Friday, February 3, 2012

For the almost 8 years that I have been working for my current company, my wife and I have been faithful to not use credit cards. We developed a plan to pay them off, one at a time, devoting $900 each month to the task when the minimum payments would have been about $550. The extra $350 each month went directly to principal on the targeted card. When that card got paid off, we put all the extra money into the next targeted card. I later discovered that Dave Ramsey practically patented “my” idea—he’d been peddling the technique for several years before I came up with it. The only difference was that I targeted the highest interest rate cards first while he advocates targeting the lowest payoff amount cards first. My way is faster, but he learned a long time ago that most people do better his way—which has a built-in “reward system” of experiencing the joys of paying off your first card sooner. I learned in college that this is an example of behavior modification. Kudos to Dave Ramsey! He’s helping people change their lives!

I was offered a Government job doing the very same thing that I was doing as a contractor. I really wanted that job. GS work has stability and is one of only a handful of occupations that offer real retirement possibilities anymore. I discussed the issue with my father because my feelings were so ambivalent. Ultimately, I had to decline the job because I wouldn’t have been able to afford the very steep pay cut. It was the existing credit card debt that enslaved me.