How do I pay off $50,000 in credit cards?

Q: I have $50,000 in credit cards. On the radio last year, you gave the name and phone number of a credit counseling service that you trusted. I need the phone number and name of that service.

A: You sure do! Call Consumer Credit Counseling Services at 800-388-2227. In the Chicago area, it will answer "Money Management, Inc." You can trust them.

So, did you also hear the "secret formula" for paying down that debt in less than 3 years? I'm guessing that your minimum monthly payments total about $1300 to $1400 (total on all cards). If you can DOUBLE that minimum monthly payment -- to say $2700 -- and keep paying that amount EVERY month, you'll have the cards paid off in a little over 2 years!

If that's impossible, then you're still digging yourself a deeper hole every month, by paying less, as the finance charges mount up! That's the simple math -- and you could be repaying 5 times the amount of your original purchase if you're only paying the minimums -- and it will take you at least 20 years to pay it off.

Now, with that perspective, you'll have some choices.

CCCS has a debt repayment program. It does go on your credit report, whereas just talking with them about your situation does not impact your credit report. They'll contact all your creditors, and they're pretty good at getting the creditors to erase late charges, lower interest rates, etc. Then you send one check monthly to CCCS, and they'll parcel it out to your creditors.

If none of this is possible, then bankruptcy is an option. But you won't know until you meet with a trained credit counselor and get help analyzing your situation. Beware of companies that offer to "consolidate and negotiate" on your behalf to wipe out debt. These are typically rip-offs.

Once you face up to the realities, you can make a better decision. That's why I always recommend CCCS. The number, again, is 800-388-2227.

Terry Savage is a registered investment advisor and the author of the newly published The Savage Number: How Much Money Do You Need To Retire? (256 pages, Wiley, $24.95).