Essay On Credit Card Debt
Analysis of Credit Card Debt
UNKNOWN - - - - - -
- - - - - - University online
MAT109 A01
Introduction Credit card debt is one big struggle in America. This is due to poor income, divorce settlements, unemployment and even gambling. Don’t have any health care benefits? In need to go to the doctor? If yes, then there is a medical bill coming your way. Taking out loans and borrowing money creates more debt if you can 't pay it in on time. Many debt collectors need to be consolidated and it all starts out with you. Debt collectors should be consolidated because the economy is in terrible need.
Calculations Let’s say for instance, if I had a balance of $5,270.00 on my credit card with an (APR) annual percentage rate of 15.53 percent. Most credit cards may require you to pay a 2% monthly minimum worth the balance. Based upon a balance of 5,270.00, I will multiply the 2%, which will equal a minimum monthly payment of $105.40. And with a 15.53 percentage rate; we will multiply 5,270.00*.1553, which equals out to $818.43. Therefore we take $818.43 and divide it by 12 months per year, which equals a monthly interest total of $68.20. Finally, we’ve calculated a total of $105.40 per month, therefore only $37.20 will be applied to the principle.
Analysis …show more content…
For example, assume you have a credit card with a current balance of $2,000, an interest rate of 18%, a minimum percentage of 2% plus interest, and a minimum amount of $15. The initial minimum payment required would be $70 greater of $2,000 x 2% + $2,000 x 18% / 12 or $15. If you made only the minimum payment each month, it would take you 114 months to pay off the debt, and you would pay total interest of $1,314. For example, if you made monthly payments of $100 on the credit card debt above the initial minimum payment was $70, it would take you only 24 months to pay off the debt, and you would pay total interest of just $396. There are no other charges applied to this account or an inactivity fee. Therefore, there is no furthermore to discuss.
Consumer Debt Example Mary lost her job a few months ago due to company restructuring. She had no "emergency savings" so she used her credit cards to make ends meet while she looked for work. Mary just found a temporary part-time job, but she still owes $25,000 on her credit card. She is finding it difficult to get by on her new lower salary. Mary checked out her debt solutions options by talking to credit counselors, a debt consolidation loan company and a trustee. She decided that filing a proposal would give her the relief she needed to get back on track. Here are the details of her consumer proposal: Mary negotiated to pay back 30% of the money she owed with no added interest; therefore, the portion of debt she committed to repay is $7,500She arranged to pay off the debt over five years (60 months) her consolidated monthly payment is $125, which she will pay to her trustee each month.
Ways to save up and pay debt You can pay off your credit card debt by getting a high paid job, saving up money and a great budget. If the overall cost is too expensive for you, then work out a plan that’s affordable for you. Take each step at time to waver all your debts away. You don’t have to take one big step in paying full cost, ask for payment plans. Call for debt consolidation companies that are on track of helping you. Pay the smaller debt settlements that you’re incapable of paying first to clear up your record. They will see your paying your debts and not ignoring them. Are you in need of a job? And can’t pay your debts, then just don’t sit there. You can get a college degree or a certificate in a year or two. A degree can open doors to a job with a high paid salary. Sign up for health and dental insurance and see if you qualify. This will help you save up money on emergency costs and visits. Still can’t find a job to pay off them debts? File for un-employment and see if you qualify. If one of your debt collections is $200 or more, then try to save up at least $20 a week and you will pay that off in 2 months. Save up a dollar each day and watch it multiply. Paying off debt all comes with hard work, budgeting and saving up money. You can do that by stop running to the mall, going to the hair salon and nail shop. The message today is to re-in focus on your needs and not your wants. Implications The way you can avoid credit card debt is to consolidate it with your debt collector by making payment arrangements. You will have to stop doing a lot of “spending” and start saving. When a bill comes up, simply don’t ignore it. The longer you ignore it, the longer other bills will pile up. If you can’t pay the total amount, my word is; to pay something. Stop taking out loans if you can’t pay them either. The more loans you take out the interests will get to you later. You will end up paying double amount than borrowed. Getting a job is a better advice. You only can get into debt by not caring about the bills wavering your way. You can talk with your debt collector and they will take out 75% off your cost. You can stop being in the pitfalls of debt if you start stepping up and making payments when they’re due. Tough love is not a promise but sacrifice all starts out with you. Conclusion Paying off debts can be very intimidating and distressful, but when you see the available options out there, then you will seek out for help.
Finances are one big problem in America and paying off bills. Life always comes with a price tag and we have to be the able bodies to put effort in paying it. If we take time out to stop all the annoying spending then we can make a thousand dollars worth of living. We all can pay our debts if we try harder to get there. We all don’t live these celebrity lives, but they’re people just like me and you. If they can do it, then I know you can do it. Work hard, play hard and you will be debt free. The beginning, the sacrifice only starts out with
you.
References
360financialliteracy.org. 2014. Debt Payoff Strategies - 360 Degrees of Financial Literacy. Available at: http://www.360financialliteracy.org/Topics/Credit-and-Debt/Debt/Debt-Payoff-Strategies [Accessed: 2 Apr 2014].
Bdodebthelp.ca. 2014. Consumer Proposal Example - BDO Debt Help. [online] Available at: http://www.bdodebthelp.ca/EN/consumer-proposals/Pages/example-of-a-Consumer-proposal.aspx [Accessed: 2 Apr 2014].
UNKNOWN - - - - - -
- - - - - - University online
MAT109 A01
Introduction Credit card debt is one big struggle in America. This is due to poor income, divorce settlements, unemployment and even gambling. Don’t have any health care benefits? In need to go to the doctor? If yes, then there is a medical bill coming your way. Taking out loans and borrowing money creates more debt if you can 't pay it in on time. Many debt collectors need to be consolidated and it all starts out with you. Debt collectors should be consolidated because the economy is in terrible need.
Calculations Let’s say for instance, if I had a balance of $5,270.00 on my credit card with an (APR) annual percentage rate of 15.53 percent. Most credit cards may require you to pay a 2% monthly minimum worth the balance. Based upon a balance of 5,270.00, I will multiply the 2%, which will equal a minimum monthly payment of $105.40. And with a 15.53 percentage rate; we will multiply 5,270.00*.1553, which equals out to $818.43. Therefore we take $818.43 and divide it by 12 months per year, which equals a monthly interest total of $68.20. Finally, we’ve calculated a total of $105.40 per month, therefore only $37.20 will be applied to the principle.
Analysis …show more content…
For example, assume you have a credit card with a current balance of $2,000, an interest rate of 18%, a minimum percentage of 2% plus interest, and a minimum amount of $15. The initial minimum payment required would be $70 greater of $2,000 x 2% + $2,000 x 18% / 12 or $15. If you made only the minimum payment each month, it would take you 114 months to pay off the debt, and you would pay total interest of $1,314. For example, if you made monthly payments of $100 on the credit card debt above the initial minimum payment was $70, it would take you only 24 months to pay off the debt, and you would pay total interest of just $396. There are no other charges applied to this account or an inactivity fee. Therefore, there is no furthermore to discuss.
Consumer Debt Example Mary lost her job a few months ago due to company restructuring. She had no "emergency savings" so she used her credit cards to make ends meet while she looked for work. Mary just found a temporary part-time job, but she still owes $25,000 on her credit card. She is finding it difficult to get by on her new lower salary. Mary checked out her debt solutions options by talking to credit counselors, a debt consolidation loan company and a trustee. She decided that filing a proposal would give her the relief she needed to get back on track. Here are the details of her consumer proposal: Mary negotiated to pay back 30% of the money she owed with no added interest; therefore, the portion of debt she committed to repay is $7,500She arranged to pay off the debt over five years (60 months) her consolidated monthly payment is $125, which she will pay to her trustee each month.
Ways to save up and pay debt You can pay off your credit card debt by getting a high paid job, saving up money and a great budget. If the overall cost is too expensive for you, then work out a plan that’s affordable for you. Take each step at time to waver all your debts away. You don’t have to take one big step in paying full cost, ask for payment plans. Call for debt consolidation companies that are on track of helping you. Pay the smaller debt settlements that you’re incapable of paying first to clear up your record. They will see your paying your debts and not ignoring them. Are you in need of a job? And can’t pay your debts, then just don’t sit there. You can get a college degree or a certificate in a year or two. A degree can open doors to a job with a high paid salary. Sign up for health and dental insurance and see if you qualify. This will help you save up money on emergency costs and visits. Still can’t find a job to pay off them debts? File for un-employment and see if you qualify. If one of your debt collections is $200 or more, then try to save up at least $20 a week and you will pay that off in 2 months. Save up a dollar each day and watch it multiply. Paying off debt all comes with hard work, budgeting and saving up money. You can do that by stop running to the mall, going to the hair salon and nail shop. The message today is to re-in focus on your needs and not your wants. Implications The way you can avoid credit card debt is to consolidate it with your debt collector by making payment arrangements. You will have to stop doing a lot of “spending” and start saving. When a bill comes up, simply don’t ignore it. The longer you ignore it, the longer other bills will pile up. If you can’t pay the total amount, my word is; to pay something. Stop taking out loans if you can’t pay them either. The more loans you take out the interests will get to you later. You will end up paying double amount than borrowed. Getting a job is a better advice. You only can get into debt by not caring about the bills wavering your way. You can talk with your debt collector and they will take out 75% off your cost. You can stop being in the pitfalls of debt if you start stepping up and making payments when they’re due. Tough love is not a promise but sacrifice all starts out with you. Conclusion Paying off debts can be very intimidating and distressful, but when you see the available options out there, then you will seek out for help.
Finances are one big problem in America and paying off bills. Life always comes with a price tag and we have to be the able bodies to put effort in paying it. If we take time out to stop all the annoying spending then we can make a thousand dollars worth of living. We all can pay our debts if we try harder to get there. We all don’t live these celebrity lives, but they’re people just like me and you. If they can do it, then I know you can do it. Work hard, play hard and you will be debt free. The beginning, the sacrifice only starts out with
you.
References
360financialliteracy.org. 2014. Debt Payoff Strategies - 360 Degrees of Financial Literacy. Available at: http://www.360financialliteracy.org/Topics/Credit-and-Debt/Debt/Debt-Payoff-Strategies [Accessed: 2 Apr 2014].
Bdodebthelp.ca. 2014. Consumer Proposal Example - BDO Debt Help. [online] Available at: http://www.bdodebthelp.ca/EN/consumer-proposals/Pages/example-of-a-Consumer-proposal.aspx [Accessed: 2 Apr 2014].