Debt is perhaps one of the most pernicious things known to modern mankind. As nobody likes to own someone something (not even a kind remark), we soon become obsessed to pay back our due. Some do it by spending less, cutting back on their lifestyles through frugal habits, others will get a second job or study in the hopes of earning a promotion and generating a bigger income. We all do this because we desire much, hate debt and want to sleep in peace.

Debt is stressful

Often, the most common reason for dispute among couples is money. We challenge our spouse on “unnecessary expenses” and she replies back about the promotion you didn’t get, haunting isn’t it. This is a story we have all heard time and again. When one loses his job and the couple starts to accumulate debt, the note of discord starts to infiltrate the home. Stress increases as are payments accumulate, while interest rates rise due to one or two “forgotten” bills on the kitchen table. The same stress reaches a crescendo when the money is spent (read gone) before it has been deposited into your bank account. You are one step away from payday loans… you are one step away from giving back the keys to your once loved and cherished beautiful home…

At this point, you can’t see straight anymore. You don’t sleep well, are less productive at work and constantly run into disputes about money. Debt is literally consuming your entire existence from within. As you can’t walk straight because you are stuck in the fog of debt, saving money becomes an issue. Each time you save a dollar, you think about the 10 dollars of interest you have to pay at the end of the day. Your efforts seems pointless… you are crumbling under the weight of your debt.

There are people to help you see your way through the fog

If you feel as if there is no hope anymore, you are wrong. Debt is like extra pounds, it is quite easy to gain them but much harder to shed! When you are stuck in the midst of your problems, you have difficulty imagining solutions anymore. It is normal, our brain has a tendency to creating a barrier around what we know and rarely accepts an idea from outside of the box. And these walls get thicker as the problem grows.

This is why it is time to reach out for help. The very first step to helping yourself out of debt is to talk about it with other people. I know, money and debt are more taboo than sex these days. But you need to reach out and ask for help. Friends and family can give you tips, point out new solutions because they see the problems from an external, preferably objective, point of view as they are not directly linked to it. Why do you think psychologists are able to help anxious people? Because they see problems from a different angle and help people to see their issues objectively.

If you know a good financial advisor, they would be your best bet to help you get your finances in order. Unfortunately, there are a lot of peddlers in the industry and you are definitely not looking for another salesperson! You need constructive advice regarding your situation.

When you think about debt in a detached manner, you will conclude it is only a math problem. There are 3 variables:

- Your income and possible sources of income

- Your expenses

- The payments attached to the debt built over time

Technically, you need to find the perfect equation:

Your income – Your expenses – Your debt payments = 0 or higher.

You can increase your income in many ways:

- get a second job

- get a promotion

- work more hours

- make money online

- sell things (temporary)

- have a sideline according to your skills

You can also reduce your expenses:

- by being frugal

- by sharing expenses, i.e. rent with another person (when possible)

- by looking for deals (read this article about how to cut down your grocery expenses by 20% while being lazy)

And you can improve your debt payments:

- by finding a better rate (zero balance transfer credit card) (temporary)

- by consolidating your debt using a personal loan with a longer amortization (it costs more in interest over the term but frees up some cash flow)

- by including your debt in your mortgage (not really the right timing to do so…).

As you can see, there are no magic ways to get out of debt. However, by talking with people around you about your problems, they may help you find alternatives to increase your income, decrease your expenses and improve your debt payments in order to help you sleep better at night.

Once you have a plan, the hard part is yet to come; you must follow it. Many people remortgage their house a few times thinking the property was a cash machine (a sort of ATM). Unfortunately, this only works for so long. Sooner or later, you have to look at your budget and make some changes to get out of debt definitively.

Author: Mike.

Image source: Okinawa Saba

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How to be debt free is a question I get asked often via email.  The process of getting of out debt is easy…but actually doing it is hard.  See, getting into debt is easy.  It only takes a few minutes to make a $5,000 purchase on a credit card.  Paying it back though can take years.

In debt and want to get out?  Here’s how:

1. Commit yourself to paying off your debt.  Make it the most important thing in your financial journey.  Swear that until you pay off your debt, you won’t buy anything you don’t need.
2. Recognize that you are the reason you’re in debt.  Find the closest mirror, look yourself in the eye and say “You are the reason I’m in debt.  Your bad habits of the past have gotten me where I am today.  I can’t change the past, but I can change the future.”  Don’t look back, don’t kick yourself, what’s done is done.  Just recognize you were the problem, but now you’re going to be the solution.  We all make mistakes, just don’t make the same one’s twice.
3. Stop going into debt. It does absolutely no good to start the process of getting out of debt if you continue to go into debt.  If you don’t have the self discipline to stop it, than cut up and throw away your credit cards.  Don’t feel bad about this, I didn’t have the self discipline either, so I cut up my cards.  I haven’t used a credit card for more than 2 years.  I don’t miss them one bit.
4. Control your money. Start living on a budget.  Cap and control your spending, and put all available money towards paying your debt.  This may involve stopping your saving, stopping your 401k contribution for a while, skipping vacations, no longer eating out, etc, etc.  Do whatever it takes to put as much money as you can towards paying off your debt.
5. Start a debt snowball. The most powerful technique for paying off debt is a debt snowball.  A debt snowball places all of your debt in order, and helps you attack one debt at a time.  It then takes the payment from that debt and adds it to the minimum payment on the next debt and so on down the line.

That’s it.  The process is very simple, but it won’t be easy.  Getting out of debt will take time, mostly likely a few years or even longer.  It will be tough to live on a small budget, it will be tough not to buy things.  Unexpected things will come up, and detour your progress.  These are all normal.  But don’t give up, stay committed, stay focused and you will one day be out of debt.

I am now debt free, expect for the house.  2 years ago I never thought I would be.  I had more than $60,000 in debt between credit cards, car loans, and RV loan, and home equity loan.  I sold stuff, did everything I could to increase my income, and cut corners like crazy.  It was hard, but now that I am here, it worth it.  Just the stress of the debt being gone is worth it.  Well what are you waiting for???  Go get out of debt!

author: Larry

Photo by: tfkrawksmysocks

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Are not two sparrows sold for a cent? And yet not one of them will fall to the ground apart from your Father.  But the very hairs of your head are all numbered. So do not fear; you are more valuable than many sparrows. Matthew 10:29-31

Several years ago, we made a dumb decision to take out a loan in order to purchase a car. It was a relatively sensible used minivan, nothing extravagant, but I have regretted the decision ever since. Fortunately, our car has held up well and we have had no more than the usual types of repairs. :twists fingers and rolls eyes heavenward:

Our loan is scheduled to be repaid in less than three years, I will be on pins and needles until that happens. A blown engine, a collision, a deer in the highway and we could be in a world of hurt. I am working on leaving this particular bit of worry with God.

I was speaking with a friend in church yesterday and “Tim” mentioned yet another possible event for me to add to my bucket of worry – remember that storm that we experienced back in July? Well, my friend, Tim’s car was outside during the hail and took on major damage. So much so that the insurance company totalled his car – even though it still ran perfectly. No windows were broken, not so much as a tail light – just dents from stem to stern.

His car was financed at around $7,100 and the Bluebook value was set at $6,500. Tim had full insurance coverage as required by law, including gap insurance (covers the gap between the amount financed and the actual value of the vehicle).

Here is what happened: the insurance money went directly pay off the loan and the insurance company towed his car away. There was nothing he could do – he offered to purchase the car back from his insurance company and he tried to talk them out of totalling the vehicle to no avail. They told him that they plan to tear the car apart and resell it for parts. Tim then offered to purchase all of the parts at once, before they towed it. They appreciated his sense of humor, but no dice. I understand the why’s and wherefore’s of this situation, but I was wondering if any of you have experienced this type of thing?

And the moral of the story? Do not purchase a car with credit! Swallow your pride and save up for a sensible, reliable vehicle that does not come with anything having to do with APR’s, monthly payments, gap insurance or “notes” and start saving up for that next vehicle. If something goes wrong, you will not be stuck with no transportation or worse – making payments for a car that no longer exists.

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Last month I applied for another Discover More card.  I had to end up getting two cards as the first one in my wife’s name wouldn’t cover the entire remaining balance on my 29.9% Bank of America credit card (crooks!).

Before any of you freak out about me getting additional credits cards, I’m transferring the balances to get a reduced rate and won’t be using the cards for anything else.  As a matter of fact upon receiving the cards I immediately scanned the cards and stored to images in Evernote then sent them straight to the shredder.  I just don’t need the temptation laying around.  I am sure I’d be fine, but I just don’t trust myself enough.

I’m digressing….back to Discover card.  I waited a week or so after receiving the card to see if the zero percent balance transfer request went through.  After still receiving no notification, I logged into discovercard.com and checked on the status.  Before I even got to the point of checking on the transfer, I noticed my interest rate for balance transfers was 3.99%.  Whoa, hold the phone!  I didn’t apply for a 3.99% card, I applied for a zero percent balance transfer card.  I immediately called customer service.

Deceived?

Before I go any further, let me just say that in all fairness to Discover, out of all the crooked credit card companies, thus far Discover has been the most pleasant to deal with.  Their staff is incredibly friendly, courteous and helpful.

Back to the story…  After navigating their crazy/insane phone menu system, I was finally connected to a real representative.  She looked at my account and told me that I had in fact responded to a 3.99% balance transfer offer, not a 0% balance transfer offer as I had thought.

I just love it when they tell me I’m wrong.  In fact, I replied via a mail-in offer they sent me instead of using an online offer.  I did this more out of convenience than anything.  I do seem to recall some benefit of using the mailed code vs. an online offer though.  Regardless, I specifically recall the offer being a zero percent balance transfer similar to the ones I offer here.  Unfortunately I didn’t keep the original paperwork.

Lesson: Always keep your paperwork.

In hindsight I should have scanned the paperwork into Evernote* to have for reference.  Not doing so gave me no proof of the offer and unfortunately no leverage to make them work with me.

The representative was very kind, but also firm that the offer they had in their system was a 3.99% offer and that she couldn’t change it.  This is fairly typically though as most of the initial representatives that you get from credit card companies can’t do much.  I asked if I could speak with someone that could further assist me and was transferred to some other group responsible for new accounts.

While the lady I spoke with was professional, she wasn’t near as nice as the prior rep.  We talked and argued for a good 10 minutes, and the conversation finally came down to this: They would rather lose me as a customer than convert my current card from a 3.99% balance transfer offer to 0% balance transfer offer.  She said that the system would no allow her to convert the card over.  I’ve found that blaming the computer systems is a common escape goat.  We hung up.  I was livid.

While I am not 100% sure in my mind the offer was indeed a 0% offer, I am 99% sure.  The other thing that makes me suspicious about this is that during the application process I had to fax in proof of income to a special group in the new accounts processing area.  I don’t recall ever having to do that for any previous cards I’ve applied for, ever.

Here’s my theory: I probably didn’t qualify for their 0% balance transfer offer, so rather than decline me, they converted the application to a 3.99% offer hoping I wouldn’t notice.  Why would they decline me?  With 2 mortgages, a home equity line on the old house, and remaining credit card debt my credit score probably isn’t to attractive. I also lower my available credit as I pay these down too, which further hurts my score (for those of you who value your credit score, please don’t waste your time educating me about how stupid this is, I don’t care about my credit score as I plan to live debt free as soon as I can).  It wouldn’t surprise me if somewhere in the fine print they told me this and I just failed to notice and they didn’t want to tell me.

Long story short, I seriously considered canceling the card, but honestly I didn’t want to go through the hassle of applying for another card only to find out that I wouldn’t qualify.  To be honest, I’ve been happy with Discover card’s customer service.  Also, 3.99% is far better than 29.99% as well as is just part of the stupid tax I’m having to pay for living on money I didn’t have in the past.  I’ll just put this card at the top of my debt snowball and get it paid off as quickly as possible.

* I have an article I’m working on that will review Evernote in detail, but if you’re looking for an awesome place to keep pretty everything about your life, Evernote is the bomb.  Check it out (not an affiliate link).

Think this was a bait and switch manuver by Discover?  Have you had a similar experience with Discover or any other card?  Want to just vent about how crooked credit card companies are?  No problem, add a comment!

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“Nope, no credit cards for me.  I don’t even carry one.”  I cannot tell you how many times I have said this phrase or something very similar to friends and family over the past 3 years.   Most recently it came up at the store while looking at a “great deal” on something in the electronics department.

I was talking with a guy there who was considering purchasing the same item.  Since we hadn’t allocated the money for it in our budget, I decided to pass on it.  I said something to the effect of  “I’ll have to pass this time, I don’t have the money.”  to which he replied “Heck, I’m buying it.  That’s what credit cards are for right?”  I wanted to just walk away, but since he asked, I just couldn’t help but reply: “No.  You’re using money you hope you’ll have in a few weeks.  If you don’t or you elect to not pay it off, you’ll end up paying more for it than you would have without the deal…potentially way more.”  He looked at me with a deer in the headlight look, and I just walked away.  It was obvious that he really wasn’t looking for an answer, nor did he want to hear a lecture on credit cards.  His mind was made up.

My wife and I stopped carrying credit cards when we had our financial epiphany.  We cut up our credit cards and haven’t carried one since.  Unfortunately we still owe on them, but we haven’t used one in a long time.  Here are just a few of the reasons why we stopped and why many of you reading this should consider stopped too:

Buying things you can’t afford

It took me years to realize it, but we (more myself than my wife) used credit cards to buy things we couldn’t afford.  If we went to a store, saw something we wanted (and wanted now) and if we didn’t have the money to buy it, we would use a credit card.

I distinctly remember walking into an HH Gregg store looking at large screen TVs.  I remember convincing myself “that I deserved it“.  I worked hard right?  I made sacrifices for my kids right?  I deserved this TV.  My wife applied for a zero % interest deal they were offering (I couldn’t apply as I wouldn’t have qualified due to the amount of outstanding debt I had).  We walked out a few minutes later with a $3000+ big screen TV.  I can’t believe how stupid we were.

Everything came to a head for me when I was buying groceries and gas one night on a credit card because we had no money in our checking out.  A huge sign that you’re in big financial trouble is when you’re buying life basic items on credit because you don’t have the cash.

You can barely pay the combined monthly payments

A very common financial tool that myself and many other personal finance bloggers talk about frequently to assist with paying off debt is the Debt Snowball.   I have a debt snowball now, but the first one I had was a very different kind.

I had my first credit card as a teen.  I got a few more in college, then a few more after I was married and employed, then a few more later.  After a while I probably had more than 5-10 different credit cards, all maxed to the limit.

The initial minimum payment was easy, but the payments snowballed on me from there.  Each minimum payment from a card added to the next and then all of the sudden one evening I had more minimum payments than I could make!  Believe it or not, I actually used other credit cards to make minimum payments on my credit cards!

The worst part is that at the time, those minimum payments weren’t even enough to keep me ahead of the game.  The credit card companies were loving me.  I was paying huge amounts of interest on items I had bought years before and making zero progress on getting the balance down.  I’m pretty confident I was on their list of top 10 best (read stupid) customers.

Living off of potential future income

After getting our finances under control, I realized at some point that when you make purchases on credit cards, you are using someone else’s money.  In my case, I was literally using someone else’s money because I didn’t have any of my own.  When that finally clicked with me, I felt terrible.  I wasn’t good enough at managing my own finances, so in order to live I had to rely on someone else that could.  Looking back, I still can’t believe I didn’t see that.  If you are struggling with debt, please re-read what I just wrote and let it sink in.

Using credit cards, you are also borrowing off of your future income.  If you buy something today on credit that you intend to pay off next month or maybe even over the next few months, you’re making the potentially dangerous assumption that you’ll have the money then.  This is not a safe assumption to make, especially in today’s economy where lay-offs are becoming far too prevalent.  Instead, live off of money you have now, not my money you hope to have sometime in the future.

Stop being slave to the lender

I realized this pretty quickly when I was calling credit card companies asking for reversal’s of $40 late fees and decreases in 28%+ interest rates that I was definitely slave to the lender.  I had nights were I wouldn’t sleep due to the stress of having more than $60,000 – $70,000 dollars in debt (excluding our mortgage) and having no clue how in the world I would ever pay it off.  I some how had convinced myself that it was normal, that everyone had a large amount of debt and that it was just the American way.  I had a dark cloud of debt following me around everywhere I went.

I finally got tired of not sleeping, worrying and relying on those credit card companies.  I finally did something about it.  While I’m not debt free, I’ve paid off more than $50,000 in debt in the last 3 years by selling things, using a debt snowball, and through cutting up our cards to avoid going in the wrong direction.

We’re still slave to the lender, but far less than we were.  If things go as planned, in 2-3 more years with the exception of our home, we’ll no longer be slave to the lender and will be debt free.

How about you?  Do you use credit cards?  Why or why not?  Did you have a major turning point like I did?  What did you do?  Add a comment!

Photo by: smlp.co.uk

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My disdain for credit card companies and their unethical practices isn’t a secret.  I’ve written quite a few articles here on Gather Little by Little about how I dislike them.  The unfortunate reality for many of us that previously lived in the land of stupid for too many years (or maybe even still do) is a large amount of credit card debt that we’re stuck with until we can get it paid off.

Unless you can find options for transferring that debt, we have no alternative other than to continue to deal the credit card companies.  If you’re in that boat like I am, than I highly suggest you make every effort possible to minimize the amount of profit they get from you while you’re with them.  Not sure how?  Here are just a few ideas:

Zero Percent Balance Transfers

Credit card companies are highly profitable due to high interest rates and fees.  The best and most effective way you can “stick it to them” is to minimize their profits.  A few credit card companies still offer zero percent balance transfer options.  If you’re currently paying any interest at all on a credit card, you’re crazy to not move that balance to a zero percent balance transfer card.  I did this recently and have literally saved myself hundreds in interest alone over the past few months.

In today’s economy, zero percent balance transfer options are becoming very rare, but there are a couple of the one’s still around and that I personally like.  Applying for these cards literally takes only a few minutes and depending on your credit card balance, could literally save you hundreds of dollars each month!  To be real honest, I am not sure how much longer these types of offers will be around.  I’d suggest taking advantage of them while you can.

Personally, I moved my balances to the Discover More Card – Sealife Collection. Thus far, I’ve been very happy with my decision.  Don’t wait folks, there is no reason to continue to pay interest to credit card companies.

Make your payments on time

While they don’t act like, credit card companies love it when you pay late.  That’s when they get to nail you with a $25 or more late fee.  If you have a zero percent balance transfer option, they’ll also immediately bump the 0% rate up to some crazy level of internet like 25% or more.

Make sure you pay your monthly minimums on time.  Better yet, pay early and pay more.  I recommend starting a debt snowball along with debt snowflaking to optimize the amount of money you are paying on your card, and minimize the amount of time you have to deal with the credit card companies.

Cut up your cards

Credit card companies of course love it when you continue to use your credit card, especially if you fall back into old habits of not paying off your monthly balance.  Many personal finance bloggers utilize credit cards as a source of income, and if you are 100% responsible with your credit cards and have some level of trust with the credit card companies, I can see how that would make sense.  I don’t trust them though, so I doubt seriously you’ll ever see me go that path.  I just don’t like playing with snakes, and that is what credit card companies are in my opinion, venomous snakes.

If you don’t have the plastic in hand to use it, you can’t use it right?  So cut up your cards.  Yes, I said cut up your cards.  Take a pair of scissors and literally dice them up and throw them away.  I would suggest writing your account number down in a secure location, so you have it, but you don’t need the plastic.  Scissors too boring for you?  Here’s a list of 10 creative ways you can cut up your credit cards.

For those of you like me that are anti-credit card, what suggestions do you have for sticking it to those credit card companies?  What steps have you taken to reduce that amount of profit they make from you?  Add a comment!

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I’ve written before on how to get out of debt using debt snowflaking even before PaidTwice came up with the great name and started the snowflake revolution.  Since then I’ve gained a number of readers and thought it might be useful to discuss the concept of debt snowflaking again, especially as  it’s something I’m really trying to get back to now.  I’m refocusing on my debt snowball again after it sadly melted.

What is Debt Snowflaking?

Debt Snowflaking is an awesome tool that compliments your debt snowball.  With a debt snowball, you set up fixed monthly payments to attack your debt and pay it off as quickly as you can.  If you’re interested in setting up a debt snowball, I have a full primer in my get out of debt article.  Debt snowflaking is the concept of supplementing your debt snowball by using any extra money and applying to your debt.  Here are just a few examples:

• Receive an unexpected check in the mail?  Deposit it and immediately make a payment against your debt.
• Save your change?  Count it up, deposit it and make a payment on your debt.
• Sell stuff on eBay or Craigslist?  Take the proceeds and apply it to your debt.
• I’ve been using my blog coaching and consulting revenue as snowflakes over the last month as well.
• I use MyPoints to earn relatively free money.  When I redeem those points for gift cards, I transfer that money the money I would have normally spent from my account to my debt.  For example, if I redeem my MyPoints for a $50.00 Amazon.com gift card, I also make a $50.00 payment against my debt.

The point is whenever you get “extra” money, immediately apply that money to you debt.  I’ve had a few months in the past where these snowflake payments were in the area of $500!  That’s a big snowflake.  Mostly though, my snowflake payments are between $100 – $200.

Snowflakes make snowballs

What is a debt snowball?  Just a bunch of debt snowflakes.  Using this analogy, making lots of snowflake payments each month against your debt can quickly form another debt snowball.  What better way to attack your debt than with multiple debt snowballs right?  Remember, no amount of money is too small for a snowflake payment as many small amounts can add up to be large amounts.

If you made $50 a month in snowflake payments against your debt, that equates to an extra $600 per year, and depending on your interest rate (hopefully you have a zero percent interest rate) the result could be much larger.  That’s making a pretty extra dent in your outstanding debt especially when coupled with your normal debt snowball.

Do you snowflake?  If so, what extra money do you use.  If you don’t snowflake, is this something you might start doing?  Add a comment!

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Before you close your browser and stop reading, let me explain…

I have my credit card payments set-up for auto-bill pay.  I make sure all of my payments go out on time and even provide a “buffer” just in case something goes wrong.  About 6-months ago, I received my statement for my Bank of America credit card.  The interest rate?  29.99%  WHAT?

I quickly called customer service and they stated that my payment was received late.  Late payments automatically cause the low interest rate to jump to 29.99% along with a $35.00 late fee.  I explained to the rep when my payment was received and confirmed with my bank that Bank of America had indeed received the electronic payment on time.  I called Bank of America back and was told that the payment had been 2 days late.  After some arguing and “fussing” (as we in the South call it), they waived the late fee and put the interest rate back.  They clearly said though that this was a one time courtesy (gee, thanks).

Flash forward to November, I again received my statement and saw a $35.00 late fee and 29.99% interest rate.  This time my payment was received a day late.  I again called my bank and confirmed that the payment was received a few days prior to the due date.  I called Bank of America back and they refused to waive the fee or reduce the rate.  I spoke with several supervisors who all said there was nothing they could do.  I hung up, and immediately went online to begin looking for a new 0% rate card.

0% Discover Card

I had heard really great things about Discover and had received a few mailers from them in the past about their 0% offer card.  I applied online and was quickly accepted.  I also specified that my balance from Bank of America be transferred over.  A week later, I received the card in the mail along with a note stating that most of the balance was transferred but that my new credit limit wouldn’t cover the whole transfer amount….hmmmm.

I called Discover card to find out why.  It would seem given I currently have two mortgages and their more “conservative” recent credit practices they couldn’t do the full amount, BUT they did say they would denote my account and provide a credit limit increase as soon as they could.  Ok, not perfectly happy, but most of the Bank of America balance was now on a 0% card instead of a 29.99% card.  I was happy enough.

Hopefully soon Discover will bump my limit up enough to move over the entire Bank of America balance and I can have the pleasure of calling them back and closing my account.

0% Card Offers

A number of my blogging buddies offer various credit card offers on their site.  I would like to consider adding a page to Gather Little by Little for 0% credit card offers.  Note, I would not in any way condone using these cards for anything other than moving over higher interest rate debt.  As you well know, I very much respect you as my readers and before doing this, I wanted to get your take on it.  I certainly don’t want to encourage anyone to get further in debt either, but at the same time I cannot control the decisions people make, only make recommendations.

I really debated this whole thing for a while, as you well know I hate credit cards.  But I really believe it just makes smart financial sense to pay minimum interest when you do have debt.  Transferring your balances to 0% cards will do this for you.

Some of you will be happy to know that I cut my card up as soon as I received it.  I used the boring shredder method.

Anyway, what are your thoughts?  Would you be ok with me doing this?  Let me know what you think, add a comment!

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Our debt snowball melted.  I’m not exactly sure when it happened, but I do know why.  I guess it started melting around the the time we began looking for a new home and placing ours on the market.  Our finances are in a bit of chaos right.  A controlled chaos mind you, but chaos none the less.

What melted our debt snowball

A number of things have very quickly melted our debt snowball:

• Our old home not selling. This caused us to take on not only two mortgage payments, but dual expenses as well.   Including 2 power bills and dual property taxes.  Property taxes on our old home are due this month.
• Repairs on our old home. In order to get our home in sellable condition, we had to make about $20,000 in repairs.  This included repainting the interior and exterior, having the chimney rebuilt, new carpet, and a number of other repairs.  We ended up using a home equity line to pay for most of this, but I minimized that to the extent I could.
• Moving. While not a huge expense, we did pay someone to move us.  We also had to buy boxes and packing supplies and rent a U-Haul trailer.  A number of other little expenses crop up as well when you move and we had to cover those.
• Murphy. As Dave Ramsey likes to say, Murphy has moved in a few times as well.  I recently broke my finger which has caused us to incur some unplanned medical expenses.  I’ve had to drive back to the city we lived in every week and will continue to do so until the end of December, another unexpected expense.  To top things off, my wife was in a minor accident on Monday that damaged her vehicle, so we’ll need to get that fixed, along with a few repairs on both of our vehicles.
• Christmas. Of course the holiday season is here as well, and even though we have a Christmas fund, there are always little extra expenses that come up such as: higher grocery expenses, replacing lights an decorations as needed, Christmas cards, etc., etc.

I’m sure I’m missing a few things as well.  Financially, the last few months have just been crazy.  Now with that said, we’ve stayed mostly in budget and where we haven’t, our emergency fund was used.  We’ve even been able to refund it every case.  I just haven’t been able to get caught up enough to get that debt snowball started again.

Right after the first of the year though, it’s restarting.  I’ll start with a small one, and once we either get our old house sold our rented, I’ll add that in as well.

Don’t be discouraged

Why am I telling you all of this?  Many people start the debt pay-off process and due to life situations have to slowdown or stop altogether for a while.  That’s what has happened to us.  It’s perfectly normal and doesn’t mean I am no longer on my path to be debt free, it just means my plans have been slowed a little.  A few bumps in the road if you will.

When these bumps happen in your life, don’t get discouraged, just adjust your spending and your budget.  Stay focused on the long term goal, and get back to it as soon as you are able.  That is what I’m doing.

Life isn’t perfect, we aren’t perfect, and neither is your debt snowball.  Has your debt snowball melted?  Just make another once it snows again.

Photo by: akeg

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As with most industries – change is going to come. Not all change is welcome however, especially when it comes to your finances, your personal protection, and your financial well-being. So when the credit card industry rolled out the following doozies, it should make you take pause and understand them before following the sheep into the pasture.

Bye Bye Rewards

If you made the unfortunate mistake of selecting your credit card based solely on the cool points you earn towards free hotels, free airline tickets, discounted merchandise, or even getting cash straight back into your wallet, you may be in for a big disappointment without much warning. Credit card rewards programs can be a great incentive for some people. But with the current situation in the credit card world, those rewards you spend so hard to earn may just go away one day. Just in the last few years, one of the popular incentives, the double rewards programs, have been disposed of by several different credit card companies. Also, percentage rewards such as the cash back offers have also decreased in an effort to save the credit card companies more money.

The Free Fake Out

Many companies offer the “free” balance transfer promotions as a way to entice you into signing up for their card. However, transferring those balances from a credit card with high interest may not always be free. Sure you may be saving some dough on the lower interest rates and if you have chosen to consolidate the credit cards you’ll be saving monthly payments – all a plus. But if you are not reading the fine print, those balance transfers could cost you. Some companies will hold a strict limit on the amount you can transfer. Other companies have been known to charge up to several hundred dollars in transfer fees. As the credit crunch continues on, truly free balance transfer offers may be very hard to come by.

The Show and Go

Speed and efficiency are popular in society so it stands to reason that any idea that makes things faster makes people happy. However, that happiness can be easily destroyed when you go way overboard in your spending. The technology was invented so you can essentially wave your credit card in front of the little machine for all purchases under $25 and get out of the store fast. There are no button pushing, no waiting. But with that convenience, comes the ease at which you spend money. Even the smallest purchases can add up quickly. Not to mention the security aspects and what happens if you accidentally drop your card and someone else figures out they can show and go at your expense.

Whether or not you are partial to new trends, credit cards are not about the bells and whistles. You need to select a card that works for you and your finances. You want to find the lowest interests rates and a credit card that doesn’t charge outrageous fees for memberships and the like.

This is a guest post by Tisha Tolar.  Tish is a freelance writer providing content for http://www.creditcardassist.com, where she regularly writes about credit cards, rewards programs and general consumer finance issues.

From Glblguy: Normally I don’t post guest articles during the week, but I’m nursing a pretty sore broken finger which makes typing a bit difficult! If you would like to have a guest article featured here on Gather Little by Little, contact me.

Photo by: MR “(O)”

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