Drowning in credit card debt? Bankruptcy could help

On Behalf of | Jun 20, 2022 | Bankruptcy

It is unfortunate, but also true, that credit card debt can quickly add up and make it difficult for people to afford the normal necessities in everyday life. While credit cards can be helpful in emergencies and have some benefits over using cash, they can also come with heavy fees if payments are missed and high interest rates that make you pay more than you originally spent on your purchase.

The average cardholder in the United States has around $5,934 in credit card debt as of the fourth quarter of 2021. People under the age of 35 tend to have less debt, while those 75 and older have the most.

Regardless of where you fall in these age ranges, if you’re dealing with debt now, it’s important to look at your options.

You need to know your options when you’re dealing with credit card debt

There are all kinds of options you can try to use to pay off credit card debt. Some of the most common include:

  • Working another job for a short time to focus on paying off a particular debt
  • Consolidating the debt onto a larger loan with lower payments and a reasonable interest rate
  • Transferring the debt to a zero-interest credit card

These and other options could help you get ahead on payments and get out of debt sooner, so you can start using your income towards the things you need and have a better financial balance in your life.

Bankruptcy can help eliminate unsecured debt

Chapter 7 or Chapter 13 bankruptcy could both be solutions to your problem. Both allow you to eliminate unsecured debt. Chapter 7 bankruptcy helps by discharging debts you cannot pay so long as you meet the requirements, including liquidating some assets (in some cases).

Chapter 13 bankruptcy puts you on a payment plan for three to five years, but once you’ve paid on time for that time, any remaining qualified debts are discharged.

In both cases, you can walk away from the bankruptcy you decide on with a fresh financial outlook and no further requirement to repay debts that the court has discharged.