POST SCRIPTS

Great post Jack!! There are a couple of other things people should take advantage of also...call the CC customer service number and tell them you want a lower rate. If they won't comply shop for a card with a better rate and transfer the debt to that card.

Always pay MORE than the minimum or you will never overcome! A couple of beers or latte's is enough. If that isn't in the cards put pennies in a piggy bank each month and deposit when you can. it isn't the money...it's the discipline (in the beginning).

Most important of all...learn to pay yourself first. Start a savings account and put money in it every month. Pretend that you are a bill that comes due every month, just like the rent or that car payment. You won't realize much in the beginning but the shift in thinking will begin to work in all areas of your life and over time it will begin to add up.

Jack:
I know you are smarter than that. You would not confuse a 12% return on investment, which is a profit, with not paying an 18% fee for borrowing, which is just a break even proposition avoiding a loss. But some people would confuse the two, and you should not mislead them, especially now that you are a politician. Too many politicians confuse the ignorant masses in economic matters, for example by pretending that taxes are an "investment."

Dan, I hear you, but think of it like this for the sake of the readers... lets say you have $10,000 in credit card debt as of July 1, 2007.

Let's say the credit card has an APR of 18%, no annual fees, the minumum payment is 2% of the balance and you make the minimum payment. So far so good?

Ok...now by December of 07, you have paid $889 in interest and reduced your balance by just $296. Thats not much, but now look what happens... By the end of 2008 you have paid in a whopping $3451 in mostly interest and a tiny bit of principal and the balance is still a high $9137! That's outrageous and people should be smarter than that.

If you had invested that $10,000 instead and got 18% growth for a year you would have $11800,(+1800) right? Right, that's a no brainer. But, look up above again...see the interest/principal and balance? Thats really bad.

Again, I still think paying off credit debt and keeping it off is one way for people to get ahead and then start a savings account. We were raised that way, you and I are both tightwads and we're big savers because that is security. That's the real message here. People better start getting concerned about saving and pay down debt because the next recession is never that far away.

I look at it this way. Anyone who has that much credit card debt, and at 18% no less, doesn't have a clue about the freedom that saving money and investing in your future can bring so they sure as heck don't know whether the 18% is an actual return on the money...or not. But maybe a story like Jack's will inspire some sense of adventure, if not responsibility...it couldn't hoit!

Now I understand. You are addressing people who don't pay off their credit card balances each month before finance charges apply. But you should have posted on Libby's blog.

Jack, you subversive, you. How do you expect to attract corporate campaign dollars carrying on like that? It's downright unAmerican!