Like many other California consumers, you may have a credit card that you use for daily purchases. Like others who have credit cards, you may find that you rely on them as sort of an emergency fund as well. Data suggests that many Americans have more credit card debt than they can reasonably handle, leaving many in a precarious financial situation.
Due to accumulating interests, even a few late or missed credit card payments can quickly spiral into a serious problem. If you find yourself with a significant amount of credit card debt, you are not alone. It may help to understand more about this problem facing many Americans, as well as what you can do to secure a better financial future for yourself and your loved ones.
A growing problem; a complex solution
The latest data about credit card debt is alarming. Due to a strong economy, lower unemployment and other factors, consumer confidence is high. This means more spending, most of the time using credit cards. However, there are many reasons to indicate that more and more consumers are facing a difficult time managing the debt they do have.
One sign of a problem is the increase in the charge-off rate. The charge-off rate is the amount of debt that credit card companies are confident they will never collect. In the first quarter of 2019, the charge-off rate increased to 3.82%, which is the highest it has been in approximately seven years.
What does this mean for you?
There are many practical reasons why it is not smart to allow your personal credit card debt to reach unmanageable levels. Even if you do not think that your situation is too pressing or at a point where you need to be concerned, it is always best to take action before an emergency arises.
Credit card debt can affect other areas of your financial health. If you cannot manage this type of debt, you may find that you struggle with other types of bills and expenses as well. It’s worthwhile to find solutions that allow you to look to the future with confidence.
Dealing with your debt
Overwhelming credit card debt can be a sign of poor financial health. One of the possible options available to you is to file for bankruptcy. This may not seem like a beneficial option, but it may allow you to discharge certain types of unsecured debt and stop harassment from creditors and debt collectors. It may help to seek an assessment of your case and explanation of your options from a bankruptcy attorney.