Swiping It Is Not Like Really Paying For It?

Have you gotten into credit card trouble?

Aren't credit cards great? It really seems like you are getting stuff for free! Paying a bill down the road doesn't feel the same as paying it on the spot, especially if your card allows you to carry a balance! You can always save a little more or work a little more and get to that balance next month, or the next month, or the next. All of a sudden it's a year later and your card is at its limit, but here is another card that is offering 0% interest on balance transfers, well gee that sounds good! It would be good, if only now you didn't have the old card sitting around with a zero balance and that new LED television staring you in the face! This is the problem facing the world these days as people found themselves deep in the whole without even realizing what it is they have been charging.

The growing debt crisis isn't only limited to individual people and can affect entire countries as well. The problems in Europe have been well documented from the growing debt facing the English Premier League and the teams who play in it to the debt issues in Greece. Do the current problems in Greece really differ from an average family in America? If a country, company or individual spends more than they make they will be in debt.

In some cases for individuals, they may not even know who their creditors are any more because companies can buy debt leads from one another. When things reach this point what can people do? The best option, if you are able, is to work with your creditors directly but this not always possible, so two of the other paths are bankruptcy or debt consolidation. Bankruptcy should only be considered as an absolute last point of desperation and you can see no other way out, otherwise because of the long lasting affect on your credit it should be avoided.

Debt Consolidation is a more viable option for many people because it allows you to still pay off your debts but with one lower monthly fee. It will get the creditors off of your back and make you feel much better about your situation, but is it as good as it sounds? In short no, it's not as perfect of an option as it sounds, but that doesn't mean it may not be the best option for you.

Essentially what happens is you just receive a loan to cover the amount of your debt and then you pay off the loan with one monthly payment. Sounds similar to the transfer your balance technique you may have tried earlier, which you might remember did not necessarily work out so well. Now while certainly not as bad as bankruptcy or simply never playing your debts, consolidation can have some negative effects on your credit. From a credit standpoint, it will look the same as opening a large line of credit, which can appear negative.

Before deciding if debt consolidation is for you, you need to examine, and probably change, your current spending habits. Taking a consolidation loan and then returning to the behavior that got you here in the first place, will only make things much, much worse down the road. A good idea before considering taking one of these loans is to visit a credit counselor who can help balance your budget and identify ways to cut spending.

Debt consolidation can be a great option to get back on your feet and your way to financial stability, if you allow it to be. Remember you must be willing to accept you can not buy like you used to buy, even though it may feel like you can.

Patrick Kelly is an expert writer on phone systems based in San Diego, California. He writes extensively for an online resource that provides expert advice on purchasing and outsourcing decisions for small business owners and entrepreneurs such as VoIP service at Resource Nation.