Consolidating Your Credit Card Debt

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.
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?
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.