Any Credit Card experts?

[jefferson-mo]

Here's my dilema.......about 10G credit card debt.......

not bad compared to some people, but with the finance charge and 'payment protector' charge every month it's hard to keep up........

what's the easiest or best way to pay this down..........

the Home Equity angle is out..........I don't own anything........

Also I get about 10 Credit Card offers a week, what about the old shell game of transferring balances and hopping from card to card @ 0% interest?

any input is always appreciated...........even jokes!

[Marauder_Santa]

Do you receive any credit card offers with 0% interest for 12 months or so? Get that card at 0% and use the money to pay off the high interest rate cards. Been doing this game for years. Then make equal payments for the 12 months to pay the 0% card off before the interest kicks in. Also make sure you pay on time. One late payment and they kick your ass with interest.

[KillJoy]

NEVER EVER EVER PAY THE MINAMUM AMOUNT! You will NEVER get the balance paid down.

If you have that much debt (I'm not much better :D) The best thing to do is start giving up some stuff to make extra payments.

Think of it this way.... forget about interest for a moment.... you have $10K on a CC. If you could make a $500 / month payment ... it would be paid off in 20 months. Add in interest (assuming 12%), it may take up to 30 months. Every little bit you can pay helps.

Also..... 4 equal payments throughout the months hepls a LITTLE too. Instead of one big payment at the end of the month. You may want to look into this to see if your financial institution offers this. I know my Citi Card does.

Oh yeah.... never be late or miss a payment. That's a big no no too ;)

KillJoy

[magindat]

Steve is right about making smaller payments. Try to make the due date payment at least the minimum, then at each paycheck interval pay some more. This is especially easy these days with online payment options. The due date payment covers your interest and the others pay down your principle.

Several years ago, I contacted Chase. They had a 0% interest reward card (Disney promotion). I called and asked them to directly pay off all my smaller cards and promised to cancel them all and use Chase exclusively. I asked for a credit limit equal to my existing smaller cards. They granted exactly what I asked and I did exactly what I said. I now have greater purchasing power with a single high limit and no chance of having to make a dozen 'little' payments I have to juggle or can't afford. Each amount I send now chips away at the bottom line quicker.

This is a version of the shell game, but with an end in sight. After consolidating, I set up a budget of bills due and when and then crossed that with my paychecks. I now know exactly how much I can send each PAY PERIOD. I just send money every pay period and it goes down. Then the money is there if I need it.

Good luck bro. Credit card debt is a PITA!

[SergntMac]

No lecture here, I believe we have all had a taste of this, one time or another. Been there, did that in my early 20's. Went "credit nuts", before the electronic age caught up with us.

Caught myself floating checks for cash through food stores, just to put gas in my car to get to work. The truth caught up with me in a very embarrassing way, and I had to face the reality that I owed more in monthly payments than I cleared "net" on payday. That's "flat broke", and I was flat broke for two years while I lived through the recovery.

More credit is NOT the solution.

IMHO...The volume of "new credit card" offers via US mail were no different then than they are today. Seems that the more you owe on credit, the more credit attractive you become to creditors. They sell you money you didn't earn and can't afford to buy, or, pay back. I don't get it, seems a grand bunco-pyramid scheme, as well as a "house of cards" that will blow down someday. Yet, it is the American way these days, yes?

The final cure is painful, it really hurts both financially and in your heart. But, it's a cure that has not changed since my 1972 financial melt-down. What made it worse for me, was that I was a cop, and back then, folks threw corruption money at cops left and right. From the free lunch, to a weekly "tip" for keeping a parking lot free of non-paying customers at local shopping center, to the customary "I'll pay my fine for speeding now, if it's okay with you, office".

Thankfully, I never took up any offers, but I did take a bus to work because I didn't have gas money, and only because Chicago cops ride Chicago Mass Transit for free. Y'all should know, there is only one cure, and it's as rough a ride as kicking alcohol or drugs.

Cold turkey. Stop all out-of-pocket cash expenses everywhere you can, and dedicate that cash flow to the credit pay off.

Everyone who has posted here, offers good advice one way or another, but the bottom line is 24-36 months of budget, budget, budget. From bring your own PB&J lunch, to clipping coupons for everything you need, including not buying that which you don't actually need to survive one more day. Get a part-time job delivering pizza, washing cars, yada, yada, yada.

There is only one answer, and that answer is cash out of the credit.

Nothing personal meant to Jeff-Mo, best wishes to anyone so affected these days. Just too damn easy to sign your name and worry about it later, IMHO.

Carry on gents.

[cyclopsram]

Buy Bud for 15bux a 30 pack and not in a bar, quit smoking, use regular gas in the Marauder... yes it will tolerate it keep your foot out... eat in...That 9 buck chicken boob at 99 is only about a 75 cent item if you cook it at home..No sports events and no eating at them for sure...lunch is skipped if you have cheerios and a banana and two slices of toast at home... takes three minutes... and then... the double hamburger for a buck at McD is full of all the stuff you need for dinner... including two slices of cheese... The water in half liter bottles is 17 cents at Costco and a buck and a half at the gas station... so, heck you can save a grand a month til you are solvent...

[whoskal]

Buy Bud for 15bux a 30 pack and not in a bar, quit smoking, use regular gas in the Marauder... yes it will tolerate it keep your foot out... eat in...That 9 buck chicken boob at 99 is only about a 75 cent item if you cook it at home..No sports events and no eating at them for sure...lunch is skipped if you have cheerios and a banana and two slices of toast at home... takes three minutes... and then... the double hamburger for a buck at McD is full of all the stuff you need for dinner... including two slices of cheese... The water in half liter bottles is 17 cents at Costco and a buck and a half at the gas station... so, heck you can save a grand a month til you are solvent...

I dont think that is a good idea. I would never put low grade gas in my car.
The couple bucks you might save is not worth it.

[wesman]

Cancel your cell, cancel your internet, cancel your gym, cancel your cable, move to a smaller place, cancel any magazines or papers, make it hurt and you'll get there. Absolutely no fast food - value per $ spent is crap. Any office parties or BBQs make sure you eat, not everything in site, just enough to fill you up so you can skip the next meal.
A guy at work just did all of the above, he knocked $200 off the bottom line per month. There are always the same ones at work that bring tupperware and take something home after the party!

[SergntMac]

Well it seems not much has changed in 30 some years. Same advice given here today that I took, (and lived through) back in '72.

The "light at the end of the tunnel" isn't all that dim either. I just recently traded my checkbook for a debit card, and it's business as usual, with respect for rule #1. If the cash isn't in the bank, I can't spend it.

Credit sucks. Give it up as soon as you can, and own, not loan.

You will be surprised what you can buy for yourself, when you are spending you own cash.

Real life is a game of Monopoly, play it once in a while and watch who loses...

[martyo]

Jefferson: Some good advice given here, especially Mac's real world anecdotes.

Did you know that if you make the minimum payments due on your card, you will "only" need to make payments for 33 years! :eek:

As you know, I made a living helping people with problems like yours and far worse. I no longer make a living that way. Call me one evening if you want/need to chat and I will only charge you a couple of pictures of Baby Mo! :D The number is (914) 582-6262.

[AzMarauder]

The 0% card isn't a bad idea... IF you stop overspending. However, a lot of the 0% cards require a "transfer fee" of several hundred dollars.

Also, they have this fine print, that if you default or are late on ANY type of payment (think water bill or something) and they find out about it, the 0% is OVER and they whack you HARD with a much higher interest rate.

Good luck. I've felt your pain before.

[MM03MOK]

I consider myself very lucky that I never carry credit card balances and only have a small home equity line for the house and the boat. Everything else is mine, including all the cars, free and clear. Good luck, Jeff. Budgeting can be a challenge but the long term dividends make it worth the effort.

[martyo]

Also, they have this fine print, that if you default or are late on ANY type of payment (think water bill or something) and they find out about it, the 0% is OVER and they whack you HARD with a much higher interest rate.

This is called a universal "default provision" and it exists in almost every credit card holder agreement. Default on one card and you are treated as in default on them all. These clauses have a pretty harsh effect and so far they have not been challenged successfully. Credit card user beware!

[1 Bad Merc]

Also, be careful when you keep jumping from credit cards to credit cards to get the 0% interest. You probably only want to do it once or twice and you really do not want to cancel the single credit card you are paying off. Keep the account open with a 0 balance (unless it's an annual membership fee) and rip up the cards or put a card away for safe keeping. The reason I am telling you this is I had a friend of mine who did the same thing and cancelled about 6 cards as he jumped from 0% to 0%. He went to get a loan on a house and all the cancelled cards showed up on his' credit report and caused him to have a lower credit rating. He was not able to buy the house he wanted because they would not lend him the amount he needed. The money they would lend him was at a higher interest rate also. Be careful and do some research.

[Bigdogjim]

Start with the card with the highest instrest rate, pay more on that on.

Start cutting them up so you are not tempted!!

Small steps, big results, remember it takes time to fix what was done.

There is a light at the end of the tunnel and it is not another train!!

Just keep one and only one card:)

[Petrograde]

I'm in a similar boat,.. so I'm working 60 hours a week to pay it all off,.. I've shreadded 2 card already.

Mac, sounds like you're a Dave Ramsey listener. If you're not, check him out on your AM dial.

www.daveramsey.com

[SergntMac]

Mac, sounds like you're a Dave Ramsey listener. If you're not, check him out on your AM dial. www.daveramsey.com (http://www.daveramsey.com) Thanks, Tom! I'll check it out.

Can't say I have heard any "Dave talk" myself, but I do listen to AM talk radio almost every day, WGN's AM 780. He may be syndicated in there somewhere, it's full of solid financial advice.

Actually, a whole lot of what I have said here, was my father talking to me. I suppose he never stopped raising me until he couldn't be there anymore.

Those of you with children, your job never stops. What you do today, will be their legacy, they are watching your every move.

Responsibility is taught, not bought.

[magindat]

Jefferson: Some good advice given here, especially Mac's real world anecdotes.

Did you know that if you make the minimum payments due on your card, you will "only" need to make payments for 33 years! :eek:

As you know, I made a living helping people with problems like yours and far worse. I no longer make a living that way. Call me one evening if you want/need to chat and I will only charge you a couple of pictures of Baby Mo! :D The number is (914) 582-6262.

DO NOT PASS UP THIS OFFER!!!!!!

[Mike]

I had the same problem when I was married, DEBT, DEBT, DEBT.... finding all the 0% credit cards we could to do the transfer but still credit cards. We just bit the bullet, put ourselves on a severe budget and finally got out of it (easier said than done, but did it). After all was said and done, it was nice to pay CASH for everything after that!!!! If we couldn't pay cash for it, we just didn't need it bad enough!! I now only use my debit/credit card that is for my checking account.

[Dr Caleb]

Don't pass up on Marty's offer Jefferson! Or Sarge's advice.

I was in the same boat as him, just 20 years later. You can't rob Peter to pay Paul. At least, for very long.

One thing you can do that no one has mentioned, is call the companies, and arrange alternate financing and interest. If you're straight up with them, usually they will re-negotiate because it is in their best interests to get paid in full, rather than have you bankrupted. They want to get paid, and if it means they have to take less blood, they will. If you run and hide, or or avoid them, they will bleed you dry.