Consumer Report: Tips for Addressing Credit Card Debt

I started to feel the weight of credit card debt when I began using my card for everyday expenses. For Jennifer Paes, mounting costs paired with dwindling cash flow meant that she had to rely on credit cards for even the most basic items. That was a clear warning sign, I think. She’s not alone, though. Americans have accrued a staggering $1.21 trillion in credit card debt. On average, households carry around $6,000 in credit card balances, with many cards charging interest rates exceeding 20%. This makes it tough to chip away at that debt.

So, if you’re facing challenges with credit card repayment, what can you do? According to consumer expert Lisa Gill, it might be wise to pause on using your card and find ways to cut monthly expenses. If you can, direct any extra funds toward paying off the card with the highest interest rate first. This strategy can save you more money over time since you’re tackling the costliest debt first. If your credit score is decent, you might think about transferring your high-interest balance to a card that offers 0% interest for a set period—just be sure to pay it back before that time is up, or you could revert to those high rates.

It’s also a good idea to adjust your payment date to coincide with your payday if that’s an option. Some credit cards allow you to set up automatic payments by choosing your due date, which helps ensure you pay at least the minimum on time and avoid late fees. But if your debt becomes overwhelming, don’t hesitate to reach out to your credit card company. Sometimes, they can offer lower interest rates or reduced minimum payments if you explain your situation. It’s worth a shot.

You might want to connect with a nonprofit credit counseling agency for additional support. They can often help you lower your rates and consolidate your debts into one manageable monthly payment. That’s what Jennifer did—she reached out to Money Management International, a nonprofit, which proved to be a lifeline for her in managing her debt.

Another handy tip is to take a few minutes each week to review your finances. Just track what’s coming in, what’s going out, and how you’re doing overall. It really makes a difference.

For numerous families, credit card debt is an ongoing source of anxiety. It’s easy to feel hopeless as the bills pile up, but there is potential for debt settlement. Consumer reports describe how it functions, the benefits it offers families, and what you should know before signing any agreements. However, exercise caution—many individuals seeking to escape debt encounter fraud. Be wary of companies that appear out of nowhere, pressuring you to make swift decisions or demanding upfront payments. A legitimate debt relief agency won’t operate that way.

Legally, if a company is offering debt services over the phone, they cannot charge you in advance before negotiating your debt or settling it. Legitimate agencies will transparently discuss fees and won’t push you into making hasty choices. If you’re looking for trustworthy services, check out the National Foundation for Credit Counseling—it’s a solid resource for finding accredited services nationwide.

If you proceed with a debt management plan, it typically consolidates payments into one monthly bill with significantly lower interest rates and usually a clear repayment timeline of 3 to 5 years. Interestingly, Money Management International calculates that those with an average credit card debt of around $23,000 could save over $48,000 in interest through a management plan and get rid of debts more quickly.

However, be advised that your credit score might dip initially when you start a debt management plan, primarily because you may have to close some or all of your credit cards. But, with consistent payments, your score is likely to improve over time.