Mississippi residents have helped Americans as a whole generate a total of over $1 trillion in credit card debt. Those who want to pay off that debt have several options to do so. However, the best option may be to start with the credit card that has the highest interest rate. This is because reducing the principal balance on that card also reduces the amount of interest paid to a lender.
Ultimately, people will be able to pay their debt down faster if more of each payment goes toward the principal instead of interest. Once a credit card balance is paid off, a debtor will then start paying down the balance with the next highest interest rate. While it may take longer to pay down a debt using this method, it will save a person money in the long run.
To speed up the process of paying down credit card balances, they should be transferred to a card that has a zero percent introductory interest rate. This will result in all of a given payment going toward the principal balance. Another way to pay down debt faster is to make payments every two weeks instead of once a month. Doing so means making the equivalent to 13 monthly payments, and that can also result in more money going to the principal balance.
Individuals who are looking to eliminate debt may do so by filing for Chapter 7 bankruptcy. Credit card debt can often be discharged without a debtor paying any of the outstanding balance. Once a debt is discharged, a debtor has no obligation to repay it. In most cases, a debtor is entitled to an automatic stay of creditor contact after filing for bankruptcy.
Many people living in Mississippi have concerns about credit card debt. While credit cards can be a useful tool in managing personal finances, consumers will sometimes run up balances that can be difficult to manage or pay off. In fact, a recent study has shown that the average household credit card debt in the United States is $8,284.
In many cases, consumers do not intend to run up significant debts. They use credit cards responsibly, and either pay their balances each month or make reasonable monthly payments. However, circumstances can affect an individual’s ability to pay their credit card bills. For example, someone may become ill, unemployed or face a major, unexpected expense such as a medical bill or home repair.
When people can’t pay their credit card bills or can only pay a minimum amount, balances will balloon due to interest rates and late fees. It can be very difficult to catch up, particularly if one is attempting to cope with a diminished income or other urgent financial obligations. Over time, the stress of trying to deal with creditors and pay bills can take a significant toll on a debtor’s health, marriage and family life.
Fortunately, people living in Mississippi have several debt relief options. These include bankruptcy as well as negotiating installment payments and debt consolidation. Homeowners who are concerned about making mortgage payments may also be able to avoid foreclosure through some similar strategies.
Debtors could benefit from speaking with an experienced attorney. The lawyer might be able to review the client’s current financial situation and make suggestions regarding debt relief options like bankruptcy and possible ways of avoiding foreclosure.
According to an article in Health Affairs, medical debt in collections peaks when individuals are in their late 20s. This is because younger people tend to make less money than those in their 50s or 60s. Furthermore, younger people are more likely to not have insurance. Even if a person has insurance, the policy likely comes with a deductible that an individual could have trouble paying. However, there are ways that those dealing with such debt in Mississippi and throughout the country can better manage it.
For instance, it could be possible to negotiate with a care provider to reduce the bill. This may work best for those who can provide detailed income and other financial information to demonstrate their ability to pay. A medical bill advocate may be able to negotiate on a patient’s behalf. In some cases, a substantial portion of the balance could be forgiven when going this route.
If that doesn’t work, a doctor or hospital may allow an individual to make payments each month. In the event that a bill is already in collections, there is a chance that the debt collector will take less than the amount owed to resolve the matter. Individuals who are searching for a way to pay down a medical debt could try to crowdfund the money or ask family members for a loan.
Those who are struggling to pay off a medical debt might benefit by filing for either liquidation or reorganization bankruptcy. Doing so may make it possible to put an end to creditor phone calls or other debt collection activities. This might mean keeping a home, car or other property that is secured with collateral. It may also mean that a creditor lawsuit could be postponed until the bankruptcy case has been resolved.
Some women who are living in Mississippi may struggle more than men to pay off credit card debt. A study found that more than one-quarter of women around the country said they were not confident they would be able to pay all their bills in a month compared to 14 percent of men. Furthermore, just under one-third of women who had credit cards said they had paid the balance in full one time or less in the past six months compared to 20 percent of men.
There are a number of reasons for this. A major problem is that their median wages are 80 percent of what men make, so it takes them longer to get out of debt. Single mothers in particular struggle because they often do not make enough to make ends meet and must rely on credit. This is the case even in a time when the economy is strong and unemployment is low. Many women may also be less informed about finances than men. Women’s magazines do not tend to write about financial literacy as much as magazines aimed at men, and women’s clothing stores may encourage using credit to get discounts.
However, credit card debt is on the rise for everyone. WalletHub reports it has reached its second-highest point since the 2008 financial crisis ended.
People who are struggling with credit card debt might want to discuss debt relief options, including bankruptcy, with an attorney. Credit card debt can be discharged in a bankruptcy, but other types of debt such as student loans and child support generally cannot be. It might be possible to create a budget that helps pay off debt, or a person may be able to get a loan or consolidate the debt.
Far too many people in Mississippi struggle with credit card debt on an ongoing basis. When it is difficult to make ends meet, many people turn to credit cards to cover the gaps. Of course, it can then be even harder to keep up with existing expenses while trying to pay back the credit card bills. Credit card companies also urge customers to take on more debt. However, by keeping some tips in mind, people can help to resist these advances.
Across the country, consumer revolving debt, including credit card debt, stands at $1.037 trillion. Many credit card companies’ tactics inspire people to increase their debt burden, but that can come with a significant cost to consumers. Credit card rewards programs bill themselves as ways to benefit consumers for using the card. Sometimes, they can be a good choice, so long as people have the money to pay off the bill at the end of the month. But some programs can help people rack up debt; for example, one program allows people to buy a plane ticket now, but obtain the miles to cover it later through card purchases. If a customer doesn’t rack up miles, however, he or she will have to pay to buy the miles on credit.
In other cases, people may get in trouble due to late payments. After someone is more than 60 days late on a payment, a credit card issuer can apply a penalty rate to that person’s entire balance. This means that an APR can skyrocket to 29.99 percent across the board, making the debt even more difficult to surmount.
Consumers are often looking for debt relief, especially when their financial situation becomes unsustainable. A bankruptcy lawyer might be able to help people to review their options to move forward toward a new financial future, including personal bankruptcy or other negotiated alternatives.
