There are a variety of reasons that people will start using credit cards, from trying to establish a credit history, earning cash back or rewards on spending habits and even to pay for unexpected emergencies. If a plan is made to ensure that the charges can be paid off monthly, the use of a credit card can be beneficial, but unfortunately, quite a few credit card holders may find themselves unable to make the minimum monthly payments. Michigan residents who find themselves with overwhelming credit card debt may have some resources available to them to help overcome their growing debt.
Credit card debt doesn’t discriminate between a low- or high-income earner. Reasons for using a credit card, regardless of income status, can be the same across the board. While, for some, it is just the lack of financial planning and overspending on wants versus needs that can lead to their financial woes, for others, the feeling of needing to use a credit card to pay off other debt obligations — from basic expenses to unexpected medical expenses — can lead to extreme amounts of debt.
A recent story of a woman in another jurisdiction, a pharmacist with a good income but a lot of debt in student loans, can sound like a similar tale for many people with debt. The initial use of a credit card was scary, and the desire to not fall into the minimum payment plan was top priority, but a car accident changed everything. Years after the accident, the woman, still suffering from back pain, was in need of surgery to fix the issues behind it, but her insurance only paid so much of the expenses. She then obtained a credit card to pay for her growing medical costs but also found herself using it for everyday expenses as well as extras. She was soon drowning in debt.
For some, the ability to create a financial plan on their own to pay down debt may be an option, but others may need more help. Filing for bankruptcy can possibly discharge some of a person’s debt and help keep creditors at bay while creating a payment plan that is affordable for them. Michigan residents with overwhelming credit card debt may have legal options available to help them get their finances back on track.
Source: The Huffington Post, I Make 6 Figures, But I’m in Financial Trouble, No author, Dec. 18, 2013