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Helping good people through bad times

Credit cards and interest rates

The economy has been rough for many Tennessee residents over the past decade. Many people have had to rely on their savings accounts and credit cards to make it by. For some, this has just been a temporary problem, but for others it is become a deep cycle of debt. It gets to a point where people have to rely on credit cards in order to meet their monthly expenses.

This is not an unusual problem within the United States. In fact some data shows that the average United States family carries more than $7,000 in credit card debt.

Credit card companies are the real winners here. They charge large amount of interest on the money that is owed. Data shows that the average interest rate in the United States is somewhere between 17 and 20 percent. This interest rate is the fee that the credit card holder is charged for the privilege of being able to borrow the money.

With such high interest rates, those making the minimum payments on the credit card rarely start to pay off the actual principal. Instead, much of their payment is going each month just to pay the interest. This not only keeps people in debt, but it keeps people from being able to have money they need to invest in other projects or the ability to save some money.

Experts suggest that people try to pay more than the minimum payment each month if possible to pay down the debt. Ideally, people should pay off their entire credit card balance each month to avoid costly interest. By paying as much as possible on the balance, people save money on interest payments over time.

Sometimes a person's financial situation does not allow them to pay any extra on the credit cards. People in this situation are often in need of serious debt relief. There are debt relief options that can help with credit card debt. In some cases, filing for bankruptcy can help give people the financial fresh start that they need.

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Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-624-4002
Toll Free: 800-257-7594
Fax: 423-624-0509
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