Just look at the numbers Americans love credit cards. According to the National Foundation of Credit Counseling:
78 million of the 105 million households in the United States had at least one credit card last year.
The 1999 average annual percentage rate on all bank credit cards was 17.11 percent.
The revolving balance of credit card debt totaled $580 billion in 1999. That included $490 billion on bank credit cards and $90 billion on store credit cards.
Americans charged more than $1 trillion on their cards during 1999.
As Americans use credit cards more, personal bankruptcies have increased. Personal bankruptcies have reached 1.4 million a year, up from 348,000 in 1984.
Shwell Cavallon, of Amerix, the largest service provider to the credit counseling industry in the United States, said that because the industry is so saturated, companies must market to college students.
Howard Dvorkin, president of Consolidated Credit Services, a nonprofit counseling agency that helps people avoid getting into credit problems, said the reason credit card companies market to college students is the same reason they do anything: "for money there's tremendous profitability in marketing to college kids.
It costs very little to sign up college students, who hang on to the cards for an average of 15 years, he said, and because they'll be college educated, they have a good chance of becoming high-income owners.
Here are Consolidated Credit Counseling Services' 10 steps to freedom from debt:
1. Figure out how much you owe. Collect all your credit card statements and figure out the total amounts you owe and the interest rates.
2. Keep the card with the lowest rate and cut up the others.
3. Get a card with an interest rate of less than 14 percent.
4. Avoid using your credit cards and try to use cash or debit cards.
5. Resolve to pay more than the minimum payments if you only pay the minimum, it may take forever to pay them off.
6. Pay more than the minimum and stretch your budget no pain, no gain.
7. Apply all your funds toward the cards with the highest rates, and put the additional money on the card with the largest balance. Pay the minimum on the card with the lowest rate until the highest card is paid off.
8. Consolidate your debt. Many credit card issuers offer low 6-month introductory rates. Pay off the debt aggressively.
9. If you are unable to transfer balances to one card, consider calling CCCS at 1-800-SAVE-Me-2. Debt management programs usually can organize debts into a low monthly payment, reduce or eliminate interest charges and help restore credit ratings.
10. Consider using your savings to get out of debt.