by Tricia
Whew…it took me a while to get this ready, but I finished running the numbers in Quicken and formatting the charts in Excel. I only ended up reducing my debt by $409 and of course I would have hoped for more progress there. I still had quite a hit with the finance charges of $330.53, but next month should be a very pretty picture in terms of finance charges. It’s funny how my attitude has changed – now I want to hurry up and see my credit card statements 🙂
I mentioned earlier today, well yesterday now, that I am feeling quite uneasy about how my debt is spread out with balance transfers. It’s late and I should get some sleep so I will elaborate more this weekend.
NOTE: This blog focuses on my credit card debt, but because my Prosper loan transferred some of that debt away, it will now be included in future reports.
You are doing great! Keep it up and it will be gone before you know it. You are staying focused….that’s the most important and that your debt will never be as much as it is now. It will keep going down.
GREAT JOB!
I hope you are relaxing a bit now. Debt will make you age–at least the stress from it. Looks to me like you are on the right track.
One suggestion – so you don’t forget payments or lose your new lower rates. Make the minimu payments automatic for the day before they are due. Then continue to pay extra when you can.
Maybe you already do this?
I’m cheering you on!!!
-d
Thanks LeighAnn!! I don’t ever want to have my debt that high again. I want to go to cash only living.
D – It’s funny, blogging about my debt is actually making me stress less about my debt. Probably because I am keeping better track of it. I kept track before, but I never had all the info staring me in the face. I have a way in Quicken that helps me to not pay things late. It’s hard to explain. I think the thing I worry about most is having a balance transfer expire and being stuck with a high interest rate again.
You can try to pay your way out of debt, but the result is inevitable. The system is deliberately designed to make you fail. It uses the credit reporting system to manipulate you into paying, then your ego, and fear of being sued.
Let me tell you this, if you are not paying the balance every month, you will inevitably fail, lose all of your cash, have very bad credit, etc.
A. As if you didn’t already know, the consumer credit system is rigged in favor of its investors, not its customers. By changing your perception “debt” you will see your way out and new opportunities.
B. Understand that credit card payments are cash flows to creditors, and in many cases, securities that are purchased everyday. That is, you can buy them via the stock exchange.
C. If you have debt, let’s say credit card debt, you got that money legally. The longer you keep it, the more it benefits you. There are laws that make this easy once you have the knowledge.
D. The interest rates charged by creditors tell you when to stop paying, when your risk is too high. We’ll discuss something creditors refer to as “universal default” and how it can be used to lower your risk to creditors.
E. The same habits of borrowing and spending that got you into debt will not get you out of debt. Getting out of debt requires new thinking and new habits.
1. More Debt is Inevitable
The banking system has created a deliberate economic cycle with consumer credit cards. They profit at each stage, it goes like this: They originate (counterfeit) “money” for your credit account. This is based on your credit history, and the better your credit history, and the longer you continue paying, the more credit accounts you can have. This cycle continues until you are not able to continue paying on their terms. Then your credit score goes down and your interest rates and payments increase.
Eventually you no longer benefit from the use of these credit cards, are unable to use them, will have no more available credit and then find yourself in a collection process. Unless you pay your credit card balance in full each month, you are inevitably caught in this cycle and it will take its course.
Settlement, bankruptcy, counseling and consolidation are all part of the same system, to induce you to continue paying in some way. The more payments that the system can get from you, the more valuable are their cash flows (receivables) and the more dividends they can pay to shareholders.
The statistics show that if these methods help you get out of debt, in nearly every example, you will need to give up all of your cash and you will still lose your credit history or borrowing power. The alternative is that the bank simply obtains a judgment lien and then begins taking your income, property and assets involuntarily.
The bank profits from day one, they sell an interest in your credit account to investors, they have it insured and if you don’t pay, they claim it as a loss and the tax payers pay for it (us) and then sell the value of the account to a third party collection firm who tacks on huge fines, penalties and attorney fees.
Remember that all of these systems, programs or services that people believe will get them out of debt were created over many years by many thousands of attorneys working only for the benefit of the credit and banking system. Your financial well being has never been in their plan.
Many people will tell me or believe that they don’t have debt problems, even if they are not paying their balances in full each month. They say they have a job, or two jobs and can easily make the minimum payments, oh, and that their interest rates are very low.
A business practice known as “universal default” changes all of this, because if this person is late on one payment, for any reason, maybe he forgot, was out of town, didn’t tell the bank about his new account number, whatever, the credit reporting services notify all creditors that there was a late or missed payment and immediately, all interest rates jump to usually 29% and 39%. Almost always, this is a disaster and that’s party why I say that “more debt is inevitable”. The system is designed for you to lose, and this is just one way of insuring that.
During and following my experience with debt, I learned some very important lessons that I would like to share with you:
1. The “debt” I thought I had was actually tax free money that I legally received from my creditors.
2. My creditors already factored into the “loan” the chance that I would not pay the balance in full someday.
3. My creditors were very sneaky, they didn’t tell me that they had a license to create money from nothing and call it a loan, as if they lent their own money when they really did no such thing.
4. Instead of paying creditors first with my available cash, I could invest my cash into assets that could later be used to pay creditors, either my current creditors or future ones.
5. After my creditors were paid, I would still have my cash and assets working for me.
6. After six years of applying my new knowledge
I became a millionaire and just a couple of years after that, I had acquired a net worth of over five million dollars!
The most powerful message I can give you about my experience and what I’ve observed with tens of thousands of success stories is captured in my new dialogue, What Would Your Attorney Say?
John Gliha
Blowing the Whistle on Credit Card Debt