Eliminate Credit Card Debt Before Interest Rates Soar

[May 15, 2010.]

 

Struggling With Credit Card Debt?

If you are not able to pay your credit card balances in full at least every three months, you are at risk. You need to eliminate credit card debt because credit could get very expensive in the near future. If you cannot pay your balances in full now, a higher interest rate on your credit cards would make it nearly impossible. Don't wait, act now to get out of debt.

Why Interest Rates May Soar

Extremely low interest rates for an extended period and a burgeoning U.S. deficit may be a recipe for interest rates to soar. In order to stimulate the economy during the worst recession since the great depression, the Federal Reserve set their main interest rate at about zero. This was appropriate when the economy was struggling. One Fed President, Thomas Hoenig of Kansas City, has repeatedly said that it is time to consider raising interest rates. Hoenig is a voting member of the FOMC, the Federal Reserve's committee that decides monetary policy. Once other voting members take Hoenig's position, the FOMC will start raising interest rates.

Hoenig is also concerned that financing the growing U.S. deficit could cost more. He worries that the creditors financing the deficit, countries like China and Japan, may grow uncomfortable as the deficit gets larger and demand higher interest rates. He warns that the U.S. deficit is not sustainable and could ultimately pressure the Federal Reserve to print money to get out of debt, creating an inflationary environment that would cause interest rates to rise.

A Lesson from the Ostrich

An ostrich is known for putting his head in the sand when he gets scared. He thinks he is making himself invisible but he is just giving his predators the advantage. Making minimum payments on credit card balances is like putting your head in the sand. You may be hiding, thinking you will figure out your debt problems next month, but really you are endangering yourself by giving your hard-earned money to credit card companies. Don't put your head in the sand! Act today to find debt relief.

 

About Author:

Renee Morgan has been a loan officer for over eighteen years. She is also a freelance writer and guest expert for radio and TV.