Current trends in the United States have seen many people overextending themselves with credit and debt. This has caused high rates of bankruptcy and has forced many families regardless of how much money they bring in to literally live paycheck to paycheck. Unfortunately, with so many credit cards available, so many different offers and incentives to get more, people keep accepting more plastic and racking it up at the same time.

The biggest issue people have is when they have more than one credit card. Most people don’t consider the overall debt that they have, they consider how much they have on each card. For example, someone might have 6 credit cards, all with $150 on each one. This doesn’t seem like all that much money, but when you do the math, that is $900 in debt from those six cards. While this is a relatively low amount, some people find themselves using their credit cards until they are maxed out and then paying the minimum payment on them until the balance is paid off. Unfortunately, many credit cards are almost impossible to pay off by paying just the minimum. It would take you hundreds of years to pay off your credit cards using this method. This results in many people paying in thousands more for items than they would have if they would have just paid cash for the item or paid off their credit card immediately after purchasing that item.

If you consider someone that has 6 credit cards, all have a maximum balance of $500, and all of them maxed out, with minimum payments of $25 per month. Now lets assume that the $25 per month only pays the balance down by a few dollars each month because the interest rate is so high. This means this person has to pay $150 per month to her credit cards alone, just to stay on track. This debt will almost never go away without them paying more, but because of this debt, they are now living paycheck to paycheck.

It really is a shame and it could all be avoided. The best thing to do is build your credit up by starting with 2-3 different cards. After your credit is better and you can qualify for a higher limit credit card, get that one and destroy the other ones. Make sure that you are making regular payments on this one card and that you aren’t using it for purchases unless it is an emergency. The other cards, keep them active so that they populate your credit report and help your score, but by destroying them you make it so that you can’t use them unless you order new cards, this of course should only be done in an extreme emergency.

By sticking with this one card method, you are keeping yourself out of extreme debt while ensuring you have lower overall payments, and capping the damage you can do in a wild shopping frenzy.