Debt is an unavoidable circumstance for most Americans today. As a matter of fact, the Federal Reserve Bank reports that as of the start of 2008, the total consumer debt of the country has reached beyond $970 billion. There are many factors that contribute to the consumer debt statistics, and those include utility bills, mortgage loans, car loans, and credit card bills. Families in America are having more and more difficulty managing their income, let alone allotting money to pay off such debts. Impossible as it may seem, there are ways by which you can avoid falling into debt, and at the same time, you have money set aside for a rainy day.

One way to avoid being stuck in the debt rut is to pay all your bills on time, and pay them completely when possible. When it comes to paying off your credit card bills, CNN Money recommends that if you have the adequate funds, then settle the credit card with the largest interest rate first. Here is a bit of info from the same source: did you know that the average credit card debt in US households is $9,000? This may be due to the unmanaged spending and the inability to pay monthly dues on time, causing interest rates to balloon the already large balances. According to, surveys have shown that the average interest rates of major credit card issuing companies can vary from 11 to 13 percent.

The credit card is a nuisance once you realize that you actually spend more than what you can. Surveys by financial sources found out that the largest issuers in the country are Chase, Bank of America, and Citibank. In addition to that info, there are sources that explain that many Americans juggle more than one credit card at a time. On the average, every adult in the US has 3 to 4 active cards in his wallet. To avoid this scenario, you should try not to be tempted by new offers by credit card companies in the mail. Enticing as the promos and waived annual fees may seem, you generally don’t need many cards. To be frank, MSN Money advisors say that you should actually use cash whenever you can.

MSN Money also says that you should try to set a budget for yourself or your household. Even $10 set aside per week will help you manage your monthly expenses such as utility bills and other responsibilities. If your current household income seems insufficient to support all your bills, you might consider working overtime or getting a second job, even on a part time basis. There are times when you really have to scrimp, and make sacrifices by avoiding the usual things you enjoy but you spend too much on. According to MSN, eat out less frequently, and if you have several cell phone bills, you might want to stick to only one number.

Avoiding debt takes commitment on your part, as well as more sensible ways of looking at your financial priorities for the present and the future. In cases when you think you cannot decide on your best options for managing debt, you can consult with an advisor to help you out.


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Avoiding debt and having money set aside is not as impossible as it seems. If one can accumulate a huge amount of debt over time, then he can also reduce those dues, given the right mindset and the tools to overcome them. At the same time, he can also enjoy the benefits of having cash put away for a rainy day.