Listening to a late night radio recently there was a committed follower of the talk show host who was exclaiming that after taking the cure for piling up significant debt that after 5 years of work, the couple was debt free. The caller came from the painful pile of debt ranging from credit cards, mortgages, car loans and the like which started out so innocently buy layer by layer they were “owned” by the banks. Many couples need credit for homes, cars and the convenience of having a card for travel. It’s the abuse of this availability of the ready credit that gets credit card users in trouble. It’s not always a good thing to have government poking their nose into any consumer affairs more than they have to. In so many cases personal bankruptcy is the only option for persons facing a ton of debt. Banks lobbied to slow that down by forcing debtors to move into a Wage Earner Repayment Plan (Chapter 13) if their income was high enough. Consumers who incur debt need to pay it. It’s what expected. However, if the Credit Card issuers grease the skids by making this access to easy credit super convenient what responsibility do they have in a consumer’s slide into a mountain of debt? If a business plays to the weaknesses of human nature by making it too easy and accessible without stressing the importance of budgeting, building assets and careful use of credit then where does one draw the line for responsibility?

It might be like this for a consumer going to a local chapter meeting of the “CCAA” Credit Card Abusers Anonymous Meeting. “Hi, my name is Jim and I’m a Credit Card Abuser”. In unison it is heard “Hi Jim”. Setting in a town meeting lined with rows of chairs and a moderator up front attendees who felt the calling stood up and told their story. The common tread was heard. “It all started with one card…” It’s a very common theme. Families will always have one crisis or another and by utilizing the ready access of the credit cards soon many find it difficult to even meet their minimum payments. It’s like a wild carrousel going faster and faster. Using credit and making payments make the user even more attractive to other credit card issuers. Credit scores keep going up due to the fine payment history and consumers take on more cards with attractive balance transfer offers or new cards. In the end, unless income is accelerating as well, the ability to repay reaches the breaking point and the precipitous fall begins.

It must be argued that more help for consumers is needed in the area of budgeting and family financial planning to keep themselves away from the possible effects of this train wreck waiting to happen. A consumer can get access to help. It’s like someone getting conned out of all his or her money and don’t call the police because they are embarrassed about being “so stupid”. However, like so many personal challenges, to dig out of the hole it is necessary to recognize that there is a problem and THEN take steps to move on. Budgeting is key with a plan. There are always three options. Increase income, cut expenses or do both.

Anyone in the mortgage lending business many times is looking at the residue left over from the abuse of credit card debt and the negative impact it has on consumer’s lives.

Credit is needed to run this country. The abuse of the ready credit is the issue here. In the country of India, as well as others, local communities have set up small micro banks to extend loans to families who want to run a small in-home business. Community leaders discuss the probability of success based on the concept and the character of the borrower. This has been extremely successful. Defaults are very low. Lives are impacted in a positive way. Helping hands with a designed purpose is a positive result of extending credit in this example. It is making a dramatic life changes in these communities. Americans can do as well IF armed with a plan on what to do with credit.

Some of the major purchases for a family are for housing and cars. Anything beyond that may be a luxury. Mortgages can be paid off quicker and the overall interest payments reduced. Cars can be paid off quicker as well. The running up of large credit card balances without an accelerating income plan is a road to disaster. Credit Card issuers need to be more proactive in consumer education with regard to budgeting and family financial planning. It needs to be more than collecting 8% to 24% interest charges and putting family’s financial health in danger. In this informational age-it would be easy.

Warning labels? Yes! Some forward thinking states have addressed this issue. As long as credit card issuers continue with this free wheeling credit extension enterprise. What’s good for the goose. “This credit card maybe hazardous to your financial health.” Rather credit cared issuers need to start helping with credit education and planning. The first credit card issuer to do that in a MEANINGFUL way may be considered a GREEN company and I’m not talking about money. It’s much bigger than that, it could be life changing in a positive way for families and their futures.