Debt Getting You Down?: Part 2

October 1, 2012

We left off with Mr. Jones making some extra money doing yard work, which has successfully helped pay off Credit card #1. Now we move on to Credit card #2. Click here to see Part 1.

The Jones family had been making their minimum payment of $100 per month on this account. However, since they were able to pay $200 each month to pay off their first credit card, they can add it to the minimum payment of the second card. Here is what the new payment looks like.

$100 minimum +PLUS+ $200 from first card = 
$300 total payment each month on Credit card #2

The progression from Credit card #2 to the Vehicle loan will work the same way. If the Jones family pays $400 each month on their car, the new payment will be $700 per month once Credit card #2 is paid off. The Jones family has successfully progressed from small balance debt to medium balance debt.

Using the Jones family for example purposes only, it is possible to get completely out of debt and stay out. Our grandparents knew how to save up before making purchases. In our have-it-now society, we don’t want to get left behind when our friends are getting the latest gadget. However, it means so much more if you work for your wants ahead of time.

Credit card companies will offer points, rewards, etc. to keep people “addicted” to debt. Break the cycle and refuse to be tempted by their schemes. Only when you can become mad at your debt can you truly change your thinking and break free!

Our next post will show how to proceed from medium balance debt to high balance debt. We will also begin discussing saving and faith giving.

Thanks for following Practips!

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Practips Debt House by Becky Reckelhoff is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License

1 comment:

  1. Impressive post I agree when it comes to our finances we need to have good decision making that's why I studiedcollege for financial

    ReplyDelete

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