Each month, you receive a statement from your credit card company. But do you really take the time to read it? If you did, would you know what to look for?

There is a lot of fine print in those statements, so it can be tempting to skim the details. However, savvy consumers know that it is well worth the effort to review each and every credit card statement—no matter how little time you have. In fact, you can review a credit card statement in five minutes or less.

On Tuesday, MMI was one of nine organizations that participated in an all day call-in event called Your Money Marathon. During the course of the day, we had received a whopping 14,000 phone calls. It quickly became clear that callers shared some common concerns and I wanted to address these concerns in the blog. Yesterday, I talked about settlements. Today, I would like to talk about rising credit card interest rates.

Credit card interest rates are being raised even though the Fed has cut interest rates. Rate hikes can have a huge impact a person’s financial situation—particularly those who are on the edge financially. Here are a few rate-hike scenarios and suggestions on how to handle them.

-If you get a letter in the mail saying that your rate is being hiked due to no fault of your own, read the fine print—you may have the chance to refuse the change. In many cases, you are given a chance to refuse the term change if you write to the creditor. This action would mean that you are no longer able to use the card, but you would be able to repay any balance at the original rate.

-If you are late on a payment and trigger the default rate, you might want to communicate with your creditor. A creditor does not have to readjust your rate upon request, but some people claim that they have had success with this tactic. If your initial call is unsuccessful, ask to speak with a supervisor. Be clear about what you want, but not confrontational.

-If a temporary setback resulted in actions that triggered a default rate, ask your creditor if they will place your account on a temporary hardship program. Many creditors have programs in place to help consumers recover from unexpected setbacks such as a job loss or medical emergency.

-If you are unable to lower your rate, you can try to seek a card with more advantageous repayment terms. However, consumers who have less than an excellent credit score may find it more difficult to qualify for a new credit card account. Also, there is nothing to say that your new card’s lower rate won’t be raised in the future.

Finally, if you are having trouble making minimum payments on high interest debt, do not allow the problem to escalate. Talk to a certified credit counselor to see if they can work out a revised payment plan with your creditor.

Of course, the best thing you can do is to reduce your reliance on credit entirely. (I do realize that this is easier said than done.)

Yesterday, MMI was one of nine organizations that participated in an all day call-in event called Your Money Marathon. The calls came in at a rate of about 1,000 an hour. By the end of they day, we had received an astonishing 14,000 phone calls.

I personally answered calls by concerned consumers. By noon, it was clear that there were some very common concerns. I am going to address one of these concerns each day over the next few days. Today, I will talk about settlements. I have written about the pros and cons of debt settlement in the past, so I am going to address one specific settlement issue as expressed by a woman from Aurora, Colorado.

Question: We found ourselves about $20,000 in debt to credit cards. Not wanting to go bankrupt, I made deals to pay the credit card companies 40 cents on the dollar. Now I am hearing that the credit card companies will issue 1099 forms for the debt forgiven. Is that true? I was never told about this. I will be forced to file for bankruptcy!

Answer: IRS Publication 982 states if a debt is cancelled or forgiven and a debtor receives a Form 1099-C, Cancellation of Debt, the debtor generally must include the cancelled amount in gross income for tax purposes.

There are several exceptions from the inclusion of cancelled debt in income. One of the exceptions in having to include this debt as income is if you are insolvent. You are insolvent when your liabilities exceed the fair market value of your assets. If you wish to claim the insolvency exclusion, you will need to fill out and include with your tax return, Form 982 “Reduction of Tax Attributes Due to Discharge of Indebtedness.”

If you have questions about whether or not you will have to pay taxes on a forgiven debt, please seek the services of an accountant familiar with tax law. You can also find a lot of tax information at IRS.gov.