Financial problems can sneak up on Illinois residents

The economy has left many people living from paycheck to paycheck. At times, people use credit cards in order to keep their heads above water each month. Before they know it, many Illinois consumers may find themselves with financial problems.

There are warning signs that things may be taking a turn for the worse for those who are using their credit cards. One indicator is credit limit. If a consumer is reaching their credit limit, or if that limit is reduced by the bank, there may be a problem. Another indicator is if the credit card company raises the interest rate on a card.

Of course, a more dire indicator is if a consumer is struggling to make the minimum payment or is unable to make that payment at all. To make matters worse, once a payment is missed, the bank may increase the interest rate on the card upwards of 29 percent. If a consumer was having trouble making the payments before, it may become impossible. Some people may find they have stopped contributing to their retirement plan in order to make payments, or that their credit card payments are more than 15 percent of their income.

All of these factors are indicators that financial problems are around the corner, if not already present. Illinois residents that are buried under their credit cards and other bills may find solace in filing for bankruptcy. Filing for bankruptcy protection can give the filer the time and space to address their financial issues free from the stress and anxiety of dealing with creditors. In the end, it could provide a financial fresh start.

Source: The Arizona Republic, "7 red flags of credit-debt overload," Robert Anglen, Jan. 26, 2013

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