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How to Consolidate Your Credit Card Debt
If
your credit card debt exceeds what seems to be a reasonable
level, you may want to consider credit card debt consolidation.
So what is credit card debt consolidation?
Credit cards have revolutionized the purchasing experience
since Diners Club released the first credit card in
the year 1950.
The
Dinners Club credit card gave consumers limited credit
that, at times, even surpassed the personal savings
of some participants. It allowed them to buy items they
usually could not afford if they were to make a straight
cash purchase. It also provided the convenience and
safety of not having to carry large amounts of cash.
On
average, American households possess 4 credit cards
or a total of 13 payment cards if debit cards and store
cards are included. There are, actually, 1.3 billion
payment cards of assorted types in circulation in the
United States.
But,
if you think that credit cards have made the lives of
modern American consumers easier, you may be wrong...
Statistics
show that the average credit card debt for each household
in the U.S. is $4,800 per month. Also, there were 1.3
million credit card holders declaring bankruptcy in
the year 2003.
And
if you still consider yourself unaffected by credit
card debt, then consider this: upon retirement, most
Americans can only expect to receive about 37% percent
of their annual retirement income because of prior debt
payment. This will leave many individuals depending
on the government, family and charity for economic survival.
These
are some scary facts. So before you find yourself in
a position of economic uncertainty, it might be wise
to evaluate your spending and current credit card debt.
In
a nutshell, credit card debt consolidation is taking
all your credit card payments and consolidating them
into one monthly payment. This way, you don’t have
to worry about managing the payments individually. Aside
from this advantage, it may also provide you with the
following additional benefits:
-
Reduce interest payments
- Waive late and overtime fees
- Reduced monthly payments
- Debt relief in a shorter time
- Credit improvement
- Save more money in the long run
There
are actually two major types of credit card debt consolidation...
You
may want to consider a Credit Card Counseling firm.
They assist consumers by consolidating all their monthly
payments into one single payment and then dispersing
this to the creditors on behalf of the consumers.
The
other type is through a home equity loan or other secured
loan. This is done by exchanging an unsecured debt (such
as
credit card debt) for a secured debt (a debt backed
by specific assets such as real estate).
Now,
credit card debt consolidation isn’t a magic balm
that will drive all your credit card debt malaise away.
But, it will make paying all your debt easier and might
save you money in the long run. Definitely an alternative
worth considering...
1howto.com
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