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You are not alone: major credit card debt can affect everyone

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If you have spent some time on this blog then you're probably giving some consideration to filing for bankruptcy. It's not an easy decision, which is why this blog exists. We understand that it helps to understand what others are dealing with and similar stories about accumulating debt can better help you grasp where it is you stand financially. Well, maybe the story of Mary Uhazi will help.

Originally written about in an MSNBC article, Ms. Uhazi built up $60,000 in credit card debt and just recently suffered a salary reduction. If it sounds familiar already, read on.

Like so many of Americans struggling under the strengthening pressure of consumer debt, Ms. Uhazi admits than in the end, after spending all that money, she had "...nothing to show for it."

Extreme credit card debt starts, and often ends, with the best of intentions, especially when you have a good job. Ms. Uhazi started with a gas card to avoid stopping for cash every time she needed to fill her tank. In commuter heavy Sacramento, where she lives, that is a great reason to have a card. However, the collection of cards continued to build and what was once an easy amount to pay in full each month became a regular balance. And when that balance is spread among a number of cards, it doesn't take much for things to spiral out of control.

Ms. Uhazi's debt load was built over time and didn't include what most would consider large, impulse purchases. It was simply some presents for Christmas here, a dinner with friends there and a few weekend trips. Also, a major car repair popped up, which is probably one of the best reasons to use a credit card.

Thus, the story of Ms. Uhazi's debt accumulation is very common. Today, almost every major consumer product retailer--department stores, home improvement chains, book stores--have a branded credit card with their own litany of benefits. For those with good credit, the lure of an immediate 20 percent discount is often too enticing to resist. Rewards, cash back and free merchandise are constantly used as bait for access to your good credit rating. The more you spend, the more offers for cards you receive.

Everything was fine for Ms. Uhazi until she let a single payment deadline slip. Then things began to crumble.

Enter California's historic budget crisis. Ms. Uhazi was notified that she would be required to take unpaid days off from work so the state could alleviate its own debt problems. With less money to pay the minimum balances, lenders pulled back credit limits and as if on cue, raised her interest rates. The perfect storm began to rage and when she sat down to get an idea of her debt the credit card balances totaled more than $62,000. Just two of her minimum balance payments were close to $2,000.

Ms. Uhazi took control of her situation by contacting many of the retailers and card issuers to negotiate lower balances but even the small reconciliations made in that effort carried a cost. For example, her creditors would lower rates on store purchases but increase them on cash advances. Despite the progress and new approach to spending that she now employs, Ms. Uhazi remains uncertain about where her economic future is headed. She is considering bankruptcy.

If you see any of yourself in Ms. Uhazi's story, know that there are many more just like you. You are not alone in this economy and you certainly not the only person who has experienced bad things as a result of good intentions. Keep in mind that just by consulting with a bankruptcy attorney, you may realize that filing is often the most reasonable solution.

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