Welcome to Debt Consolidation
Debt Free Uk Article
This is a selection made from among articles on Debt Free Uk. For a permanent link to this article, or to bookmark it for future reading, click here.
from:
Debt Solutions - Pay Off Credit Card Debt
By Michael Russell
In 2005, the average American had $8000 dollars of just credit card debt. Of course, the total amount of debt was much higher once you consider a mortgage, personal loans, home equity loans, student loans and a few bucks from mom and dad. Most people have more than one and in some cases a wallet full of the plastic cards. $8000 is a mountain of debt that most people can barely make the minimum payments on let alone try to figure how to get rid of it. Lets look at some options that will help you eliminate that debt.
Adjusting your payments on a credit card can affect your financial picture in the long term. The minimum monthly payments on credit cards use to be 2% of your total debt. If you have $8000 of debt and you are paying the 2% minimum or $10 which ever is more, prepare to pay that card off for 54 years and accumulate $23,000 in interest. The first payment would be $160 and it would trickle down to $10 as you paid the minimum each month. This calculation is based on an 18% interest rate. If you could maintain that payment of $160 each month, you could pay of the same credit card off in just under 8 years and pay less than $7000 in total interest. Just by maintaining your payment, you can see how you can eliminate much faster.
Credit card companies have doubled the minimum payment to 4% now. This has caused some people to file for bankruptcy since they could barely afford the 2% minimum. Now you have to pay $320 instead of $160 if you are the average American. If you can afford to pay that amount, it will take you less than 3 years to pay it off and expect to pay $2000 in interest. By doubling the minimum payment, you can pay it off much more quickly.
Let us also look at interest rates. It is easy to forget to look at the interest rate when making any financial decision. If you have several federal student loans accumulating interest at 3.5% and you have an equivalent amount of money in the bank, most would want to take that liquid money and pay off the student loans. This would be a mistake because you forgot to look at interest rates of investments. If safe and secure bonds are paying you 5% and you are only losing 3.5% on those loans, please do not pay it off. You can invest and pay the minimums on those student loans and capture that 1.5% interest difference. The same goes for credit cards. Pay off the ones that are higher first. If you have multiple cards, pay the minimums on the lowest interest cards and put the rest towards the highest. Once the highest interest rate credit card is paid off, figure out which card has the next highest interest rate and repeat. Do this until you are down to one card and you should be paying that off quite fast if you do not decrease the total amount that you are putting towards your credit cards each month.
As you can see, the more you pay per month will have an astounding effect on your total payments in the end. The first step is to budget yourself so that you can stop using credit cards, the next is to figure out how much you allocate to paying them off each month. Start by being aggressive on the highest paying cards and work your way down. The effects off paying off that debt will help you breathe easier and know that you are back on the right track.
Michael Russell
Your Independent guide to Debt Solutions
Article Source: http://EzineArticles.com/?expert=Michael_Russell
http://EzineArticles.com/?Debt-Solutions---Pay-Off-Credit-Card-Debt&id=265137
Debt Free Uk Specific links
Top 25 Hottest Female Athletes
- Check out the hottest women in sports. From Maria Sharapova to Danica Patrick, check out Hollyscoops annual countdown to these athletic beauties.
-- http://www.hollyscoop.com/
Debt Free Uk News
Crisis, what crisis? Meet the debt-free - The Observer
Crisis, what crisis? Meet the debt-free The Observer, UK - Price comparison site Moneynet.co.uk is launching a 'financial detox' programme later this year, which will aim to help people organise their money, ... |
Stephen King: Interest rate cuts won't cause another bubble, but ... - Independent
Stephen King: Interest rate cuts won't cause another bubble, but ... Independent, UK - Rapid growth in the US and the UK, after all, has ultimately depended on home-grown debt and not on irresponsible behaviour elsewhere in the world. ... |
Financial Problems in the US Are Small Potatoes Compared UK - Daily Reckoning - Australian Edition
Financial Problems in the US Are Small Potatoes Compared UK Daily Reckoning - Australian Edition, Australia - Hardly more than 12 months ago, the American central bank's vaults were so full of US Treasury debt that anything else in there wasn't worth talking about. ... |
Ferrovial cashes in on its Belfast asset as George Best is sold - Times Online
Ferrovial cashes in on its Belfast asset as George Best is sold Times Online, UK - This would help to reduce its enormous debt burden, which Ferrovial said last week was €28.7 billion (£23.1 billion). The debt associated with BAA was €16.2 ... Ferrovial to sell Belfast City Airport for £132.5m |
Housing help may rescue market - Scotland on Sunday
 Times Online | Housing help may rescue market Scotland on Sunday, UK - THE UK is finally in recession, according to the Organisation for Economic Co-operation and Development. So how can consumers protect themselves from the ... What stamp duty changes will deliver House Plans 'Too Little Too Late' |
Uncertainty will rule the land until the election - Times Online
Uncertainty will rule the land until the election Times Online, UK - Banks such as Merrill Lynch, Goldman Sachs, Wachovia and HBOS will have to raise a total of almost $800 billion to cover debt that is coming due this year ... |
Letter to shareholders - Sydney Morning Herald
Letter to shareholders Sydney Morning Herald, Australia - If you have any questions about BHP Billiton's pre-conditional offer, you can call freephone in the UK: 0800-987-8750, Australia: 1-800-835-640 or in the ... |
Debt Management UK: One Stop Solution for Multiple Debts - Best Syndication
 Best Syndication | Debt Management UK: One Stop Solution for Multiple Debts Best Syndication, CA - Debt management also gives free advice to the borrowers to facilitate better management of finances. One can apply online and get a free quote from the ... |
The Market's Finest - Barron's
The Market's Finest Barron's - One New York money manager, who requested anonymity, notes that Microsoft "trades at its highest free-cash-flow yield [or lowest multiple of free cash flow] ... |
'My girlfriend is a compulsive gambler. She stole and pawned items ... - Irish Independent
'My girlfriend is a compulsive gambler. She stole and pawned items ... Irish Independent, Ireland - "When the reality of their addiction surfaces, gamblers may be hundreds of thousands in debt and it comes out of the blue for those around them. ... |