The periodic finance charges are calculated by the following equation: Average Daily Balance x the number of days in the billing period x the Daily Periodic Rate. So if you pay the $ 50 right away by the due date as one lump payment instead of two $25 payments spread out over the month you pay off the balance amount owed sooner. Thus reducing the average daily balance sooner and paying less interest on the remaining balance owed.

The sooner you pay off the balance the less interest you will have to pay and more of your payment will go toward paying off the balance. If you change any one of the parts of the equation then you change the finance charge. by lowering the average daily balance over the billing period you will pay less interest since the balance is lower. The longer you wait in the month to make $25 principal payment the more interest you will pay than if you paid it sooner in the billing period.

I hope this helps!

Hi, I’m new here, so I hope this hasn’t been covered. I’ve been told that making two credit card payments in a month somehow messes with the interest calculation and pays the debt off faster. For example, if my minimum is $25, but I usually send in $50, split it into two payments of $25, one at the beginning of the month and the other in the middle.

I don’t remember the logic. Anybody tried this?

Can’t see how this would work. Now, if you normally made a payment of $25 a month and you started making two, $25 payments a month that would do wonders to bring down the principle amount. The whole key is to bring down the principle as fast as possible. Splitting a $50 payment into two payments wouldn’t do that. In fact, you’d be worse off than making that $50 payment to begin with.

I read about this technique in this book:

When I get home tonight, I’ll reread it and see if I can summarize her logic. I had forgotten where I read it, but found it again last night.

They may call it something else like Citibank’s Checking Plus but the words overdraft protection or coverage will tell them what you want. If you don’t have enough funds in your checking account it provides coverage for checks.

Also if you have a mastercard or visa debit card associated with the checking account it should cover its transactions too. But again I warn the APR is high 18-21%. I have two overdraft accounts with Citibank and Chase. I just had a problem where Citibank denied a transaction that my wife did over the Internet but hopefully I will be able to clear this up.

1. Talk to your DMP about the problem and ask them where you could get funds

2. Do you belong to an ethnic or social group that has a free loan society. We in the Jewish Community have such a thing but you would probably need a creditworthy cosigner to back such a loan up.

3. Consider overdraft checking. The interest rate is high(18-21%) but you could get the money you need as a last resort.

I just found out I need to have about $3000 worth of work done on my transmission, fule tank, and fuel line.

That’s the total for the lowest estimate plus the cost of a rental to drive for the week my car is in the shop.

I am in a DMP so I am already strapped for cash. Anybody have a similar experience?

Know of any ways to borrow/magically produce that kind of money on short notice? TIA for any advice/info.

That is no debt at all, no home debt, auto debt, medical debt, credit card or consumer loan debt etc. Total debt freedom prior to retirement and living a cash based lifestyle. The story of those who have achieved debt freedom will be an encouragement to those that are still in debt that debt freedom is attainable.

Pay yourself 10% first is a goal that all need to do in order to start on a path to debt freedom. Setting up a budget and sticking to it and living beneath your means is the only way to achieve total debt freedom.

Living beneath your means is spending less than you take home from your employment. It is not how much you make that is important it is how much of it your keep.

I am currently reading True Prosperity your guide to a cash-based lifestyle by K.C. Knouse from my local library. The book has some good ideas and guidelines on how to become debt free.

My husband and I have been having the same problems that you are having, so I feel for you. One suggesting that I do have is to call either the hospitable or were the billing is coming from and ask to speak with a supervisor or manager. I’ve worked in customer service for 6 years, and there is really so much that they can offer you and the secret to getting what you want is to speak people who have more control. Explain your situation to them and if they tell you that you still have to have a $120 payment a month, ask to speak with their supervisor or manager. Don’t give up until you get what you want.

Make sure that you never give a verbal or written okay to set up a high payment plan. If you are sending in payments, they have to except your payments. Also, make sure that you document every call that they make and tell them to note your file that you called. I have noticed that these medical collections lack communication. For example I just recently called to check on some of my payments that I sent, and let the lady know I am sending in another payment. The next day, they called and asked when a payment would be made.

Another note, I do know that medical bills are looked at last by creditors. However, if you are denied credit, go back to your records and supply them with all the information in writing. Let them know that you were making payments and give them all the documentation that you were trying to solve the situation. But just keep sending in payments as you are and keep fighting. They will give in. When I speak with them, I always ask/tell them when they say they can’t except less than a large amount, I can either send nothing or $25, which one do you want. Make them choose, and don’t be afraid to be stern with them or the Credit agency and remember, if you don’t like the answer from them, asked to speak with someone else.

The only place that has ever refused a partial payment has been my union with my union dues. They actually sent the check back and demanded the whole amount or I would lose my job.

The creditors have all told me they wouldn’t accept lower, and some even demanded wire transfers or phone payments. One even said I couldn’t mail it to the original creditor even though I was receiving bills from both the original and the creditor they hired. All of them cashed my checks just fine. They weren’t happy, but I was paying something, and I could prove it.

I would go ahead and send what you can. Yes, it will probably go to a creditor, and just send what you can there too. None of my creditors have bothered to take any legal action, probably because my bills aren’t that large, and I do have a record of paying, just not as much as they would like. At least you can establish a record that you are hanging in there and doing your best. They don’t have to like it, but it’s better than nothing, and you already know you can’t send more than that.

I personally wouldn’t remind my spouse of what has been purchased in the past. Just put it behind you and enjoy the widescreen. You should focus on the present (lunches, fantasy football) and address the waste of money it creates. Not to make it sound like it’s entirely his wrongdoing, mention something you’ll cutting back/eliminating so its sounds more like a joint effort from the two of you.

In a previous post, I liked the mention of paying off one debt, and then moving on and paying off the second one, etc. In July 05 I’ll be making my last car payment, and I already have the money earmarked in Aug. to agressively start paying off the first card. Good luck to you, and just stay focused!

Just in reading your message, the first time, I saw a number of danger signs. Not sure why your husband would just up and quit his job without another, especially knowing he’s partly responsible for bills and a family.

Also, I commend you for being one who’s not afraid of work, but part of me can’t help but wonder if your priorities might be a bit of out line. If you already know you have “way too many credit cards,” this probably means that you’ve way overextended yourself. The additional fact that you said you felt you should be able to buy my kids designer clothes and have what you want indicates that you probably buy some things you don’t need (or at minimum, aren’t necessities). Sure, the kids might be and look cute, cool or contemporary, but at what cost?

Are you not in effect teaching them that it’s ok to “have what you want,” even if you can’t afford it, and go way into debt to get it? So, I guess the real question really isn’t about debt elimination companies, but perhaps might be this: do you want to get yourself in a stable financial position, and learn the principles so you can teach your children how to do the same, OR, do you want to keep working “a lot”, buying your kids designer clothing, yet be broke with a horrible credit rating? What legacy do you want to leave your kids? Your choice.

The right company can be helpful in assisting a person to get a handle on debt and come up with a plan to pay it off, but with your current apparent mindset, it would only be a matter of time before you’d find yourself right back in the same (or worse) position. Why do that to yourself?

Happy Veteran’s Day!

I have a hospital bill from where my daughter was in there last year for almost 2 weeks that is about $1,500 now left to pay. At first, the company handling their accounts said I could pay $25 a month minimum, so I did (that was before I got the phone tape recording device). Then I got a letter saying it is their policy for me to have it paid off in 12 months and I told them I couldn’t pay that much right now since I have so many other medical bills I am paying on. They wanted something like $120 a month! That is a big jump from what I was previously told! They also told me they couldn’t take smaller payments, so now they turned me in to the collection company and I have 2 weeks before it goes on my credit report. The credit agency told me that I would have to pay $140 a month and they don’t even accept less, even though it would still be on my credit report!

I talked to my husband about just getting a bad credit installment loan from MtpLoans or PersonalMoneyService for the amount to avoid it going on the report, but he doesn’t want to take out another loan. He says just pay them what you can and forget it, but I’m concerned they’ll not cash my checks if I send less and they might take me to court or something. Also, I’ve cleaned up my credit report (it’s not perfect…but much better) and now I feel this will be a blemish for the next 7 years. My husband says creditors won’t look much at a hospital bill.

Can they actually refuse payments of less than what they are requiring? Also, do creditors actually overlook hospital bills to an extent? If we did get a loan for it, the interest would probably be really high.


After a couple of months, you can begin to see a trend with a program like MS Money. I prefer Quicken but MS Money syncs’ to my handheld computer easier so I’ve been learning that.

We have also been successful on the program where you pay off a credit card and then close it. We have eliminated two cards so far, and are well on our way on the other ones. It does work much better than making the minimuns everywhere and making payments on each. Find some extra money and get one paid off. Then when it’s gone, you take the minimum that you were paying on that one and apply it to another one. Pretty soon they will disappear and make sure you close them. That is the key.

Buh bye Brick card, and buh bye Leons. Thank you for playing Teppermans.

We each have one credit card with fairly low interest rates that we use sparingly.

It might help to eliminate some bills if you can as well.

I remember when I was a teenager and our household bills were telephone, oil (we used wood for a wood furnace, but oil as backup), mortgage, insurance, and a car payment.

Nowadays we have cell phone, home phone, wife’s cell phone, gas, water heater, internet access, mortgage, insurance, car payment, two or 3 or 10 credit cards, kids. The world sure is changing fast, and I’m only 34. The key is to cut back where possible.

If you own your home, it’s FAR cheaper to buy the water heater than it is to rent it. Find out if you can buy it out. The money you save on rent easily covers replacing it in 10 years.

Oh, and if your kids aren’t too small, turn the thermastat back two degrees, and wear a long sleeved shirt in the winter. You will cut your gas bill by 1/3.

Track all your spending to see where it goes.

My wife and I are in a similar situation. And I will be the first to admit that I don’t save as well as her. I purchase things that I want / need as well, and I do purchase things that I need for my computer consulting business. But that said, I do make good money but I’ve found out that our living expenses are fairly high.

After we got married I bought her a 2 year old Ford Explorer. The payments would be $380 a month. Didn’t seem like a big deal. She would have a safe vehicle to drive in the winter (We live in Canada where there is 500 feet of snow Eh!) and we would have a nice vehicle to drive on trips. I have a full size pickup and I don’t drive anything where my ass drags on the road.

The $380 I was okay with. The problem arose when I went to get insurance on it. My insurance jumped from $80 per month for her Cavalier and my F150 to $390 a month for my F150 and the Explorer. This was because of 1 at fault accident and 2 speeding tickets over 5 years.

It is costing me more to drive the Explorer than it is to buy it. I’m very aggravated about this, as the whole insurance business (in Canada anyways) is a complete farce.

Anyhoo, my suggestions are to use a debit card to buy everything. I get out $20 at the beginning of the week for coffee’s all week, and I pay debit for everything else. Lunch, movie rentals, all that crap.

I recommend sitting down every month and doing a written budget TOGETHER. decide Together where every dime is going before you spend it. Any extra MUST go to paying off debt.This is also a good time to stop using credit cards.Try it for 3 months and you will be amazed at how much less you spend.Tracking with Quicken is also a good idea. If you do this TOGETHER, he will never have to worry about where the money went. He will already know and also see that you have more than before.

My advice: purchase Quicken or MS Money (I only know about Quicken) and set up your accounts so you can track you spending by Categories. Then you can see exactly where your money is going, esp in the “Dining Out” and “Entertainment” categories. Do it for 3-6 months, you’ll be surprised how much money goes for non-essentials. And don’t forget to track cash ATM withdrawals! Good luck, you will find a lot of good advice at this group.

Other software is discussed in this video:

i have researched and found out even if i am sued they cannot garnish my wages in Pennsylvania.

i also know that they cannot put a lein on my house because in my state they cannot do that if both the husband and the wife own the house and the card was only in one name. thank goodness none of them were in both our names.

so in a way i feel safe but an still nervous some will sue before we settle because some are high amounts. did you go to court? i figured i will use you legal advice on line that you suggested but wait until they actually proceed, right now they are just threatening. any advice you have i would appreciate.

thanks, Alice

I am a single Mom of one great little boy…but what comes with that great little boy, are great expenses. I understand exactly where you are coming from. I sometimes ask myself the same things your husband asks you. I finally sat down and put it all on paper in black and white. I took 2 months and wrote down every single expense I had/have. Down to a pack of gum, just to see where it all goes.

It is amazing! You get tired of writing it all down, but a couple of things happened for me. I started paying a lot closer attention to the outgo and realized it would exceed my income before the 17th or 18th.

By month two, I made it to the 27th. Yeah for me!!! That little experiment helped me a great deal. Maybe you could make a list for your husband and you BOTH try this for 2 or 3 months. This might open his eyes a little bit. Im sorry you sound so frustrated. Like I said, I know where you are coming from 100%. You will be fine.

HI everyone, new here to the blog – so far so good. I am a wife, mother of 2, and working full time. Christmas just passed, and took quite a chunk of the finances, and a bunch of rainy day money had to also be spent on unforeseen expenses, like car repairs, etc. Not to mention the kid’s baptism and birthday parties. I was wondering if others also experience the husband asking them “I don’t understand how we got to this point, why the money isn’t stretching, and why we are such in the hole. I just don’t see where the money goes.”

I was wondering how other ladies/men handle this situation when your spouse says this.

I don’t know how else to explain that there is mortgage, car, utilities, water, garbage, old credit card debt from the past, everyday essentials, daycare, other kid’s birthday parties, etc. How do you explain it – it’s all in front of you? I am tempted to just let him handle all of the bills from this point on.

Is that a smart move? btw, should i remind him of the $3000 42″ widescreen that’s on finance, or the long lunches he goes to with friends, or the fantasy football money he spends, or all the toys that he purchases for our girls? I just don’t know!

A couple of my cards have aprox. 3 Interests Rates (Standard Purchase/Cash Adv./ Special). How do I have my payment applied to the highest interest balance? How do they determine where my payment goes?

Have had simular circumstances and by saving and comparing my most recent statements, I couldn’t help but notice my card applied the payment to the lowest interest rate first, therefore making more revenue for them.

Most of the time payments are applied to the earliest charges made on the account. This is the big reason credit card companies offer those super low rates on balance transfers since those are the balances that are first entered on the account. They are banking on you using that account for your regular credit purchases so they can collect the higher rate on those. They only way around this is to transfer the balance and then not use the account until the balance is paid off.

Hello:-) My name is Alice. I’m 26 yrs old, SAHM (2 yr old daughter). My hubby and I have a lot of credit card debt and some school loans. It’s tough to pay off. We’re doing okay though.

It just sometimes seems like it will take forever. Our hope is to have it paid off, have lots of savings, and never use a credit card again! We already don’t use them at all – we’re just trying to pay them off.

Just a week ago we were able to transfer all our credit cards over to one with a very low interest rate. It’s so exciting that we were able to do that!

Anyway, hope to meet you all and learn lots of new things.

It’s called “The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke”. It also explains why bankruptcy helps, and not hurts, the family (assuming your debt isn’t from overspending on luxuries or blowing it all on nonsense, compulsive debting etc, which statistically speaking is extremely rare). That is just a small part of it though.

All I have to say is PLEASE read it and do yourself a favor (heard about it from the Dr. Phil show, which I do not watch but someone told me about it). Right now it is a BARGAIN bok at amazon in hardcover for $6.99 (less than paperback!!), which is how I bought it. The link is below to read about it, at the bargain price.

I am new to the list, and thus far my mail bounced because of account probs at yahoo…but glad to be here. Have filed BR in the past.

I’m new to this blog, but having been trying to pay down debt for some time. It’s a slow process, but it works if you stick with it.

Deciding whether to do a 0% transfer or a fixed low rate transfer depends on how much debt you have and how long the low rate transfer is for. Some low rate transfers will charge a fee (say $50), but will keep that rate until the entire debt is paid off. For this type of transfer, make sure you DO NOT add more debt to the card. The company may also have a no fee transfer with a slightly higher rate. You’d have to decide which works best for you. As far as the 0% transfers go, find out how much the rate is after the promotion and see if you can negotiate that down as well. The 0% may be best if after 6-9 months, you can transfer back to your original card at a 0% rate.

Everything’s negotiable. Even if your old card doesn’t have a current promotion going, call them to see if they’ll give you one if you transfer the money back. It never hurts to ask. Good luck. Hope some of this helps.

Adam (hopefully credit card free in 1 year)