News of the Day

There are several news items today, that are of interest to personal finance readers. Instead of writing two different articles, I thought I would combine it into one (1) article. So without further ado, lets get started.

Congress & Higher Food Prices

This is the story that has the quote of the day.

"Why are we putting food in our gas tanks instead of our stomachs?"

That is what Richard Reinwald, a bakery owner, asked a Congressional panel investigating rising food prices.

An Agriculture Department economist told the panel that the use of food crops for alternative fuel is one reason for higher prices. He says other factors include global weather patterns and the declining value of the dollar.

But the White House downplays the role of ethanol. A spokesman points to the increasing cost of energy that makes it more expensive to get food to the table.
- KGAN 2 CBS

No matter the reason, people in supermarkets and grocery stores all over the United States are seeing their grocery prices rise. Here in Topeka shoppers, this week, seen a 48 oz bottle of Wesson Oil go from $3.69 to $6.59.

Government launches crackdown on unfair credit cards

WASHINGTON - The Federal Reserve and other regulators are moving Friday to crack down on "unfair and deceptive" practices in the credit card industry that have added billions in debt to people already struggling to cope with the economic downturn.

In the most far-reaching crackdown on the credit industry in decades, the Fed and two government agencies are proposing rules that would stop credit card companies from unfairly raising interest rates and make sure they give people enough time to pay their bills.

The banking industry is expected to fight the new rules.

- from the AP Newswire

Wow, I really like this idea. At least part of me does. The part of me that fights for consumers rights and protection of the consumers. Then there is the part of that supports smaller government, and I wonder why the government is getting involved. Still, though the smaller government part of me is overshadowed by the desire to protect the consumer from those business' that wish to take advantage of the poorer consumers. I am for "free trade," if you will, but at the same time, business' must be fair in their business practices.



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Worshiping At The Altar of the FICO

This past weekend, the Today show on NBC, had a story entitled, "7 ways to improve your credit score." It is clear from not only the title, but also their guest that they are worshiping at the altar of the FICO score.

So what are the 7 tips?

1. Fix your credit report
   

The fastest way to raise your score is to fix errors on your credit report. Go to www.annualcreditreport.com to get a free report from each of the three credit bureaus every 12 months. It’s important to fix mistakes on all three credit reports. You have a separate credit score based on each bureau’s report, so your scores could be very different if one report contains errors.
- Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show


I personally agree that if there is errors on your credit report, they need to (and must) be removed. I am a big proponent of checking all 3 credit reports once each year.



2. Pay your bills on time
   

   About one-third of your credit score is based on your payment history. If you’re having trouble paying the total balance, pay at least the minimum by the deadline. Making that deadline is more important to your score than the amount you pay (although the more you pay off, the less interest you’ll owe). If you do miss the deadline, pay up as soon as possible, the later you are, the more you’ll hurt your score.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   This is a commonsense no brainer. If you are late paying your debts, utilities and other bills, it is going to negatively affect your credit. Always, let me say that again, always pay your bills on time.
   
   
   
3. Keep your balances low
   

   Another big part of your score is the share of available credit you’ve used. Lenders get worried if it looks like you’re maxing out your cards. Keep card balances below 25 percent of the credit limit, 10 percent is even better. It’s the amount you charge that counts, even if you pay the balance in full every month.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   If we are going to be debt free, why do we need to keep low balances? This is one area, where this lady and the banks are trying to keep you in debt, by trying to tell you closing the account will negatively affect your credit. The only reason banks want you to keep any balance at all, is so they can relieve you of your hard earned money and make themselves richer.
   
   
4. Don't close old accounts
   

   Keeping old accounts with a good record can help because the age of your oldest card and the average age of your cards are key elements of your score. Closing accounts also lowers your overall credit limits, which makes it look like you’re closer to maxing out your available credit. If you do want to close some accounts, especially ones with high annual fees, close only one every few months and don’t close any accounts within six months of applying for a loan.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   I pretty much answered this one in my last response. As Dave Ramsey has repeatedly said on his show, the only thing a good FICO score shows is that you love debt. If we are going get out of debt, we don't need a score at all. Plus, if you want to get a mortgage and don't have credit, you can still get that mortgage. Mortgages being the only debt Dave Ramsey, backs away from being critical on, can be obtained by using a mortgage broker that uses manual underwriting.
   
   
5. Pay off old debts
   

   Even a small library fine or disputed electric bill can crush your credit score if the debt goes into collection, dropping a high score by as much as 100 points. Now that more municipalities and utilities are sending small, old bills to collection agencies, I’ve been hearing from many more readers whose scores dropped significantly because of a very old bill for less than $100. Even if you pay off the bill after it’s gone to collection, the damage is already done. Negative information generally remains on your credit report for up to seven years, but the impact on your score lessens through time. Don’t lose track of small charges that can come back to haunt you, and pay the bills off quickly before your score suffers.
   - Kiplinger’s Personal Finance magazines, Kimberly Lankford on NBC's Today Show
   

   Yes, I agree. Going back and paying off debts that may have gone to collection is not only a legal obligation but us a moral one, because we are to honor our agreements.
   
   
   
6. Order your credit score
   

   You can’t get your score for free, but you can order it when you get a free copy of your credit report at www.annualcreditreport.com. Or you can go to www.myfico.com and get your score directly from Fair Isaac, which created the popular FICO score. Some credit bureaus also offer their own versions of credit scores, which can give you a general idea of how your record stacks up, but most lenders use the FICO score when setting your rates.

   
   
   I have even heard Dave Ramsey talk on his radio show about going to www.myfico.com and checking his FICO score. In his case it is 0 on all three credit bureaus. Meaning he doesn't have an "I love debt score," because he doesn't.
   
   
   
7. Don't ignore your score
   

   Buying or refinancing a house is the biggest reason to be concerned about your score. But your credit score also affects your credit-card rates and terms, car-loan rates and auto and homeowners insurance premiums. Insurers found that people who have low credit scores are more likely to have insurance claims, and your score can have a big impact on your premiums in most states. Potential employers and landlords may also check your record. Don’t worry about micromanaging your score, you’ll usually look good with anything above the high 700s. But your score can affect your personal finances at any time.

   
   OK, I have gave my thoughts on this. Unless you are going to make the banks richer and go into debt again, I strongly urge you to ignore your score. You can get a mortgage by using a manual underwriter rather then a bank that leans purely on the FICO score.
   
   With that said, I do know my scores. Last Month, the last month WaMu checked my credit from the old Providian Credit Card that i just paid off, they put me at a 688 with TransUnion.
   
   However, on April 14th of this year I logged into and got all 3 FICO's. I must say there is quite a bit of difference and I haven't been late on anything recently nor have I applied for any new debt.
   
   *** TransUnion 619 *** Equifax 550 *** Experian 624 *****
   
   Two of the three did however, have a public record on them that even though it was paid and the lien released had not been removed from my credit reports. In fact, the state actually just sent me the court papers dated some 3-years after they were to have been filed. Go figure.
   
   

Finally, Suze Orman who most recognize as a person who worships at the altar of the FICO score, has a product called, the Suze Orman FICO Kit Platinum that is available when you sign up with myFICOscore.com. The video below is from VideoCreditScore.com, and is an intereting review of the product. While I certainly to hold to the belief of fixing your "I love debt score," unless you want to put yourself into debt further (or again as the case may be), it is certainly worth viewing.






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2007's Top 5 Favorite ways To Destroy Credit Cards

We all know you should destroy your credit cards (as Dave Ramsey says). Scissors and shredders get the job done, but how much fun is that? There’s got to be more entertaining ways to destroy your card, so I’ve searched all over to find you the top 5 ways to dispose of your credit cards.



Kids, don’t try this at home.

5. Microwave it
This may not be the most effective means but still a fun method of destroying your credit card. I really expected it to spark and crack rather than ... well, you'll see.

4. Blow it up
Very funny. Watch and be amused as this Amateur shows his cards who is boss.



3. Blend it
Looks kind of fun, I don’t think anyone will be getting those card numbers.


2. Mow it
The Prince (that's me) destroys not only my credit cards, but those of a friend (Sean) while I attempt to keep the camera steady (not to successfully) on the destruction.


- and the number one way to destroy your credit cards. -

1. Shoot it
An entertaining little "soap opera" of the credit card which refused to die.

Top 24 Ways To Destroy Your Credit Cards

I recently came across a post, I think I actually seen it before but, that listed 27 Fun Ways to Destroy Your Old Credit Card. Well, after recently destroying my 1 credit card and 3 others of a friend, I found the post to be incomplete. As I found more you tube videos, I will add them to the collection below.


Now for my list:

24. Contact your local bomb squad - see if they will toss it in the machine the next time they have a suspicious package.

23. Toss it in a burning building - Not that bright of an idea, but would melt them pretty good.

22. Flatten it at the Indy 500 - Toss your old credit card in the path of 33 blazing automobiles and rejoice as it’s flattened into the raceway.

21. Multiple ways - If you want to make sure it's destroyed and unavailable to anyone else, then put several of these ideas together. For example, you might cut it up, then flush half of it and burn the other half.

20. Make a Collage - after I ran those cards under the lawn mower, I made a collage of sorts out of the remaining pieces.

19. Throw it in the river - Place it (or them) in a bag with a rock and then chuck it into the river. It will then be forever more at the bottom of the river.

18. Toss it in with the Cat Litter — Can’t say enough nasty things about your old credit card company? Let your cat do the talking for you. Toss the card in their litter box and giggle manically while it’s covered in, well, you get the picture. (thanks Frugalist)

17. Chain saw/Saw zaw - pin the card to a piece of wood. then attack it with a chainsaw or Saw Zaw, that would be dramatic and loud.

16. Target Practice - How about going to a firing range and attaching the card to a target and then blast it with a few bullets?

15. Thermite - combine powdered rust with ground aluminum and make thermite. It burns hot enough to melt through an engine block. (But you have to light it with a strip of magnesium, available on the Internet for a buck or two)

14. Dartboard - Put your card on the dart board and start tossing those darts.

13. Make your card famous — Post your cards demise on You Tube

12. Dryer - See just how many times it can make it through the dryer

11.“Throwing Stars” — Bring out your inner ninja and get some target practice by tying your old card to a tree and seeing how many times you can hit it with your throwing stars.

10.See how many pieces you can cut it into — Grab a pair of scissors, and see how many teeny tiny pieces you can get out of your credit card before your hand freezes up or you reach the end.

9.Piranha - If you live in or are visiting South America, you might want to feed it to the closest piranha.

8. Hot sun and the dash board - If you can cook cookies or eggs on your dashboard in the current triple digit heat, why not melt you credit card(s) on the dashboard?

7. Cook - Place your credit card(s) in the oven (on a cookie sheet) or place it in a skillet and cook it to it's death.

6. Give your fish a new toy — Want a constant reminder of your credit problems? Toss your old credit card in the fish tank and let your fish gape at it constantly.

5. Chipper - Throw you card(s) into a tree branch chipper and watch it become little tiny pieces.

4. Break into a locked room - you have seen the movies where someone breaks into a locked room or office with a credit card and it always seems to work, but chances are it will be broken into two pieces.

3. Cremate it and spread the ashes - Kind of self explanatory.

2. Shred Them - Run your credit card(s) through a shredder.

- and the number one way -

1. Mow them - my personal favorite, run a lawn mower over those credit cards like I did in the you tube video posted above.

In all cases make sure the credit card(s) are canceled before the destruction, just in case anything should be found by some unscrupulous person.
Do you have any others ideas? Let's make this list more complete. Do you know of any other youtube videos of credit card destruction, let me know so I can add them to the video reel above.

What's NOT in your Wallet?

The other day, I asked for suggestions on unique ways to mutilate my credit card. Well, the idea, I liked best came from a friend of mine who suggested that I might have my credit card chopped up by a lawn mower. I liked that idea so much that I chose it as the way to mutilate my card.
I wish I could of had sound with it, but I think the point is made by what you view here.

See the video below:




It was interesting to see the Best Buy and Bank of America cards were the hardest to get chopped up. With B.o.A.'s card requiring the most swipes of the mower before it was mutilated enough to be called "cut up."

So what you think? Did you like the way these cards were mutilated?
Feel free to help promote this video. Feel free to post it in your own blog or email it to your friends. I just with the camera I was using had sound, so Dave ramsey could play it on the air, but maybe there is a way I can still add in the sound of a mower to it.

Revisiting Practical Way to Become Debt-Free Forever!

In August of 2006 I posted Practical Ways To Become Debt Free Forever. Today, I thought I would re-post the article, with a few minor updates.

1. If you have Credit Cards with Outstanding Balances.

A. Cut up ALL Your Credit Cards, and do NOT open new lines of credit.

B. Call those cards and ask them to reduce the interest rates.

2. Save or Earn an Extra $150 - $200 Per Month.
3. Pay this Extra Money off ONE Credit Card each Month until it is Paid Off.

A. Do NOT open new lines of Credit, as the idea is to get OUT of debt, not deeper into it.

4. Continue to Pay the Minimum of ALL your other Credit Cards each Month.
5. Once One Card is paid Off Apply the TOTAL amount to a Second Card.
6. Continue until All Your Credit Cards are Paid Off.
7. Apply the Same Method to your Car and House Loans.
8. Do Not Borrow Money for Consumer Goods Ever Again.
9. Use this Monthly Amount to Build Your Assets (aka Savings).

Using this Simple Method, as John Cummuta says, most People can become Debt Free in 5 to 7 Years and Wealthy in 10 to 15 Years. Please note Dave Ramsey say, that you will be more successful if you build an emergency savings of $1,000 ($500 if you make less than $20,000/year) first, and then pay off you smallest debt first. According to Ramsey, it may be mathematically correct to pay off the highest interest rate first, but if we were think mathematically, we would never have gotten ourselves into debt in the first place.

Savings Agent is Really A Money Grubbing Whore

In recent weeks, I have received 2 emails from a reader asking me to review a new personal finance tool. When I reviewed Cd's, DVDs and books on blog critics, I received free copies of those items. This website that contacted me, gave me, no compensation in any way, but I looked at the site any way, to see if it was something I could actually use and recommend.
What I found was a big disappointment. The site claims to help you save money. However, it wants to keep you in debt by pushing to sign you up for credit cards. Anyone, who has read my blog on a regular basis knows that I do not do credit and as such am opposed to credit cards. I cannot, therefore, give a positive review of CreditCardClients.com.
Anyone, who seriously wants to get out of debt, will avoid this site, the credit cards that pays them to be listed there and for that matter all credit cards.
I am going to get debt-free $1 at a time and never go into debt ever again.
The key is writing a monthly budget and stick to it. Which, I admit can be difficult. I even, have a hard time sticking to it, when I so often desire something that I really can't afford.

Top Ten Credit Tips

CreditCard.org has listed the following "Top 10 Credit Tips," that I found an interesting read. I don't agree with all the tips, as pointed out in previous posts, but still interesting.

1. Use disclosure box to shop for the best deals

Inundated with credit card offers? Well, the best way to sort through to find the best deal for yourself is to go strait to the "disclosure" box. It is required by law to tell you everything. If the interest rate seems too low, go find out what the interest rate really is in the disclosure box.

2. Get your FREE credit report with no strings attached (unlike Consumer Info

You can get a copy of your credit report FREE. We tell you how in section 2 of Credit Strategies Seminars. A quick hint is to avoid any site that advertises free. Free in the ad is almost always a bait and switch.

3. Use a recorder to track expenditures

Spring Break is again upon us! When you're finished with midterms, it'll be time to work on your Spring Break tan. The key problem that you want to avoid is to not overspend on your credit card. The best way to do so is to track your purchases. Some students have used a checkbook recorder. In recording how much you spend, your credit card bill won't be as big of a surprise.

4. Keep your card active!

Instead of leaving your card inactive charge at least a very small amount. What you want to do is manipulate your credit report to look like you pay on time every month. Your credit bureau does not record how much you pay. Therefore, if you charge only $15 and pay it all off on time, you get credited for a "1". Do this if you have zero for a balance. Do not do this if you already have a balance. Most students use their card sporadically. This strategy of charging a small amount will make your credit report look better.

5. Be careful of credit scams

Credit scams are all around. Be extremely careful in giving out your credit card number. A scam that has been reported recently goes like this. A telemarketer calls to notify you that you have won a prize if you have a visa card number that starts with a "four". The scamee runs to get his card and realizes HE'S A WINNER. His visa credit card number starts a "four". In his elation, he gives the rest of the number to verify his winnings. What the scamee does not realize is that all visa cards start with a "four", all MasterCard's start with a "five" and all American Express cards start with a "three". Be careful out there!

6. Work with the retention department as opposed to the customer service personnel

Have you ever seen a $10 late fee appear on your statement? When you call they will tell you that they received your payment a little late (sometimes they charge the $10 fee just after three days). The person in customer service says that it is policy to levy this fee. At this point, you should politely ask as a "courtesy" that they waive the fee. There may be real, legitimate reasons why they received the payment late (post office delays, system backlogs...). Regardless, ask this person in customer service to waive the fee.

If they do not agree to waive the fee and you feel as if you have a concrete gripe, then you should state that you would like to cancel the account and take your credit card business elsewhere (you do see one or two banks on campus begging for your business, don't you?). At this point, they will know who the boss is. They will then either:

1. waive the late charge or
2. transfer you to an "account closing specialist".

This "specialist" is really going to be smooth and his/her job is to keep your account. Please note: if you perpetually pay late don't expect preferential treatment. Working with the "account closing specialist" in the retention department is your best bet when it comes to getting results. Aren't we sneaky?

7. Rebate Cards

Do you notice some credit card companies on campus trying to sell you a credit card? Yeah, pretty sickening how they're on every corner you turn. Well, we're here to talk about REBATE cards. Among the different "bait and switch" schemes, credit card companies are the most guilty.

8. Reduce your balance

We've all heard horror stories... There's always some friend of a friend of a friend who is just completely out of control with their credit card. Interest can really add up quickly. Here are some tips that are really helpful in reducing your balance (if you have one):

1. Watch what you charge! Small purchases (movie, food, Cd's) can really rack up your debt. Recording transactions is a great way to keep track of what you'll be owing at the end of the month.
2. Keep your balance manageable. Don't charge huge amounts in the hopes of paying them off with future income. Sale items that appear to be "too good to pass up" can be costly. A good rule of thumb is to never have a balance that is three times the amount that you can pay off in one month.
3. It's O.K. to have a "0" balance! Some students are so used to a balance that they feel the need to charge something big when they don't owe anything.
4. If you do have a balance you're trying to whittle down, use not only the above strategies, but also LOWER YOUR INTEREST RATE. The benefits are obvious--you'll owe less money. How do you lower your rate? There are two ways: negotiate the interest rate with your bank or shop for a lower rate offer.

9. Bad credit can raise your insurance premiums!

In a Wall Street Journal article (Nov. 6), insurance companies were cited using credit reports to predict the likelihood of future claims. The most glaring example is Allstate which has "on the basis of statistical analysis" concluded that people with bad credit are more risky to insure.

Is this fair? Hardly. This can potentially have a big negative impact for you. Car insurance premiums are high enough for us. Having to pay additional for the same coverage isn't very appealing. The article goes on to elaborate State Farm policies for evaluating. State Farm concentrates on, "bankruptcies, foreclosures, repossessions, judgments, and multiple large charge-offs". They imply that they don't care if you are a few days late paying on a Sears card...or do they?...

What I wonder is that if bad credit can raise your premiums, will good credit lower them?

10. Rip up incoming credit card solicitations

Be really careful when you're throwing away those credit card solicitations--someone may be digging through your trash. Why? Most credit card solicitations contain a lot of very personal information. Some even come in the form of a certificate that is very easy to forge. Here's potentially what can happen:

1. a thief finds your credit card offer that you do not rip up,
2. that person fills out the application and
3. gets the card sent to some other address.

Credit card companies do take precautions to ensure that this doesn't occur but why trust them? Your best protection is to be safe with our personal information.

Bonus - Your credit card interest rate can be negotiated!

Last month, we talked about "reducing your balance". One of the best ways to owe less money and save money overall is to NEGOTIATE DOWN your interest rate. Here are some specific strategies for doing so.

Negotiating strategy number 1:
Call your bank. Ask for them to lower the rate. Most banks have multiple rates that range from 5.9% (a teaser rate) to 19.9%. Use the principal we outlined in an earlier "Tip of the Month" (October 1995 - Work with the retention department...). Remember, your bank values your business and will do a lot of things to keep your business.

Negotiating strategy number 2:
Shop for a better rate. Look around for offers that are really aggressive. Going from a 17% rate to a 13% rate saves you quite a lot.

Negotiating strategy number 3:
Make your credit report look stronger. This will reward you in the long run. Remember, loan officers use a scorecard. When you make a conscious decision to improve your score, that will make you more qualified for better offers in the future. People with good credit are inundated with low interest rate offers.

Here's an example of how you can work these "negotiating strategies" into a real life situation. Let's say you owe about $750. Your current bank charges you 16.95%. Here's exactly what you do. Call your bank's customer service department and have them tell you what your current interest rate is. Then, tell them that you are considering a much lower rate offer. An offer you recently received in the mail that is much cheaper, 5.9%. Listen to what they then say. It will probably go something like this, "Oh, that's just a teaser rate to get you to switch... " and then they'll say, "we provide outstanding service and we're #1". Your reply should be, "Can you as my current bank match this new bank's offer?" Say nothing and wait for their response. Be ready to walk away from your bank. If they say "yes" you are happy as a clam and we're glad that we could help. On the other hand, if you meet up with some resistance...

Ask to cancel the account and go through the retention department (do this with confidence if you have good credit and know it). The conversation with the retention department should go along the lines of, "Hello, my name's Mike and I can handle the details of closing your account. I am sorry that you are closing your account... we very much value your business. Before I start the process of closing your account, can I ask you why...Is it something that we did?... " This "Mike" will be super smooth but you'll be ready. Tell him, "Look, it's not that I don't like the wonderful service because it's terrific. I might even miss you guys...but what it comes down to is money. It's important to me. I want a lower interest rate." Be very nice but also very firm. Either he lowers your rate or you're taking your business elsewhere. This "Mike" has the authority to review your account and will most likely help you out.

Some notes we want to make clear. Make sure you have good credit before you start exercising these negotiating gambits. There is no clearer example of the benefits of good credit than when your bank values your account to the point that they feel they can't afford to lose you. That is the position that you want to be in

2 New Carnivals Started

Debt Free 4ever made it into 2 brand new carnivals that were launched this holiday weekend.

Carnival of Credit Cards

an exclusive carnival on credit card related issues

Carnival of Money Stories

the first edition of Money Stories, where people share their personal experience/stories dealing with finance.

I expect there will also be an appearance in the Carnival of Personal Finance today.

Credit card fees can suck you in

I found this article interesting. Those of you who insist on using credit cards, may want to reconsider that after you have read this guys story. Especially those of you, who use the arguement that you pay your balance off in full every month. If everyone, that says they paid the bill in full actually did, then the credit cards companies would be bankrupt. However, there is a more pressing reasoning to cut up those credit cards. This time I am not releying on Dave Ramsey to prove my point, instead I am looking to an article in the USA Today (Dec. 15, 2006).

René Rodríguez of Juana Diaz, Puerto Rico, paid late on his August credit card bill for the first time in years. A simple oversight: He misplaced his bill.

But the fees Rodríguez was hit with were hardly simple. First, Citibank charged a $39 late fee. And even though he paid his full balance, the bank dropped his interest-free grace period. Then it began charging interest, compounding daily, at a 24% annual rate. All told, it cost him nearly $100. The policy "is perplexing," Rodríguez says. "It's probably somewhere in the contract, and whether it's fair or not, once the company puts it there, you're stuck."

Remember when most of us paid only an annual fee on credit cards? Today, late fees and over-the-limit fees are replacing that annual fee. Add in a dizzying array of extra charges: for phone payments, "expedited" online payments, credit card use overseas and balance transfers from other cards.

At a time when Americans wield more plastic than ever — 692 million credit cards, with $711 billion of debt — fees and policies have grown so complex that even regulators struggle to grasp them.

That's right folks, miss that payment due date once, and your grace period no longer exists.

Lots of card issuers offer low initial interest rates these days. But once they've pulled you in, they often replace "fixed" rates with floating rates — which can rise — and impose penalty rates of up to 30% even on those with good credit.

"It's like economic Darwinism," says Chi Chi Wu of the National Consumer Law Center, an advocacy group. "The business model has changed from one rate and annual fee to all these different tiers and fees designed to make money."

As I have stated repeatedly, you cannot beat the credit card companies. Eventually, you will miss a payment for some reason, probably by accident and they will sock it to you. It's not a game that I am willing to play. Pay cash for everything, and you will come out ahead of anyone that pays with credit. Ths article is a perfect illustration of that point.

As for those 0% and low intrest credit card offers, the article is clear in repeating what I have said in past posts. Those offers are to lure you in and then they snare you, like a wild animal in a hunters trap. Or, to use John Cummuta's annalogy, like a drug dealer, giving a new adict his first taste of cocaine. Once you have tried the drug, it becomes hard to refuse it. That's why Cummuta refers to credit cards as "Consumer Cocaine."

Practical Way to Become Debt Free Forever!

1. If you have Credit Cards with Outstanding Balances.

A. Cut up ALL Your Credit Cards, and do NOT open new lines of credit.

B. Call those cards and ask them to reduce the interest rates.

2. Save or Earn an Extra $150 - $200 Per Month.
3. Pay this Extra Money off ONE Credit Card each Month until it is Paid Off.
4. Continue to Pay the Minimum of ALL your other Credit Cards each Month.
5. Once One Card is paid Off Apply the TOTAL amount to a Second Card.
6. Continue until All Your Credit Cards are Paid Off.
7. Apply the Same Method to your Car and House Loans.
8. Do Not Borrow Money for Consumer Goods Ever Again.
9. Use this Monthly Amount to Build Your Assets.

Using this Simple Method, as John Cummuta says, most People can become Debt Free in 5 to 7 Years and Wealthy in 10 to 15 Years.