Mortgage Forum

rachael24

Here is an article I wrote that may help everyone:

There are millions and millions of people around the United States that are in some serious debt. If you are one of these people, remember that you are certainly not the only one. Being in debt can be a very stressful and traumatic time in your life. You may be asking yourself what you can do in order to consolidate your debt and keep your credit in good standing. The first step in this process is to gather all of your bills and credit cards, and figure out the total amount you owe.

First, you want to compare what you make with how much money you must put out each month on your bills. Remember to only add in the minimum payment that you must make. Once you have those amounts, subtract what you pay out from what you make and see what's left. Assuming that you have a bit of breathing room after you purchase the necessary things, there is something you can do to really help get rid of your debt.

Find the credit card which has the most interest and that you carry the highest balance on. Find the next highest interest rate credit card and so on until you have made it through each of your credit cards. Make a list, with the highest interest rate cards on top. Also include how much you owe on your list as well as the minimum monthly payment. Starting with the next bill month, you want to pay as much as you possibly can on the credit card. If it's possible to pay it completely off, do it. Send only the minimum payment to the other credit card companies.

Once you have paid off the bill that is on the top of the list, cut the credit card, shred it, throw it off a cliff or incinerate it. Whatever you have to do to keep yourself from charging something else on the card! Next, do the same thing with the second credit card bill on the list, remembering to send the minimum monthly payment to the other credit card companies. This is going to help you consolidate your debt and get out of debt for good.

Continue to pick out the cards that are most important to pay back, and go down the list after your card reaches zero balance. You should keep one or two cards in case of any emergency, but get rid of the rest. By using this process, you stop the huge interest rates from compiling while you're trying to pay off your debt. After you have paid off all the credit cards except for the ones that you're keeping for emergencies, take a look at your other debt and do the same. You may have loans, mortgages, etc. Using this method is one of the best ways out of debt and get your life back to normal.

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Recent college graduate with a credit consolidation concentration.

Glenn Dorsey

I like your article Rachael. You must be a banker huh? I'm guessing so by the article and "Recent college graduate with a finance concentration." My brother also has a degree in finance, but he chose to work for the government so that he doesn't really have to work. lol

The most important thing you said, that took most of my life to really understand, is: "Once you have paid off the bill that is on the top of the list, cut the credit card, shred it, throw it off a cliff or incinerate it." Can I get an A-Men Sister from somebody please??? The best firewood in the world is credit cards. If I would have just gotten rid of a credit card after I had paid it off long ago, well I would probably be heading to France this summer for a vacation instead of Jersey City!

Good stuff there my banking buddy. Got any more for us to read???

:O)

Glenn

rachael24

A-men! LOL Let me go through my folders and see if I have any other articles I wrote about some relevant topics.

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Recent college graduate with a credit consolidation concentration.

Zino

Excellent advice Rachael!

This is a great idea, after you pay off the worst cards and throw them off a cliff not only will things be easier to manage, you'll be left with the best cards.

A lot of people max out the good cards, then when an emergency hits they have no option but to reach for one of the high interest cards.. This emergency is normally at a time when extra debt is the last thing people need. After this, things tend to spiral out of control.

Making a list as you mentioned and writing things down is also good advice, when people get snowed under it's really hard to think clearly and make the best financial decisions.

Drawing up a simple list of all income, general living expenses and debts can shed light on what's coming in and going out and help make the situation clearer.

So you work in a bank Rachael? I had a feeling you did.

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