Most families or individuals are loaded with credit-card debt.
The average household has more than two credit cards and the average interest rate runs around 15%.
Some debt is good and i.e. borrowing for a home usually makes very good sense.
Just make sure you don't borrow more than you can afford to pay back, and look around for the best rates.
On the other hand some types of debt are bad!
Don't use a credit card to pay for things you consume quickly, such as meals and vacations...
There's no faster way to fall into debt!
Instead, put aside some cash each month for these items so you can pay the bill in full.
If there's something you really want but it's expensive, save for it over some period before charging it so that you can pay the balance when it's due and avoid interest charges.
Most people spend a lot of money without much thought to what they're buying.
Evaluate your financial situation, write down everything you spend for a month, cut back on things you don't need and start saving the money left over or use it to reduce your debt more quickly.
The key to getting out of debt efficiently is to first pay down the balances of loans or credit cards that charge the most interest, while paying at least the minimum due on all your other debt.
Once the high-interest debt is paid down, tackle the next highest, and so on.
If you just pay the minimum due on credit-card bills, you will barely cover the interest you owe, to say nothing of the principal.
It will take you years to pay off your balance and potentially you'll end up paying double the original amount you charged.
Always be ready for the unexpected and build a cash cushion worth five to six months of living expenses in case of an emergency.
If you don't have an emergency fund, a medical bill or a car accident can seriously upset your finances.
Do not hesitate to get help as soon as you need it.
If you have more debt than you can manage, try to seek help before your debt breaks your back!