A lot of people are in debt nowadays. Everybody has a credit card because it’s so easy to use. The only problem is that it’s often used to cover other debts. If you don’t have any money left, you can always use your credit card. Just be aware of the fact that they charge you a lot for being in debt. The same goes for the mail order companies.
Let’s say you pay back on your loans a thousand dollar a month. You pay one hundred and fifty to your credit card company and one hundred to a mail order company. These two are the ones with the highest interest rates by far, probably somewhere between fifteen en twenty percent. You pay back to a personal loan two hundred and fifty a month at approximately ten percent interest and you bought a car but didn’t have the money, so you have to pay them five hundred a month.
Four debts in total for this example, credit card, mail order, personal loan and a car loan.
If you double the amount on your credit card pay back and on your mail order payback. Let’s say it’s paid back in eight months. Then you start paying five hundred a month to redeem your personal loan. The very high interest debts are gone, so you will start with the next one. Get in touch with your bank by phone or email and ask them if you may postpone your two hundred fifty payments for eight months, adding the promise that, after those eight months, you will start paying five hundred a month instead of the current two hundred and fifty. Let’s say it will take you a year to pay off your loan. This means that the bank is happy as well. The will receive their money back four months earlier. Now it will take you twenty months to pay it back, instead of twenty-four, you doubled the amount after eight months. Now the car loan. You will start your payments again after twenty months, and it seems that you don’t have anything to offer, you already pay five hundred now. They have pledged your car.
You have invested the other five hundred a month. This ten thousand, twenty times five hundred, will generate income. It will at least generate fifty to one hundred a month. After twenty months you probably will save more money, so you can offer the car loan company more. Tell the car company what you are doing and how your plan looks like. The will be more than happy to have a customer who has straightened out his finances and will surely pay off his debt to you
Within three years you can be free of debt and you will have at least eighteen thousand as investments in assets. So you roughly turned it around from being in debt into being an investor within three years. I can assure you, once you get the hack of it, it will be much quicker. If you also invest the amount you don’t have to pay back on the loans, it will double your speed. And only by paying the same amount as before, think about that.