Money Matters

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Forget about the U.S. government budget deficit being at an all time high and banks carrying a heavy debt load from bad mortgages. A lot of individuals are finding themselves deep in debt.

The average American household now has credit card debt of more than $9,300.

However there are ways of getting control of and managing your debt.

1. Asses your debt. If more than 20 percent of your take home pay goes to finance non-housing debt or if your rent or mortgage payments exceed 30 percent of your monthly take home pay, you may be over extended.

2. Begin with a budget. Track your expenses for one month by writing down what you spend. Then, break that down into essential and non-essential spending to see where you can reduce expenses.

3. Pay off high rate debt first. Begin with the highest interest rate credit cards and eliminate the balance as aggressively as possible.

4. Transfer high rate debt to lower rate cards. Consolidate credit card debts to a single card with the lowest rate. Beware of those teaser rates that go up dramatically after six months. Go to to compare and shop.

5. Borrow only for the long term. The best use of debt is to finance things that will gain in value such as a home, an education or big ticket necessity, such as a washing machine or computer. They will still be around when the debt is paid off.

Avoid charging concert tickets, meals out and vacation expenses. The more debt you pay down, the less you'll pay to big banks that will be bailed out by the federal government some day.

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