Warning: Seven signs of too much debt.
Just because you aren’t late on payments doesn’t mean you have things under control, this sense of security can break apart like thin ice before you realize where you are. I want to have you stop and take a moment to think about your finances and where you are standing now.
Warning (slippery slope ahead):
1. You don’t have any savings.
2. You make minimum payments on your credit cards.
3. You use credit cards for things you used to buy with cash, such as groceries.
4. You use increasing amounts of your total income to pay off debts.
5. You have more than two or three major credit cards.
6. After you pay your credit card bill, you increase your balance
7. You’re at or near your credit limit on your credit cards.
End of the Road (turn back now):
1. You count on the float in order to pay your bills, writing a check hoping that you’ll be able to cover it by the time it clears your bank.
2. You’re unsure of the total amount you owe on all your debts.
3. You take out cash advances on your credit card to pay other bills.
4. You’ve tried to make a purchase with your credit card and been declined.
5. You’ve been denied credit.
6. You bounce checks.
7. You get calls from collectors.
8. You lie to your spouse or other family member about your spending or hide credit card statements from family members.
If you are in the first ‘˜warning sign’ of danger you have more control at this point and can make changes now in your habits that won’t affect you long term. If you are in the second ‘˜warning sign’ of danger, it would be a good idea to cut the cards up, get help and turn things around
Some Resources:
CreditinforCenter.com
Credit repair and the scams
Consumer Credit Counseling Service
The full Credit Repair series
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Dawn C. is site owner of Frugalforlife.com where this is a repost from: Skating on the Thin Ice of Debt. Dawn is residing in Colorado with her spouse, Teri, of 11 years.
Dawn: Those are a great list of telltale signs. Just making the minimum payment on a credit card is definitely indicative of a slippery slope. Here’s a good article on how to break the minimum payment habit on credit cards.
A great list however one of the items on the slippery slope list “You use credit cards for things you used to buy with cash, such as groceries” is only a slippery slope sign if combined with #2.
I started using CCs to pay for everything possible once I realized that with the cash back rewards cards out there I can actually get some money back as long as I pay off the bill in full each month thus not incurring any interest that would wipe out any rewards.
As it stands right now, I’d even charge $1 on my CC!