every year, more than nine million debtors go to credit card debt management agencies to evade a financial crisis without filing for bankruptcy. Hence the need for credit card debt management for a larger section of population is gaining importance.

It also provide a history to financial institutions and banks who can decline any further issue of credit cards or refuse a loan to consolidate the debts. People do not always realise or think about it but keeping an outstanding credit card balance is one of the most expensive financial arrangements you could possibly subscribe to. There are certain things in life that you will wish to avoid if you want to have a secure financial present and future for your self and your family.

If you have the opportunity to transfer balances to lower interest cards, go ahead and do it but keep paying that $300 per month, and keep allocating it first to the highest rate cards. It works even better if you use the lowest interest rate loan available, a 0% balance transfer credit cards. And while 0% balance transfer credit cards are a bit more scarce than they were two years ago, they do still exist and they have been joined by other low interest balance transfer credit cards schemes.

Work out the fees and the interest of your entire current accounts to check on the final reimbursements you are making at the moment. Even without late fees, exceeding a 20 percent interest rate on your credit card debt is easy. With the late fees $25 or more for missing your payment or exceeding your maximum, the money you can pay out then progresses into loan shark territory.

If you have a home of your own you can apply for a Home Equity Loan or Mortgage Refinancing. Today, many mortgage lenders advertise their services online. When mortgage lenders compute your credit worthiness for real estate financing, they deduct points for unfavorable department store credit lines.

Also remember that debt negotiation really does work. Credit Card Debt Settlement/Debt Negotiation is something you could probably do by yourself, however in most cases hiring professional help is the best way to go. When you have saved enough money in the account, your debt negotiation company will contact your creditors and settle your debt.

If you find yourself in this predicament, there are some practical things to do and think about which will enable you, over time, to eliminate your credit card debt and move on to live an abundant life. Many of these suggestions will seem radical, given the fact that we often find ourselves addicted to buying on credit and remaining comfortably vague about how much we actually owe, and what our debt is actually costing us.

Assuming you are at the end of your rope and losing sleep, heres what to do:

1. Stop using credit today! Yes, it can be done. Go on a cash basis. Do not panic. Many people decide to cut up their credit cards or, at a minimum, put them in the back of their freezer.

2. Begin keeping a record of all money you spend. Use a little notebook and write down everything, yes everything, from lattes to tolls to snacks.

3. After a month, total all of your expenditures. Break them down into categories such as rent or mortgage, clothing, car, utilities, food in, food out, nails, payments against your credit cards and so on. You probably will discover some surprises.

4. Closely examine all of your actual expenses and, on paper, begin cutting out those that are not absolutely necessary and reducing others that are out of line. Be willing to overcome your vagueness. Be pragmatic and ruthless.

5. From the results of your analysis, prepare a monthly spending plan, using your categories, that falls within your income and allows you to make larger payments against your credit cards.

6. Begin reducing your credit card debt by paying as much as your spending plan allows, above the minimum monthly payment, toward the smallest of all your credit card obligations. In the meantime continue making minimum payments against the other credit card balances.

7. When the smallest amount owed has been paid in full, begin applying the extra cash to paying off the next smallest balance. Repeat this process until all credit card debt has been eliminated. Yes, it will take time.

8. Use cash, checks or a debit card to make grocery, clothing and similar purchases. Write down each of these expenditures in your little notebook. If necessary, you can buy airline tickets and rent cars with a debit card.

9. Continue keeping a monthly tally of all your expenses in order to make sure you are keeping to your spending plan. Hold yourself accountable, if you can, by discussing your situation and progress with someone you trust or a spiritual advisor.

10. Above all, do not take on any new debt. Try paying all bills the moment you receive them. Touch them once. Dont allow them to accumulate. That way you have no unpaid bills.

A word about your spending plan. You do not have to fall on your sword to take care of your creditors. Make allowance for taking care of yourself. Include spending categories for entertainment and self care. Self care also must include a savings account if you dont have one. You should begin from day one of this plan to establish a prudent reserve. Each week, make a contribution to savings. Can you afford $5.00 per week? Or more? Include it in your spending plan.

Nothing will contribute to your sense of well being more than responsibly handling your debts and building for your future. You can eliminate your credit card debt by following the straightforward plan outlined above.