Help Getting Out of Credit Card Debt

Face it. You have to charge less than you are paying off. Bottom line. Freeing up extra money on an ongoing basis is key to achieving this. Yesterday, we discussed a bit about automobiles. It was revealed that a used card will cost less because it is, well, used. But you don't lose nearly the amount of money that you would (buying new) when you leave the car lot.

Too often people are driven only by "How much will it cost per month?" This kind of thinking is so short-term that it is frightening when you actually take the time to do some of the math. Sure, it only costs $250 dollars a month. The sticker price may say $10,999. "I can afford that", you say. A new car loan can often be rolled into a package that is for 72 months, or six years. Most people don't keep a car for four years, so if you trade it in, your car may only be worth $3,000 after four years. You still owe $6,000 on that car. You are now upside down on the car and a dealer would be happy to roll that into your new car purchase. Now, you will have a very difficult time getting out from being upside down.

If you did keep your car for the full six years, that $10,999 car would have cost you $18,000. Guess who pockets the extra $7,001? It isn't you. With a used car, you loan is for a shorter term, you pay less up front, and somebody else has already taken the depreciation hit on it.

All I have to say is that you need to think with your head and not your heart. Do your homework and you will thank yourself for that in the long term. Have a GREAT day! (visit my website, the book Never Surrender is scheduled for release on June 14, 2009)