Five Signs You Need to Cut up Your Credit Cards

1. Can't go a month without charging

   You find yourself using your credit cards to purchase groceries or gas because there's not enough money in your checking account for everything. Be sure to prioritize your spending. Pay for necessities first and do what you can to make cuts or increase income so that you can start only spending what you're bringing in for income each month.

2. Making only minimum payments

   The higher the balances get, the harder it is to pay down the cards. This forces you to make only minimum payments costing you a lot in interest and it will take a whole lot longer to pay off. Work to make changes in your budget and income (like in #1) so you can to make more than the minimum payment on at least one card - if you have more than one. Note: paying extra toward your cards but still using them every month doesn't count because it's getting you nowhere.

3. Buying stuff you can't afford

   Sometimes spending can be a vicious cycle. You might think "I already have a balance, so what's another $100?" because you really want something. However, you don't need it and the more you continue to charge, the harder it will be to break the debt cycle. Skip the wants and focus on your needs until you're in a more stable financial position.

4. Maxed out cards

   Hitting credit limits is a telltale sign. If you're at this point with any of your cards, taking action is crucial because you're likely relying on credit cards to live. And when your card or cards are maxed out, don't open (or attempt to open) any more. It's time to make some serious budget changes so you can live within your means again.

5. Doing balance transfers regularly

   This might seem like a smart move because you can get a temporarily low or 0% interest rate, but if you're not making progress paying down on any of the debt it won't be worth it in the end. Doing balance transfers can be a hard habit to break and could even cause you to continue increasing your debt load because of the fees assessed each time.

If you identify with any of these signs, it's time to cut up those cards. And the bright side is that there is help. Meeting with a Financial Counselor and setting up a realistic budget is a great first step. We can help you set up a realistic spending plan and determine your best repayment option. For most people, the Debt Management Plan (DMP) is the best option as it typically reduces interest rates and helps you pay off your debt much more quickly, not to mention all the money you'll save due to the reduced interest rates and shortening the payout length.

For your free and confidential financial counseling session, call LSS at 888.577.2227 or go to our website to GET STARTED ONLINE now. Our Financial Counselors will give you the tools and resources you need to get control over your finances and build up savings.

Author Elaina Johannessen is a Program Director with LSS Financial Counseling.