Perhaps you have been thinking about my challenge to you yesterday to come up with financial goals for 2009. Part of you may be thinking that sounds like a great idea to eliminate your debt fast. But, you may also be thinking that it's kind of nice to only be paying your minimum monthly payments. In fact, you may be getting along just fine by doing so. When you look at your monthly cashflow situation, you can eat out, buy new clothes, and you still have money left over at the end of the month.
Well, consider how much more money you would have each month if you weren't making payments to the credit card companies and toward your student loans. Don't just think about the interest you pay each month, but the entire amount of your payments. Once you pay your debts off, you will free up a lot of cash for savings, investing, college funds, etc.
If you want a clearer idea of what the interest is costing you, please check out the two links below. Input your information and it will give you some startling results.
Cost of paying minimum payments
What will it take to pay off your balance
Say you have a credit card with a $5000 balance, with an 18% interest rate. It will take you 26 years to pay off that card if you only pay the minimum amount due. You will also end up paying over $7100 in interest over that time. And this is assuming you never use the card again in your life.
After you find out how much you will pay in interest, consider what you can do with that money if you invest it. What a difference!
My intention is not to end the year with depressing information, but to motivate you for the exciting days ahead.
Happy New Year, everyone!
Showing posts with label credit cards. Show all posts
Showing posts with label credit cards. Show all posts
Wednesday, December 31, 2008
Friday, December 26, 2008
Don't Buy Stuff You Can't Afford!
I'm sure you've noticed all of the deep discounts in the stores. But take this into account.
Sometimes things can be confusing when they are put into the simplest of terms. Hopefully, we as Americans can let this one sink in...
Sometimes things can be confusing when they are put into the simplest of terms. Hopefully, we as Americans can let this one sink in...
Thursday, November 20, 2008
Need cash now?
I was reading the latest issue of Kiplinger's Personal Finance magazine today and came across an article that discusses "A Dozen Timely Ideas on How to Pay Unexpected Bills and Weather Tough Times". I must say, I was actually excited (in an extremely nerdy way) to read the article and was hoping to read about something I never thought of. After all, it is my slower time of year and extra cash is always a good thing.
To my extreme disappointment, the article was full of unwise and impractical solutions. Six of the twelve "ideas" involved borrowing money in some way. What a novel idea--If you need some extra cash to pay your bills, ask your friends and family. Or better yet, idea #10--Borrow From Strangers. They then went on to describe a kid who mass emailed 10,000 people (illegal) and asked them to each donate $2.50 for his college tuition.
Other ideas involved taking money out of your retirement funds (which you can do, but for a penalty) and selling your investments (horrible time for that). And the worst idea of them all--Cash Convenience Checks. You are setting yourself up for disaster by using one of those blank checks that come with your credit card statement. The interest rate is usually very high and there is typically a fee you need to pay just for the convenience (around 3%-4%). And in some cases, when you pay credit card company back, your payment will be applied to your normal credit card purchases first, then toward the convenience check.
Number 12 on the list was "Sell Your Stuff". Finally, something that makes sense. I'm pretty sure I would donate plasma before doing anything else on the list. This article got me thinking and I will be working on my own list of things you can do to make some extra cash for the holidays or just to help make ends meet.
To my extreme disappointment, the article was full of unwise and impractical solutions. Six of the twelve "ideas" involved borrowing money in some way. What a novel idea--If you need some extra cash to pay your bills, ask your friends and family. Or better yet, idea #10--Borrow From Strangers. They then went on to describe a kid who mass emailed 10,000 people (illegal) and asked them to each donate $2.50 for his college tuition.
Other ideas involved taking money out of your retirement funds (which you can do, but for a penalty) and selling your investments (horrible time for that). And the worst idea of them all--Cash Convenience Checks. You are setting yourself up for disaster by using one of those blank checks that come with your credit card statement. The interest rate is usually very high and there is typically a fee you need to pay just for the convenience (around 3%-4%). And in some cases, when you pay credit card company back, your payment will be applied to your normal credit card purchases first, then toward the convenience check.
Number 12 on the list was "Sell Your Stuff". Finally, something that makes sense. I'm pretty sure I would donate plasma before doing anything else on the list. This article got me thinking and I will be working on my own list of things you can do to make some extra cash for the holidays or just to help make ends meet.
Thursday, November 13, 2008
You're going to charge me to pay you?!
Have you every tried to pay for something with a credit card only to find out that you were going to be charged a "small" fee to do so? Or maybe there was a minimum purchase requirement and you were forced to purchase something else only to "qualify" to use plastic? Well, I'm sorry to say you have been taken advantage of.
Terrica, of Fabuluxe Events in Georgia, has a great post today that goes into detail about the terms that merchants agree to when they allow credit card purchases. Be sure to read this information so that if you are ever confronted with this situation you can make a knowledgeable and sound argument.
Terrica, of Fabuluxe Events in Georgia, has a great post today that goes into detail about the terms that merchants agree to when they allow credit card purchases. Be sure to read this information so that if you are ever confronted with this situation you can make a knowledgeable and sound argument.
Thursday, October 23, 2008
An Excuse to Drink Starbucks
I cannot say I am addicted to coffee or ever need a Starbucks "fix". But I do enjoy a caramel macchiato every once in a while and I definitely fall for the overall atmosphere of the place.
What's more is I don't feel guilty about spending the extra $3.50 because of my Starbucks Duetto Card. It's both a Visa card and Starbucks card in one. 1% of all purchases is loaded onto the "Starbucks side" of the card. If this isn't enough of an incentive, you automatically receive $25 loaded onto the card after your first Visa purchase.
I only recommend this, of course, to someone who plans on paying off the bill every month. I certainly don't condone a credit card bill that rolls over each month. So please, use with caution.
There are obviously other credit cards with cash-back and other perks available. This just happens to be one that works with my lifestyle.
Do any readers use this card or use other credit cards with points or cash-back? Please share.
What's more is I don't feel guilty about spending the extra $3.50 because of my Starbucks Duetto Card. It's both a Visa card and Starbucks card in one. 1% of all purchases is loaded onto the "Starbucks side" of the card. If this isn't enough of an incentive, you automatically receive $25 loaded onto the card after your first Visa purchase.
I only recommend this, of course, to someone who plans on paying off the bill every month. I certainly don't condone a credit card bill that rolls over each month. So please, use with caution.
There are obviously other credit cards with cash-back and other perks available. This just happens to be one that works with my lifestyle.
Do any readers use this card or use other credit cards with points or cash-back? Please share.
Wednesday, February 6, 2008
The Dollar Dance
Whether you had one of these at your wedding reception or not, I don't really care. There are many other blogs that will debate the etiquette and/or audacity of them.
I am here to discuss the post-nuptial dollar dance. The wedding is over and the honeymoon bliss is a fading memory. Two bank accounts have now become one. In this blog I will talk about the many different questions and issues that arise not only for new marriage relationships, but for anyone who wants to do it right.
It's time I put my finance major and love of this topic to use. As we go, please email me any questions you would like me to answer regarding banking, investing, credit, budgeting, and the like.
The purpose of this blog is to stop dancing around the subject of money and to start making educated decisions that will lead to a brighter, more financially independent future.
Let's go!
I am here to discuss the post-nuptial dollar dance. The wedding is over and the honeymoon bliss is a fading memory. Two bank accounts have now become one. In this blog I will talk about the many different questions and issues that arise not only for new marriage relationships, but for anyone who wants to do it right.
It's time I put my finance major and love of this topic to use. As we go, please email me any questions you would like me to answer regarding banking, investing, credit, budgeting, and the like.
The purpose of this blog is to stop dancing around the subject of money and to start making educated decisions that will lead to a brighter, more financially independent future.
Let's go!
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