As January comes to a close, many Maryland families are faced with bills from the holiday season. Those expenses may lead to a closer examination of the family’s finances, the result of which can be the sobering realization that something has to change. For some, this is the time of year when an important decision must be made: is it better to attack debt repayment or begin the process of consumer bankruptcy?

For those who want to try and pay down their existing credit card debt, there are a number of approaches that can be taken. One of the best ways to handle this type of debt is known as the “snowball” method. Consumers begin by paying off the account that has the lowest balance, then move on to the next account. This approach can give individuals a sense of momentum, as the total number of accounts will decline sooner.

Another approach is known as an “avalanche” approach. Here, consumers rank all of their credit card debt according to interest rate, and begin paying off the account with the highest rate first. This approach may lack the immediate gratification of the snowball approach, but over time it can lead to savings in interest and fees.

For some in Maryland, consumer debt has risen to the level at which no form of repayment is likely to lead to a successful outcome. In such cases, the next step involves meeting with a consumer bankruptcy attorney to discuss the bankruptcy process. There are a number of options to choose from, all of which give consumers a measure of much-needed financial breathing room.

Source: abc10.com, “Two strategies for paying off holiday credit-card debt”, Gabrielle Karol, Jan. 8, 2016