In the world of debt, there are two primary forms that Tennessee residents should understand. The first is secured debt which is any type of debt associated with a real item that acts as collateral. Examples of secured debt include mortgages and auto loans that are connected to homes and vehicles. The other type of debt is unsecured, meaning there is no collateral associated with it. Credit card debt is perhaps the most common type of unsecured debt that plagues Americans.
When it comes to finding ways to reduce credit card debt, Forbes indicates there are different strategies that consumers might want to consider. One of these is to focus on eliminate the debt with the smallest balance first. This may provide fast results and help people feel successful in managing debt, fueling their efforts to continue chipping away at the next debt balance. Another option is to first target the debt that has the highest interest rate associated with it and pay this off, moving on to other debts after that.
According to NerdWallet, consolidating debt either via a personal loan or via transferring the balance on one credit card to another card with an introductory zero-percent interest offer may help some people better manage payments. It is important to evaluate any fee that may be associated with these options to ensure the benefit is worth it.
In some situations, bankruptcy may offer consumers the best path to a better financial future if some of the above strategies are not viable for them.