Credit Card Debt

This is a repost of mine - enjoy.

According to the National Foundation for Credit Counseling, the average American house has $15,788 in credit card debt.

O.M.G. !!!!!

That is a lot of money to owe someone, and if you are making minum payments, that amount will double before you pay it off! That is, if you aren't ever late with a payment...if you are, they can - and will - jack your interest rate up to 29.9% IN ADDITION to the late fee of about $30!! Now your amount won't double with minimum payments, it might triple! That $15K just became A $45K monstrosity that is robbing you of your retirement fund, your children of their college education and more.

(sigh)

Don't play their game!

First of all - stop using the cards! Move to an envelope cash system or something similar for your purchases. If you don't have the money - you don't spend it, it really is that simple!

Then, here is what you do: make a list of all cards, the interest rates and their balances. Your list should look something like this:

Visa 18.9% $2,100
Kohl's 14% $354
Discover 23% $1,400
etc.

Now rank them in order of interest rate, low to high so your list looks like this:

Kohl's 14% $354
Visa 18.9% $2,100
Discover 23% $1,400
etc.

Your first month - make the minimum payments off the Kohl's and Visa, they make a double payment for the Discover. You will find, that by simply doing that each month until the card is payed off, you will keep more money in YOUR pocket instead of theirs and the Discover card will be paid off faster than you thought possible!

When that card is paid off, start making TRIPLE payments on that Visa. This should be easier than you think as you are no longer making the double payments on that Discover card...

Soon, you are now paying off that Kohl's card and almost have that credit card monkey off of your back.
=)

Now, I know what you are thinking...HOW can I survive in today's world without a credit card? Easy! Go to Walmart.

Confused?
Let me explain. Walmart has a prepay CC - it costs you $3 and then you "load" it with money. You can now shop online, make hotel reservations, etc and will never again run up a huge balance that rips you off on finance charges. Seriously, this is a great option for a debt free lifestyle -- just give your local Walmart a call and ask about it, you will see.

I know some credit counselors say to KEEP your CC and use them occasionally to help your credit score (available credit window, etc) but I would rather have a debt free life than have a card just to play a game.

Here is my challenge to you: Do you know how much you owe on plastic? Make a list and make your plan to wipe it out.