The Dangers of Excessive Credit Card Debt

One of the largest risks to the average American household is excessive credit card debt. Recent legislation aimed at protecting consumers from credit lenders is testament to the growing credit card debt crisis in this country. The average credit card statistics in this country are overwhelming, with the majority of households in over their head.

One of the reasons that credit card debt has become so excessive is the ease with which people can rack up credit card debt. Unlike other bad habits that may require a trip to a casino or bar, it is exceedingly easy to pay for things online or swipe your credit card at a store without ever seeing the actual money leaving your hand. Just like chips at a casino, credit cards are a way for institutions to take your money without you feeling like you are losing money because you never see the cash.

The excessive nature of credit card debt becomes compounded by the late fees and interest paid on outstanding (month over month) debt. This increases the total amount of money owed, leading to even greater amounts of money owed in interest, which are added to the total. This cycle of compounding continues until the debtor is in extreme credit card debt.

Many people struggle to get rid of credit card debt, especially excessive credit card debt, because they lack the fundamental understanding of how credit cards work. Although paying the minimum payments will eventually get you out of debt (provided you are not adding to that debt through new purchases), it usually will take decades to do so.

There are a number of options out there for those with excessive amount of credit card debt and for some, consulting a credit card attorney may be a worthwhile proposition. With or without an attorney though, options for reducing debt include personal debt consolidation and negotiating credit card debt. Additionally, as discussed frequently in our other posts, adjusting your personal spending habits is eliminating excessive credit card debt in the long run.