Debt Warning Signs: How to Spot Debt and What to Do About It

If more than one or two of these warning signs describe you, you may have too much debt:

• I'm not sure how much I owe.
• I can only pay the minimum amounts due on my credit cards and other bills each month.
• The total amount of money I owe isn't getting any smaller.
• I often pay my bills late.
• I am borrowing from one credit card to pay another credit card.
• I put off going to the doctor or dentist because I cannot afford it now.
• I spend more than I earn.
• I would have financial problems right away if I lost my job or missed a paycheck.

There are plenty of things you can do to start reducing your debt. Living in debt doesn't have to be permanent, but you will need a plan to tackle your payments:

1. Get help from a nonprofit financial counseling agency: Check to see if your local state university (Extension Service) offers a free debt management service. They can help you set up a repayment plan and write to your creditors.
2. Cut way back on your credit card use: Leave your card at home. Don't use it to pay for extras that you can't afford.
3. Get help from a non-profit financial counseling agency: Check to see if your local state university has a free debt management service. They can help you set up a repayment plan and write to your creditors.
   
4. Try one-on-one credit counseling: Contact the National Foundation for Consumer Credit online at www.nfcc.org or by phone at 800-388-2227.

How do I improve my poor credit history?

• Look at how much you owe.
• Prepare a realistic budget. See how much you can pay off each month.
• Contact the companies you owe money to and work out a payment schedule.
• Consider using savings, selling assets or getting another job, at least for a while.
• Consider getting a secured credit card to rebuild your credit, but be sure you understand what will happen if you cannot make those payments.
• Be sure to take the steps listed to maintaining good credit.