Credit card debt among Americans is higher than ever at $1.3 trillion, which averages out to more than $10,000 in high-interest debt for every single family in the country.
If you're staring at your own pile of credit card debt, try not to panic. It's time to make a plan, and act.
* If you're facing a financial emergency and can't make a minimum monthly payment, contact your credit card company immediately to explain the situation. Tell them what you can afford to pay and when can start making normal payments again. Keep a written copy of any agreement between you and your card issuer.
* Contact a credit counseling organization to help you with money management. They may recommend a debt management plan to consolidate all your payments at a lower interest rate.
* Avoid for-profit debt relief or debt settlement companies. These companies might make unrealistic promises about clearing your debt or advise you to stop paying your bills or communicating with your card issuer — two very bad ideas.
* Consider a debt consolidation loan. These fixed-rate lump sum loans have repayment terms of up to seven years. You can apply for loans through your bank or credit union, or through an online lender that can give you a preview of your loan terms without affecting your credit score.
* If your credit card debt exceeds 40 percent of your income and cannot be paid off within five years, bankruptcy might be the best option. Contact a bankruptcy attorney to discuss your specific situation and the pros and cons.
Sources: Consumer Financial Protection Bureau, NerdWallet