Some people feel that they are staying afloat by making their minimum monthly payments on their credit cards. But this won’t clear all of that debt hanging over you. That was the case with this man who was getting by making the minimum payment on $150,000 of credit card debt (along with a million dollar mortgage and a home equity line). His income changed and suddenly he realized that he wasn’t going to be able to make this minimum payment anymore. He sought debt help to determine if bankruptcy was his only solution.

The basic problem: Thinking you’re living within your means if you can make the minimum payments. (Living within your means actually means only spending what you make, or ideally spending less!)

To avoid this problem: You need to make a commitment to only using credit cards for emergencies. You should pay off balances in full each month. You should not spend more than you make.

Additional resources for people who are barely keeping their head above water:

• Strategies for Sticking to Your Budget
• Advice on Using a Credit Card
• What to Do When You Can’t Make Your Minimum Payment
• Should You Save Money if You Have Debt?

Next debt horror story: Divorce and the Credit Card Shuffle