Average American with at least 1 card has roughly $9200 in Credit Card Debt (Cardweb.com) average rate is in mid to high teen's.
Don't try to keep up with the norm. as far as materalistic things!
Build a plan, then work the plan month in and month out. Don't worry about what your friends, family and neighboors think. If your financing the fancy stuff, it looks good the first month then after you make a couple of payments its not so nice.
2. Some debt if leveraged it Good
Don’t borrow more than you can handle, shop around for rates. College or Leveraged loans for your house is great but remember your house is a Liability (takes money out of your pocket) There is a huge Catch 22 for all my young readers and folks out their trying to establish credit- You must play the game of using debt to your advantage. Start small with low limits and if you are young and filed BK in the past your rate will be probably at a maximum. Make your payments and stay on top of it.
3. Take control of your monthly spending
About 60-70% of you out there spend your money with out even thinking about your monthly obligations. Take Control In my course this is revealed in the “Credit Landmine Prevention Audit” and there is samples of all everyday people.
If you are just getting points from the blog, start simple:1. Go a whole day without spending any money2. Go a week without charging anything on your credit cards3. Pack your lunch and try not to purchase any fast food
Repeat and Repeat- See where you are at, towards the end of the month
4. Bad Debt
Don’t default to your credit cards to purchase items you consume monthly. If you have reward cards they trap you into thinking that you have to do this. They can give you 1-3% a month cash back if you purchase all “Consumable items” Why would they do this? So you can trip in your monthly habits and not pay the card off entirely and BOOM! Interest and Fee’s they win NOT YOU.
5. Drip Effect
Covered in my book and way to long for a brief summary. Things to think about, if you pay double all your minimals on your cards- Stop- Pay minimal on all except the one with the lowest balance owed and pay extra on that one. For example:
Min. are
$25.00, $25.00, and $25.00 Totalling $75.00 You pay $50.00, $50.00 and $100.00 totalling $200.00 budgeted in your monthly - I suggest you pay $25.00, $25.00 and $150.00 on the smallest balance. In 6 to 8 months you'll see a big hit.
6. I pay min. on my cards and my credit is outstanding
Good for you, but the moment you miss a payment your creditors can take a look at your overall credit and you can drop from 700 to 600 in a matter of a month.
7. Borrow from Home and 401K
A lot of folks out their think they can borrow against their home and 401k for college and to consolidate bills.
College – Start a 529 plan as soon as you can. It is an investment vehicle solely for your children’s college. You can have monthly amounts that you can contribute straight out of your bank account for as little as $50.00 a month.
8. Emergency Funds
In your monthly financial statement pay all your bills and try the best to save up 6 months of your bills and just put into a liquid savings account. It is tough to start but if you can put back at least $100.00 a month and just get it started.
9. Mortgage
Buy smart, and a mentor always told me "If your not embarassed by your offer, its not low enough"
10. Buy my course
Plan and simple purchase so you can have all the goods and montly newsletter that beats the socks off this blog.
