The Debt Elimination Scam … Version 2.0

When people are faced with a difficult financial situation, sometimes they make decisions out of pure desperation that they’ll later live to regret. One such decision is taking the “debt elimination” plunge.

The basis of the debt elimination “procedure” is that promoters claim that you never actually borrowed any money on those credit cards, because credit card debt is not *real* money. Hence, there’s nothing to pay back.

Yeah, tell that to the judge, then let me know how that worked out for you.

My good friend, Charles Phelan, of www.zipdebt.com, just published an excellent article on this whole debt elimination thing. It’s definitely worth reading. Here’s a direct link to his article >> www.zipdebt.com/blog/debt-elimination-variation

Over the years I’ve seen the debt elimination scam come and go, and apparently it’s making it’s rounds again with so many people struggling financially these days. And sadly, there will be unwitting people that will sign up for the debt elimination procedure and it will make their financial predicament even worse. Just don’t be one of them.

Warren Buffett: U.S. In Recession

Last night I watched a fascinating (to me, anyway) interview on CNBC with billionaire investor Warren Buffett. Among the many things he talked about, he came right out and said, “From a common-sense standpoint right now, we’re in a recession.”

Ironically, I published an article on this blog just last week stating the exact same thing, even though many in the media and government are presently waffling on the topic and afraid to come right out and say it. Here’s the link to my article in case you’re interested.

The numbers don’t lie. They are what they are.

On a positive note, though, he did restate his view that over the long-run the U.S. economy will do fine and that each generation will live better than the one before it.

Is The U.S. In A Recession?

While watching the evening news the past few weeks, there have been several stories about the “possibility” that the U.S. “might” be headed into a recession.

Might?

Yet today President Bush told reporters at a news conference that “I don’t think we’re headed into a recession”.  

Huh?

You don’t need to have graduated from the Harvard Business School to know that we already are in a recession. Hello! Maybe certain business leaders or people in the government don’t want to “scare” the American public by actually uttering the word r-r-r-recession. How sweet of them.

But come on, give us a little credit here. We in the American public know exactly what’s going on. We’re not stupid. Things are not going that well financially for a lot of Americans right now. All you have to do is take a look around.

And you know what? As much as I hate to say it, I think it’s probably going to get worse before it gets better. You don’t just snap your fingers and halt a juggernaut overnight. It took years (perhaps a couple decades) for us to get to where we are right now, and I believe it’s going to take a few years or longer to get this thing turned around.

Sorry to sound like Mr. Doom-and-Gloom, but you can’t ignore the facts.

But in a strange way this cloud could have a silver lining. I actually think something good can come of these challenging financial times.

With all the financial pressure and uncertainty, we’re all eventually going to be forced to make some new choices that will require all of us to …

In a way, we’re going to have to re-invent ourselves. 

From a financial perspective, we’ll going to need to reduce our debt burden and consume less and less. As we do that, things are going to settle down, and we’re going to start to experience freedom again by not having to work so many hours to support our previously stupid spending habits, and we’ll come to realize that we didn’t need half of the crap that we bought in the first place.

And maybe one day we’ll get back to the day where it’s socially acceptable to just sit on your back patio with your neighbors on a July evening and just listen to the baseball game … or play fetch with your dog … instead of checking your email 20 times a day from your iPhone.

Sign me up.

Credit Card Debt Statistics … The Numbers Might Surprise You

A few weeks ago I came across a fascinating article written by Associated Press writers, Rachel Konrad and Bob Porterfield titled, “Unpaid Credit Cards Bedevil Americans”. Here are a few highlights from their article that really caught my attention:

If you’d like to read the full article, here’s the link  >>  Unpaid Credit Cards Bedevil Americans

If you’re looking for additional information on credit card debt statistics, here’s another link that might be of interest to you  >>  Credit Card Debt Statistics

Credit Card Debt & Personal Responsibility

Earlier this month I wrote an article about the practice of certain credit card companies jacking up interest rates to astronomical levels even though the cardholder has never been late on their monthly payment. In case you missed that article, you can check it out by clicking here

There’s a related matter that I wanted to touch on briefly, and that is the topic of personal responsibility.

It’s true that I believe some credit card companies have policies that are unscrupulous or questionable. However, it’s important to keep in mind that the credit card companies are not forcing you or anyone to use a credit card. It’s all voluntary.

When a person racks up too much debt and creates a challenging financial situation for themselves it’s tempting to look for someone else to blame for their financial predicament, and often the easiest target to go after is the credit card company.

But remember, the credit card companies do not force their cardholders to:

Bottom line, we’re just talking about being personally responsible for your actions. If you can’t afford it, don’t buy it. Don’t worry about keeping up with the Jones. Let the Jones — not you – get the ulcers from worrying about how they’re going to pay for everything.

Now don’t get me wrong, I am not defending the credit card companies and some of their questionable policies and tactics. I believe there are some things they can definitely improve upon. 

And I’m not saying that all credit card purchases are reckless or frivolous, either. Unexpected events (like medical emergencies) do sometimes happen. All I’m saying is let’s not alter reality and place 100% of the blame on someone else when in fact we had a hand in creating the problem. That’s all I’m saying.

If you’re presently struggling with a lot of debt, I know what you’re going through. Been there, done that. Not fun. Most of have felt the financial pinch or maybe even an outright meltdown at some point in our lives. And yes, you’re going to have to address the situation sooner or later. But accepting responsibility for what has happened is almost always the first step toward resolving the matter.

If you’d like a little comic relief, check out this SNL video that pokes fun at credit card debt and personal responsibility >>  click here to watch the video

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