Become Debt-Free and Take Back Your Financial Future!

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In modern society most people have credit card debt; it’s a harsh fact. For most of us in this situation, the debt has accumulated over time and for various reasons, often beginning slowly and quietly building until one day we notice we are under a mountain of debt. While we may have borrowed for ‘good’ reasons, such as to help with tuition or emergency expenses, it matters little now as we make payment after payment, barely making a dent in the principal. Perhaps the expenses were justified so long ago or so often that we don’t even remember the specifics anymore.

While paying off more than the minimum every month is commendable, unless you are paying off your credit card debt IN FULL every month, you are playing a losing game. You are putting your hard-earned, after-tax dollars into someone else’s pocket, causing your original purchases or relief to cost you potentially many times more than the original amount. Money that could and should be earning interest FOR you is, instead, acting as a healthy asset for someone else.

At this point in the debt cycle, many people feel overwhelmed and do one of several crazy things: they begin spending MORE, feeling things are hopeless so there’s no point worrying about it; they stop caring or get in over their heads and begin missing payments; or they consider bankruptcy.

Warning! All of the above options may feel good in the moment, but each will have a disastrous effect on your credit rating. This in turn (even if you don’t care about it now), will cause you much more regret when the consequences hit hard some day in the future.

Instead, consider the following tips to stave off disaster while you re-group and form an effective plan to put yourself firmly on the road to financial health and independence:

TIP #1: Get in communication with your banking institution/s. Honesty is the best policy here, and getting to know a friendly face at your bank can make all the difference in how your accounts are handled. Considering debt consolidation? Start with your bank, for a couple of good reasons: they are a known, trusted entity (even if you don’t agree with all their service charges), and may offer you lower rates because of your existing customer status. Also, a loan from a bank actually improves your credit rating, while a similar loan from a debt consolidation company can actually have the opposite effect in many cases.

TIP #2: Call your credit card companies, again with the goal of keeping open communication. Speak with as many people as you need to in order to negotiate either a lower interest rate, lower minimum payments for a set period of time, or some other compromise. Remain calm and professional, and remind them that you wish to continue fulfilling your obligation. You may also ask them for any ideas they may have, such as alternate cards with less frills but an accompanying lower interest rate.

TIP #3: Consider credit counseling, but only from reputable providers. Many companies in this line of business actually take appalling advantage of clients’ desperation, pulling some not-so-funny tricks. Ask your bank for referrals to above-board credit counseling; they may even offer in-house help to sort out your difficulties. You are not the first person nor the last to be enduring tough economic times, and most banking institutions are deeply concerned as well. Many are making efforts to help their clients and to ensure both the customers – and the banks themselves – will be around and in a healthy financial state for years to come.

Above all, remember that you are not alone and do not panic. People make strange and foolish financial decisions when they are afraid or overwhelmed, and once the air clears they may regret actions which cannot be undone. Your thoughts are very powerful, and can deeply affect your behavior and decisions about all things financial.

Author Bio
Shauna Arthurs is the founder of BreathingProsperity.com and author of ‘30 Days to Wealth.’ Get your copy now for an eye-opening look at how your mindset affects your finances, along with bonus material to help you keep your peace of mind during these turbulent times, improve your credit rating and more! Available instantly in downloadable e-book format!

Article Source: http://depositarticles.com/

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