Do you have a problem with your credit card debt? Do you know the credit card warning signs that your debt may be out of control or hard for you to handle? I think that if you are truly honest with yourself that you probably know these seven credit card warning signs that you may be in debt trouble. Here are the credit card warning signs to look for…
Seven Credit Card Warning Signs Of Too Much Debt
Paying Off One Credit Card With Another
One of the easiest signs that you most likely have too much credit card debt is that you are using one credit card to pay off the balance of another. Have you ever used those balance transfer checks to payoff another credit card? This may be a good strategy if you have an overarching plan to specifically attack your debt. But, it can also be a warning sign that you may have too much debt and cannot handle the payments. It is a slippery slope that you are tackling by moving debt around from one account to another. And, as the last statement described, it is also simply moving debt around. It is not tackling the underlying problem of your spending habits that are creating the debt.
Using Advance Payments
Another warning sign that you may have too much debt and could possibly have trouble handling your credit card debt load is if you are using the advance payment checks that are often offered with your credit cards. They typically have even larger interest rates than your standard purchases that you make with your credit cards everyday. The best thing that you can do with these advance payment checks from your credit card company are to shred them as soon as you receive them in the mail.
Reaching Your Credit Limit
Another one of the credit card warning signs is that you are reaching your credit limit on one or more of your credit cards. This is similar to shifting the alance of your cards around from one credit card to another. How many of your credit cards are maxed out? This is definitely a warning sign for you that you debt might be out of hand.
You Do Not Have A Budget
Even if you are not maxing out your credit cards, taking cash advances, or shifting balances from one card to another, you may still have the warning signs of a debt problem. Do you have a written monthly family budget that lays out all of your family’s monthly expenditures? This is also another one of the credit card warning signs. If you do not know where your money goes every month even down to the last cent, you have an increased potential to bridge any gap with your credit cards. It is a big danger to not have a budget helping to manage your family’s finances.
You Are Not Sure How Much Your Interest Rate Is
Do you know how much you are spending on interest payments by borrowing money with your credit cards? Do you know your interest rates that you pay? You should know how much you pay in credit card interest. Understanding what your interest rates are for all of your credit cards allow you to know which credit cards to pay off first. While there is much consternation and a lot of discussion about whether to payoff the credit cards with the lowest balance or the ones with the highest interest rates first. Dave Ramsey is a big proponent to payoff those credit cards with the smallest balances regardless of the interest rate and roll its payment into the next one. Others think that you should payoff the credit card balances with the highest interest rates first which will save you the most money over the long-term.
You Are Falling Behind On Your Payments
Are you starting to miss payments on your credit cards and other debts? Missing payments is a definite credit card warning sign that you have bitten off more than you can chew. Significant credit card warning signs that you may have too much debt that you cannot handle is when you are deluged with phone calls from creditors because you are missing your credit card payments.
You Are Ignoring Phone Calls And Mail
If you ignore phone calls and even set your mail aside, then it is a sign of denial. You should be cognizant of what you do with your mail. Do you immediately shred it? Do you throw it in the corner and let it fester alone? These are definitely credit card warning signs that you may have a problem. Also, you may see a dramatic increase in credit card offers in the mail and even harassment from creditors through the mail as you continue to approach your credit limits on your cards. You would think that it would be the exact opposite as you start to max out your credit cards, but it has the unfortunate possibility of backfiring as more credit card offers often pile in.
These are many of the most likely credit card warning signs that you may run across if you are in debt trouble. Are there any credit card warning signs that I missed? Let me know in the comment section below.
Join The Debt Movement
Join ReadyForZero and hundreds of other personal financial bloggers, and thousands of real people have gotten together with the Debt Movement as we pay down a mountain of debt… $10 million in 90 days to be exact! Through scholarships, education, community, and hard work, we are putting a huge dent in the pile of consumer debt in America. Jeff Rose from Good Financial Cents and ReadyForZero create a community that could band together with one common goal: annihilating debt and becoming financially free. The number $10,000,000 is our goal, and the debt movement will give you the tools and resources you need to succeed.
How You Can Join The Debt Movement
Joining in the movement is easy! Join with the community and commit to paying off debt. You can join in by clicking on the “Join us” button on the widget at the bottom of the page. There will be in excess of $15,000 in scholarships awarded to lucky winners.
- Step 3: Track Your Progress - 1) At minimum we will be sending out a survey twice a month to see how your progress is doing. We will expect you to be as honest about your progress as possible. Winners are not solely based on total debt paid off, but also the ability to show poise and determination through financial setbacks. 2) Keep track of all your debt paid off. The easiest way is to use ReadyForZero. Why? It’s free! If you prefer not to, then you’ll be able to let us know how much you’ve paid off with the survey that is emailed you.