There has been an explosion in the number of credit cards for only one reason: the credit card companies make a ton of money charging high interest! They also know that people spend aboutone-third more when they use credit cards rather than cash. The average household with an unpaid balance has about $10,000 in credit card debt.
Here are some suggestions to help you pay off your plastic.
Snowball the Plastic!
Snowball your way out of debt! In addition to making the minimum payments on all your credit cards, focus on paying off the smallest balance card first. You’ll be encouraged to see its balance go down and finally to be completely paid.
Then, after the first credit card is paid off, apply its payment toward the next smallest one. After the second card is paid off, apply what you were paying on the first and second toward the third smallest. That’s the snowball in action!
So…where do you start? List your debts in order with the smallest remaining balance first. Every time you pay off one don’t forget to celebrate!
Perform Plastic Surgery!We started with nine credit cards, and today we carry two that we pay in full each month. Fewer credit cards makes life simplier! So, cut up the cards you do not really need. If you can keep the cards you’ve had the longest it will help your credit score.
Also, opt out of receiving telemarketing calls and credit card offers by mail.
Log on the Web site of the National Do Not Call Registry at www.ftc.gov/donotcall to stop telemarketers. To stop junk mail, call toll free 1-(888)-5OPT-OUT. You’ll be really glad you did.
Lower the Interest Rate!
There is a lot of competition among credit card companies for your business. If your company is charging a high interest rate, phone and ask them to drop it. You may have to call several times, but 75 percent of the time, they will lower the rate.
Another alternative is to transfer the balance to a card that charges less interest. Before switching to a lower-rate card, confirm that the new card has no transfer fee, no annual fee, and that the interest rate on transferred balances is not higher than the advertised rate. But remember, if you miss a payment or make a payment late, your interest rate will automatically skyrocket in most cases.
Copyright (c) 2011 by Compass-finances God’s way TM. All rights reserved.
What’s the most published and most read book in history containing more than 2300 references to money and is worth more than its weight in gold? I think you already know the answer. Of course, we’re talking about the Bible. Every speck of wisdom in this world is found within its pages and we’ll dive into that today including a few verses sometimes overlooked from a financial perspective. Then it’s your calls at 800-525-7000.
· John chapter 14, verse 27, Jesus says, “Peace I leave with you; my peace I give to you. Not as the world gives do I give to you. Let not your hearts be troubled, neither let them be afraid.”
· “Peace to you” was a common salutation among Jews in the first century A.D., and it’s repeated often throughout the New Testament. Jesus means that true peace comes from knowing that we’re reconciled with God through faith in Him. But what does it have to do with money?
· Jesus tells us that by focusing on God everything we need in this world will be added to us. But when we rely on our own power to provide, we have to be reminded constantly that God owns everything that He is our Provider not just of wealth, but even our skills and abilities to acquire it.
· Proverbs 12:11 tells us, “Whoever works his land will have plenty of bread, but he who follows worthless pursuits lacks sense.”
· Proverbs 14:23: “In all toil there is profit, but mere talk tends only to poverty.”
· Proverbs 12:24, “The hand of the diligent will rule, while the slothful will be put to forced labor.”
· So, we must work heartily wherever we feel God calling us and He will provide the rest. Believing that leads to contentment. Of course, we’re to use our brains as well as our hands when we work. We should plan carefully in all that we set out to do whether that’s earning, saving, or giving.
· And of course we must be totally honest in all that we do. Psalm 37 tells us, “Better is the little that the righteous has than the abundance of many wicked.”
· In Matthew 25, He talks about separating the sheep and goats on Judgment Day. Jesus says, “Truly I tell you, whatever you did for one of the least of these brothers and sisters of mine, you did for me.”
· When we care for the poor we’re caring for Jesus Himself who has the power to welcome us into eternal dwellings. That’s truly a wise use of worldly wealth.
Here are a couple of questions we answered from our callers on today’s program:
· I am going to be 85 years old. I live with my daughter and son in law. I was left with a considerable amount of money in the bank. I have trusts for my children. Is it feasible to invest some of this?
· I am looking at buying a property. Since all house prices are up, should I wait for the housing bubble to pop?
· What are your thoughts on an index universal life program?
· My husband and I cashed out our 401K and bought property and started a business. We are reducing debt and don’t keep a credit card balance. Should we put money back into a 401K or somewhere else?
Ask your questions at (800) 525-7000 or email them to Questions@MoneyWise.org. Visit our website at MoneyWise.org where you can connect with a MoneyWise Coach, purchase books, and even download free, helpful resources like the MoneyWise app.
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