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Is it better to settle your credit card debt or pay in full?

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Stressed young woman has financial problems credit card debt to pay crucial
Paying off your credit card in full is one viable option for tackling your debt — but so is debt settlement in some situations.

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Right now, a range of economic issues, from elevated interest rates to high prices on gas, groceries and housing, are weighing heavily on many people’s budgets. In turn, some Americans are turning to credit cards to try and bridge the gap between their budgets and their necessary expenses. But with the average credit card rate hovering near 22%, that may not be the best plan. After all, compounding credit card interest charges can make it tough to pay off what you owe, as evidenced by the fact that credit card delinquencies have become more frequent recently and cardholders are maxing out card accounts at concerning rates.

Maxing out your credit cards is never ideal, but having late or delinquent credit card payments on your credit report can cause severe damage to your finances and credit. And, not only does the damage to your credit score from late payments take time to repair, but missed payments are a red flag to lenders, making it harder to get approved for loans, mortgages, rental housing and other credit products in the future. There are also potential credit card late fees and penalty annual percentage rates (APRs) to contend with, both of which can further increase the cost of your credit card debt.

So, if you’ve fallen behind on your credit card payments, it’s crucial to take control of the situation as soon as possible — before the situation spirals further out of control. Credit card debt settlement is one potential path you can take to address delinquent credit card debt. When you take this route, the goal is to try and get the credit card company to forgive a portion of your total card balance. But while this can help you get out of high-rate card debt, is it better to settle your debt or pay off what you owe in full? 

Find out how the right debt relief company could help you get rid of your credit card debt

Is it better to settle your credit card debt or pay in full?

Paying off your credit card debt in full is almost always the optimal route when looking at the issue from a credit score and financial perspective. By paying off the full balance owed, you will eliminate the debt and keep your credit report clean of any derogatory remarks related to the debt. And, in some cases, your credit score may even increase due to the lower credit utilization.

However, paying off credit card debt in full may not always be feasible, especially if the total balance is too high to reasonably afford. And, that’s even more true when you’re carrying a balance from month to month and the interest charges are compounding. That’s where debt settlement could be the next best solution. 

With debt settlement, you typically work with a debt relief agency that negotiates with your creditors on your behalf to try and settle what you owe for less than the full amount (you can also try to negotiate settlements on your own, but that can get complicated.) If negotiations are successful, a lump-sum settlement is paid to the creditor to “settle” the debt for a percentage of the full balance, saving you a hefty sum on what you owe.

Creditors are often willing to accept a settlement because it allows them to recover some amount of money when the alternative could be receiving nothing if you were to default entirely or declare bankruptcy. And, in addition to saving you money, the debt settlement process also benefits you because settled debts are considered “paid” or resolved from the lender’s perspective, whereas unpaid debt can lead to charge-offs, collection efforts and potential litigation.

That said, successfully negotiated debt settlements will typically appear on your credit report as “settled for less than owed.” This does create a negative mark that can temporarily ding your credit score, but the damage is less severe than charge-offs or debts sent to collections. And, your score often recovers and improves after the settled debt is paid.

Settling your debt is also typically preferable to bankruptcy, which leaves a major scar on your credit history for up to 10 years. And if bankruptcy is a serious possibility due to out-of-control debt levels, lenders would likely prefer you settle rather than discharge the debt entirely through bankruptcy proceedings.

Compare your debt relief options and start tackling your high-rate credit card debt today.

How to decide which repayment option is best for you

So how can you determine which option makes the most sense for your finances? Well, that answer typically depends on your circumstances. 

For example, if you can realistically pay off your credit card debt in full by living frugally, taking a side job, borrowing from family or finding more room in your budget through other means, full debt repayment is typically the best and fastest path back to a clean credit report and score. However, if the debt balance is too high to reasonably afford a payment in full, debt settlement may be worth considering.

It may help to calculate how long it would take you to affordably pay off the debt in full based on your current budget and payment sizes. If you find that it would take several years or more in an aggressive payment plan to repay your debt, the interest charges accruing during the payoff period could make it very difficult to pay the balance in full. In that scenario, it may be better to settle for a lower lump sum payment that you can more realistically afford.

You may also want to calculate the fees involved and taxes owed on any forgiven portions of debt to understand the true costs. After all, the IRS considers the portion of the debt that’s settled to be taxable income, so it could increase the amount you owe. And, debt settlement companies typically charge a fee for their services, so that can add to the cost of debt settlement. 

But if you make those calculations and find that the settlement route provides affordable resolution in a reasonable timeframe compared to untenable options like bankruptcy, it could make sense for your situation.

The bottom line

Having delinquent or maxed-out credit card debt can inflict serious damage on your finances and credit score. So, if you’ve fallen behind on payments, it’s crucial to address the situation head-on as soon as possible. In general, paying off your credit card debt in full is the optimal solution that preserves your credit score and history. 

However, it may not always be feasible to afford paying the total balance owed, especially with high interest rates compounding the problem. In this scenario, debt settlement could be the next best option to resolve the debt affordably. To determine whether that’s the right path for you, weigh your ability to pay off the debt in full through an aggressive payment plan based on your budget and income. If you find that path is untenable, debt settlement could provide the most viable path to future financial stability.



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Trump, Mexican president give differing reviews of “wonderful conversation” on border, illegal immigration

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West Palm Beach, Fla. — President-elect Donald Trump declared a win on stopping illegal immigration through Mexico on Wednesday after talking with that country’s leader. But Mexican President Claudia Sheinbaum suggested Mexico was already doing its part and had no interest in closing its borders.

The two spoke just days after Trump threatened to impose sweeping new tariffs on Canada and Mexico as part of his effort to crack down on illegal immigration and drugs — a threat that drew a prompt and terse response from Sheinbaum, who said any U.S. tariffs would be met with reciprocal measures from her government — stressing: “There is no subordination here.”

Trump said in his social media posts that Sheinbaum had “agreed to stop Migration through Mexico, and into the United States, effectively closing our Southern Border.”

Sheinbaum indicated on social media, however, that she’d “explained” to Trump that Mexico is already “taking care of” migrant caravans, calling it an “excellent conversation,” but indicating no major changes in her government’s policies.

“I explained to him the comprehensive strategy that Mexico has followed to address the migration phenomenon, respecting human rights. Thanks to this, migrants and caravans are assisted before they reach the border,” the Mexican leader wrote. “We reiterate that Mexico’s position is not to close borders but to build bridges between governments and between peoples.”


Why Trump wants to tariff goods from Canada, China and Mexico

07:02

Trump’s social media posts about the borders — describing what he called “a wonderful conversation with Sheinbaum and suggesting Mexico had made concessions in the wake of his tariff threat — did move financial markets.

Even if the proposed tariffs fail to materialize, Trump may argue to his supporters that the mere possibility of them is an effective policy tool, and continue to rely on tariff threats.

But the only new policy clearly referenced by either leader in their social media posts Wednesday was a vow by Trump to launch a new national ad campaign warning against the dangers of fentanyl use.

Sheinbaum had said in her message that she and Trump, “also talked about reinforcing cooperation on security issues, within the framework of our sovereignty, and the campaign we are carrying out to prevent fentanyl consumption.”

Delivery Ceremony Of The National Sports Award 2024
Mexico’s President Claudia Sheinbaum speaks at a sports awards ceremony at the National Palace, Nov. 28, 2024, in Mexico City, Mexico.

Carlos Santiago/Pixelnews/Future Publishing/Getty


In his third, rapid-fire post on his own Truth Social platform about their conversation, the president-elect said he would be “working on a large scale United States Advertising Campaign, explaining how bad Fentanyl is for people to use — Millions of lives being so needlessly destroyed. By the time the Campaign is over, everyone will know how really bad the horror of this Drug is.”

Illegal migration across the Mexico border is down in part because the Biden administration secured some stepped-up cooperation from Mexico — the sort Trump seems to be celebrating.

Arrivals at the U.S.-Mexico border have dropped 40% from an all-time high last December. U.S. officials mostly credit Mexican vigilance around rail yards and highway checkpoints.

Driven by mounting pressure from the U.S. to block migrants going north, in the past few years Mexican authorities have turned to sending them to southern Mexico, in a strategy seen by experts as an attempt to wear migrants out until they give up.


Homan visits U.S.-Mexico border as Trump threatens Mexico with tariffs

07:06

Neither side clarified any firm plans to impose new tariffs in their social media messages on Wednesdday. But their implementation could fuel higher prices for American consumers and slow economic growth, potentially blowing up the trade agreement among the U.S., Canada and Mexico that was finalized in 2020 during Trump’s previous time in the White House.

Trump on Monday said he would impose a 25% tax on all products entering the country from Canada and Mexico as one of his first executive orders upon taking office on Jan. 20. He also proposed an additional 10% tariff on China tied to its exporting of materials used in the production of fentanyl.

Through September, the United States has imported $378.9 billion in goods from Mexico, $322.2 billion from China and $309.3 billion from Canada.



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What’s open on Thanksgiving 2024? Key store, fast-food and restaurant chains with open doors today

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AAA projects more cars will be on the road this Thanksgiving weekend


AAA projects more cars will be on the road this Thanksgiving weekend

03:25

Many retailers close their doors on Thanksgiving Day, observing what is, after all, a national holiday and offering their employees a well-earned rest ahead of the busy holiday shopping season. But some stores, restaurants and food suppliers stay open on to serve customers in search of essentials and last-minute Turkey Day ingredients

For example, if you’re thinking of visiting a Walmart on Thanksgiving, you’ll be out of luck — its stores are closed for the day, as are big-box and department stores including Costco, Kohls and Target. Here’s what other businesses are open and closed Thanksgiving.

Which grocery store chains are open on Thanksgiving?

  • Central Market: Stores are open from 8 a.m. to 2 p.m. local time, while curbside pickup hours are 8 a.m. to 1 p.m.
  • Food Lion: Food Lion grocery stores are open from 7 a.m. to 4 p.m. local time.
  • H-E-B: H-E-B grocery stores are open from 6 a.m. to 12 p.m local time, but pharmacies are closed. Curbside pickup is available from 7 a.m. to 11 a.m., and home delivery hours are 7 a.m. to 10 a.m.
  • Hy-Vee: Hy-Vee’s more than 550 stores around the U.S. are closed for groceries on Thanksgiving Day. Shoppers may pick up catered orders from 8 a.m. to 11 a.m.
  • Kroger: Store hours will vary on Thanksgiving Day, so contact your local Kroger to verify when they’re open. Some stores will be closed, while all open stores will close at 4 p.m. local time. All Kroger pharmacy locations are closed. 
  • Publix: All of Publix’s 1,386 grocery store locations across the Southeast are closed on Thanksgiving.
  • Wegmans: Most Wegmans stores are open on Thanksgiving until 4 p.m. In Massachusetts, the company’s stores in Burlington, Chestnut Hill, Medford, Northborough and Westwood are all closed on Thanksgiving.
  • Whole Foods: Many stores are open for limited hours. Check your local store’s website for its status.

Which convenience store chains are open on Thanksgiving?

  • CVS: Most CVS Pharmacy locations are either open from 9 a.m. to 2 p.m. on Thanksgiving or are closed. Check your local store’s hours using the CVS store locator.
  • Walgreens: Nearly all Walgreens stores will be closed on Thanksgiving. Twenty-four hour pharmacy locations will remain open, however. 
  • Dollar General: Most Dollar General stores are open on Thanksgiving. Check your local store’s hours using the company’s store locator.
  • Rite Aid: Rite Aid stores are closed on Thanksgiving, a company spokesperson told CBS MoneyWatch.

Which fast-food and restaurant chains can I eat at on Thanksgiving?

  • Burger King: Burger King outlets are open on Thanksgiving, but check the chain’s store locator since individual franchisees may have different hours.
  • Chick-fil-A: All Chick-fil-A restaurants are closed on Thanksgiving Day, according to the company’s website. 
  • Cracker Barrel: Cracker Barrel is open regular hours on Thanksgiving Day, with a traditional meal starting at 11 a.m. 
  • Dunkin’: Dunkin’ store hours on Thanksgiving vary by location, so check your local store’s hours here.
  • McDonald’s:  The fast-food giant’s Thanksgiving Day hours vary by outlet, so check your local McDonald’s
  • Olive Garden: All Olive Garden restaurants are closed on Thanksgiving Day. 

Are any clothing stores open on Thanksgiving?

Most clothing stores, including JCPenney, Macy’s, Marshalls, REI and TJ Maxx are closed for business on Thanksgiving Day. They open again on Friday. 



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Ukraine says Russia’s “tactics of terror” apparent in huge missile attack on energy sector as winter arrives

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Kyiv — Russia launched a massive attack Thursday on Ukraine’s energy sector, forcing emergency power outages as temperatures dropped to freezing across the country. Ukraine’s energy grid has been heavily targeted since Russia launched its full-scale invasion in February 2022, with Kyiv accusing Moscow of “terror” tactics by trying to plunge Ukrainian cities into darkness and cut off heating to civilians throughout the winter.

The overnight strikes come after two weeks of dramatic escalation that has seen both sides launch new weapons to gain an upper hand ahead of President-elect Donald Trump’s inauguration in January.

Ukraine’s Energy Minister German Galushchenko said power infrastructure was “under massive enemy attack” after a countrywide air alert was issued for incoming missiles.

People take shelter inside a metro station during a Russian military attack, in Kyiv
People take shelter inside a metro station during a Russian military attack, in Kyiv, Ukraine, Nov. 28, 2024.

Alina Smutko/REUTERS


The air force reported a string of Russian cruise missiles and attack drones heading for cities across the country, including the capital Kyiv, Kharkiv in the northeast and the Black Sea port city of Odesa.

Ukraine’s “energy sector is under massive enemy attack”

“Once again, the energy sector is under massive enemy attack. Attacks on energy facilities are taking place across Ukraine,” Galushchenko said.

National power grid operator Ukrenergo “urgently introduced emergency power cuts,” he added, as temperatures dropped to around 32 degrees Fahrenheit.

Energy provider DTEK said Ukrenergo was introducing emergency power outages in the regions of Kyiv, Odesa, Dnipro and Donetsk.

Officials warned residents in many cities to remain in shelters, with the air alert still in place.

“As soon as the security situation will allow it, the consequences (of the strikes) will be specified,” Galushchenko said.

President Volodymyr Zelenskyy’s chief of staff said the wave of attacks showed Russia was “continuing their tactics of terror.”

“They stockpiled missiles for attacks on Ukrainian infrastructure, for warfare against civilians during… winter,” Andriy Yermak said in a post on Telegram, pledging that Ukraine would respond.


How can NATO respond to Russia without escalating the war in Ukraine?

04:52

A senior United Nations official, Rosemary DiCarlo, this month warned Russian strikes on Ukraine’s energy infrastructure could make this winter the “harshest since the start of the war.”

Russia-Ukraine war escalates with new weapons

Russia earlier this week said it was preparing its own retaliation for Ukrainian strikes on its territory using U.S.-supplied ATACMS missiles.

Ukraine has launched at least three attacks on Russian territory with the long-range missiles since the White House gave it permission to fire them deeper into Russia.

Moscow responded to the first strike by firing a never-before-seen ballistic missile at the Ukrainian city of Dnipro. In an angry address to the nation, Russian President Vladimir Putin warned the nuclear-capable, intermediate-range, multiple-warhead missile could be used against Western countries if they let their arms be used by Ukraine to hit Russia.

Russia’s defense ministry said Thursday it had downed 25 Ukrainian drones fired overnight, including 14 over the southern Krasnodar territory — just to the east of the annexed Crimean peninsula.

Krasnodar’s governor said a woman was wounded by falling debris in the town of Slavyansk-on-Kuban, around 60 miles east of the Kerch bridge — the giant infrastructure project linking Crimea to Russia that Kyiv has heavily targeted throughout the war.

Trump taps retired general to lead on Ukraine, Russia policy

The latest missile salvo came a day after Trump named staunch loyalist and retired general Keith Kellogg as his Ukraine envoy, charged with ending the Russian invasion.

Trump campaigned on a platform of securing a swift end to the Ukraine war, boasting that he would quickly mediate a ceasefire deal — comments that have triggered concern in Kyiv that the U.S. will push it to cede land occupied by Russian forces.


Trump taps Keith Kellogg as special envoy to Ukraine and Russia

09:23

Kellog, an 80-year-old national security veteran, co-authored a paper this year calling for Washington to leverage military aid as a means of pushing for peace talks.

The outgoing Biden administration has urged Ukraine to drop the minimum age of conscription to 18 to plug severe manpower shortages across the 600-mile front line.

Russian troops have been advancing in the east for months, where they have a manpower and ammunition advantage over Ukraine’s stretched forces.



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