Most debt problems begin innocently enough – you see something you want to purchase, and although you don't really need the item immediately, you don't want to delay the purchase until you have the cash to pay for it. A store credit card seems like a convenient way to get something now that you had already planned to buy later. If you are adept at managing your finances, a few extravagant purchases now and then are probably harmless.



Problems begin when people begin to use credit cards or other kinds of credit impulsively, and the balances on one or more accounts grow beyond their ability to repay the debt quickly. Debt, especially credit card debt, can accumulate rapidly, and many people soon find themselves barely able to make the minimum monthly payments.

Whether you are already overwhelmed with credit card debt, or simply want to prevent debt problems before they start, there are steps you can take to keep the compulsion to overuse credit cards in check, prevent minor credit card debt from spiraling out of control, get out from under excessive debt, and repair your credit.

One strategy that can work to keep you from overusing your credit cards is to put them in a place where they are not easily accessible. If you have to go through some trouble to get to the cards, you will have time to reconsider the purchase you want to make. Before you begin cutting up your credit cards, remember that if your credit is already damaged you may have a difficult time getting approved for a new credit card. You may need the card at some point to deal with an emergency.

When it comes to the business of reducing your credit card debt, you have a number of options. If you are behind on some of your accounts, contact the creditors and explain your situation, expressing a willingness to make good on the debt. They will often be accommodating and allow you to restructure your payments, or assist you in getting caught up. It is much less trouble to work with you than it is to turn the account over to collections.

Repaying your credit card debt will take less time if you have a solid plan. A proven method of reducing debt quickly is called debt-stacking. Also known as accelerated debt payoff, debt-stacking works as follows: First, determine the interest rates that you are paying on each of your credit card accounts, or for that matter any other debts you wish to pay off. Decide how much you can afford to put aside for debt repayment each month, and pay only the minimum monthly payment on all the debts, except the one with the highest rate of interest. Then, apply whatever money you have left over toward the account with the highest interest rate. When the highest interest rate account is paid down, repeat the process concentrating on the next most expensive debt. This method of debt repayment will shave many months off of the total time it takes to pay off your debt.

A surprising number of people have inaccurate items on their credit reports. You should review your credit history report from all three of the major credit reporting agencies, as there is probably some unique information on each report. Take note of any entries that look suspicious, and if you conclude that they reflect inaccurate information you have the right to make corrections and have the items removed.

As you continue to practice responsible use of credit cards, your credit score will gradually improve. Bad credit can have a snowball effect, growing out of control before your eyes. Likewise, good credit practices over time will create momentum in increasing your credit score. As your finances improve, continue to increase the amount of money you apply toward savings so that when financial surprises occur, you will be able to deal with them without having to resort to using credit cards.