Get Help Cutting Out Credit Card Debt

When Tracy Chelenza needed some financial advice, she knew exactly where to go.

Chelenza, a staff assistant in Duke's Office of Counsel, signed up for "Plastic Surgery: Reducing Credit Card Debt" at the Duke Federal Credit Union, one of about 10 financial seminars scheduled this fall and winter.

She wanted to learn best practices about managing credit card debt to share with her daughter. 

"Warning signs like paying the minimum amount due on credit card bills is probably a good sign that you need to rein things in," said Chelenza, noting one of the key messages of the seminar. "The credit union is great because they offer this information in a very non-intimidating way unlike big banks that aren't as personal."

Duke Credit Union's financial seminars are open to Duke faculty, staff and their family members at no charge. The credit union also visits departments with a group of 10 or more who want to learn more about budgeting, reducing debt or other topics.

During a recent seminar on credit cards, Scottie Dowdy discussed a variety of ways to handle debt, including potential warning signs cards are being used too much, how to control spending urges and how to get rid of debt.

"You need to manage the money you have so you're in control instead of your money being in control of you," said Dowdy, a financial guidance counselor with the credit union. "You want to look at things from a long-term standpoint and not get caught up on impulse buys you think you'll easily pay back later."

Because of a stagnant economy, Dowdy said credit card companies are rarely offering benefits like 12 months with 0 percent finance charges. Many companies are increasing finance charges if card users miss payments, which can make debt add up quickly, she said. She also noted that companies will try to tack on extra charges to monthly bills for services like "credit protection" that aren't actually needed if users pay attention to bills.

Dowdy said some easy ways to cut down on credit card debt include:

• Live a cash-based lifestyle
• Use a debit card instead of credit card
• Only keep a credit card for emergencies
• Avoid shopping as a social activity

The easiest way to stay out of debt, Dowdy said, is keeping an eye on big picture financial goals instead of instant gratification through credit card purchases that can be paid back later. During last week's seminar, Dowdy even handed out scissors and asked participants to consider cutting up their cards and add the pieces to a fishbowl with four years worth of credit card scraps.

"It helps to avoid getting stuff - things we don't need - because that's a big way to control spending," Dowdy said. "Maybe you can learn to do things that don't require money, like go to a library or museum."

Those were helpful hints for Lia Gilmore, who said she participated in the seminar to reinforce her spending habits.

"You hear so many things on the radio about how to pay off credit cards or how to get help, so I wanted to get the low-down on how legit some claims are," said Gilmore, a referral coordinator for Counseling and Psychological Services. "It's good to know I'm on the right track and already making good decisions."