How to Measure Your Debt Load – Healthy vs. Unhealthy

Credit-card debt doesn’t have to be bad  – but it must be managed properly. Using credit cards is one of the primary ways Americans establish a healthy credit score.  Credit cards also act as great emergency fund resources when a big unexpected cost comes up – but using credit cards must be done with caution and restraint.   Below I have listed a simple and short list of how to tell whether you are approaching a critical level of unhealthy debt.

Symptoms that your credit card debt load is unhealthy & critical:

1. You’re unable to make the minimum payments on your credit cards
2. You borrow from one card to pay another
3. You’re frequently charged late fees for making late payments or going over your credit limit
4. You use plastic out of necessity rather than convenience
5. You cannot put money towards your savings and retirement plans because you have to make payments on credit cards
6. You devote more than 20% of your take-home pay to making payments on credit cards and loans other than your mortgage.

If you find yourself in any of these money mismanagement situations, don’t fear – there is a way to recover!  Finding a cure to your credit card debt may be as simple as working out better terms with your creditors, transferring your balances to a credit card that has a low interest rate or consolidating your debt with a debt management plan.

If you feel like you need outside help from a professional, reaching out to a certified credit counselor can help you get a grip on your debt.  With credit counseling, a credit counselors can craft a debt-management plan that works for YOU. For more information about how to talk with a  certified credit counselor about your debt, visit Consolidated Credit