Debt Freedom March – Couple #2 – Month 12
Introduction
This couple is THROUGH with debt! They announced that they were breaking up with debt in October 2007. They have agreed to share their Debt Freedom March with everyone in the hopes of inspiring others to do the same!
Here is this month's update.
Here is their updated Debt Freedom Date calculation …
Month By Month Progress …
Sangl Says
Couple #2 have torched over $33,000 in debt in less than two years! They are ON IT! They have backed off on the debt pay-off plan for a little while because they are replenishing their emergency fund and their new baby fund! Exciting times for Couple #2!
Credit Card Law Changes
President Obama recently signed into law several new changes to credit card lending.
Here are some things that stand out to me:
- 80% of American households have a credit card – Half of those carry a balance
- "Some get in over their heads by not using their heads." – President Obama
- People under 21 won't be able to obtain a credit card without a job or a co-signer
- Customer must be over 60 days late before rates can be increased on existing balances
- Consumers must receive a 45 day notice and explanation before interest rates can be increased
- There are more than 700 million credit cards in circulation in the United States – more than two cards for every man, woman, and child
You can read about it HERE. (Thanks to Robin for the link)
Your thoughts?
Ways To Save Money
My team has been working on a page on our Next Steps site to provide practical ways that people can save money on common items that people purchase.
We want your ideas!
For example, what are some ways you have saved money on:
- Groceries
- Internet
- Cable TV
- Cell phone service
- Car insurance
- Purchasing a new appliance
- Purchasing a new home
- Buying plane tickets
- Hotel
- Dining out
Share your ideas and check out the "Budget Boosters" section of our Next Steps site to see if there are any ways YOU can save money right away!
How Healthy Are Your Finances?
I saw that title on an article link at CNNMoney's personal finance website, so I clicked on it.
The link leads to a great tool that helps you evaluate your current financial condition – then it gives you a report card grade.
Check it out HERE.
Rule Of 72
Have you ever heard about the "Rule of 72"?
It is utilized to quickly provide a rough calculation of how long it will take your investment to double.
You need to know three things to use the "Rule of 72":
- The annual growth rate of the investment
- The current amount of money invested
- The amount of time (in years) the money will be invested
NOTE: This rule does not include any additional contributions you make to your investment.
Here is how it works. You divide 72 by the annual growth rate of the investment. That tells you how many years it will take for the investment to double. Then divide the number of years it takes to double into the amount of time the money will be invested.
Here is an example. Let's say that you have $40,000 invested growing at an average of 8% a year and that it will be left alone for 36 years. We divide 72 by 8 and that tells us that the investment will double approximately every 9 years. We divide the 36 year investment period by the time it takes the investment to double (9 years), and we find that the investment will double approximately 4 times.
So let's do the math and double the invest FOUR times.
Double Once: $80,000
Double Twice: $160,000
Double Thrice: $320,000
Double Four Times: $640,000
Please note that this is an approximation. The actual calculation is more difficult, but using the Investment Value Calculator HERE we find that the actual amount would be $705,793.
The point is to get a close approximation really fast.