How do you know if you have too much debt? Even if you earn a high income and are currently making your payments on time, you could be in trouble if your debt-to-income ratio is too high, says personal finance expert Lynnette Khalfani-Cox (www.themoneycoach.net). Here are some warning signs:
•· You have maxed-out credit cards, or cards that are pretty close to their limits.
•· You use your credit card checks to pay your credit card bills.
•· You can't afford some of your payments, so you skip them.
•· You're not sure what your total debt is.
•· You switch credit cards to get a lower rate because you can't afford to pay the minimum on the card you have.
•· You and your partner argue about bills.
•· You're stressing out or losing sleep over bills.
•· When you apply for new credit, you're turned down.
•· You get phone calls from creditors or bill collectors.
•· You're using a credit card to buy things you need on a daily basis, like gas or groceries.
•· You have a low FICO score because of the amount of your debt.
Khalfani-Cox says that if any of these statements describe you, you're probably operating in the danger zone with your credit cards.
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