Tuesday, December 27, 2005

    Finances with JustaDog - Attack!

    If I have credit card debt then the only responsible way to take that off my shoulders is pay it all off. Credit card debt causes all sorts of nasty behaviors and depression that my readers don't need.

    In my mind if you carry over a balance (are not able to pay the full balance each billing period) that generates finance charges then you are in debt. If you're paying interest and you pay late fees or any other fees then you are really in trouble - listen up.

    In my case I chose to be responsible for the expenses I incurred on various unsecured instruments and I also chose not to pawn it off to the financial institutions I promised to pay back. The only way to resolve this was to tilt the income/expense equation - even if just for a few months.

    I was able through a friend to get a job at a startup company in the Bay area of California. I was lucky to get a position that paid well, and I only had to go into the office once or twice every other week - I did not like that Bay Bridge so that worked out nice. I quit after 6 months because the firm was trying to set up an IPO in a foreign nation and at the level I was at I was privy to shenanigans that I wanted no part of. Anyhow, in that 6 months I was able to direct all that income to my credit card debt and reduced it about 75%. Hopefully your debt isn't as big as mine was.

    Following the plan I posted yesterday - paying off then closing the accounts with lower balances - NOT trying to pay off the higher interest accounts first. It didn't take long for offers of zero interest for 6 or 12 months to start coming in. It was then I transferred those higher accounts - the highest was 16.9% - to 0% accounts. In a matter of a few more months I was paying NO interest fees and every penny was going toward the principle.

    Bottom line - increase your income however possible long enough to follow the plan and close accounts. It works and I've been out of debt for years, never carrying a balance - period!

    BTW - NEVER convert your unsecured debt to secured debt by using your home! That's a no-no. An exception to this would be if you have equity in your home and you have an adjustable rate mortgage (for suckers) - then it would be advantageous to refinance to a fixed rate mortgage and use ONLY the amount of equity to pay off those cards - then close them!

    Next we'll cover the schemes credit card companies use to hook you. Hey - not their fault people are gullible - but my readers will be smart and aware.

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