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HomeOff Topics › credit card made me a depressed person , needs help please
03-08-2008 09:32 PM  10 years agoPost 21

rrKey Veteran

Anaheim, CA

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Do what ever you can to start paying down the principal. Then, follow my 6 steps below to be rich. -Steve

I just gotta put in my $.02 And as you read this, please dont think I'm trying to come off like I'm bragging.

I was young once too... My parents were always tight with their money. Now, they are very wealthy. My dad had a great line that I heard a million times... I would ask him for something and he would answer, "sure - go buy it." Of course he never gave me the money to buy it... But he never stopped me. I would save and save and then buy some crap. Then I would feel like $hit because I had wasted so much money that I saved up so hard for. After doing this 5 or 6 hundred times, I learned the lesson. And it really made me respect the things I bought. Why, because I earned those things by working for them.

My parents had some simple rules. I followed by their example and now I'm doing very well at age 37. I owe $63k left on my 5 bedroom house in Anaheim Hills - and that was with a 15 year loan. I have a 21' R/V (not pretty since it's a 1985, but everything works). I have a '94 Ford Explorer, a 2004 Surburban and a 2006 Tacoma. I have a 3 motorcycles, a boat and 2 jet skis. Of course everything is "paid off." I have $290k in a 401k. The secret of my sucsess, 6 simple rules.

1. Buy what you want - but always pay cash...

With the excpetion of a home, there is pretty much no reason to pay someone interest... You want something. Fine. Save up and buy it. You would be surprised how much you can save up if you put your mind to it and save. By the way, while your saving, you are EARNING interest on your money. That means the less you have to save. I know it sucks to wait longer to have something. But it will pay off in the end.

2. Use a credit card to buy stuff. But, never, ever carry a balance. Get the free points, airline miles, cash, etc. the credit card companies want to give you... But never pay them a cent in interest. This is the big trap. Once you get behind, it is hard for most people to get out of the trap of credit cards. By the way, credit cards are a great way to BUILD your credit rating. But, they are also a great way to destroy your credit rating.

Along this note, only have one credit card. Is there any reason to have 2, 3, 4 or 10 of them. No. You only need one. The longer you have an active credit card, the more points you get for your credit score. Find a good one (like through a credit union) that has no fees and stay with it. Never open a Target or Wal-Mart or even a gas credit card.

3. Always make a car payment. Huh, car payment you ask??? What about rule number one? The trick, make the car payment to YOURSELF. Here is what I mean. Put $250 (or what ever is good for you) per month in a special savings account. I suggest you have your mom or dad open the account with only their name on it. This way, you cant touch the money. Once you have enough money for a car (new or used is discussed in rule #4). Go buy it... After you buy the car, start over and keep making a new car payment to yourself for you next car. Do this for the rest of your life. You never end up paying interest, but instead you end up making interest. And, you are making the same car payment that everyone else is making. Lastly, it's nice to be able to pick a car and when the sales guy says how do you want to finance it, you get to say - cash!

4. Buy the car you need, not the one you want. This only applies until you are rich and money is no longer an issue. Sure, we all want a new car. But, a used car is a hell of a lot cheaper. I know some people say. "but with a new car you get a warranty." Ha! Really, how many people do you know have ever had an engine blow up on a car? Seriously. It just doesnt happen much. And if you buy a 2 or 3 year old car for half the cost of the same new car, you are saving tons of cash. And even if that 3 year old car takes a major dump, you can fix a whole hell of a lot with the money you saved from buying it used.

Next on cars, never, ever lease... It's just a trap for people who cant afford a "nice" car to have a nice car. You must learn to live within your means... And that saying goes for everything, not just cars.

Once you are a little older and fincinacly well off, you can buy all the new, cool cars you want. Cash of course...

5. Save. Start now when your young. A little saved now adds up to be a lot when you older. I'm not going to go on and on about this. But, you MUST learn to save and save now. When you get you paycheck, 10% goes right into a Roth IRA. $250 goes towards you car payment. What ever is left (for now their wont be much), you get to spend. Sorry. But that is life.

A few years down the road (and trust me, those years go by quick), you will never have to worry about money. Yet all your friends and neighbors will be crying about having to pay all their credit card bills and car payments...

6. Learn from other peoples mistakes. Talk to older people (like in their 50's or 60). Seriously. Ask them, "if you were 17 again, would you re-live your life spending money the same way?" I bet you 99.9% of them would go on and on for hours about what they would do if they could go back and start all over. And they would all say the same thing. Save early and live within your means...

Money is a good thing - if you have it... You should judge a man by what he saves, not what he earns. Lastly, a gentle reminder of the golden rule. Buy what you want, but always pay cash!

If you follow these simple steps, I can pretty much guarantee you will be set for life. If you dont, well, you will be like the other 280 million Americans who live in the richest country in the world yet are near broke...


03-09-2008 03:08 AM  10 years agoPost 22

rrKey Veteran

Virginia Beach, VA

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One more thing.....

I would keep one Credit Card. The one with the lowest interest or one that gives cashback. Use a piece of tape on the front of the card and write "Emergency Use Only' on it. Stick it in the back of your wallet.
The reason is that sometimes stuff happens. You place can burn down, banks can get screwed up and won't let you withdraw $, family emergency etc. Then it's a good time to have a source of cash on hand.
It came in handy for me during Katrina. Nice not having to worry about your next meal until the .gov and .ins can figure out what to do.


'Send Money, Women and Guns!'

03-09-2008 03:51 AM  10 years agoPost 23



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Ok I am not sure if you want to do this but I have done it for a clt of mine. I called the credit card company and asked to settled. He was many payments behind and owe 1500 on one card. They settled for him only paying 900 or the 1500. I know that is still a lot but every dollar off helped. The catch is you have to make it in either 4 or 6 payments. If you miss a payment the deal is off. Also it does affect your credit some but the way it was explained to me is that it was a middle of the road bad. So not like you were bankrupt but also not perfect.I am not sure if I was any help but there you go.

03-09-2008 05:55 AM  10 years agoPost 24


South Carolina

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I called the credit card company and asked to settled. He was many payments behind and owe 1500 on one card. They settled for him only paying 900 or the 1500.
Don't ruin your credit for the next seven years over a few hundred bucks. It would be better to just make minimum payments until your financial situation changes, than to carry a settlement until 2015. The higher interest rates you will pay in the meantime will more than offset anything you save settling with such a small amount of debt. Try to think long term...

If everyone is thinking alike, someone isn't ...

03-09-2008 06:59 AM  10 years agoPost 25


London, Ontario, Canada

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I just want to say am 27 yrs old and I got tons of interesting concepts, thoughts and experience-based opinions in this thread that will save me from mistakes for years to come, I feel like am 50 yrs old experience wise , thank you every body and please keep in putting the great advices

Scale life or no life !

03-09-2008 11:17 AM  10 years agoPost 26


Lakewood, CO

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I really have to agree with Hughs500. He has good, sound advice that will go a long way. I am not a kid anymore and I have a few dents on my credit report. I am working my ass off to correct them. hile at the same time, putting a little money away to get the wife and I on the way to financial security. The economy is not going to get any btter anytime soon. Start preparing yourself for the future today and you wont be disappointed.


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03-09-2008 12:29 PM  10 years agoPost 27


Wales. UK

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A lot of these consolidating loans are using your home as security. Check the small print or you may end up on the street.

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HomeOff Topics › credit card made me a depressed person , needs help please
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