Get A Jump On Retirement Part 3

Get A Jump On Retirement Part 3

Get a​ Jump On Retirement - Part 3
I am going to​ make a​ bold statement but it​ is​ a​ true statement nonetheless .​
If you ever plan to​ retire comfortably or​ at​ a​ reasonable age you cannot abuse credit cards .​
They are financial cancer.
I used to​ be buried in​ credit card debt .​
Part of​ it​ was sensible because it​ helped me purchase books and other things to​ get me through college, which I​ financed on my own .​
However, some of​ it​ was just stupidity .​
Once I​ decided to​ make a​ change in​ my thought process it​ only took me 2 years to​ get out of​ this debt and I​ wasn’t making lots of​ money at​ the time either.
Let’s take an​ example .​
The average credit card debt is​ almost $10,000 per household now .​
Let’s say you have a​ $9000 credit card debt balance and the interest rate is​ 14.9 % which is​ low for most people .​
Depending on the company the minimum payment is​ probably in​ the neighborhood of​ $150/month .​
If you paid nothing but the minimum payment on that card, and never made another purchase, it​ would take you 111 months to​ pay this card off .​
Almost 10 YEARS to​ pay off a​ $9000 credit card debt? That is​ insanity .​
It would cost you roughly $16,600 to​ pay of​ $9000 in​ debt.
Let’s take a​ look at​ the same balance with some different, and probably more common, factors involved .​
Take a​ $9000 balance and a​ 28% interest rate, which happens with just a​ couple late payments, and you pay the minimum payments only .​
Someone that only pays the minimum payments will take 1984 months to​ pay that $9000 balance off .​
I​ am not sure about you but I​ am not going to​ live 165 years to​ pay off my credit card debt.
Obviously it​ wouldn’t take you that long to​ pay it​ off because your estate would cover it​ when you died but it​ speaks to​ the point of​ my article .​
How would you plan to​ retire comfortably, and certainly not early, if​ you have this debt as​ well as​ other debt hanging over your head?
What many people do not see is​ that the money you save by not forking it​ over to​ the billion dollar banks, that give you the credit cards, can be used much more wisely for you .​
At my worst I​ was paying $400 in​ interest on credit cards .​
Once I​ finally paid off my credit cards and stopped using them I​ found I​ was easily able to​ pay cash for the things I​ would typically put on credit cards .​
Not only that, I​ found when I​ was taking money out of​ my bank account I​ was much more careful on what the money was being spent on in​ the first place.
I decided at​ age 27 that I​ wanted to​ retire comfortably at​ age 50 and spend my free time with my kids (that I​ did not have yet) and grandkids .​
It was worth it​ to​ me to​ sacrifice at​ a​ younger age than it​ would be to​ deal with my mistakes at​ age 70 .​
Who really wants to​ be bagging groceries, at​ the age of​ 70, for some high school kids running the register? I​ know I​ don’t .​
Clearly, it​ could happen anyway because of​ illness or​ some other circumstance that wipes out my retirement savings but I​ have no control over those things .​
I​ do have control over stupidity though and I​ wanted to​ stop it​ at​ an​ early age.
What I​ am hoping you will take away from this article is​ how bad credit cards are for you .​
Credit card companies make billions in​ profit each year and it​ is​ for a​ reason .​
Many people feel the insurance companies are the same as​ credit card companies in​ that they like to​ screw people .​
The difference is, with an​ insurance company you are at​ least getting something back for all the money you give them, if​ you buy the right products of​ course.
Insurance companies are rich because they take the money you give them in​ premiums and invest it​ to​ make their money .​
In many cases insurance companies pay out more money on claims for auto and home than they actually take in​ for premiums .​
It is​ hit or​ miss if​ they make a​ profit on earned premiums .​
(Sorry for the insurance jargon.)
You get no benefit from a​ credit card company accept for the ability to​ spend even more money you don’t have .​
Credit cards should be use for emergency purposes only and if​ you adopt that outlook you will most likely be standing next to​ me on the golf course in​ 20 years.

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