Are you struggling with debt? I’ve been there (and it was a major cause of my divorce). This is information I wish I had known then. As always, feel free to comment below.
Step 1: Draw a Debt Picture
Gather all your statements and enter your information in the Debt Payoff Info worksheet. You’ll need to know your balance, interest rate and current payment. Total the balances and the payments. Acknowledge that you used your credit cards to fund your lifestyle and move on to debt-freedom. Get my free Debt Payoff Info worksheet in Excel or Adobe.
Step 2: Stop using your Credit Cards
The credit card companies are masters at this game and if you’re carrying a balance, you’re on the losing end of the deal.
- Did you know that new purchases don’t have a grace period if you have a balance?
- Did you know that new purchases don’t usually get the existing teaser rate?
- Did you know that if you have multiple interest rates on the same card that most or even all of your payments will go to the balance with the lowest interest rate while the balances at the highest interest rate just keep compounding?
These are all great reasons to stop using your credit cards now!
Step 3: Convert Minimum Payments to Fixed Payments
This is the beautiful part! Let me explain.
When you get a home and auto loan, you pay the same amount of money for a specific amount of time and then you’re done and the debt is paid off. With a credit card, though, your payment is a percentage (usually around 4%) of your balance. As you make payments, your balance drops and so does your minimum payment. This is what will keep you in debt jail for a very long time.
However, you don’t have to make just the minimum payment. I recommend that you take the minimum payment from this month and pay that same amount every single month until it is paid off.
Converting your credit cards payments to fixed payments can save years and years and thousands of dollars. Let’s see how much this method can save by looking at one client’s debt information:
| Name | Interest Rate | Current Balance | Minimum Payment |
|---|---|---|---|
| Visa | 32.24% | $970.86 | $29 |
| MasterCard | 19.49% | $1506 | $128 |
| Cap One | 16.24% | $11,700 | $277 |
| Store Card | 13.07% | $1407 | $42 |
| Auto Loan | 8.09% | $10,356 | $237 |
| Totals | N/A | $25,940 | $713 |
Paying the minimums only will take 350 months and cost $49,007 (total interest is $23,067 almost double the current balances!). Changing the payments to fixed (paying the same amount every month as listed above) will take 47 months and the total will be $33,272 ($7,332 in interest). Total savings is $15,735 and over 25 years!!
AND they didn’t pay any more than they paid this month.
What if you could become completely debt-free faster than you ever thought possible?
What If You Could Instantly Create A Plan To Pay Off All Your Debts Including Your Mortgage? And without “pinching pennies”, getting a second job or cutting your spending in any way!
Introducing the PDQ Pay Debt Quickly kit!
Warning: This program is NOT for everyone. If you are months behind on your bills or about to lose your home, you require more help than the PDQ Pay Debt Quickly kit can provide — Please do not order this program.
If you ARE paying your bills but just can’t seem to get ahead, the PDQ Pay Debt Quickly kit is for you. It’s also for those who are doing extremely well and getting ahead but still trying to get rid of their debt and eager to learn how to get rid of it once and for all.
If you are in either of these two situations, then reserve your PDQ Pay Debt Quickly kit while you’re thinking of it and instantly create your plan to eliminate debt forever.
Warmly, Cindy Morus, The Money Mender
P.S. You can also earn money recommending the PDQ Pay Debt Quickly program to your friends. Email me to find out more details.
