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A Personal Loan to Play Credit Card Balance Transfer Game

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A few months ago, Credit Card #1 decided to raise the interest rate on me again. I was so flustered that I soon was on a mission to get that debt off of that card.

I actually went into two banks and discussed the possiblity of getting a personal loan to pay the credit card so then I can turn around and transfer the loan balance right back to the credit card (to take advantage of their 0% interest balance transfer offer).

I had all of my papers with me, including the offer from the credit card stating the end date to accept the balance transfer offer.

It didn’t take long for them to say “No.”

I briefly then considered finding a loan shark, but decided against that choice. I guess I will get rid of Credit Card #1 the old fashioned way.

Technorati Tags: balance+transfer, personal+loan, interest+rate

Fight Identity Theft With a Shredder

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A great tool to fight identity theft is a shredder. They are fairly inexpensive for a small shredder and they will render your old documents unreadable.

I have two shredders in my house: a strip-cut and a cross-cut. A strip-cut shredder cuts your paper into thin strips the length of the paper you put in it. A cross-cut shredder cuts your paper into confetti-size squares or rectangles. I use the strip-cut shredder for things like old receipts that do not have my complete credit card numbers on them. I also use it for papers that have personal information on them but not account numbers (like credit card applications). My cross-cut shredder shreds anything that has my social security number or bank account numbers. Those are things that I definitely do not want getting in the wrong hands.

You only really need one shredder and if you were going out to buy one today I would recommend the cross-cut shredder. I only have two because I started with the strip-cut and then decided to get a cross-cut. I want to extend the life of my shredders so I alternate shredding days.

Technorati Tags: identity+theft, shredder

Is There Such a Thing As Good Debt?

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Alot of the time, even I think debt is all bad and it should be avoided at all costs. But, there are some types of good debt out there.

A few examples of good debt are:

  • Mortgage – the debt incurrered when purchasing a home is usually paid back over may years. You also have something of value that could pay off the debt immediately if needed.
  • Student Loans – you may regret ever taking out a student loan while in college, but the higher earning potential that you have should make the loans worth their trouble. The rates for Student Loans are also much lower than traditional personal loans.

With any loan that you must make, the best thing to do is to only take out a loan for as much as you need. Put down as high of a down-payment as you possibly can.

Technorati Tags: mortgage, student+loans, good+debt, bad+debt

My Debt to Income Ratio

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When you look at my monthly payments towards debt compared to my income (debt-to-income ratio), you will see why my debt is very bad.

I found his handy calculator to use:

Debt to Income Calculator

My monthly debt payments eat up 54% of my monthly gross income (pre-tax).

A “healthy” ratio is under 36%. If you are over 50% it is recommended that you get professional help to reduce your debt because you are in trouble.

And, as I will discuss later, my income just recently increased so I was dealing with this debt with even less income. That is why I will often give tips on how to live frugal because I have been living frugally for quite a while just to make sure bills were getting paid.

Technorati Tags: debt, debt+income

I Can Be Debt-Free!!

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A common phrase that I catch myself saying (or thinking) alot whenever someone says something negative is: “Not with that attitude.”

Those 4 words mean alot to me. It stresses how important I feel it is to have a positive attitude.

Instead of saying “maybe I can do it” you need to be saying “I can do it.” Remove all of the doubt in your voice.

For me, it means instead of saying, “Maybe I can be debt-free” I am saying “I CAN BE DEBT-FREE!”

A positive attitude can go a long way when you have goals to reach ๐Ÿ˜‰

Technorati Tags: debt+free, positive+attitude

Get Out of Debt Emails

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I just checked my email, and out of 20 junk emails, I had 2 that claimed that I can get out of debt. Somehow, I got on some mailing lists. I can only expect to be on more now – LOL!!

I’ve never looked into those emails, but I have a feeling those aren’t the real thing. Remember to always be careful with your personal information. That is solid advice for anything you may decide to sign up for in your lifetime.

And another golden rule usually applies as well….if it looks to good to be true, it probably is.

Technorati Tags: debt, junk+email, personal+information

A Warning About Pay Day Loans

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You have probably seen advertisements where you can get a cash advance until pay day. These are typically called “Pay Day Loans.” You bring in prior paystubs and let them know how much you want to borrow. You get the money right there, and you have to pay it back when you get your paycheck.

Make sure you read the fine print.

The rates on these short-term loans are astronomical. Is it really necessary that you have the money right now? Is it possible to get an interest-free cash advance from your employer? Even if it is difficult to ask your employer, it is worth a shot.

Another thing to be careful of with these loans is getting in a viscious cycle where you are continually using the services because your normal cycle of pay day spending has been altered. Every time you get one of these loans you are paying a lot in interest.

Pay day loans can be great for times where you absolutely need the funds and you cannot get them any other way. Just be careful.

Technorati Tags: pay+day+loans, cash+advance