5 Features of All the Best Credit Cards

You must have probably experienced the worst when you see better offers slip away because you had no cash and you are planning to apply for a credit card.

The big problem? You are confused about what features are the best to look for when applying for a credit card.

The good news: There are a couple of features you should check when you have made up your mind that you are applying for a credit card.

Below are some of the five features of all the best credit cards you can ever imagine of:

1. Low interest rates

Perhaps this is the feature most people will look for. Everyone wants to save money. So, there’s a need to save it when there is an opportunity. Credit cards that have low-interest rates will give a few perks, but they are the best if you need to save some cash.

The good news is that when you have a good credit score, your credit issuer will offer you lower interest rates. The bad news though is that some credit card issuers will assume the benefits and charge you high fees.

One of the best ways to choose the best credit card is to do some comparison. Thanks to the internet. You can get nearly everything you want from the internet. So, make good use of the internet.

2. Rewards Program

It’s no secret anymore that people love free things. You probably want the same. So, why not look for a feature like a rewards program?

Rewards are good, but it depends on how you will use your rewards. There are rewards of offer discounts such as travel, fuel discounts, etc. You can also check some other offers that your credit card issuer has.

To get the best out of this program, you should pay your balances in full every month. Carrying forward balances month after month will not only deny you the rewards program but will also expose you to some penalties. You can see here to check on best credit cards.

3. Bad credit rebuilding

Do you have a bad credit history? Do you intend to rebuild it? If yes, you are in the right place.

If you want to rebuild your credit card history, then you will need to choose a credit card that regularly reports to agencies. This will help you rebuild your credit card history faster than just taking prepaid cards.

4. Customizable credit cards

People love to choose from a variety. If you are one of them, you need to look for customizable credit cards. Customizable credit cards allows you to select the features that you love. Such features include lower interest rates, better rewards program, or longer grace periods. It’s your prerequisite, choose the best features that suit you.

5. Introductory offers

The headline is not a typo error. Yes, there are introductory offers. So, if you are confident that you have a good credit score, then you can check out introductory offers. For example, you could have the offer not pay any interest fee for 6 to 12 months.

If you want to get the best out this offer, you should pay off your debt before the end of the introductory period. This will help you get better rates. 

Wrap Up

Going for a credit card is the best decision you should ever make, but you need to choose the best features. The features above should guide you.

My mom stole my identity

I’m pretty excited about today’s post because it’s gonna provide some very interesting responses in the comment section below (assuming you leave me a comment that is :)). I was browsing the web yesterday and came across this question in a PF forum…

My mother has been using my credit cards and has ran up a serious balance. Now she doesn’t want to pay them. Am I stuck with this debt that isn’t mine? Or could I threaten with having her arrested for identity theft?

Oh. Pick me. Pick me. I know the answer. You throw that woman in the slammer and never look back. Oh wait… If mom is in jail, who is going to fold my clothes and make me meatloaf?

Looks like we have a little predicament here. It’s a tough call not knowing the specifics of the situation (persons age, amount of fraudulent debt, relationship with mommy, etc) so I’m not gonna really try and provide any insight. What I am going to do, however, is play the hypothetical game and ask “What would you do?”

Here’s the situation….

You wake up tomorrow to a phone call from Bank of America. They say you are 6 months late on your credit card payments. “That’s funny” You think to yourself, “I’ve never had a CC with BoA.” After some investigating you come to realize yo momma (or dad/sibling/spouse) has racked up a solid $30,000 in debt on a CC she fraudulently took out in your name for silly things like entertainment, cosmetics, etc. It’s not that she needed the money for medical treatment or something urgent. You’re now on the hook for the $30k and have zero to show for it.

Personally, I would probably file the criminal charges (no offense Mom Ninja). It would be extremely difficult to do because I’m a total mommas boy, but she raised me to be a law abiding ninja (in fact she told me if I ever drank underage she would send my a$$ to military school). Why should she not be expected to adhere to the same standard? A $30,000 debt would be a major setback seeing that I am only one month away from being debt free. I’m also a few months out from starting a family of my own and have a responsibility to put Girl Ninja’s needs first. So yes, if my mom took out $30K in my name, and blew it on a bunch of random junk, I would seek the death penalty file a criminal complaint against her.

Alright, now you know the situation. How would you handle it? I’m sure most of you would confront mom and tell her she has to make the payments. Let’s assume she can’t afford to, which is a reasonable assumption seeing that she resulted to identity theft. What do you do? Do you tell your mom your pissed at her, but make the payments yourself? Refuse to pay, refuse to press charges, and let the delinquent accounts wreak havoc on your credit score for the next 7 years? Or do you head down to the local PD and file a police report knowing that she could possibly face some jail time (don’t drop the soap mom)?

For those of you that aren’t aware, the only way (that I know of) to have fraudulent charges removed from your credit report is by filing a police report indicating your identity has been stolen. You then take this police report to the credit reporting agencies as well as your specific creditors to have the bogus debts disappear. It’s not as simple as disputing them online.

Interest is interesting

The interesting thing about interest, is that it acts as our frenemy (friend/enemy). It’s often a major player in wealth building, but also one of the driving forces behind the ‘paycheck-to-paycheck’ lifestyle. It can work for or against you. The choice is yours.

To kick things off, I thought I’d start with a chart I’m sure we’ve all seen before. It shows just how important investing while you’re young really is. It compares a 25 year old that invests for 11 years, to a 35 year old that invests for 26 years. The results are rather interesting (pun intended)….

Pretty crazy stuff, huh? The younger dude only invested for 11 years, but came out with a butt-load more money than the older dude. It just goes to show that interest can be your best friend, especially when you have time on your side, but as Newton’s 3rd Law of Motion says: “To every action there is an equal and opposite reaction”

This, my friends, means that interest can bend you over and….well we won’t go there. Unfortunately, a bunch of people (maybe you being one of them) don’t realize this. They see a $15/month credit card payment and think life is just peachy. News Flash: It’s not that simple.

The following table shows how long it takes to payoff a $10,000 credit card debt (13% interest rate), when only minimum monthly payments are made. Any guesses as to how long it will take to pay off this debt? Scroll down to find out…

This is what I call gettin’ scr-izz-ewed….
Month Minimum
Payment
Interest
Paid
Principal
Paid
Remaining
Balance
1 $200.00 $108.33 $91.67 $9908.33
2 $198.17 $107.34 $90.83 $9817.50
3 $196.35 $106.36 $89.99 $9727.51
4 $194.55 $105.38 $89.17 $9638.34
5 $192.77 $104.42 $88.35 $9549.99
6 $191.00 $103.46 $87.54 $9462.45
7 $189.25 $102.51 $86.74 $9375.71
8 $187.51 $101.57 $85.94 $9289.77
9 $185.80 $100.64 $85.16 $9204.61
10 $184.09 $99.72 $84.37 $9120.24
11 $182.40 $98.80 $83.60 $9036.64
12 $180.73 $97.90 $82.83 $8953.81
13 $179.08 $97.00 $82.08 $8871.73
14 $177.43 $96.11 $81.32 $8790.41
15 $175.81 $95.23 $80.58 $8709.83
16 $174.20 $94.36 $79.84 $8629.99
17 $172.60 $93.49 $79.11 $8550.88
18 $171.02 $92.63 $78.39 $8472.49
19 $169.45 $91.79 $77.66 $8394.83
20 $167.90 $90.94 $76.96 $8317.87
21 $166.36 $90.11 $76.25 $8241.62
22 $164.83 $89.28 $75.55 $8166.07
23 $163.32 $88.47 $74.85 $8091.22
24 $161.82 $87.65 $74.17 $8017.05
25 $160.34 $86.85 $73.49 $7943.56
26 $158.87 $86.06 $72.81 $7870.75
27 $157.42 $85.27 $72.15 $7798.60
28 $155.97 $84.48 $71.49 $7727.11
29 $154.54 $83.71 $70.83 $7656.28
30 $153.13 $82.94 $70.19 $7586.09
31 $151.72 $82.18 $69.54 $7516.55
32 $150.33 $81.43 $68.90 $7447.65
33 $148.95 $80.68 $68.27 $7379.38
34 $147.59 $79.94 $67.65 $7311.73
35 $146.23 $79.21 $67.02 $7244.71
36 $144.89 $78.48 $66.41 $7178.30
37 $143.57 $77.76 $65.81 $7112.49
38 $142.25 $77.05 $65.20 $7047.29
39 $140.95 $76.35 $64.60 $6982.69
40 $139.65 $75.65 $64.00 $6918.69
41 $138.37 $74.95 $63.42 $6855.27
42 $137.11 $74.27 $62.84 $6792.43
43 $135.85 $73.58 $62.27 $6730.16
44 $134.60 $72.91 $61.69 $6668.47
45 $133.37 $72.24 $61.13 $6607.34
46 $132.15 $71.58 $60.57 $6546.77
47 $130.94 $70.92 $60.02 $6486.75
48 $129.74 $70.27 $59.47 $6427.28
49 $128.55 $69.63 $58.92 $6368.36
50 $127.37 $68.99 $58.38 $6309.98
51 $126.20 $68.36 $57.84 $6252.14
52 $125.04 $67.73 $57.31 $6194.83
53 $123.90 $67.11 $56.79 $6138.04
54 $122.76 $66.50 $56.26 $6081.78
55 $121.64 $65.89 $55.75 $6026.03
56 $120.52 $65.28 $55.24 $5970.79
57 $119.42 $64.68 $54.74 $5916.05
58 $118.32 $64.09 $54.23 $5861.82
59 $117.24 $63.50 $53.74 $5808.08
60 $116.16 $62.92 $53.24 $5754.84
61 $115.10 $62.34 $52.76 $5702.08
62 $114.04 $61.77 $52.27 $5649.81
63 $113.00 $61.21 $51.79 $5598.02
64 $111.96 $60.65 $51.31 $5546.71
65 $110.93 $60.09 $50.84 $5495.87
66 $109.92 $59.54 $50.38 $5445.49
67 $108.91 $58.99 $49.92 $5395.57
68 $107.91 $58.45 $49.46 $5346.11
69 $106.92 $57.92 $49.00 $5297.11
70 $105.94 $57.39 $48.55 $5248.56
71 $104.97 $56.86 $48.11 $5200.45
72 $104.01 $56.34 $47.67 $5152.78
73 $103.06 $55.82 $47.24 $5105.54
74 $102.11 $55.31 $46.80 $5058.74
75 $101.17 $54.80 $46.37 $5012.37
76 $100.25 $54.30 $45.95 $4966.42
77 $99.33 $53.80 $45.53 $4920.89
78 $98.42 $53.31 $45.11 $4875.78
79 $97.52 $52.82 $44.70 $4831.08
80 $96.62 $52.34 $44.28 $4786.80
81 $95.74 $51.86 $43.88 $4742.92
82 $94.86 $51.38 $43.48 $4699.44
83 $93.99 $50.91 $43.08 $4656.36
84 $93.13 $50.44 $42.69 $4613.67
85 $92.27 $49.98 $42.29 $4571.38
86 $91.43 $49.52 $41.91 $4529.47
87 $90.59 $49.07 $41.52 $4487.95
88 $89.76 $48.62 $41.14 $4446.81
89 $88.94 $48.17 $40.77 $4406.04
90 $88.12 $47.73 $40.39 $4365.65
91 $87.31 $47.29 $40.02 $4325.63
92 $86.51 $46.86 $39.65 $4285.98
93 $85.72 $46.43 $39.29 $4246.69
94 $84.93 $46.01 $38.92 $4207.77
95 $84.16 $45.58 $38.58 $4169.19
96 $83.38 $45.17 $38.21 $4130.98
97 $82.62 $44.75 $37.87 $4093.11
98 $81.86 $44.34 $37.52 $4055.59
99 $81.11 $43.94 $37.17 $4018.42
100 $80.37 $43.53 $36.84 $3981.58
101 $79.63 $43.13 $36.50 $3945.08
102 $78.90 $42.74 $36.16 $3908.92
103 $78.18 $42.35 $35.83 $3873.09
104 $77.46 $41.96 $35.50 $3837.59
105 $76.75 $41.57 $35.18 $3802.41
106 $76.05 $41.19 $34.86 $3767.55
107 $75.35 $40.82 $34.53 $3733.02
108 $74.66 $40.44 $34.22 $3698.80
109 $73.98 $40.07 $33.91 $3664.89
110 $73.30 $39.70 $33.60 $3631.29
111 $72.63 $39.34 $33.29 $3598.00
112 $71.96 $38.98 $32.98 $3565.02
113 $71.30 $38.62 $32.68 $3532.34
114 $70.65 $38.27 $32.38 $3499.96
115 $70.00 $37.92 $32.08 $3467.88
116 $69.36 $37.57 $31.79 $3436.09
117 $68.72 $37.22 $31.50 $3404.59
118 $68.09 $36.88 $31.21 $3373.38
119 $67.47 $36.54 $30.93 $3342.45
120 $66.85 $36.21 $30.64 $3311.81
121 $66.24 $35.88 $30.36 $3281.45
122 $65.63 $35.55 $30.08 $3251.37
123 $65.03 $35.22 $29.81 $3221.56
124 $64.43 $34.90 $29.53 $3192.03
125 $63.84 $34.58 $29.26 $3162.77
126 $63.26 $34.26 $29.00 $3133.77
127 $62.68 $33.95 $28.73 $3105.04
128 $62.10 $33.64 $28.46 $3076.58
129 $61.53 $33.33 $28.20 $3048.38
130 $60.97 $33.02 $27.95 $3020.43
131 $60.41 $32.72 $27.69 $2992.74
132 $59.85 $32.42 $27.43 $2965.31
133 $59.31 $32.12 $27.19 $2938.12
134 $58.76 $31.83 $26.93 $2911.19
135 $58.22 $31.54 $26.68 $2884.51
136 $57.69 $31.25 $26.44 $2858.07
137 $57.16 $30.96 $26.20 $2831.87
138 $56.64 $30.68 $25.96 $2805.91
139 $56.12 $30.40 $25.72 $2780.19
140 $55.60 $30.12 $25.48 $2754.71
141 $55.09 $29.84 $25.25 $2729.46
142 $54.59 $29.57 $25.02 $2704.44
143 $54.09 $29.30 $24.79 $2679.65
144 $53.59 $29.03 $24.56 $2655.09
145 $53.10 $28.76 $24.34 $2630.75
146 $52.62 $28.50 $24.12 $2606.63
147 $52.13 $28.24 $23.89 $2582.74
148 $51.65 $27.98 $23.67 $2559.07
149 $51.18 $27.72 $23.46 $2535.61
150 $50.71 $27.47 $23.24 $2512.37
151 $50.25 $27.22 $23.03 $2489.34
152 $49.79 $26.97 $22.82 $2466.52
153 $49.33 $26.72 $22.61 $2443.91
154 $48.88 $26.48 $22.40 $2421.51
155 $48.43 $26.23 $22.20 $2399.31
156 $47.99 $25.99 $22.00 $2377.31
157 $47.55 $25.75 $21.80 $2355.51
158 $47.11 $25.52 $21.59 $2333.92
159 $46.68 $25.28 $21.40 $2312.52
160 $46.25 $25.05 $21.20 $2291.32
161 $45.83 $24.82 $21.01 $2270.31
162 $45.41 $24.60 $20.81 $2249.50
163 $44.99 $24.37 $20.62 $2228.88
164 $44.58 $24.15 $20.43 $2208.45
165 $44.17 $23.92 $20.25 $2188.20
166 $43.76 $23.71 $20.05 $2168.15
167 $43.36 $23.49 $19.87 $2148.28
168 $42.97 $23.27 $19.70 $2128.58
169 $42.57 $23.06 $19.51 $2109.07
170 $42.18 $22.85 $19.33 $2089.74
171 $41.79 $22.64 $19.15 $2070.59
172 $41.41 $22.43 $18.98 $2051.61
173 $41.03 $22.23 $18.80 $2032.81
174 $40.66 $22.02 $18.64 $2014.17
175 $40.28 $21.82 $18.46 $1995.71
176 $39.91 $21.62 $18.29 $1977.42
177 $39.55 $21.42 $18.13 $1959.29
178 $39.19 $21.23 $17.96 $1941.33
179 $38.83 $21.03 $17.80 $1923.53
180 $38.47 $20.84 $17.63 $1905.90
181 $38.12 $20.65 $17.47 $1888.43
182 $37.77 $20.46 $17.31 $1871.12
183 $37.42 $20.27 $17.15 $1853.97
184 $37.08 $20.08 $17.00 $1836.97
185 $36.74 $19.90 $16.84 $1820.13
186 $36.40 $19.72 $16.68 $1803.45
187 $36.07 $19.54 $16.53 $1786.92
188 $35.74 $19.36 $16.38 $1770.54
189 $35.41 $19.18 $16.23 $1754.31
190 $35.09 $19.01 $16.08 $1738.23
191 $34.76 $18.83 $15.93 $1722.30
192 $34.45 $18.66 $15.79 $1706.51
193 $34.13 $18.49 $15.64 $1690.87
194 $33.82 $18.32 $15.50 $1675.37
195 $33.51 $18.15 $15.36 $1660.01
196 $33.20 $17.98 $15.22 $1644.79
197 $32.90 $17.82 $15.08 $1629.71
198 $32.59 $17.66 $14.93 $1614.78
199 $32.30 $17.49 $14.81 $1599.97
200 $32.00 $17.33 $14.67 $1585.30
201 $31.71 $17.17 $14.54 $1570.76
202 $31.42 $17.02 $14.40 $1556.36
203 $31.13 $16.86 $14.27 $1542.09
204 $30.84 $16.71 $14.13 $1527.96
205 $30.56 $16.55 $14.01 $1513.95
206 $30.28 $16.40 $13.88 $1500.07
207 $30.00 $16.25 $13.75 $1486.32
208 $29.73 $16.10 $13.63 $1472.69
209 $29.45 $15.95 $13.50 $1459.19
210 $29.18 $15.81 $13.37 $1445.82
211 $28.92 $15.66 $13.26 $1432.56
212 $28.65 $15.52 $13.13 $1419.43
213 $28.39 $15.38 $13.01 $1406.42
214 $28.13 $15.24 $12.89 $1393.53
215 $27.87 $15.10 $12.77 $1380.76
216 $27.62 $14.96 $12.66 $1368.10
217 $27.36 $14.82 $12.54 $1355.56
218 $27.11 $14.69 $12.42 $1343.14
219 $26.86 $14.55 $12.31 $1330.83
220 $26.62 $14.42 $12.20 $1318.63
221 $26.37 $14.29 $12.08 $1306.55
222 $26.13 $14.15 $11.98 $1294.57
223 $25.89 $14.02 $11.87 $1282.70
224 $25.65 $13.90 $11.75 $1270.95
225 $25.42 $13.77 $11.65 $1259.30
226 $25.19 $13.64 $11.55 $1247.75
227 $24.96 $13.52 $11.44 $1236.31
228 $24.73 $13.39 $11.34 $1224.97
229 $24.50 $13.27 $11.23 $1213.74
230 $24.27 $13.15 $11.12 $1202.62
231 $24.05 $13.03 $11.02 $1191.60
232 $23.83 $12.91 $10.92 $1180.68
233 $23.61 $12.79 $10.82 $1169.86
234 $23.40 $12.67 $10.73 $1159.13
235 $23.18 $12.56 $10.62 $1148.51
236 $22.97 $12.44 $10.53 $1137.98
237 $22.76 $12.33 $10.43 $1127.55
238 $22.55 $12.22 $10.33 $1117.22
239 $22.34 $12.10 $10.24 $1106.98
240 $22.14 $11.99 $10.15 $1096.83
241 $21.94 $11.88 $10.06 $1086.77
242 $21.74 $11.77 $9.97 $1076.80
243 $21.54 $11.67 $9.87 $1066.93
244 $21.34 $11.56 $9.78 $1057.15
245 $21.14 $11.45 $9.69 $1047.46
246 $20.95 $11.35 $9.60 $1037.86
247 $20.76 $11.24 $9.52 $1028.34
248 $20.57 $11.14 $9.43 $1018.91
249 $20.38 $11.04 $9.34 $1009.57
250 $20.19 $10.94 $9.25 $1000.32
251 $20.01 $10.84 $9.17 $991.15
252 $19.82 $10.74 $9.08 $982.07
253 $19.64 $10.64 $9.00 $973.07
254 $19.46 $10.54 $8.92 $964.15
255 $19.28 $10.44 $8.84 $955.31
256 $19.11 $10.35 $8.76 $946.55
257 $18.93 $10.25 $8.68 $937.87
258 $18.76 $10.16 $8.60 $929.27
259 $18.59 $10.07 $8.52 $920.75
260 $18.42 $9.97 $8.45 $912.30
261 $18.25 $9.88 $8.37 $903.93
262 $18.08 $9.79 $8.29 $895.64
263 $17.91 $9.70 $8.21 $887.43
264 $17.75 $9.61 $8.14 $879.29
265 $17.59 $9.53 $8.06 $871.23
266 $17.42 $9.44 $7.98 $863.25
267 $17.26 $9.35 $7.91 $855.34
268 $17.11 $9.27 $7.84 $847.50
269 $16.95 $9.18 $7.77 $839.73
270 $16.79 $9.10 $7.69 $832.04
271 $16.64 $9.01 $7.63 $824.41
272 $16.49 $8.93 $7.56 $816.85
273 $16.34 $8.85 $7.49 $809.36
274 $16.19 $8.77 $7.42 $801.94
275 $16.04 $8.69 $7.35 $794.59
276 $15.89 $8.61 $7.28 $787.31
277 $15.75 $8.53 $7.22 $780.09
278 $15.60 $8.45 $7.15 $772.94
279 $15.46 $8.37 $7.09 $765.85
280 $15.32 $8.30 $7.02 $758.83
281 $15.18 $8.22 $6.96 $751.87
282 $15.04 $8.15 $6.89 $744.98
283 $15.00 $8.07 $6.83 $738.05
284 $15.00 $8.00 $6.76 $731.05
285 $15.00 $7.92 $6.70 $723.97
286 $15.00 $7.84 $6.64 $716.81
287 $15.00 $7.77 $6.57 $709.58
288 $15.00 $7.69 $6.50 $702.27
289 $15.00 $7.61 $6.44 $694.88
290 $15.00 $7.53 $6.37 $687.41
291 $15.00 $7.45 $6.30 $679.86
292 $15.00 $7.37 $6.23 $672.23
293 $15.00 $7.28 $6.16 $664.51
294 $15.00 $7.20 $6.09 $656.71
295 $15.00 $7.11 $6.02 $648.82
296 $15.00 $7.03 $5.95 $640.85
297 $15.00 $6.94 $5.88 $632.79
298 $15.00 $6.86 $5.80 $624.65
299 $15.00 $6.77 $5.72 $616.42
300 $15.00 $6.68 $5.65 $608.10
301 $15.00 $6.59 $5.57 $599.69
302 $15.00 $6.50 $5.49 $591.19
303 $15.00 $6.40 $5.42 $582.59
304 $15.00 $6.31 $5.34 $573.90
305 $15.00 $6.22 $5.26 $565.12
306 $15.00 $6.12 $5.18 $556.24
307 $15.00 $6.03 $5.09 $547.27
308 $15.00 $5.93 $5.02 $538.20
309 $15.00 $5.83 $4.93 $529.03
310 $15.00 $5.73 $4.85 $519.76
311 $15.00 $5.63 $4.77 $510.39
312 $15.00 $5.53 $4.68 $500.92
313 $15.00 $5.43 $4.59 $491.35
314 $15.00 $5.32 $4.51 $481.67
315 $15.00 $5.22 $4.41 $471.89
316 $15.00 $5.11 $4.33 $462.00
317 $15.00 $5.00 $4.24 $452.00
318 $15.00 $4.90 $4.14 $441.90
319 $15.00 $4.79 $4.05 $431.69
320 $15.00 $4.68 $3.95 $421.37
321 $15.00 $4.56 $3.87 $410.93
322 $15.00 $4.45 $3.77 $400.38
323 $15.00 $4.34 $3.67 $389.72
324 $15.00 $4.22 $3.57 $378.94
325 $15.00 $4.11 $3.47 $368.05
326 $15.00 $3.99 $3.37 $357.04
327 $15.00 $3.87 $3.27 $345.91
328 $15.00 $3.75 $3.17 $334.66
329 $15.00 $3.63 $3.06 $323.29
330 $15.00 $3.50 $2.97 $311.79
331 $15.00 $3.38 $2.86 $300.17
332 $15.00 $3.25 $2.75 $288.42
333 $15.00 $3.12 $2.65 $276.54
334 $15.00 $3.00 $2.53 $264.54
335 $15.00 $2.87 $2.42 $252.41
336 $15.00 $2.73 $2.32 $240.14
337 $15.00 $2.60 $2.20 $227.74
338 $15.00 $2.47 $2.08 $215.21
339 $15.00 $2.33 $1.97 $202.54
340 $15.00 $2.19 $1.86 $189.73
341 $15.00 $2.06 $1.73 $176.79
342 $15.00 $1.92 $1.62 $163.71
343 $15.00 $1.77 $1.50 $150.48
344 $15.00 $1.63 $1.38 $137.11
345 $15.00 $1.49 $1.25 $123.60
346 $15.00 $1.34 $1.13 $109.94
347 $15.00 $1.19 $1.01 $96.13
348 $15.00 $1.04 $0.88 $82.17
349 $15.00 $0.89 $0.75 $68.06
350 $15.00 $0.74 $0.62 $53.80
351 $15.00 $0.58 $0.50 $39.38
352 $15.00 $0.43 $0.36 $24.81
353 $15.00 $0.27 $0.23 $10.08
354 $10.19 $0.11 $0.09 $0.00

That’s right. It takes 354 months to payoff this debt. That’s 29.5 years. Not only does it take you almost three decades to finally rid yourself of the credit card ball and chain, but the $10,000 you borrowed winds up costing you $21,267. I don’t know about you, but I can think of a lot of things I’d rather do with $11,267 I paid in interest charges.

Take that same $10,000 CC debt and, instead of making the minimum payment, let’s say you make a fixed $300/month payment every month. Wanna know how long it takes to payoff the CC? 42 months, or 3.5 years. That’s 26 years sooner than the other option. Not to mention it saves you nearly $9,000 in interest payments.

Making the minimum payments on your high interest debt (when you have the ability to pay more) is just about the stupidest thing you could do…. ever.

Did you at any point fall victim to “minimum payments” with your high interest debt? Did you delay saving for retirement because you thought “There’s always tomorrow”? What do you find interesting about interest?

You’re broke because you choose to be

The title of today’s post may be a little harsh, but I’m not one for sugarcoating. If you have been in a coma for the last two years, you may not have noticed the economy is not in the greatest shape. There is no denying many Americans have been affected by the economic downturn, but I get pretty frustrated with people that always point the finger at someone else.

I am going to punch a baby in the face (figuratively speaking of course)  if I hear another person complain about how broke they are. Don’t get me wrong, I don’t have a problem with broke people, I only have an issue with those that complain about being broke, but have no plan to become un-broke (is that a word?).

Don’t tell me you can’t get ahead when you have an 800 channel cable package, an unlimited cell phone plan, and a fridge full of beer and soda. Wanna know something? You’re not broke, you’re stupid. Ya gotta change your mentality. You have to accept responsibility for your situation and quit pointing the finger at someone else (even if it really is someone elses fault).

Maybe you worked really hard, made a decent salary, used your credit cards responsibly, but fell victim to some shady business practices from your lender. Oh freakin well. Last time I checked, bitterness wasn’t a key to success. Bad things do happen to good people, but what really separates the winners from the un-winners (losers sounded too harsh) is the drive to consistently better themselves.

If you have found yourself strapped for cash, don’t sit idly by and wait for someone to fix your problems, it’s on your shoulders. That means you might have to say goodbye dining out, adios Nordstrom, and ::GASP:: farewell tall-non-fat-caramel-macchiato-upside-down-with-a-whip-a-grip-and-a-kung-fu-twist from Starbucks. Please do not tell me you aren’t sure how you are going to pay your credit card bill if you haven’t canceled your cable. Change starts with you (and your spending habits).

Yes my tone may be slighty harsh, but sometimes people need a good swift kick in the a$$. My assumption is most of my readers are either financially secure, or at least have a plan to become financially secure, and therefore this message does not really apply to you, but it’s still an important message nonetheless. Do you have any good stories from people whining about their finances when they have done NOTHING to correct the issue? Is it possible that I simply lack compassion and am actually a terrible person for being so mean? You can call me mean, but I like to think of myself as…well…honest 🙂

My credit score: A love/hate relationship

Screen shot 2009-12-09 at Dec 9, 2009, 10.37.26 PMWhat’s that saying? Oh that’s right, “Damned if you do and damned if you don’t.” I’ve never really had a reason to use this phrase before, but when it comes to my FICO score, it is the first thing that comes to mind. The only way to have a high FICO score is to continually be borrowing money. This causes a problem when your blogs name is Punch Debt In The Face. How can I possibly strive to have a high FICO score, but swear off virtually all debt? Unfortunately, I’m not sure I can answer that question, but I’m gonna give it my best shot.

For those that don’t know, your FICO score is basically a measure of how likely you are to repay your debts. A high FICO score, means you will probably make most payments on time, with few (if any) hiccups. A low FICO score, indicates a high probability you will make late or no payments rather frequently.

There are five main categories that make up each individuals FICO score…

* Payment History (timliness of repayment)
* Amounts Owed (available credit compared to credit used)
* Length of Credit (length of time you’ve had the account)
* New Credit (how frequently are you opening new accounts)
* Type of Credit (student loans, car loans, credit cards, etc)

Now that you know the components of your FICO score, lets talk about why it’s important. I assume most of my 20 something readers are like myself and  hope to one day purchase a home. I would also assume most of us plan to take out a loan to purchase said home (if you are planning on paying 100% cash, you need not continue reading).

Did you know your FICO score plays a huge factor in your ability to purchase the home of your dreams. Let’s run through a little hypothetical situation…

Johnny has a terrible credit score and walks in to his local bank to apply for a $200,000 mortgage on his dream home. Ninja also walks in to the same bank to apply for a $200,000 mortgage, but Ninja has a very high credit score. There is a good chance the bank is going to reject Johnny’s application, therefore crushing his dreams of being a homeowner. But let’s say they don’t. Let’s pretend they decide to qualify Johnny for that loan. The bank gives Ninja a low interest rate of 4.75% because he is not a risky person to loan money to. With Johnny however, the bank has taken on some risk by giving him a loan, so they decide to charge him an interest rate of 6%. Ninja’s total interest paid over 30 years is going to be $175K, meanwhile Johnny’s going to have paid over $230K in interest. That’s a $55K difference for taking out the same loan from the same bank. High credit scores generally result in better financing options.

Here’s the problem. The only way to have a high credit score is to be continually borrow money. You’ll notice all five components of the credit score require you to have credit available to you (aka you have to be in debt). What if you are like me and have sworn off incurring future debt, except for a mortgage, and are aggressively working to get rid of all current debt? Fortunately there is at least one way to continually be “borrowing” money, without actually being in debt.

I use my credit card for every purchase I make. By the end of each month, my balance is usually around $1,500. I then pay off this balance in full, so I incur no interest charges. My CC company will then report this information to the credit agencies. Since I made my payment on time, my credit score is going to continue to increase. It’s a simple, yet effective way, to raise your credit score, without having to pay for it.

This is the only free way to raise your credit score I know of. Does anyone else know of other ways to raise your credit score without going in to debt? Let me know ’cause I’d be very curious to hear them! At the end of the day I really wish credit scores didn’t exist, but the reality is they do, and they are frustratingly important.

What are you worried about?

Screen shot 2009-11-19 at Nov 19, 2009, 8.04.58 PM

I’ve never really understood why asking people about money is off limits. What are people worried about? Why is it offensive to ask someone how much their new car cost, how big their mortgage is, or how much they are contributing to their 401K? Finances are often a “don’t ask, don’t tell” gig.

Now I’m not saying that everyone needs to be comfortable sharing their financial status with anyone that asks. Obviously if a stranger wants to know how much debt you have, you have my blessing to punch them in the face. Similarly, I believe salary should definitely be kept confidential within the work place (causes too much office drama if Pamela makes more than Carmen). Budgets Are Sexy wrote a great article highlighting the times it is NOT appropriate to ask someone about their income.

One of my favorite ways to learn is through conversation with friends and family. How the heck am I suppose to be financially educated if I can’t really talk about money with anyone I associate with? It’s not like the school systems teach the fundamental of finances. What are we scared of? Are our friends going to judge us because we make too much money, or not enough? Why are things like mortgages, student loans, and credit card debt never to be discussed?

I know where most of my friends stand in regards to their political and religious views, but for some strange reason I feel like they would shoot me if I asked “Have ya been saving for retirement?” Sure, there are situations in which discussing one’s financial situation is inappropriate, but I also believe there are times when finances NEED to be discussed, but aren’t, out of fear of the other party becoming offended. Screw that. I’m laying it all out there. My name is Debt Ninja and this is my financial situation…

Annual Income: $50,547
Cash in Savings: $18,755
Total Debt: $16,877
Percent of income contributed to retirement: 18% + (5% match)
Number of Credit Cards: 3
Annual burrito expenses: $600

You don’t have to be scared. My blog is a “safe place”. No one will judge you no matter what your financial situation. Are you feeling bold? Care to share your financial situation? Any thoughts on why finances are so taboo?

p.s. For those that haven’t commented before, today’s post would be a great day to come out of hiding 🙂

“Good debt” is for dumb people

Screen shot 2009-11-18 at Nov 18, 2009, 7.45.23 PM

I was facebook chatting yesterday with one of my loyal readers. She was discussing her car loan, when I mentioned my student loan. She said “At least your student loan is ‘good debt’.” She put good debt in quotes because she knows (and I know) there ain’t no such thing as good debt (did you know ain’t IS a word?).

Typically student loans and mortgages are considered good debt. Why? The thought is, with student loans you obtain a degree, and with a degree you get a higher paying job. For mortgage, you take on a loan, buy a house, and sell the house for a profit. Nice idea right?

Have you read my blog’s title? Is it Punch Bad Debt In The Face? I don’t think so suckers. There is no such thing as good debt. Debt is debt…period. A degree doesn’t guarantee higher income, no more than your home guarantees increasing in value. So don’t fall for the trap and think you should keep Sallie Mae around for the 20 year visit she is planning to take.

It’s time to change the classification of debt. There is bad debt (which we all know as credit cards, payday loans, etc) and not-as-sucky-but-still-pretty-crappy debt (student loans, mortgage). Whoever decided to call some debt “good” was a genius. Heck, I wonder how much money that label has made the banks. Probably at least ten dollars 🙂

Don’t get me wrong. I’m not opposed to utilizing debt to get an education or buy a home. In fact, I’m 99.9% sure I will take out a mortgage. But don’t trick yourself in to thinking that your mortgage is good. It should still be seen as a money hungry beast that won’t go away until you MAKE IT go away. Were you like me and once thought  “good debt” existed? If I could go back in time, I probably would have gone to a public college, saved a ton of money, and graduated debt free. Oh to be young, naive, and easily influenced.

p.s. Anyone that thinks student loans are “good debt” is more than welcome to have mine 🙂