Here''s how to tell when you''re too deep in credit card debt: if 15% or more of your monthly income goes to pay your credit card bills, you''ve triggered one of the many warning signs that your credit card debt is out of control. There are other triggers, too: paying the monthly payments on one credit card by taking out a cash advance on another credit card.
If this scenario describes your financial habits, you''re not alone: some 39% of credit card holders pay only the minimum payment, practically guaranteeing a lifetime of debt if they don''t change their credit card habits. So what''s the solution?
The solution is to get your spending under control. Easier said than done, right? But most people waste an enormous amount of money on recurring expenses that could easily be made more affordable. One of the more obvious areas is groceries: people use grocery story coupons to buy brand-name breakfast cereals and other items, thinking they''re saving money. In fact, anyone using coupons is actually wasting money, since coupons are only printed for items that carry an outrageous markup to begin with. Buying brand-name processed foods is a sure way to eat yourself into further debt. Your health will suffer, too, since processed foods offer very poor nutrition.
Another big money waster in the food category is soft drinks. They''re not only terrible for your health (their main ingredient, high fructose corn syrup, has been linked to diabetes and obesity), but they also gobble up your budget. Drinking straight water (filtered, please) can save you as much as $50 / month.
If you''re too deep in credit card debt, take a look at your food purchasing habits, and be sure to review your restaurant and fast food expenditures, too, since that''s a huge expense for many people. By altering food choices alone, most people can dramatically reduce their level of credit card debt and improve their level of health at the same time.
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Or you''re waking up at night worrying about the bills. Or you''re taking cash advances on one credit card to pay the minimum due on another. All are signs of getting too far into debt, credit counseling experts say. These "debt triggers" should be the cues for consumers to take stock of where they are financially so they can get spending in check and begin dealing with debt. A recent survey by the Cambridge Credit Counseling Service found that more than one-third of consumers pay their credit card bills in full each month. All contents Copyright 2004 The Denver Post or other copyright holders.