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Plan to address holiday debts now

Now that the holiday season is over, some people are faced with a harsh reality as the credit card bills start rolling in. You really can't avoid checking the mail, and ignoring the credit card statements won't help the situation at all. Instead, you need to find out what you owe and plan to get those bills taken care of.

One of the first things that you need to do is to find out exactly what you owe. This includes all your debts, and the minimum payment for each account. Once you have this information, you can sit down to create a budget. This lets you know whether you can realistically make all the payments while keeping up with your regular bills.

Next, you must determine how to pay more than the minimum payments. You might need to focus on paying off one card at a time by paying as much over the minimum amount that you can. As you pay off one card, you can apply what you were paying on that one toward the next card on your list.

Unfortunately, some people will realize that the holiday season's debts, as well as other debts, have amassed to more than they can reasonably pay. They might decide that they need to find another option to help them address the issue.

Bankruptcy is one option that some consumers might explore. This gives them a chance for a fresh financial start once they meet the requirements for the chapter they file.

Chapter 7 bankruptcy liquidates your nonexempt assets to pay off as much debt as possible, and anything remaining is discharged once the case is closed. Chapter 13 requires you to repay the bankruptcy trustee on a set schedule. Any balances that remain on accounts covered in the bankruptcy are discharged when the case is finished.

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