Overcoming
Debt:
The Way to Solvency
Personal
Debt is Skyrocketing
With
the exception of
a small rise in
middle-class wages
in the late 1990s,
real wages have
simply not kept
pace with inflation.
In fact, the median
income of average
households has fallen
steadily for five
years in a row.
Despite these facts,
consumption continues
to increase. How
can this be? The
answer, unfortunately,
is that people are
incurring an increasing
amount of personal
debt. Were
talking here about
the 95% of us who
are not wealthy,
who are not saving
enough for retirement,
and who are bombarded
constantly to buy,
buy, buy.
Its
true that the nations
economy is growinghow
many times have
you heard politicians
point that out,
while you wonder
why youre
still so far in
debt? What they
fail to mention
is that the economic
expansion is largely
the result of people
overextending themselves,
using credit to
buy such necessities
as food and clothing,
and even taking
cash advances on
credit cards to
pay mortgage payments.
A Federal Reserve
study showed that
43% of US families
spend more than
they earn. The only
way to do that is
to use credit. And
it's pretty obvious
that if you use
credit to spend
more than you earn,
you are going to
be in debt.
The
credit card industry
collected 43
billion dollars
in late-payment,
over-limit, and
balance-transfer
fees in 2004. The
major advertising
ploy used by all
the credit card
companies sounds
like a scene out
of Brave New
WorldYou
like it. You deserve
it. Buy it.
Its easy to
fall into their
supposedly people-friendly
trap. But the truth
is, they exist for
one reason only,
and that is to make
money from you.
Uh-oh,
the mail is here.
With
the typical American
family now owing
$19,000 on non-mortgage
debts, its
no wonder that mail
deliveries have
become something
to dread. Which
bill is due or overdue?
How much are the
finance charges
on credit card A,
B, C, D...and on
and on. (The average
family has 13 credit,
debit and store
cards.) Sandwiched
between the bills
are offers from
other credit card
companiesor
even the same ones
youve already
got. Transfer
your balances! No
interest for six
months! Many
people go this route
as a way out. It
can buy you some
time, but it doesnt
work forever. The
proverbial piper
must eventually
be paidand
when that time comes,
it will be worse
than ever.
But
I always make the
minimum payment!
Making
just the minimum
payments on your
credit cards will
keep your credit
picture in focus
as far as the credit
reporting agencies
are concerned. Pays
required amount.
Pays on time.
Sounds good, doesnt
it?
Actually,
youd be playing
right into the hands
of your creditors.
The less you
pay on your balance,
the more interest
they make. Lets
say you have a balance
of $6000 on a credit
card and you STOP
using it today.
If your interest
rate is 17.5%, a
pretty average percentage,
and you pay the
minimum payment
of $90 every month,
it will take you
almost 20 years
to pay off the balance.
You will have paid
$21,240 on that
$6000 balance. They
made $15,240 in
interestand
maybe additional
amounts in annual
fees.
Think
about what you could
do with $15,240!
Wouldnt
you rather be tucking
that money into
an IRA or a college
fund?
Medical
Expenses Are Enough
to Make You Sick
A
2006 study conducted
by the Center for
American Progress
showed that most
older Americans
who find themselves
in debt do so because
of the high cost
of healthcare and
prescription medications.
In fact, anyone
of any age with
a serious illness
or debilitating
injuries suffered
by any family member
can soon find themselves
in deep financial
trouble. Even if
you have health
insurance, there
are deductibles,
co-pays, supplies
and drugs that aren't
covered. With todays
astronomical healthcare
costs, a policys
maximum lifetime
payout can be reached
with alarming speed.
When they stop paying,
and care is still
needed, where do
you turn? A medical
emergency can be
devastating to any
but the wealthy.
When
Keeping Up With
the Joneses Is a
Bad Idea
In
recent years, low
mortgage rates and
steadily rising
real estate costs
made home ownership
seem like an excellent
investment. While
that is still true,
some people find
themselves in trouble
now if they financed
their home with
an A.R.M. (adjustable
rate mortgage) or
an interest-only
loan. When the federal
reserve began raising
interest rates,
ARMs started resetting,
increasing mortgage
payments by as much
as 25%. If you took
an interest-only
loan to buy a dream
house just before
the housing bubble
burst, prepare yourself
for disaster. With
prices declining,
theres a high
possibility that
if you cant
make your payments,
you will have to
sell the home for
less than you owemaybe
a lot less.
Wait!
There must be a
way out.
You
could take an equity
loans on your houseassuming
you have enough
equity to make it
worthwhile, and
that you can handle
the equity loan
payoff. Although
you could try a
credit counseling
agency, and IRS
inquiry in May,
2006, revealed that
the 41 so-called
credit counselors
they examined were
of virtually no
benefit to consumers.
Investigations into
other agencies are
on-going.
I can always
go bankrupt.
Recent
changes in federal
bankruptcy law have
made the procedure
so expensive that
people in dire financial
straits cannot even
afford the filing
fees. While people
often think that
declaring bankruptcy
means you can toss
out your bills and
just pay cash until
your credit rating
improves, the new
laws demand a payback
percentage to creditors.
Credit counseling
is now mandatory,
although the chances
are you will find
yourself paying
a bogus credit
counselor
for nothing more
than a checkmark
on your bankruptcy
record that youve
completed the counseling.
Is
There a Reasonable
Solution?
Yes.
Think about it.
If you need more
money to pay your
debts, then you
simply need to make
more money. This
doesnt mean
you need to go out
and search for a
new job in a crazy
job market. It simply
means that you need
another income source
to add to those
you already have.
Ideally,
you need to find
a way to bring in
extra income without
undue stress on
yourself and your
family. You should
still have some
down time for relaxation.
If this sounds impossible,
there is good news:
It can be
done. Thousands
of other people
have already proven
it.
If
you're determined
to get out of debt,
a home-based
business is
a viable method
for generating a
genuine second income.
Its a far
cry from working
for peanuts at a
night job in a retail
store, warehouse,
or fast-food joint.
Youll save
money on commute
time and gas, and
the only equipment
youll need
is a computer and
a telephone.
Your
first goal will
probably be to heave
a huge sigh of relief
as you realize your
balances are declining
and youre
getting ahead. Like
many others, you
may discover that
you were always
cut out for running
your own business
and increasing your
personal wealth
more every day.
Your second job
could become so
rewarding that you
will decide to make
it your only job.
Imagine working
from the comfort
of your home, interacting
with people who
started out just
like you and are
now making fortunes.
The
way to financial
solvencyeven
wealth is
open now.
If
you're ready to
pop that steadily
swelling debt balloonready
to shape your future
the way youve
dreamed it could
beyou can
begin right now.
Simply fill out
the form and well
send you free, no-obligation
information.