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The $10,000 Credit Card Challenge
ever wonder how some people deep in credit card debt manage to come out on top financially? this is the hypothetical but realistic story of emily, one person who dug herself out of $10,000 in credit card debt in just a few years.never a big spender, emily was shocked when she noticed that her two credit cards had a combined balance of $10,000. what happened?
the millennium.
get one with a lower mortgage. she didnt sell her expensive car to buy a
cheaper one, since she would get much less than she had paid for it. in
reality, the thought of driving a less-nice car was painful
was paying interest, and interest on interest, buying the privilege of having
the credit card company hold onto her debt another month.
of the credit limit, her interest rate on the card skyrocketed from 17 to 27%
.
emily considered taking out a loan to pay off her credit card debt. she owned a condominium whose property values had increased 40% since she bought it, so she could easily get a good low-interest second mortgage.
but a loan scared emily: it would mean admitting her debt would not go away soon. besides, emily wanted to get rid of her debt, not trade (her unsecured debt for secured debt). plus, she knew that if she ever couldnt pay the second mortgage, she would lose her house, while failing to pay credit card bills would just mean a ruined credit rating.
for about a year, emily argued with herself over whether to take out a loan to pay off her credit card. then catastrophe hit: her beautiful car was totaled in an accident. while shopping for a new car with friends, emily finally had to admit to herself that buying another car like the one she had had would be financial suicide.
finding an answer
emily cried and cried as soon as she got home from the car dealership that day. it wasnt just that she would have to admit that she wasnt someone who could afford the car she had been driving. when emilys parents were her age, they had already bought a five-bedroom house; emilys one-bedroom condominium was already a stretch. if she ever got married to a man with the same financial picture as she had, she wasnt sure theyd be able to afford children. growing up, her parents had always told her shed do better than they had. what went wrong?
emily did not have to think hard about what went wrong. her father had been able to pay for college with what he earned at summer jobs, and then got a manager-level job straight out of school. between college and graduate school, emily had accumulated $70,000 in student debt that she was still slowly paying off. houses in emilys town, even adjusting for inflation, cost several times what they did when emilys parents bought one. cars had leaped in price about as much. the only thing that hadnt gone up was income.unable to cope with having less than her parents had, emily had used her credit cards.
solving the problem
emily knew that since her lack of financial skills had dug her into her rut, she would need outside help to dig herself back out.she had heard about credit counseling services that took large chunks of the payments you made against your debt, so she was careful. she found a counseling agency that was a member of the better business bureau, american association of debt management organizations and whose credit counselors are certified through the national institute for financial counseling education. doing a quick search on the web, emily verified that these were organizations with real standards and not just empty names.
heres what emily got from the credit counseling service:
in fact about average for americans. the credit counseling agency showed her
that even if she didnt have the advantages she had?a decent job and home
equity?she would be able to rid herself of her debt if she just faced up to
it.
even as her credit card interest mounted. but once she started saving, she
felt amazing. she realized she had been under enormous stress from always
being one paycheck away from poverty.
loan, and helped her create a budget that would let her pay off her
consolidated debt within a few years. besides the car, all emily had to give
up were smaller expenses.
about her financial situation. she figured out how much more money she would
have to make to have her desired lifestyle, and aggressively pursued a new
job. starting fresh with her new coworkers, emily focused on meeting people
who were less materialistic?and even met her fianc?.
joel walsh has created a guide to choosing a credit counseling service: http://debtguru.com
article source: http://ezinearticles.com/?expert=joel_walsh
Credit Card Late Charges And How To Avoid Them
it is simply getting ridiculous the charges credit card companies are imposing on consumers who are late making payments. yes, creditors have a legal right to do what they are doing, however ethically speaking that is certainly open to debate! lets look at some ways you can avoid costly credit card late fees:
1. pay your bills on time. this one is obvious. when you get your bill, open it up and pay it right away. waiting means forgetting or hoping that your payment arrives on time.
2. pay online. paying via your computer is faster than mail services, but there is still some lag time from when you authorize a payment and when the payment is finally credited to your credit card account.
3. automatic payment. if your credit card provider permits it, have them automatically deduct a set amount from your account every month. that way theyll get their funds well in advance of their due date.
4. fight it. just because the credit card company said that your payment was late doesnt mean that it was late. call them up and ask them to reverse the charge -- now as high as $39 -- and to adjust their records accordingly.
allowing credit card companies to run roughshod over you is one sure way to worsen your credit card woes. know your rights and take action as required.
copyright 2005 -- matthew keegan is the article writer who writes on a variety of topics including: advocacy, automobiles, aviation, business, christian themes, family, news, product reviews, travel, writing, and more. samples from his portfolio are available right online.
article source: http://ezinearticles.com/?expert=matthew_keegan
Cash Back Credit Card: Earn While You Spend!
cash back credit cards are an excellent way to earn money while you spend! instead of making purchases with standard credit cards, you might want to consider applying for cash back credit cards because such cards reward you with cash back on every purchase you make! further, in addition to cash back on all of your purchases, cash back credit cards offer you the opportunity to afford additional savings, in ways you might not have imagined possible.
cash back
the obvious benefit derived from having cash back credit cards is the money that consumers get back on every purchase. frequently, credit card issuing companies will supply credit card users with approximately 5% cash back on certain purchases like those made at drug stores, supermarkets, and gas stations. additionally, many credit card companies will give 1% cash back on all other purchases. needless to say, if you use your credit card frequently, such benefits can add up quickly. further, your accumulated savings can be used for just about anything, but you can really save if you follow the example provided below.
savings
due to the fact that you save 1 to 5 percent on many of your purchases made with cash back credit cards, you can find yourself saving quite a bit of money. lets take a look at the example provided below to analyze the possibilities.
if you spend $1000 at supermarkets, $200 at drug stores and $300 dollars at gas stations in three months time, you will have spent $1500. now consider this:
$1500 x 5% = $75.00
thus, you save $75.00 for every $1500 you spend with your cash back credit card! now project such savings over one years time. for instance, if you spend approximately $1500 every three months at establishments that make you eligible to receive 5% back on your purchases you will have spent $6000.00 for the year. now, consider the savings:
$6000 x 5% = $300.00
making your savings work for you
so, what can your savings do for you? plenty! with the $300.00 you save, you can store it away for a rainy day or you can reward yourself for being so credit savvy and for saving yourself some money!
copyright 2005 ed vegliante. you may freely reprint this article provided the resource box remains intact with a live link back to http://www.freeroller.net .
ed vegliante is the owner of http://www.freeroller.net , a well organized credit card directory enabling the user to compare and apply for a variety of credit card offers including cash back credit cards. find links to secure online credit card applications.
article source: http://ezinearticles.com/?expert=ed_vegliante
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