Here’s a fact:

Many people possess credit card debt they are unable to pay off each and every month.

They want to pay it off each month, but they are unable to. As a result, they feel stuck. The interest rate being applied to their credit card balance is one of the primary reasons they feel that way.

0% balance transfer credit card offers provide a way to eliminate a credit card debt very quickly and can provide HUGE savings over keeping a balance on a high interest card.

Here’s an example:

• Credit Card Balance: $16,000
• Interest Rate: 21.99%
• Minimum Payment: 1% of balance plus interest charges (or $10 – whichever is greater)

If this person were to keep the balance on this card, they would pay $44,895.36 and take 36 years 4 months to eliminate!

By transferring the balance to a 0% transfer offer and making the same payment, they would pay $17,039.51 TOTAL (only $1,039.51 in interest and fees) – and they would be free of credit card debt in 49 months!

Rolling a high interest credit card balance to a 0% balance transfer credit card offer SAVED $27,855.86 and become debt free 387 months (32 years and 3 months) sooner!

Here’s the process of how this type of offer works:

1. THE OFFER  An offer and application for a zero percent balance transfer credit card is completed ON-LINE or through a mail-in offer.  During the application process, the applicant is asked if they wish to transfer a balance.When this option is selected, the application process includes the opportunity to provide information regarding existing loan balances that they wish to be transferred.  This requested information is detailed including – current provider, account numbers, and loan balance.It is important to understand that the application process requires the applicant to provide their social security number and that a credit check will be performed.Once the application is submitted, a decision is typically rendered within a time range of a few minutes to a few days.
2. THE EVALUATION  Once the application has been submitted, the credit card provider evaluates the information provided to determine credit-worthiness.  This evaluation is completed based upon several factors that vary between lenders.  It always involves a check of one’s credit score and the loan amount requested.This evaluation also ensures that the person listed on the application is really the person requesting credit.  This is an extremely important step to prevent identity theft and fraud and should make the applicant feel much more comfortable with this process.
3. THE DECISION  Once this evaluation is complete, a decision is rendered.  The lender’s decision will be one of three alternatives:
   1. ACCEPTED:  ALL of the balances to be transferred to zero percent
   2. ACCEPTED:  SOME of the balances to be transferred to zero percent
   3. DENIED:  NONE of the balances will be transferred

   If ALL of the balance transfer requests are accepted, the new credit card provider will send money directly to each of the lenders.  Within a few short days, the balances due each previous lender will be lowered by the requested amount and that new balance will transfer to the new card provider.

   If SOME of the balance transfer requests are accepted, the new credit card provider will send money directly to some of the lenders.  IT SHOULD BE NOTED that it varies between lenders on which balances will be accepted.  On one of Discover’s applications, it stated the following in their terms and conditions:

   “We process multiple balance transfers in the order they are requested on the application. Your credit line may be less than the amount of balance transfers you request. In addition, balance transfers may be limited to a portion of your credit line. If a balance transfer will exceed the credit available for a balance transfer, you authorize us to process any balance transfer for less than the amount requested, up to the amount of your credit available for balance transfers.” – SOURCE: Discover’s website

   If NONE of the balance transfer requests are accepted, then it means that requested balance transfers will not occur and the current lenders will remain the owners of each debt.

That’s how this type of offer works – hopefully it can help you save tons of money!

Disclosure

Is home mortgage interest deduction a good idea?

This is one of the most frequently asked questions at our live events.  Below is my answer.

If you have a mortgage and are paying interest, it is ABSOLUTELY very important to take the mortgage interest deduction. BUT there are a few key facts to consider as well.

One thing I have heard commonly stated is “I am not going to pay off my mortgage early because I do not want to lose the mortgage interest deduction.” I believe this saying was initiated by banks because it is much more costly to keep the mortgage than to pay the taxes owed without the interest deduction.  See the example illustrated below.

The Mortgage Interest Deduction
Let’s say you paid $5,000 in interest on your mortgage last year. By taking the deduction, you effectively reduce your taxable income by $5,000. You receive back the tax rate on that home mortgage interest deduction. If your tax rate is 30%, you will receive a refund of $1,500 because of the home mortgage interest deduction (30% of $5,000). Of course, the bank keeps the $5,000 you paid in interest. Uncle Sam receives 30% of your taxable income which is now $40,000 because you were able to reduce your taxable income by the $5,000 interest you paid. The total net OUTGO from your bank accounts to Uncle Sam and the bank is $17,000!

The Paid-Off House Scenario
Well, you are living life pretty good in your debt-free condition! You have paid off your house, so now you no longer pay interest to the bank (yay!). This means you will be taxed on your full income of $45,000. If your tax rate is 30%, the total net OUTGO paid to Uncle Sam is $13,500!

NET RESULT:  By eliminating your mortgage, you have $3,500 LESS OUTGO from your bank account to someone else.

Read recent posts

As children, we’ve all heard the story about the tortoise and the hare challenging each other to a race.

We were shocked to learn at the end of the story that the slow-poke turtle beat the lickety-split rabbit.

Would it shock you to learn that people who choose the turtle approach with their finances usually end up much better off than those who choose the long-eared approach?

Those that choose the rabbit approach use the following two-step logic:

1. “I wanted to buy a truck, and I was able to buy it that very day!”
2. “Now, I want to get out of debt today, so I should be able to become debt free this very day!”

When their urgent desire to fix their financial situation wanes, the debt still remains and they give up.

Those that choose the turtle approach use the following two-step logic:

1. “It was a series of decisions that put me in this financial situation.”
2. “It will take a series of decisions that will take me to the financial situation I desire.”

Do you see the difference in the approach? Do you feel it?

I wanted to become debt free except for my house on December 2, 2002 when I experienced my IHHE Moment. But it took a series of committed decisions over 14 long months for my family to achieve debt freedom.

Which process will you choose? Or which process have you chosen?

Read recent posts

I am passionate about helping people win with their money.  This means that I really focus on the statements that people make and how they make them.  I observe their body language, tone, pitch, and wording.

There are some statements that are particularly telling of what I call a “broke mentality” – the thinking of a financially broke individual.

One of those statements is “How much are the payments?”

People who are not broke ask the better question – “How much is the total cost – the purchase price AND the ongoing operating expenses?”

I have observed that people who ask “How much are the payments?” are more likely to:

• Pay a much higher purchase price
• Pay a much higher rate of interest
• Be unaware of the ongoing operating expenses
• Finance their purchase versus pay cash
• Still be paying for their purchase even after that item has been discarded

We are ALL susceptible to falling into the “broke mentality” – Have you ever made decisions this way?  Would you mind sharing your story in the comments?

Read recent posts

As regular readers of JosephSangl.com know, I am passionate about connecting people to ways to lower the interest rate on existing credit card debt.  This is why I was so excited to see that credit card providers have begun offering 0% Interest Balance Transfer offers with no transfer fees!

We have updated the on-line offers that we have found HERE (http://www.josephsangl.com/2011/07/19/0-percent-balance-transfer-credit-card/).

If you have existing credit card debt that you are paying a ton of interest on, this is a great way to reduce that interest to ZERO!

Read recent posts

I was listening to the news broadcast coverage of the Greece debt situation recently, and here is how the information was being delivered in all of the coverage.

1. Greece has a debt problem
2. Because Greece is part of the “Euro Zone”, this means that the “Euro Zone” has a problem
3. Because French and German banks are heavily vested in Greek banks and debt, they stand to lose the most if Greece defaults
4. In order for the “Euro Zone” countries to “bail out” Greece, the government and citizens of Greece must accept restrictions and cuts – so-called “austerity measures”
5. The Greek government and citizens don’t want these cuts and restrictions

My response (out loud many times) has been, “OF COURSE, you don’t want cuts and restrictions – NO ONE does!  BUT your economy is BROKE and everything has been financed and leveraged to oblivion – with OTHER PEOPLES MONEY!”  Based upon recent data I have seen, nearly 95-percent of Greek debt is owned by foreign entities.”

Let’s explore this in terms that we can all understand better.  Suppose you let your neighbor borrow $10,000.  Then your neighbor spent all of the money with no real plan for repayment, and when you approached them for repayment, they said, “But if I pay you back all of the money I borrowed from you, I will have to reduce or cut out some of my lifestyle.  I’m not willing to do that.”

How would that work for you?

I have said it 10,000 times if I have said it once. The day I stopped whining and complaining and started taking the tough and difficult actions necessary to get my financial house in order is THE DAY that I started winning with money!

Read recent posts

I meet a lot of people these days who are in the midst of their pursuit of Debt Freedom.  I call it a “Debt Freedom March.”

They have used a tool like our Debt Freedom Date Calculator to calculate their Debt Freedom Date, and they have realized just how much of their money is going to a bank or lender.  For the average family with non-house debt, somewhere between $500 and $1,250 per month is being paid in monthly payments.  If you include the house payment, that average amount is between $1,250 and $2,000 or more per month.

For those who remain focused and diligent, debt freedom is achieved, and it is incredible!

Then the inevitable question shows up – “What’s next?”

If you are one of those who is asking this question, here are a few things to consider using the newly-released money for:

• Pursue a dream
• Give more away to causes you really believe in
• Build a larger emergency fund
• Invest money into a dream
• Invest money into someone else’s dream
• Reward yourself with a purchase of something you’ve always wanted

What other things would you recommend using this money for?

Read recent posts

I was pondering about my family’s journey to debt freedom, and it brought to mind the following words:

• Worthwhile
• Margin
• Motivating
• Freedom
• Intense focus
• Self-Control
• Disciplined
• Dreams
• Abnormal
• Effort
• NO!
• WAIT!
• LATER!
• Tiring
• Exciting
• Possible

Those are the words that I thought of.  What are some that you would add?

Read recent posts

If you are carrying a credit card balance or a furniture purchase with a typical interest rate of 14.00%, 21.99% or 27.99%, you can save an incredible amount of money by transferring your balance to a 0-percent balance transfer credit card!

Here is an example of savings that can be achieved.

Balance: $7,000 Interest: 21.99% Monthly Payment: $140

If this balance were transferred to a 0-percent balance transfer credit card with a 3-percent transfer fee, the calculations would look like the following.

This ONE MOVE could save $1,314.22 in ONE YEAR! If the balance would not have been transferred using a 0-percent balance transfer credit card, the actual balance owed would have dropped by a mere $141.47. By choosing to take just 15 minutes to fill out an on-line balance transfer application, a total principal reduction of $1,330 could be realized.

$1,314.22 saved for 15 minutes work. That’s like making $5,256.88 an hour!

Read recent posts

What do the following companies have in common?

• Apple (AAPL)
• Fastenal (FAST)
• Panera Bread Corp (PNRA)
• Texas Instruments (TXN)
• Bed Bath & Beyond (BBBY)

Besides being TOTALLY UNRELATED organizations, they are all 100-percent DEBT-FREE!  Google was 100-percent debt-free until 2010 and Microsoft was 100-percent debt-free until 2009.  Each company possesses more than enough cash to eliminate the debt without any financial margin issues.

Take a good look around at America’s businesses – they are almost ALL carrying some debt.

Read recent posts

I received a great Twitter message the other day with the following statement and picture:

“2 credit cards cut up and outta here! One with zero balance! One more to go and I’m done with these things @joesangl”

Listen – if you plan your spending and pay your cards off every month, get all the points you want.   But I had to chop mine up.   Apparently, this was the right decision for Desiree Dare too!

Can I ask you to do ONE THING?

1. Go to Desiree’s Twitter page and leave her an encouraging note (HERE)

It is our team’s goal to help EVERYONE take their next steps toward their financial goals – and to accomplish far more than they ever thought possible with their money!

Read recent posts

I’m celebrating with my family another No-Debt Christmas!

It was December 2, 2002 when my family decided to NEVER finance our gift-giving again.   We chopped up on credit cards (because we allowed them to fuel our impulsive spending decisions), put together a Mini-Budget to plan exactly how much we would spend for each person, and then followed that plan!

So that has led to No-Debt Christmas events in:

• 2002
• 2003
• 2004
• 2005
• 2006
• 2007
• 2008
• 2009
• 2010

That is NINE No-Debt Christmas times!

We have discovered some key things that have happened during our No-Debt Christmas times:

• We focus more on family
• There is less stress!
• We don’t dread bills in January!
• We’re able to focus on Jesus Christ – THE reason for Christmas!
• Our savings have not been impacted because we saved for Christmas every single month of the year!
• We can participate in giving like never before – because it is the season for giving!

How about YOU?   Is it a No-Debt Christmas for you?   If so, how many years in a row?   What have you discovered as you have experienced your No-Debt Christmas?

Read recent posts

A local gym has the following statement on its sign: “Stepping in the door is the hard part.   The results are easy.”

It applies to eliminating debt as well.   The hardest step is getting started!

1. Stop signing up for more debt!
2. Save $2,500 and save in your emergency fund – pay minimum payments on all debt until you have $2,500!
   
3. Find out which debts you owe and how much you owe
4. Seek to reduce or eliminate the interest you are paying
5. Calculate your debt freedom date – using the free tool HERE
6. Pay minimum payments on all debts except the smallest one
7. Attack the smallest debt with as much money as possible
8. As each debt is paid off, use the freed up payment money to add to the payment of the next smallest debt.
9. Repeat steps 6 thru 8 until you become debt free!!!

You CAN do this!   When is your expected Debt Freedom Date?

Read recent posts