Consumer and personal debt is, perhaps, the number one problem facing most American families today. The reasons behind the tremendous surge in debt have been related to emerging socio-economic patterns suggesting that we’ve become a nation obsessed with lifestyles and consumerism.
America has always been a nation of consumers and the American people have always enjoyed one of the highest standards of living in the world. Something else has contributed to this national crisis.
What has changed in the last several decades is that we have developed very sophisticated technology to acquire debt. Debt acquisition is as close as your cell phone or personal computer and can be accomplished in a matter of seconds.
However, we have been slow in developing such sophisticated systems to manage that debt at the consumer level. We have been the victims of a technological gap between debt acquisition and debt reduction.
If you do not manage your debt, it will manage you. Or more precisely, your creditors will manage your debt for you and they will, of course, manage it in a way that is most favorable to them, not necessarily you.
At the consumer level, we tend to keep our debts separated, divided, and isolated in separate accounts, making it impractical, until recently, to strategically manage that debt.
Automated debt management systems have been in use by banks, insurance companies, and other institutions as needed to maintain cash reserve requirements but, until recently, have not been available at the consumer level due to the cost of developing and supporting these specialized cash flow management systems.
Many people in other parts of the world have had access to various debt reduction systems. In this country, however, it is a relatively new opportunity to systematically manage our personal and consumer debt. We now have access to affordable technology to manage our debt rather than allowing it to manage us.
First, let me explain what a modern debt management system is not.
It is not a set of instructions or a “How To…” book available from a variety of well intentioned sources which simply overstate the obvious; instructing us to “stop spending so much money”, or “cut up our credit cards”. It is not a “makeover” system which painfully rearranges our daily spending patterns.
It is not a static spreadsheet or plan for debt reduction which does not consider our day to day personal financial circumstances.
It does not involve the refinancing of existing debt or consolidating smaller short term debts into larger long term debts. It is not a self administered or pre-calculated repayment acceleration plan. It does not involve negotiating with your creditors or any means of debt reduction which avoids the repayment of legitimate debt on a dollar-for-dollar basis.
Just like the bank model, modern debt management systems are integrated with your daily and monthly financial transactions. They are dynamic. Modern debt management systems have the ability to analyze and manage all of your debt, including your mortgage debt, side by side in a single environment and make strategic adjustments based on your daily or monthly cash flow.
A modern debt management system is programmed for liquidity. Liquidity is to debt what water is to fire. If you have an abundance of liquidity, you could be out of debt in very short order. On the other hand, if you have a shortage of liquidity, it could take decades to get out of debt.
A modern debt management system focuses on ways to harness current liquidity and seeks to fully develop your potential future liquidity. It utilizes that liquidity to systematically eliminate debt. It can develop multiple sources of liquidity and utilize that liquidity as leverage against debt.
Because of the importance of liquidity, modern and effective debt management and debt reduction systems are fully integrated with your current monthly income and expense cash flows. That is not to say that increasing your income and/or reducing your expenses is a requisite. A good debt management system takes advantage of existing cash flow, not necessarily changing it.
A modern debt management system is relatively painless to follow and does not require significant changes to your established spending patterns. It can be set to aggressively pay down debt, to maintain a certain level of debt but reduce the carrying cost, or fund a retirement or college savings plan.
Today’s sophisticated, versatile, and effective debt management systems are not inexpensive. However, in terms of future interest savings, they can make up the cost of the system in the first few months of use and, over time, produce interest savings in excess of the total amount of current and future debt.
An inexpensive or do-it-yourself system is probably not a good alternative. While you might be able to redirect some liquidity and do some good, you would not be able to recreate the integrated mathematical algorithms which drive a more sophisticated system producing the best possible results.
Any current financial plan worth its’ weight in paper should address both sides of the balance sheet and include a modern debt management system.
David Haslett is Senior National Director of the Freedom Equity Group. To discover how modern debt management technology can help you pay off your mortgage and other debt, go to: http://www.fastestmortgagepayoffplan.com
Questions related to debt management
Debt management?
Could some tell me of a good DM place to use, the net is full of sites and it's overwhelming.
An honest one that has no horror stories attached to it.
My CC bills are always paid on time but the rising interest payments are hurting me to the point in a few months they will be very hurtful.
And yes there was a medical issue with my wife that started this neverending cycle of revolving debt.
There has to be a few recommended places and places that people have used with success.
I have a card that I got a pamphet in the mail that is raising my % to 32.99 because I am using over half the balance, never have been late and never overdrawn. I talked to the company and the women said it's like that because they can.
Yes I know the DM will sting my CR, but………what'll hurt it worse?
Thanks.
Not everyone in big CC debt are bad people, just sometimes unlucky.
what company did you use and do you have any personal stories good or bad about them. I'm still weighing my options.
It is just as bad as a bankruptcy, as far as credit reporting goes…
Avoid it if you can…
Your blog has a really nice design. That being said the material here is both free and is of high-quality. I am definitely subscribing to your RSS immediately.
Sometimes when you work for your school they give you some kind of discount on tuition, might want to look into that.
As far as your credit card debt, do you have a part-time job? Do you have family or relatives that can pay off your credit card debt and pay them back a little at a time?
You should cut up your credit card for now so you’re not tempted into using it. Pay back your school first so they don’t kick you out.
I can buy an unpaid contract from anybody and then try to collect on it. That's what the "or successors" means in the agreement…it can be transferred to somebody else.
A lot of times the owner is a lawyer, because he doesn't have to hire a lawyer to take you to court; he can do it himself.
Her accent is so homely and reassuring, it’s bordering on making her less than credible.
The Credit Counseling company will probably get you a better price in the long run because they will negotiate a lower rate than you can. But, you are being charged a very large amount of compounded interest on every dollar that you owe them for every Month that the amount is owed. Let Mom and Dad help IF the interest rate and terms are better than you are currently paying the credit card companies. And, if you can afford to pay all of your bills iccluding that payment. Remember that the credit counselor is making money on you, they will not always counsel you to your advantage.
Make some extra cash Your Opinion is Worth Gold To Big Business Network .Discover How to Make as Much Money as YouWant, Just By Having an Internet
Connection,Some Spare Time, and an Opinion!”Your Opinion is Worth
Gold To Big Business…and They’Ready to Pay You Right Now for Your Time! This Little-Known Way to Make Easy Money on the Internet isHelping Thousands of People Just Like You Achieve Their Dreams
http://www.greedyclicks.com/?ref=714
Great advice on paying the lowest balances first. That’s EXACTLY what I did with my cards. I’ve heard that by sending in the payment on a paticular day or week, you can actually save from paying dubble interest or something in that mattter. Is this true and if so what is this all about? I appreciate any advice.
If you get off of a DMP they stop paying the creditors. Unless you make specific arrangements with each creditor and pay them you will now become past due on your accounts again. Because of this the interest and late payments will start to be added again, and they will make collection calls to you.
You can always get back on a DMP, unless the creditors have sued you in court. Also if the creditor sold your account to a collection agency, these agencies may or may not participate in the program.
Since you say you "hardly" have any money left after your bills and this payment, it might be good to just tough it out. One thing you may want to do is take a very hard look at your budget. Determine what is essential and what is optional to see if you can free up some money. If you do a lot in entertainment(such as going to movies or eating out) you may have to stop those for a while.
One last option is to consider bankruptcy. It will effect your credit for a while, but if you practice good credit managment after the bankruptcy it can help.
Make sure you have the skills, contacts and start-up money.
Establish a place of business and start advertising.
Best thing would be to map out the whole thing up front. You'll need to know permit/license needs, employer requirements and other general business details. There should be a lawyer in your area that can assist with applications.
I used to have a lot of problems with debt, but sites like
theinternetcaschow.blogspot,com helped me raise that little bit extra each month.
ur accent is nice
he can open equity line of credit only in his name and this way your credit report will not affect his change to obtain the loan or you have to get this loan fast- before your debt consolidation program will show on your report. most lenders treat debt consolidation program like bankruptcy chapter 13, so it is mean- they don't like see this very much.
tell them to drop the apr and lower the rates . there are two books..
debt cures is one and there is another book out there at a barnes and nobles.
its sad in this country.
I agree totally with you. Borderline entrapment if you ask me. For what it is worth this might help. There is a free download software look at my profile for the url finance. The software gives you a perspective of where you are with your debts and gives a strategy on how to clear them. Its shareware software that I used with some success. It just might help you.
what do you mean by trashing my credit rating? how do i do that?
If you’re struggling with debt you could try free sites like:
easyc4sh,co,cc
Learn seven more ways? to get out of debt for Canadians at… canadadebtconsolidationnow com
Anther good reason to pay off the lower balance credit cards first is it will give you an incentive to keep going!!! You will see that you have paid one off and it is over!! Then you can add the money you were paying on that card to the others and just keep whittling them down until they are all paid off…God willing nothing else gets in the way.
Check this site out it gives you companies that best fit your needs. Type of debt, amount, etc. see if they help you out.
http://www.ez-credit.info
Cut the plastic in half, then set a goal to eliminate both halves. When you find yourself in the hole, quit digging.
You need to cease use of the cards, list all the balances highest to lowest. Pay the minimum on those at the top, use a debt snow ball to pay off the smallest first.
see http://www.daveramsey.com