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I am overwhelmed by my credit card debt. I am still able to pay my minimum payments plus some to the principle of the card. I am not making any headway and have already cut up my credit cards. What is the next step that I should take.

You have already taken a huge first step by cutting up your cards. I assume you already have yourself on a very strict budget however, if you do not, that would be the next step. Make sacrifices and squeeze every penny you can from your income and send it to your card company to pay down as much principle as possible as fast as you are able to. Decrease your bills wherever possible…just buy the essentials, nothing more.

However, that still may not be enough to make any serious headway given interest rates in the 30%+ range which is unfortunately becomming increasingly common. If you still have too much debt given the income you make, you can:

1. Try and find “cheaper money” to use to pay back the credit card companies. The best form of cheaper money is found by pulling out equity in your home if you have any. If not, maybe you can borrow money from friends or relatives (not an ideal choice).

2. Find a good debt management program which will be able to help you lower the interest rates and help you form a solid budgeting plan.

3. If that still does not lower your payments enough, the third option is to look into a debt settlement program to try and reduce the amount of debt that you owe. This option should be considered if the others are not enough.

Best to you.