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Tips for reducing credit card debt

Kentucky residents may be surprised to learn that the average American household pays $1,300 a year in credit card interest. Furthermore, 38 percent of American households carry debt on a monthly basis. These households are known as revolvers by the financial industry because their debt turns over each month. However, there are some steps that may make it possible to reduce or eliminate credit card debt.

It may be worthwhile for individuals to take stock of what they may be able to sell or downsize. For instance, it may be possible to sell old clothes or other belongings at a garage sale or online. It may also be possible to trade in or sell an expensive car or truck in favor of a less expensive one. The money raised or saved each month could go toward paying off that debt.

Transferring a credit card balance or taking out a personal loan may consolidate debt at a lower interest rate. Online lenders may offer lower rates to those who use the loan to make direct payments to credit card companies. Other options to help pay off credit card debt faster include asking for a raise at work or using a holiday bonus to pay off the debt or make an extra payment that month.

Those who are struggling to pay down credit card debt may benefit from filing for bankruptcy. Doing so may put a temporary halt to collection calls or potential lawsuits to collect past-due balances. Bankruptcy may also make it easier to have debts discharged quickly or reorganized to make them easier to pay. An attorney may be able to explain to a debtor the benefits of filing and what type of bankruptcy that person may qualify for.

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