High interest rates could lead to extensive credit card debt

Credit card companies may offer a variety of incentives and rewards programs to potential customers. Individuals in Tennessee could use these accounts for financial assistance and to help build their credit score. However, it is generally advisable to proceed with caution when carrying a balance, as high interest rates and extensive late fees and penalties could lead to substantial amounts of credit card debt.

According to recent studies, the average interest rate on credit card accounts comes in at just under 17 percent. While a person may be able to avoid interest by paying off the balance in full by each due date, those who are only able to make the minimum payments may start to see their balances continue to rise. Although these added fees should be a major concern, studies also indicate that a significant portion of cardholders are unaware of how high their interest rates are.

Studies suggest that if a person makes only the required payments on a balance of just over $6,000, it could take more than 20 years to pay off the account. With interest fees, one also could wind up paying more than twice the original amount owed. Once credit card balances grow out of control, the financial strain of debt could have a devastating impact on various areas of a person’s life.

When high amounts of credit card debt pose a threat to a person’s financial future, he or she may find it beneficial to seek guidance on how to reduce or eliminate debts. A bankruptcy attorney can help a person in Tennessee gain a better understanding of each of the available options for relief. An attorney can provide a client with advice in forming a strategy with which to pursue debt relief and subsequently assist him or her in navigating the process.

Source: www.freep.com, “Got any idea how much credit card debt is costing you? Most don’t“, Susan Tompor, May 14, 2018