Debt-Free Forever by Gail Vaz-Oxlade (the beginning after the end read novel .TXT) 📕

real issue: You have to learn to live within your means. Credit cards and lines of credit only serve you when you have the power. Give the power to the creditor and you’re a puppet, jumping and twitching. So, do you want to be some credit card company’s puppet? Like the feeling of twitching when collectors call? No? Okay then, it’s time to retake control and be in charge.

Being in charge means being out of debt. It means paying off your balance in full every single month. It means having only as much credit available as suits your needs. Do you want to be some company’s dream customer, paying gobs of interest and twisting in the wind when the company decides to change the rules of the game? Or do you want to be in charge of your money and your life?

All you have to do is accept that living on credit is dumb. Dumb! Dumb! Dumb! The only way to be financially safe is to owe nobody nuthin’.

Living within your means isn’t as hard as some people think. Yes, it does mean you have to make choices. And yes, you may have to wait a while before you can take that vacation. But when you start living within your means, you’ll be in charge.

Don’t Pay for “Credit Repair”

When a company offers to fix your sloppy credit history, it’s often just a ploy to get your money. And wouldn’t you rather spend that money—anywhere from $250 to $1,000—paying down debt, saving for your kids’ education, or building up an emergency fund, especially when it’s virtually impossible to cover up your past mistakes? While ads for credit repair companies may seem like the cure for a credit life lived less than perfectly, in reality, no credit repair company has the power to change or erase accurate information in your file.

If the reason you’re in trouble with a potential lender is because of wrong information on your credit file, you could pay someone to take care of the problem for you, but it’s often just as easy—and a whole lot less expensive—to take care of that problem yourself.

GAIL’S TIPS

When you sign a loan application, you give your consent to the lender, be it a bank, credit card company, or retail store, to access your credit bureau information to decide whether you’re a good credit risk. Each time a lender looks at your file, there’s a record of that “look” on your file. And too many “looks” could mean you’re as bad credit risk because either you’re “credit seeking” or you’ve been declined elsewhere. So if you’re shopping around, don’t sign an application unless you’re ready to buy.

If you’ve damaged your credit rating by missing payments, carrying high balances, or overextending yourself financially, start fixing the problem by locking away your credit cards. Don’t cancel them because if your credit rating is low, you could have trouble getting new ones. But don’t use them until you are debt-free. While you must pay at least the minimum to stay on the positive side with your credit history, paying only the minimum isn’t going to get you out of debt. So figure out what it’ll take and do it!

If you are declined for a loan, it doesn’t automatically mean you have a crappy credit history. A lender may decline a loan application because the credit bureau’s records indicate that you have other loans outstanding. Yes, everything you owe shows up—including all those credit cards you have even if there are no balances outstanding. When credit is refused, you’re usually advised to have a look at your credit bureau report to see what’s amiss.

You should check your credit files at least once a year to ensure the information is correct. Send a written request (there’s no charge for this service) or go online if you’re into instant gratification, but you’ll have to pay a fee.

If you question an item on the file, the credit bureau will investigate on your behalf to verify the status of the entry. If an error is found, the credit bureau will fix it and send copies of the updated file to credit grantors upon request.

The longer you exhibit good credit behaviour by paying your bills on time and managing your credit wisely, the more your credit rating will improve, until you once again achieve a favourable credit rating. And if you’ve got a good rating that’s been marred by inaccurate reporting, it’s your job to fix it. It’s your credit, after all.

Credit Cards Aren’t Evil

While I hate debt and I think carrying a load of it around is like walking around with a sack of poop over your shoulders, I have nothing against credit cards. Credit cards aren’t evil. In fact, I love my credit card for a whole bunch of reasons:

1. Since I pay off my credit card religiously, and I have a no-fee card, there is no cost to using my card no matter how many transactions I do.

2. Using a credit card for all my transactions saves me having to walk around with gobs of cash. Lose a card and it can be replaced at no cost. Lose cash and you’re very sad.

3. My credit card statements show a clear picture of what has gone where so I can look back and do an analysis of my spending.

4. Every penny I spend on my credit card earns me points that I routinely convert into groceries or other items (like my new barbeque), saving me a not insignificant amount of money.

5. My credit card also offers purchase protection, so if the item I buy is lost or stolen within a specific period—usually 90 days—the card will replace the item. This came in mighty handy one year when I lost my cell phone while I was on a book tour. Others offer travel insurance of all kinds that can save you big bucks on everything from travel medical coverage, to collision coverage on a rental car, to