Credit Card and Debt Questions and Answers

As the saying goes “It’s too late to shut the barn door after the horse has run out.”   Do you have credit card debt that you feel has gotten out of control?

This is an all-too-obvious question when you have creditors already calling you and threatening lawsuits.   But… What if you are not at that point and feeling only a little pinch??

Using credit and debt can be a powerful tool that allows you to buy a home, a car, finance your business operation, and even provide leverage for other purchases, but when you accumulate too much debt, it can be a major problem.

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What no one seems to be discussing is “How do you know when you are starting to get into trouble with your credit cards and debt commitments?”
If you are starting to feel pressure on covering your debts, Then it  is the time to talk to your financial planner, a debt negotiator, accountant or just have a plain old family meeting and talk through how your debt can be reduced and cutbacks made.

I know this from my own personal experience.  Several years ago I had a business that provided services to the aerospace industry.  We had gotten two major contracts and everything was going great.  Then in early 1992, there began payment delays and the California economy was also starting to take a beating.

One day my accountant pulled me aside and asked a few very good questions.  He noticed that I was borrowing against a line of credit for payroll and our client was already 60-90 days behind in payments.  This client was a huge, gi-normous company that should never be this far behind.

He suggested that I make sure the client paid our company in a more timely manner or totally stop services.  The awkward part was to call up the large company and demand payment.  At that time, they made up 40% of our revenue, and they always paid but their late payments were costing our company a lot in credit.  I did make the call and I am glad that I did because
we were able to negotiate a more timely payment.

The timing of this was great -  Ask  anyone who was in the aerospace industry in California in 1992.  By the end of the year many projects were cancelled or put on hold and we were deep in a recession by the end of that year.  Timely advice helped us to transition and continue operations.

During that time, here are some things that I learned.  There are always warning sign.  Here are some early warning signs that may help.

- Always be aware of how much debt you have, if you don’t know – find out.
- If you are using credit to pay for credit (i.e. using credit cards to pay loan installments, etc.) then you have a problem in the beginning stages.
- If you are lying to friends and relatives about your spending then you need to get honest, if only with yourself
- If you are not saving any money then you need to make a saving plan and adjust your spending accordingly.

Sometimes it is difficult to realize there is a problem, but taking steps early is far better than later.

If you want to talk to someone who could offer some advice,  then fill out the form on the top right of this website and we will make sure you are contacted on a confidential basis.

If you would like a free financial/debt evaluation, go to http://www.freeattorneyconsultation.info or call us directly at 866-868-2160.