Jim, I am $27,000 In Credit Card Debt. I Don't Know What To Do Or How To Come Up With A Plan To Deal With This, Please Help.

I will tell you that $27,000 is quite a lot of credit card debt, but I have seen much worse. One man called on my radio show a few years back and had $110,000 in credit card debt.

First things first, how did you end up with $27,000 in credit card debt?  I would want to figure that out first.  Otherwise, you will end up in the same situation again in the future.  I would suggest that you make a resolution to discontinue all credit card use for now (and maybe forever).  In the future, you may want to carry 2 or 3 cards for the purpose of maintaining a good credit score, I would consider that only after you have paid off this balance (and I would keep 0 balances on them).

$27,000 is a lot of money, but you can pay this back and it will not take three lifetimes.  If you pay $686 per month for five years (at 18%) you will pay off the entire balance.  This comes out to $158 per week.  If you have to take a part time job to earn $158 per week, that is what will be required.

Another option is to negotiate with your credit card companies for a lower interest rate.  If you were able to get your rates down to an average of 12%, that would save you about $80 per month on the five year plan that I have outlined.

If you think about it, the amount you will need to pay monthly is about that of many people’s car payments.  Don’t sweat it, you can do this.

Agree or disagree, click on comments below.

My main website is www.ChristianMoney.com

James L. Paris

Comments

[Debt management]

So there must be other explanations for why the company that is perhaps the greatest enabler of American (and, increasingly, global) consumption, born in 1958 as BankAmericard and rechristened Visa in 1976, has chosen now of all times to go public. One is that Visa makes its money (a 424 million profit in the last quarter of 2007, up 70% from a year earlier) from transaction fees, not lending, so it doesn't have to worry nearly as much as banks do about people making their credit- card payments. Another is...