As jobs have become more scarce and incomes have shrunk, there has been a massive movement to eliminate credit card debt.
As people try to lower the balances, they are quickly realizing that it's not a particularly easy thing to accomplish.
The main reason this is true is simply that the credit card companies make it nearly impossible to do.
Of course, there are a couple of methods that have proven to work, but much of the conventional wisdom sounds good but doesn't really work when it comes down to it.
Lets walk through a couple of the methods to eliminate credit card debt that people talk about, but in reality have little, if any, chance to work.
1) Put the Your Cards in the Freezer - Believe me, you will be thawing them out to use them again before they are even frozen solid.
The fact is, people are taking on debt just to eat, pay rent, or cover the utilities.
I'm not talking about luxurious living, I am talking about necessities.
Yes, people should have stopped using their credit cards before the economy turned, but this is no longer an option for many to eliminate credit card debt.
2) Create a Budget - Oh, this one's my favorite non-solution! In reality, people have more debt than they know what to do with and since they are making even less money than previously, it is harder and harder to keep up with payments.
Less money is coming in and the debt is mounting up.
With a budget, you are going to have to cut twice just to get back to where you were.
The fact is, these people have already cut out the fat.
It's now a question of which necessity is more important than the next.
3) Negotiate with the Credit Card Companies - Let me know how that one goes! Simply put, these guys make their living by keeping you in debt.
They don't have a heart and aren't going to give you time to get into a favorable position before you make your next payment.
That's just bad business for them.
Not only will they not help you, they will get downright nasty to make you pay.
So much for conventional wisdom.
It should be pretty apparent that many of the different ways that people point to when talking about ways to eliminate credit card debt are more fantasy than reality.
If you want to get serious about getting out of debt, you need something that really works.
Take your medicine and get on with your life.
One strategy that does work to eliminate the debt is to let third party credit negotiators work with your creditors.
Why does that work, you are probably thinking? Many of these third party negotiators are non-profit, 501(c)3 organizations.
When they go to negotiate with the credit card companies for you, the concessions that the credit card companies make become tax write-offs for them.
They don't get this benefit when they negotiate directly with you.
Therefore, they are much more likely to tell you to take a hike because with you, they just lose money.
Plain and simple, there is nothing in it for them, but when they are approached by the non-profit, there is more to make them interested in helping you.
One possible outcome is that the company will reduce the interest rate on your balance, which lead to smaller payments or a quicker reduction in principle that you owe them.
In the best cases, the interest rate may even be dropped to 0%.
Yep, a goose egg.
Your new monthly payment will make it much more likely that they will get their money back, so it becomes a win-win situation.
It use to be that if you wished to eliminate credit card debt, you had to fight the credit card companies on your own.
With the financial crisis in full effect, many more companies are coming to the table to help consumers stay solvent.
One of the smartest things that you can do as a consumer is to find assistance when you get in over your head.
This will position you to be in good shape when things improve.
One of these 501(c)3 organizations is the perfect place to eliminate credit card debt and get ready for better days.
As people try to lower the balances, they are quickly realizing that it's not a particularly easy thing to accomplish.
The main reason this is true is simply that the credit card companies make it nearly impossible to do.
Of course, there are a couple of methods that have proven to work, but much of the conventional wisdom sounds good but doesn't really work when it comes down to it.
Lets walk through a couple of the methods to eliminate credit card debt that people talk about, but in reality have little, if any, chance to work.
1) Put the Your Cards in the Freezer - Believe me, you will be thawing them out to use them again before they are even frozen solid.
The fact is, people are taking on debt just to eat, pay rent, or cover the utilities.
I'm not talking about luxurious living, I am talking about necessities.
Yes, people should have stopped using their credit cards before the economy turned, but this is no longer an option for many to eliminate credit card debt.
2) Create a Budget - Oh, this one's my favorite non-solution! In reality, people have more debt than they know what to do with and since they are making even less money than previously, it is harder and harder to keep up with payments.
Less money is coming in and the debt is mounting up.
With a budget, you are going to have to cut twice just to get back to where you were.
The fact is, these people have already cut out the fat.
It's now a question of which necessity is more important than the next.
3) Negotiate with the Credit Card Companies - Let me know how that one goes! Simply put, these guys make their living by keeping you in debt.
They don't have a heart and aren't going to give you time to get into a favorable position before you make your next payment.
That's just bad business for them.
Not only will they not help you, they will get downright nasty to make you pay.
So much for conventional wisdom.
It should be pretty apparent that many of the different ways that people point to when talking about ways to eliminate credit card debt are more fantasy than reality.
If you want to get serious about getting out of debt, you need something that really works.
Take your medicine and get on with your life.
One strategy that does work to eliminate the debt is to let third party credit negotiators work with your creditors.
Why does that work, you are probably thinking? Many of these third party negotiators are non-profit, 501(c)3 organizations.
When they go to negotiate with the credit card companies for you, the concessions that the credit card companies make become tax write-offs for them.
They don't get this benefit when they negotiate directly with you.
Therefore, they are much more likely to tell you to take a hike because with you, they just lose money.
Plain and simple, there is nothing in it for them, but when they are approached by the non-profit, there is more to make them interested in helping you.
One possible outcome is that the company will reduce the interest rate on your balance, which lead to smaller payments or a quicker reduction in principle that you owe them.
In the best cases, the interest rate may even be dropped to 0%.
Yep, a goose egg.
Your new monthly payment will make it much more likely that they will get their money back, so it becomes a win-win situation.
It use to be that if you wished to eliminate credit card debt, you had to fight the credit card companies on your own.
With the financial crisis in full effect, many more companies are coming to the table to help consumers stay solvent.
One of the smartest things that you can do as a consumer is to find assistance when you get in over your head.
This will position you to be in good shape when things improve.
One of these 501(c)3 organizations is the perfect place to eliminate credit card debt and get ready for better days.
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