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Fiscal cliff could affect credit card debt in some households

Many families continue to struggle with lines of credit established years ago. Credit card debt is a serious concern, and changes at the level of the federal government can have implications for the average household. Families seeking to avoid past-due payments being turned over to debt collectors for further collection action need to understand both current laws regarding credit cards and how upcoming changes may affect their situation.

Our readers in Cleveland, Tennessee, have no doubt heard about the fiscal cliff currently facing the nation. The possibility of raising taxes to help head off governmental debt and deficits could have a major effect on taxpaying families. The most obvious negative effect would likely be an increase in overall federal taxation, resulting in lower amounts of disposable income.

Other potential repercussions include an increase in credit card debt if families must turn to cards to pay for necessary expenses, and there may be increases in interest rates. Banks could also cut down on the number of introductory offers and incentives in order to preserve profits. This is likely come on the heels of tightened restrictions aimed at curtailing lending to some borrowers.

Families dealing with the specter of credit card debt need to understand how changes at all levels of government can affect their financial well-being. In this unstable financial period, families in Tennessee should be aware of all of their debt relief options.

Source: The Street, "How the Fiscal Cliff Could Affect Your Credit Card," Bill Hardekopf, Dec. 24, 2012

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