Saving Money by Taking Control of Your Credit and Debt Situation

A good friend of mine worked for years as a debt collector. At parties and social gatherings he would usually share stories of his dealings with people on the phone who were, shall we say, less than enthused to be receiving his work-related telephone calls. The stories were sometimes humorous, often disturbing, and more than a little sad. Despite how people react to being called by a collection agency, they all have factors in their lives that resulted in their receiving those calls.

At these gatherings someone would always ask my friend for advice in getting a debt collector to stop calling them. His answer would be the same every time. “Pay the bill.” He had a valid point. Aside from the provisions of the Fair Debt Collection Practices Act (a federal law that governs the methods and tactics that third party debt collectors may use in their efforts), the one surefire way to stop a debt collector from calling is to pay the debt. Once they have their money, they will leave you alone forever.

Preferable to this, of course, is to avoid letting financial matters get that bad, of course. Taking control of your debt and reducing it will ensure that you maintain a good credit rating and also help you save money.

According to New Step Debt Consolidation (, Americans carry an average of $5800 in credit card debt per month. Collectively we also carry an average of thirteen different credit cards and spent $1.1 trillion on credit card purchases in the year 1999.

Taking control of your revolving credit accounts is often the first step in taking control of your financial situation and saving money. Cut up all the credit cards except the one major card with the lowest interest rate. Lock this one up and only use it for emergencies. A new dress, a new power tool, or the latest video game is not an emergency. Pay as much as you can to each account each month and make extra payments whenever you can. Once the accounts are paid down to a zero balance, close them all, except the emergency card. Any time you do use this card, pay the balance before the grace period so that you are not charged any interest. The amount you save in interest can then be added to your savings accounts or invested. Then you’ll be the one collecting interest.



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