The Millionaire Mindset

109

Millionaire

Today

is a

GreaT

d ay

sTraTeGy 4-11:

Pay off the credit card balances

as soon as possible.

Consider taking out a loan to consolidate all of your high interest rate credit cards.

For example, let’s say you carry department store charges of $3,000 at an incredible interest

rate of 28.8%. Over the course of a year, that interest would cost you $864. If, instead, you

pay back your debt through a personal line of credit at a lower rate of 10%, it would cost

you only $300 to service that original $3,000. You would save $564.

Credit Crunch

If you’re the type of person who can’t keep track of receipts then adopt a

system with two or three credit cards. Use one for all automobile expenses, another for

all entertainment. Your monthly statements will give you an easy reference record of

expenditures. Remember, though, don’t get in the habit of letting balances be carried from

month to month!

sTraTeGy 4-12:

replace high-interest credit cards with the

lower rate cards and preferably a

“no annual Fee” card.

Once you find out how much money you are spending on the higher rate cards,

you will be shocked. Seek out lower-rate cards. More and more companies are offering

low-rate cards.

Money saved with a 12% versus a 21% credit card

average bal. interest @21%/year interest @12%/year amount saved

$1,000 $210 $120 $90

3,000 630 360 270

5,000 1,050 600 450

8,000 1,680 960 720

9,000 1,890 1,080 810

10,000 2,100 1,200 900