Thomas F. Miles, Attorney and Counselor at Law
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How to address post-holiday unmanageable debt

The first few weeks of a new year is a time to focus on the future and to plan how to make improvements in the coming months. It is also a time when the holiday bills start rolling in. This is when many people realize that they spent far more than they had planned in the last couple of months of 2015. For those in California who are facing unmanageable debt, the following tips could be of assistance.

When sifting through a pile of bills, it can be difficult to know which accounts to pay first. A great place to start is with credit cards that offered a deferred-interest option. While these accounts may have seemed like a good choice at the time, the companies that extend those offers are banking on the card holder's inability to pay the balance in full by the deadline. Go past that date and the interest owed will skyrocket, making the original deal seem like a ridiculous proposition.

Next, tackle the balance owed on any store accounts. A huge range of retailers now offer their own credit cards, and many have enticing rewards for opening an account. These accounts tend to come with extremely high interest rates, however, making the total cost of the credit far higher than many people realize. Once those accounts have been paid off, a solid approach is to begin with the remaining credit cards that have the smallest balance and move forward from there.

These tips are solid pieces of advice, and many consumers are able to pull themselves out of debt using these and similar strategies. For some in California, however, repayment is simply not a viable option. In such cases, it may be time to consider if bankruptcy is the best way to address unmanageable debt and bring in a new beginning during the New Year.

Source: TIME, "Pay Off Your Holiday Bills in This Order", Martha C. White, Jan. 7, 2016

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