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3 signs credit cards are ruining your finances (and how to fix it)

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There are signs to watch for if you’re worried that your credit card usage is becoming a debt trap for your finances.

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Amid persistent inflation, Americans are struggling under the weight of the current economic climate. Prices are rising across the board, from the grocery store to car insurance. Compounding the problem are high interest rates that are causing the cost of borrowing to skyrocket.  For example, since 2021, the average credit card interest rate has soared from 16.45% to 22.63%, according to the most recent Federal Reserve data.

That’s bad news for many Americans who must rely on credit cards to help make ends meet. According to a recent Clever Real Estate survey, 61% of Americans are in credit card debt, and roughly half depend on their credit cards to pay living expenses. When bills and debt consume so much of your home budget, there’s little room left to save for a financial emergency or retirement.

If your credit card debt rises beyond your means to repay it, the impact it could have on your finances could be catastrophic. If your credit card debt is at a level you’re uncomfortable with, it’s time to resolve the issue before it ruins your finances. 

Explore your top debt relief options now and start tackling your high-rate debt.

3 signs credit cards are ruining your finances (and how to fix it)

Here are three signs you might have too much credit card debt and tips to fix it.

Sign #1: You only make the minimum payments

Your credit card company gives you a grace period, usually between 21 to 25 days, to pay your balance in full. You won’t incur any interest charges if you pay off your entire balance within this period. However, if you only make your card’s minimum payment, usually around 1% to 3% of your balance, you must pay interest on the remaining balance.

“You’re in trouble if you can only make the minimum payments and can’t chip away at the balances,” Joseph Camberato, CEO at NationalBusinessCapital.com, says.

Camberato recommends controlling credit card debt before it gets out of hand. 

“If you ignore credit card debt, that can really mess up your (credit) score. A good rule of thumb is to keep your credit card balance below 33% of your total limit.,” Camberato says. 

High credit score achievers typically utilize less than 10% of their available credit.

Find out more about your credit card debt relief options here.

Sign #2: Your credit card debt is increasing

“It’s a bad sign if your credit card balances continue to increase despite making payments, which means your debt is growing uncontrollably,” says Leslie Tayne, a financial attorney at Tayne Law Group and author of Life & Debt. 

If you find yourself in this situation, it may mean you are relying too heavily on credit cards to cover expenses, which can lead to a cycle of debt that’s hard to break. To regain control, create a strict budget that minimizes unnecessary spending. Also, consider increasing your income by volunteering for extra hours at work, requesting a wage increase if warranted or taking on a side hustle.

Sign #3: You’re falling behind on payments

“Another red flag is if you start missing payments,” says Camberato. “These are clear signs that your spending is outpacing your income.”

You may be able to get away with minimum payments while your credit balance continues to grow, but it could eventually lead to late or missing payments. 

“Late payments and high balances can cause significant damage to your credit score, which makes it more difficult to get approved for credit in the future,” says Tayne. “And if you are approved, you’ll be more likely to pay high interest rates. Bad credit also makes it more difficult to rent an apartment, open utility accounts and even get certain types of jobs.”

4 strategies to tackle credit card debt

The first step to reduce your credit card debt is to cut discretionary spending to free up more money you can apply to your debt balances. 

Start with recurring bills like seldom-used gym memberships or streaming services. And, consider shopping different car insurance companies to see if you can find similar coverage with lower premiums. 

Next, consider your options, which may include the following:

Debt repayment strategies

The two most popular strategies are the debt avalanche and the debt snowball methods. The avalanche method focuses on paying off the debt with the highest interest rate, while the debt snowball method prioritizes paying off your lowest credit card balance first. You’ll likely save more money with the debt avalanche method, but you may prefer the snowball method if you think the momentum from quick wins will motivate you to keep going.

Debt consolidation loan

A debt consolidation loan allows you to combine all your credit cards into one personal loan you repay in fixed monthly payments for a specific term. The benefit of a debt consolidation loan is that you can get a lower interest rate and simplify your finances by replacing multiple payments with a single one.

Balance transfer credit card

With good credit, you may qualify for a balance transfer credit card with an introductory 0% APR for a specific period, usually up to 21 months. That could give you plenty of time to pay down debt interest-free, but be aware these cards usually come with an upfront balance transfer fee of 3% to 5% of the amount you transfer on average.

Credit card debt settlement

One way to lower your credit card balances is to call your creditor and negotiate for a lower balance. Alternatively, debt settlement companies can negotiate with your creditors on your behalf. Consider the pros and cons of pursuing this path and make sure you go with a reputable company, says Camberato. 

“Do some research, read reviews, and make sure the company is legitimate. While some companies can help, others might do more harm than good. Some companies might tell you to stop paying your credit cards and pay their company instead and that leads to late payments and a wrecked credit score,” Camberato says.

The bottom line

There are some big signs to look for if you’re worried that your credit card debt is impacting your finances — but there are also some decent solutions to fix the issue. In addition to options like credit card settlement and debt consolidation, you might consider working with a credit counselor if you’re having trouble managing your finances and credit. These advisors can help you create a budget or debt management plan to help zero out your credit card debt. 



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What we know about offensive text messages sent to Americans after 2024 elections

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Black, Hispanic and LGBTQ+ Americans across the U.S. say they received offensive text messages after the 2024 elections. CBS News Confirmed executive editor Rhona Tarrant breaks down what’s known about the racist and insulting remarks.

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House Ethics Committee to meet Wednesday amid growing pressure to release Gaetz report

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Washington — The House Ethics Committee is set to meet Wednesday as it faces increasing pressure to release a potentially damaging report detailing its investigation into allegations former Florida Rep. Matt Gaetz engaged in sexual misconduct and illicit drug use, two sources told CBS News. 

The movements of the Ethics panel have been under heightened scrutiny since President-elect Donald Trump announced last week that he had selected Gaetz to serve as attorney general. The Florida Republican resigned his seat in the House in the wake of the announcement, which ended the Ethics Committee’s jurisdiction over Gaetz since he is now a former member.

The Ethics Committee declined to comment on the upcoming meeting. The panel was supposed to meet Friday to vote on releasing the report, but Trump tapped Gaetz for the nation’s top law enforcement officer days earlier. The committee then postponed its meeting.

Gaetz must win Senate confirmation to serve as attorney general, and senators have been calling to see the Ethics Committee’s report as they weigh whether to approve his nomination. Any confirmation hearings, which would be conducted by the Senate Judiciary Committee, would not take place until next year after Trump is inaugurated. Republicans will gain control of the upper chamber in the next Congress, which begins Jan. 3.

Sen. John Cornyn, a Texas Republican, told reporters last week that he believes senators should have access to the Ethics Committee’s findings.

“I think there should not be any limitations on the Senate Judiciary Committee’s investigation, including whatever the House Ethics Committee has generated,” said Cornyn, who sits on the Judiciary Committee.

GOP Sen. Markwayne Mullin of Oklahoma, a Trump ally, similarly told NBC’s “Meet the Press” on Sunday that he believes the Senate should be able to see the report on Gaetz.

“Congress has to advise and consent, and Matt Gaetz is going to go through the same scrutiny as every other individual, and I’m going to give him a fair shot, just like every individual, and at the end of the day, the Senate has to confirm him,” he said.

But House Speaker Mike Johnson has cautioned against the release of the report by the Ethics Committee, warning in an interview Sunday that doing so for someone who is not a current House member “would be a Pandora’s box.”

“What I have said with regard to the report is that it should not come out. And why? Because Matt Gaetz resigned from Congress. He is no longer a member,” Johnson told CNN’s “State of the Union.” “There’s a very important protocol and tradition and rule that we maintain that the House Ethics Committee’s jurisdiction does not extend to non-members of Congress.”

The House Ethics Committee first began its investigation into allegations of misconduct against Gaetz in April 2021, but deferred its consideration in response to a request from the Justice Department. It resumed its investigation in May 2023 after federal investigators declined to charge Gaetz following their sex-trafficking and obstruction probe.

Gaetz has denied any wrongdoing and blamed the ethics probe on former House Speaker Kevin McCarthy. He has called the investigation a “smear.” The Florida congressman helped lead the historic effort to strip McCarthy of the speaker’s gavel last year.

The ethics panel said in June that it had spoken with more than a dozen witnesses, issued 25 subpoenas and reviewed thousands of pages of documents as part of its investigation into Gaetz, and determined that “certain allegations merit continued review.” 

The committee said it was examining accusations Gaetz engaged in sexual misconduct and illicit drug use, accepted improper gifts, gave “special privileges and favors” to people close to him and sought to obstruct government investigations into his conduct. 

Multiple sources told CBS News at the time that four women told the Ethics Committee that they had been paid to go to parties, which Gaetz attended, that included sex and drugs. The panel has the Florida Republican’s Venmo transactions that allegedly show payments for the women. One woman who testified to the Ethics Committee said she had sex with Gaetz at a party in 2017, just after he was elected to Congress and when she was 17 years old, sources told CBS News at the time

Her lawyer, John Clune, said on social media last week that she was a high school student and “there were witnesses.” 

“We would support the House Ethics Committee immediately releasing their report,” Clune wrote.



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Two women told House ethics panel Gaetz sent Venmo payments “for sex” and asked about “party favors,” their attorney says

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Two women interviewed by the House Ethics Committee about former GOP Rep. Matt Gaetz of Florida, President-elect Donald Trump’s pick to be attorney general, testified that Gaetz paid them directly and repeatedly in Venmo transactions “for sex,” and that those transactions were obtained by the committee, an attorney for the women told CBS News. The attorney, Joel Leppard, also said the women testified that Gaetz inquired in text messages about “party favors” and “vitamins” at upcoming parties, which was understood to be code for drugs.

Leppard, who is based in Orlando, said his clients testified that they attended parties from 2017 to January 2019 where Gaetz was present and sex and drug use took place. In an interview Monday with CBS News chief Washington correspondent Major Garrett, Leppard said one of his clients testified before the House Ethics Committee that she witnessed Gaetz having sex with a 17-year-old girl against a game table at a July 2017 party. Gaetz was sworn into Congress in January 2017, so all of the events the women allege took place while he was a member of the House. 

Officials with the Trump transition team and attorneys for Gaetz did not respond to requests for comment Monday. One source familiar with Gaetz’s legal position questioned the credibility of the women and argued their recollections would not have withstood cross examination in court, had it come to that.

Gaetz, who has denied all wrongdoing, including having sex with a minor, has blasted the committee’s investigation against him and on Thursday called the testimony about him a “false smear.”

Gaetz’s conduct was also investigated by federal prosecutors, but they ended the probe in 2023 without filing charges.

As the House Ethics Committee weighs whether to release its report, which investigated allegations that Gaetz engaged in sexual misconduct, illicit drug use and bribery, Leppard said his clients want the public to know they are telling the truth. 

One of his clients said in a text to Leppard, “‘Regardless of how many times he tries to distract from the truth, the public deserves to know that what we all experienced was real and actually happened.'”

“My clients are not political; they didn’t vote in the last two elections — they don’t care one way or another,” Leppard told Garrett. “But they do want the public to know that they are not lying. They did not come forward willingly — they have never spoken to anyone without a force of a legal subpoena.”

He continued, “And if the American people would know, then they could decide if that’s the person they want to be the next attorney general.”

One of Leppard’s clients is among at least four women who have told the committee they were paid to attend parties with drugs and sex where Gaetz was present, according to multiple sources familiar with the matter. Her account corroborates the testimony of the then-minor, who told the committee that she had sex with Gaetz when she was 17 years old.

At the July 2017 party where his client alleges this occurred, Leppard said she and others were “at the party in order to provide entertainment, to be happy, to be lively and provide sexual favors for the gentlemen that were present.”

“The expectation was that they would have sexual intercourse,” Leppard said his clients testified about these parties. “They testified to the House that — and the House actually had their Venmo transactions, PayPal transactions, of Representative Gaetz.” 

Leppard said the House panel asked the women about Gaetz’s PayPal and Venmo transactions.

“‘What was this for? What was this for,'” Leppard said his clients were asked. 

“‘This was for sex,'” he said they responded. “‘This was for sex. This was for sex.'”

Leppard said the payments were typically between $200 and $500 at a time. 

He said his clients also testified that sometimes, someone other than Gaetz would make a payment on his behalf. On at least one occasion, according to Leppard, that was Nestor Galban, a Cuban immigrant who is close to Gaetz and whom Gaetz has referred to as his “son.” He said other payments on Gaetz’s behalf were made by Gaetz associate Joel Greenberg, who was convicted in 2022 of sex trafficking of a minor and other crimes.

Leppard said his client who testified that she saw Gaetz having sex with the 17-year-old also told the panel she did not believe Gaetz was aware of her age at the time. 

“My client, at least, testified that he did not know her age,” Leppard said. 

Leppard’s client testified that she knew the 17-year-old girl and her age, and said the two attended high school together. 

His client testified that she had sex with Gaetz after arriving at the July 2017 house party. Later during the party, his client testified, she was walking outside when she saw Gaetz having sex with her friend, the 17-year-old, against the gaming table. 

Leppard said one of his clients provided more than 100 texts involving Gaetz to the committee. Frequently, Leppard said, the texts his client provided showed Gaetz would have to be reminded to pay. 

“There was a lot of texts requesting payment, like, ‘Hey, when are you going to pay me?'” Leppard said. “Or, ‘I don’t want to be that girl, but can you please go ahead and pay me what we agreed upon?’ Text messages along those lines. The texts the House was more interested in was the ones where Representative Gaetz was seemingly requesting that drugs be present.”

“So, in my line of work as a criminal defense attorney, no one ever requests, ‘Can you give me some drugs, please?'” Leppard said. “They usually use code words. And so Representative Gaetz would use terms like, ‘Can you make sure that there are party favors present?’ Or, ‘Who’s in charge of party favors?’ He used the term ‘party favor mecca’ when he was referring to another individual who was bringing party favors. He also used the term ‘vitamins,’ I believe.”

Still, Leppard’s clients told the House panel they could not specifically recall whether they had seen Gaetz use marijuana or other drugs. 

The texts also included a “lot of positive emojis,” Leppard said, like hearts, and “positive statements” back and forth between Gaetz, his clients and others. Leppard characterized the relationship with Gaetz as a complicated one, but also one of friendship, and he also told Garrett that his clients knew Gaetz’s girlfriend at the time. 

“At least one of my clients testified that, in a sense, they were required to please Mr. Gaetz before going out and attending their [Electronic Dance Music] show,” Leppard said of one alleged occasion about which his client testified. “And that was something that was of particular interest to the House. Representative Gaetz’s girlfriend texted them, and they essentially took care of their duties, and later on, they went to see their show.” 

Leppard said his clients have “been through heck” and are worried that if they testify before the Senate or anywhere else publicly, “they might not be safe in their jobs.”  

The House Ethics Committee had planned to vote Friday, Nov. 15, on releasing its report, but the meeting was canceled after Trump announced his intention Wednesday to nominate Gaetz, and then a few hours later, the Florida Republican abruptly resigned from Congress.

House Speaker Mike Johnson said Friday he would “strongly request” that the House Ethics Committee withhold the report on its investigation into Gaetz. The committee has equal representation among Democrats and Republicans — five Democrats and five Republicans. 

Democratic and Republican senators who would vote on Gaetz’s confirmation as attorney general have said they want access to the ethics panel’s report.

contributed to this report.



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