6 Steps to Begin Digging Out of Credit Card Debt

Imagine this hypothetical tale of financial folly: A woman gets to the checkout at the grocery store and realizes her checking account doesn't have enough money to cover that month's bill. She then pulls out her charge card and tells herself she'll pay it off next month.

But not only is she unable to pay off the groceries, an unexpected medical issue leads her to charge another month's groceries, plus the emergency room fee not covered by her insurance.

With higher rent payments and utility costs climbing, her "standard of living" raise does not cover costs of living. The credit card finance charges begin to mount.

The next month, she scrapes together her payment - but it's late, and her credit card company raises her interest rates to the delinquent limit of more than 25 percent annually.

Her minimum payment goes up again, and after a car repair, she's accumulated a balance of several thousand dollars - and can't pay more than the minimum payment.

Like many American consumers, our heroine is in debt over her head. Worst of all, it piled up without her making a conscious decision about it. She feels helpless and trapped.

Read more at: 6 Steps to Begin Digging Out of Credit Card Debt