You’re afraid of loosing your job, or just losing some of your income. Wouldn’t it be nice if you didn’t have those awful credit card bills eating into your income? Credit card elimination will truly change your life.

There are rumors being circulated by the media that credit card companies are in the process of cutting there customers credit limits. This might be good for the credit card companies is a time when bankruptcies are becoming the rule instead of just the exception, but not for consumers that value their credit scores. The reason is that a large portion of credit scores are calculated on debt to available credit limit ratios. If your debt is only about ¼ of your total credit limit then slashing your limit will make that one forth about ½ of you limit. Imagine if your debt to credit limit is higher like ½. Slashing that would leave your credit cards maxed out, which is really bad for your credit score.

If this is happening to you than the best thing to do is credit card elimination. Over time you can get a better credit limit again, if you get rid of your balance as soon as possible.

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There are two reasons that cutting your expenses will help to reduce your credit debt.

1. Cutting expenses leaves you more money to send to your creditors.

2. Cutting the expenses that go right onto credit cards will keep your balance from growing, which is the best way to start reducing credit debt.

With that said, let’s talk about what sorts of expenses you could cut. This isn’t an all inclusive list; it’s just to get you started. I personally cut all of these things during times that we really needed to spend less. You kneed to make a list of all the things you spend money on every month to really know what you can spend less on.

1. Cable TV; I know I love TV to, but without it so much more gets done. Is there any way you can live without it, or can you just reduce to basic cable?

2. Internet connection; if the internet is a huge part of your life the getting rid of it might be impossible, but if you need to save money try getting a cheaper service. Think dial up.

3. Cell phone service, or home phone service; Most people can get away with just a cell phone. Also consider getting rid you your expensive contracted phone service and trying a prepaid phone. If you reduce your gabbing then this could be a much less expensive alternative. I was for us.

4. Magazine subscriptions; I don’t know but most magazines print the same articles every year. Maybe they are written differently, but the main points are the same. For this reason most people don’t read all of the magazines that show up in the mail every month. If you only occasionally read those magazines then consider canceling you subscriptions and then only buying the magazines when you are in the super market and a story has really caught you eye.

5. Movie service subscription; unless you watch a movie every night then paying every month to get movies in the mail isn’t worth it. Rent your movies from those movie rental boxes in stores instead.

6. Pest control; you only need a professional to spray your home if you have a really bad bug problem. Most bugs can be taken care of with the stuff that you can spray yourself.

Sacrificing to reduce credit debt is absolutely worth it. You are on the right track.

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With credit card elimination we can all be free. This is not a popular sentiment in our world of having to have it all now, weather we can afford it or not.

Think about how much you put on your credit card just preparing for Christmas. Was it really necessary? Are you going to do the same next year? If begin preparing now you can change your ways.

Next year give the gift of being an example of credit card elimination.

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As of today there are 15 more days until Christmas. Is someone on your list having trouble with there personal debt. Our debt crisis in this country has been building for a long time. Most Americans have far too much debt. Credit Card Elimination might seem impossible but I can tell you that we all can do it.

Give the Gift of Knowledge This Year

Dave Ramsey’s “The Total Money Makeover: A Proven Plan for Financial Fitness” has changed many lives for the better including mine. Ramsey has been there himself, so although he can be harsh, he is compassionate. The main point is to pay off all debt, get fully insured, and invest. The process is more complicated then that, but he explains it in such a way that makes is easy to follow.

A financial book isn’t the type of thing you could just give anyone. You would have to have a really close relationship with the recipient. Unfortunately this book could be offensive to many people, which is just too bad. Be careful and make sure the loved one that you give it to understands your intent and is open to a different way of life. Total credit card elimination is good for everybody.

Click the book to go the Amazon and get more details. This book won’t break the bank with its affordable price. Check it out.

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Lately I have noticed at least two stories that are about people working hard to get there debt eliminated. One of these stories also spoke of the wisdom or living cash only. The best advice I have ever seen on a TV news program ever. The unfortunate part of this story is that it was on at 3:00am. How many people watch news at 3:00am besides me? To bad more people could not have seen it.

We need to all spread the news that it is possible to get total credit card elimination.

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I intended to make this blog about getting out of debt with out outside help and give our own experiences. We got out of debt to fast because we had something to sell that took care of our entire debt.

So, what direction should this blog go?

Credit Card Debt in America is out of control. We need to take our finances back. I have gotten rid of my credit card debt and the credit cards themselves and it feels wonderful. I want every one to have our freedom.

The best way that we can make this credit card debt blog helpful to our visitors is to

1.      Follow the debt news and how new events are going to effect everyone.

2.      Quote from my favorite debt gurus, so you can get the best credit card debt advice right from the experts.

Whether you want to be totally debt free like me or just want to get your debt under control come back often to find out what’s new. Let’s get our credit card debt in America under control together.

You can also subscribe to my feed or get updates in your email.

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Our very own credit card debt program

In a previous post I outlined my own debt problems. I truthfully have had a hard time deciding how to write an update to that.

Our debt was hanging around the 14,000 mark and we were making around 30,000 a year for a family of five in a fairly high cost of living community. We decided to start our very own credit card debt program. We were determined to try our darndest to get it all paid off as soon as possible, but in the back of my mind it just didn’t seem possible.

I read several books on the getting out of debt subject and felt that we needed to do this fairly and without a bankruptcy. The book that helped point us in the right direction and get the right debt elimination attitude was Dave Ramsey’s “The Total Money Makeover”. He outlines exactly how you can start your credit card debt progam.

Equipped with a new way that we should live our lives in ready we just dug in. This is exactly what we did. 

1. Eliminated all services that we did not absolutely have to have.
2. Did everything in our power to lower the rest.
3. Sold our second car.
4. Sold investment stock to a sympathetic ear that gave us more than it was worth.
5. Had a huge garage sale
6. Sent all of that money to the various credit card companies and others that we owed.
7. Canceled all credit cards and vowed to never have on again.
8. To the little money we had left to move to a cheaper place.

Here is the good and the bad news;

Good news is we don’t have any more debt except on loan from family and we accomplished this in around 3 months.

Bad news is we did this just in time for my husband to suddenly be out of work with no prospects in the near future, so we get to scrape by on my meager income for a while.

Sorry, did I say that was bad news. In a way this is also good news. Stay with me here! We actually have the possibility of scraping by on my income where that would never have been a possibility before with out high debt related bills. We would have had his job loss no matter what we did about our debt. True, we are not in a good situation, but we will get though it. And this time without debt to keep us down.

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What is Credit Card Debt Consolidation?

The basic idea of credit card debt consolidation is that a loan is used to pay off the debt to your creditors.  This loan is usually against your house.  This rolls the high interest credit card debt into a lower interest home loan.  You might take out a home equity loan or line of credit loan.  This is usually a second mortgage.  You can also do a cash-out refinance which is just a new mortgage that pays of the original mortgage.  You can get a personal loan too, but you will pay more interest (but often less than a credit card interest rate).

First the Good News

One of the first benefits of these loans is that your interest rate will often be lower than your credit card rate.  You have only one check to write a month. And, most important, creditors will stop hounding you like you are a common criminal.

What’s the Catch?

One big problem with debt consolidation is that you make an unsecured debt into a secured debt, so you can’t make it go away if you have to (Heaven forbid) declare bankruptcy.  That means that you can lose your house if you don’t pay them.  You also may be tempted to load those cards up again and then have A LOT more debt, with no way to consolidate it, unless your house has a ton of equity.  You would not learn your lesson and you would be in a worse predicament than before.

Just some food for thought.

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Using credit card consolidators and debt management services are one way to get your debt taken care of, but in my opinion they are not the best way. One problem with these services is that so many of them are dishonest and will make your problems bigger. Although these services can help you they all take fees and interest from you, even the “not for profit” services charge you extra. It is true they can get you a deal with some of your creditors that can lower the balance you owe them, but understand that they have contracts with many of the major credit card companies so they are really working for them, not for you.

On the other hand if you need a service to take over the control of paying these debts with your money for you than these companies might be worth the extra you will pay them to do it. You will arrange a set amount that you will pay every month that is calculated ahead of time to get you out of debt in a set time frame. Because they have contracts with so many creditors they will have an easier time cutting a deal for you. Many of these services require that you have automatic withdrawal with them so that you don’t have a choice every month.

We have chosen not to go with a credit card counseling service or any other type because I want to try to get a better deal from my creditors on my own without having to pay someone else to do it for me. We do not own anything expensive that could be used as collateral to get a consolidating loan. It can be difficult to find a good service that will do what you expect of them, and I am determined to get the bulk of our debt taken care of sooner than three to five years. The biggest reason we will try to go it alone is that our income is too small. Any reputable service should say they can’t help, go get a bankruptcy. We will try to make deals with our biggest creditors instead, if that doesn’t work than maybe we will try one of the many credit card debt elimination services available. Stay tuned to see how it all turns out.

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If you find yourself up to your eyeballs in debt, than you might have come across this book title looking for an answer. If you have read the first few posts of my blog you would know that I am in way to much debt myself. So I have written this review from the perspective of someone that needs help getting out of debt.

The big idea of this book is to get out of debt by applying $10.00 a day to an $8,000.00 credit card debt with a 16% interest rate in about 33 months. How does one do that? This book give you steps that if followed will do just that, according to the author.

Step 1 “Assess the Problem”. This step instructs you to figure out exactly how you got into this debt with the idea that you need to find out your habits before you change them. To complete this step you will also need to know who you owe money to and how much.

Step 2 “Break Your Challenge into Manageable Steps”. She explains that you don’t need to pay debt management programs to help you clear you debt. And talks about getting a lower interest rate, which will be necessary to meet your goal.

Step 3 “Know and Manage Your Credit Score”. Any good get out of debt book will tell you to get your credit report and score, it is that important. Many people that need to make decisions about you, will use your credit score. This book puts a very large emphasis on this point. To complete this step, it will be necessary to get your score. Jean Chatzky gives a wonderful explanation of how your score is made. For instance; only 35% of the score is based on how you pay your bills.

Step 4 “Track Your Spending”. In this step the author explains “By not paying off our credit cards, we’re living on borrowed money. By not saving we’re living on borrowed time.” So to do this step you will need to track every penny that comes in and goes out. I have read the same advice of tracking your money in quite a few books about personal finances.

Step 5 “Find the Money”. The point of this step is to find anywhere that you can cut something out of your expenses to find enough money to free up the $10.00 a day. This step also talks about how to lower your interest rates, refinance your car loan, and get a better mortgage.

Step 6 “Find the Money: Consolidating Your Debts”. It seams that consolidating your debt will turn an unsecured debt into a secured debt because you will need to borrow form your house, in return you will get to pay off that debt at a much lower interest rate. She warns against the possibility of charging those cards up again. There is also an explanation of what kinds of loans you could get to do this.

Step 7 “Find the Money: Spending Less”. This may seem simple, but if it was that simple would most of us have this debt in the first place? This step goes over why we spend too much money and has you evaluating your spending list. It also talks about selling off assets and making more money.

Step 9 “Pay it Down-Intelligently”. It seems that all of the debt gurus have a formula of which debt to pay off first. I have read many different ways to choose, hers is to pay the one with the highest interest rate first.

What to do when things go wrong. There is a lot of information about what to do if you go though all of the steps, but you just can’t get the $10.00 a day to pay off your debt. This book recommends getting credit counseling or getting a debt management program, because they can get you a good deal with your creditors, you will give them one payment electronically, and they will use your payment to pay the creditors. You will end up paying the service a fee up front and then a monthly fee until you are done.

As far as aggressive debt collectors go, this is what she has to say “You don’t have to talk to a debt collector. And you don’t have to return their calls.” If you feel that you are being abused by these collectors there is information in this book that will help.

The end of the book consists of “The Debt Diet”. This is just some good rules to live by that will help you spend less money on unnecessary things so that you can get though your debt elimination.

Would I recommend This Book?

This is what I would tell a friend if asked if I would recommend "Pay It Down". This would be a good book for people that haven’t ruined their credit yet, and it contains sound advice for changing your financial habits. I also like the “do it yourself” attitude that is in the steps. On the other hand, Pay it Down is best for people that have a decent income and not a lot of debt. This book is also a bit out dated. With the increase of the monthly minimums that credit card companies hit us with not long ago, $10.00 a day would in no way be enough to cover just the minimums. Unlike other books about getting rid of credit card debt that I have read, this one does not fill me with hope for my future. I find Pay it Down a bit pessimistic for my taste. So, although this is a good book I would not recommend it to anyone that is having real financial problems.

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