It doesn't matter if you're currently facing a large amount of credit card debt or see yourself moving in this direction, it's imperative to understand why this is happening and what you can do to help yourself.
Here are some of the most common causes of credit card debt, all of which you want to avoid at all costs:
- Poor money management: If you don't know how to manage your money, you could soon find yourself facing more credit card debt than you know what to do with.
- Minimum payment trap: It's nice to know that you only have to make a small minimum payment, even if you have a large credit card balance. Unfortunately, this approach leads to hefty interest charges and debt that can drag on for many years to come.
- Unemployment: With a steady income, you may not have any trouble paying your credit card bill in full. However, if you're out of work, you may realize that your credit card debt is continuing to grow.
- Divorce: Not only can divorce lead to credit card debt, but it can also cause complications in regards to many other areas of your finances.
These are not the only causes of credit card debt, but they are among the most common. It's important to keep an eye out for these, as they can often come about when you least expect it.
If you find that your credit card debt is too much for you to handle, it may be time to consider filing for Chapter 7 or Chapter 13 bankruptcy.
Source: Pacific Debt, "Top 5 Causes of Debt & How To Fix Them," accessed May 14, 2018