2013: The Year of Financial Stability

January 24, 2013 (Press-News.org) New Year's resolutions often include some of the following aspirations: lose weight, participate in a new hobby, exercise, volunteer or pay off debt. Year after year, Americans begin the year with enthusiastic ambition. As the year moves along, however, we often fall behind on some of our greatest endeavours. What is one of our biggest resolution failures? Stabilizing personal finances.

A report issued last month by the Federal Reserve Bank of New York reveals that while the total debt in the United States dropped by $74 billion in the third quarter of 2012, credit-card debt increased by $2 billion in the same period.

The TransUnion reports that the average person had $4,996 in debt in the third quarter of 2012. By the end of 2013, Time Business & Money explains that this amount is expected to rise to $5,446. This would put numbers at their highest since 2009, when average debt peaked at $5,776.

American Bankers Association's chief economist James Chessen notes that slow job growth and failing consumer confidence could result in future payment delinquencies. Furthermore, Time reports that the number of subprime borrowers increased by over 5 percent between 2010 and 2012.

While we slipped behind in our personal debt recovery plans for 2012, it is important to attack this year with extra vigor. There are a few things that you can do to reduce your outstanding balances, but it may help to meet with an experienced attorney in developing your repayment strategy.

What can I do to relieve my credit card debt in 2013?

Analyze debt: If you are interested in attacking your debt responsibilities in 2013, you should begin by deciphering exactly how much you owe. Start by reviewing credit cards and examining balances and interest rates. Take the time to analyze existing debt and see if it is possible to reduce the interest costs or adjust repayment terms.

Pay off high-interest credit cards:Furthermore, as you decrease spending and bring down account balances, begin by paying off cards with the highest rates. High credit card interest serves as a catalyst for heightening debt. Therefore, take care of these accounts first, but remember to pay at least the minimum balances on the cards with lower rates.

Transfer balances: Most credit card companies also allow consumers to transfer balances from other cards. Examine your contracts, and try to avoid transfer fees. Also, take note of the interest rate that you will be required to pay. Aim to transfer balances from cards with high interest rates to a card with a lower one.

Create a savings plan: It is also important to start saving. The best way to do this is to automatically transfer funds from your salary into some form of investment such as a recurring deposit or mutual fund systematic investment plan. This will help you grow your savings and reduce the temptation of overspending.

These are just a few suggestions to help you combat credit card debt in 2013. However, if you have an established pattern of financial trouble, you may benefit from legal assistance. An experienced bankruptcy attorney can help you organize a solid debt-reducing plan and explore all of your options.

Article provided by The Law Offices of James C. Shields
Visit us at www.shieldslaw.net