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I Can See Russia and Lots of Credit Card Debt

By Randall Ryder

Alaska, where you can allegedly see Russia from, has more consumer credit card debt per person than any other state in the nation, according to a new study.

On average, every American citizen has $5,165 in debt. Alaska is well above that number—the average Alaskan owes $7,135.

Heavy burden

On average, each American household has $18,642.81 in outstanding consumer debt. Assume you could pay that off with no interest and make $300 payments every month. It would still take over five years to get rid of your debt. Add interest onto that, and you are looking at even longer.

Before you decide to sign up for that extra credit card, think twice.

No easy solution

Coming up with a few extra hundred dollars a month is no easy task for most households. That might be the grocery budget for a household. Making only minimum payments, however, is the slow road to nowhere.

Many consumer have tried using debt settlement companies, only to discover that they are no better position than they were before. Many of those companies charge a monthly fee for their services and end up doing little or nothing to actually help the consumer.

Looking for a place to start? Stop using your credit cards. Cut them up. Many consumers spend now thinking that things will be better later. The harsh reality, however, is that things are not guaranteed to improve down the road.

In other words, learn to live within your means now. Once you get a handle on that, you will be in much better position to figure out how to tackle your debt. The majority of people who have succeeded in eliminating their debt started with this very principle.

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Full post as published by Caveat Emptor on December 07, 2010 (boomark / email).