Week 11 More About The Dreaded Credit Cards

If you are like the vast majority of people who make New Years Resolutions, then did you notice we just reached half time? June is of course the sixth month out of twelve and half a year of time has just passed you by.

If you take a look at one of the news archive sites, check out the predictions for the economy six months ago, then take a fresh look at today's news. The sort of headlines we are seeing today were the same economic forecasts of Robert Kiyosaki & Donald Trump several years ago. I read a quote from Jim Rohn this morning which states, " If you do not like what is going on around you, change it, you're not a tree!"

This week I am revisiting credit cards, but I want to share a couple of different & challenging viewpoints on the effect they can have on your wealth.

Take an average size town in the UK, a population of say 85,000 to 100,000. That town usually has at least one main shopping centre, and the amount of visitors to that shopping centre is on average 130,000 per week. IF those 130,000 people have ONE credit card each each, with an average interest payment of just £ 30 per month on that single card, then the credit card company just made another £ 3,900,000.00 from one shopping centre per month.

Credit cards, when used incorrectly are DESIGNED to keep you in debt, at the minimum payment alone you will take 30 - 40 years to pay off the average balance. That is how they MAKE the credit card companies money, and they make a LOT of money.

Think about what kind of buildings the credit card companies own, they do not exactly run from a four bedroom detached in the suburbs do they? You will find them in prime locations in the centre of major cities, great big expensive buildings all kitted out with YOUR money. I wonder how many kids grow up thinking they might own a credit card company one day, it would be a pretty smart career choice.

Take another scenario, the first time I saw Martin Lewis on TV he had set up a stand in the middle of a shopping centre asking people to sign up for a MACS Credit Card, the interest rate was ridiculous, there were all sorts of useless bonuses to sign up today and HE was still getting "takers." He revealed at the end of the show that the MACS card was in fact the word SCAM spelt backwards.

One last thought, my colleague had swapped her balance to a no interest deal at a High Street Bank and was paying off her small balance each and every month. She never used the card so it was surprise when she found the High Street bank had "given her £100 on her card as a FREE GIFT," very nice of them you would think. The following month she found out she had been charged £ 1.00 in interest on the £ 100 she didn't ask for, I suggested she give them a polite call and ask for her money back, which she did. Why? What if there were 5 million of her, that bank would make an extra £ 5,000,000 a month alone if nobody asked for their money back, and all this was on an interest free credit card, but it does not apply to any new transactions, even transactions YOU choose NOT to MAKE.

If you have been following the Challenge, you should have paid off at least one credit card balance by now, saving you the interest. This process will can save you £ 100's of £1,000's of pounds in interest alone.

For this week's Pay Off Saving, we will use the average of £ 30 in interest from one credit card, even though the vast majority of people now have multiple cards.

Any savings that you make should be added to your Freedom Payment each month and used to Pay Off Your Mortgage in 3 Years or Less. Anything else & it simply will not work.