How to get completely out of debt, “including your mortgage” in less than five years, without having to make any extra money!

This is a letter to help Americans get out of debt. Please mail or E-mail to al your friends, neighbors and relatives.

YOUR BANKER DOES NOT WANT YOU TO READ THIS LETTER!

If you are sick and tired of being deep in debt, this information can be life changing! If you have married children, they need to read this, because they are deep in debt too! All Americans get into debt as soon as they graduate from High school when they purchase their first car. Since they live with their parents and basically have no living expenses, quite often they drive a fancier car than their parents. Then as time goes on, they purchase more things on time, and before you know it they are deep in debt, and then they get married and buy a home and then they are even deeper in debt. And they have no savings account!

Presently a good basic beginner home costs around $150,000. When you borrow that amount, in 30 years you pay back to the bank over $450,000. So you pay $300,000 in interest, if you pay for 30 years. During a lifetime of buying everything on time, Visa Cards, cars, furniture, clothing, vacations, carpeting, appliances, piano, sprinkling system, boat, motorcycles, loans for College education for your children, loans to pay for weddings, funerals, etc. etc. etc, you can add another $150,000 in interest. That’s almost a half million dollars paid in interest during your lifetime! That’s unbelievable. These two pages give you a guideline how to avoid this huge waste of your money! Following this plan can make you rich!

Can you figure how many years you have to work for a half million dollars? If you make $30,000 per year, that is 16 years of straight work for the bank! That is one third of your life’s income! Doesn’t that blow your mind? You must put a stop to living like that, otherwise you will retire totally broke, working all your life for the Banks! Can you see now how ridiculous it is to get into debt in the first place? Can you see now that by being in debt all your life, you make the Banks rich, and this strategy will keep you poor for the rest of your life? Would it not be much better to try and cut that half million in interest to only $100,000 or less during your lifetime? Read on, it can be done!

I understand there are some things you must pay on time, like a home. But to pay for it for 30 years will keep you poor the rest of your life! But 99% of Americans do that! Americans have heard about plans to pay off a home faster by paying extra principal, but they are so deep in debt, they never get around to setting up a plan to pay off their home sooner. Does that sound familiar? The things that matter most like Personal Finance is not being taught in the High schools. Children grow up seeing their parents buy everything on time, so they just copy them and do the same thing! Then as they grow up, their children also do the same thing! This letter will teach you a different plan.

There is another and better way to live your life and that is what this information is all about, so let’s get into the nitty gritty right now, and let me show you a new way of life! You have to have a plan and then stick to that plan. I will teach you a System, that will get you totally out of debt in about five years or less, including your Mortgage.

First things first. You have to take a serious look at your payments and bills situation and see where you can cut corners immediately. Most Americans buy new cars every few years. This is extremely bad financial strategy, and will keep you poor. That must stop if you want to become financially independent. If you are driving fairly new cars, you must sell them and trade down. You can buy a very nice car about 3 to 5 years old for three to five thousand dollars. Always buy from a private party. Car Dealers are ripoffs. In the nineteen sixty’s and seventy’s a car with sixty thousand miles was considered junk. Now cars last much longer. Find a car with about sixty thousand miles on it.

Then look at other things that are luxuries which you really don’t need and hardly ever use. Just get rid of them and sell them. There, now that is a start to financial freedom. But you have a long way to go. Now sit down with your spouse at your kitchen table and go through your monthly bills and write them all down. Do not include utilities like electricity and water, etc. Those you cannot do anything about.

Now re-arrange your bills with the smallest bill with the lowest payment on top and the largest bill on the bottom, which will be your home Mortgage. I will basically show you our debt situation and how we paid off everything in less that five years, so you’ll understand how this System works.

#1 Sears. $200 balance.............$50 per month. #2 Piano. $500 balance............ $100 per month. #3 Visa #1 $700 balance.............$100 per month. #4 Visa #2 $1350 balance............$150 per month. #5 Car #1. $1800 balance............$200 per month. #6 Car #2 $2400 Balance............$300 Per month. . #7 Loan #1 $4400 balance............$400 per month.

#8 Loan #2 $6000 balance............$500 per month.

#9 Mortgage $83,700 balance..........$700 per month.

Total debt $101,050. Total payments $2500 per month.

These were basically our bills and Mortgage debt. We followed our plan below and got totally out of debt in less than five years. Let me tell you, life is wonderful now. This is the life that awaits you if you follow our plan. This is what you do. This is your plan of attack. You MUST do this, or you will be in debt for the rest of your life! Pay the bankers all your life and you will eventually retire poor! Try to live more frugal, so you will have some extra money left over at the end of the month. Let’s assume you can scrape together $200 extra per month that you usually would just squander on junk.

THIS IS THE PLAN! You take that $200 and immediately pay off Sears.

Now you have $200 plus the $50 Sears payment ($250) to attack the piano bill.

You pay the piano off in two months.

Now you have $350 per month to attack visa # 1 You pay that off in two months.

Now you have $450 extra to pay off Visa #2. You pay that off in three months.

Now you have $600 extra to pay off Car #1. You pay that off in three months.

Now you have $800 extra to pay off Car #2. You pay that off in three months.

Now you have $1100 extra to pay off Loan #1. You pay that off in four months.

Now you have $1500 extra to pay off Loan #2. You pay that off in four months.

Now you will be in a position to almost Quadruple your house payments!

Now you have $2000 extra per month plus the $700 per month house payment which is $2700 per month to attack your Mortgage balance. You can now pay $32,400 per year on your Mortgage! This is what we did! However, you will have to consider the amount of interest, but that amount per month will dwindle down very fast as you continue attacking your mortgage balance.

Your Banker does not want you to do this plan!

Simply add up all the months and you can see that with our plan, you would wipe out a $100,000 debt in less than 5 years! Off course, if your Mortgage balance is larger, it could take a little more time. You will have a set back once in a while, like if you need a new washing machine, etc. Simply pay cash and continue your attack. Follow this System and you will save several hundred thousand dollars in your lifetime!

Please copy and mail or E-mail to at least ten friends OR MORE!

Help America get out of debt!!!

-- Anonymous, December 08, 2000

Answers

*Try to live more frugal, so you will have some extra money left over at the end of the month.

This is why a lot of people go into debt in the first place. They don't want to live frugally. They want the Good Life and they want the trappings Right Now! Convincing one of these party hardies to buy a car with 60k on it is like telling them to take the bus to work. Ain't gonna happen. It'll take a real Depression to take these party hardies down, and some will probably take their lives if forced to live the way that some of us grew up: hand-me-down clothing, brown bag lunches, and riding bicycles or sharing transportation. No great loss, sez I.

-- Anonymous, December 08, 2000

There is NO SUCH A THING AS "ONE SIZE FITS ALL" budget/Debt strategy. For many, many people hocking their souls when young to buy a home and car makes sense because of the priorities they must establish to do so and the ability to manage the debt load is greatly aided as they advance on their CAREERS. Overlooking that for a blanket policy of "no debts" is STUPIDITY. (But only if they are going to stay in that house for AT LEAST 5 years. Less than that and there can be no assurance that the home will appreciate enough to cover the transaction costs of selling.)

Conversely, 200 pairs of shoes ala: Imelda is just as STUPID.

The interest rate for mortgages was eternally: 4.5-6.0 % until lenders decided to add "the inflation factor". They had no choice. That factor varies but today is about 2-3%.

The "buy or lease" decision is seldom made properly and people ignore the "real cost" to factor in "the owning experience" which is intangible. For many people, their home is their ONLY asset because they have never saved unless they got lucky with company aided 401ks.

It is an error to eliminate "all" debt. Few people could ever buy a home without a mortgage. The trick with mortgages is to have good credit and get low interest loans, re-fi when you can.

The 'no debt' nuts forget something, the money that you pay the bank in interest is ONLY roughly 2-3% more than the money you obtain in interest in interest bearing accounts.

A $100,000/7.5 interest balance for 30 years has a PI payment of: $699.23 +/- .01 and so 2-3 % /month is 14-21 month. Skip the movies and MacDonalds for one night and keep your $100,000 cash in the bank making money. THAT is how you use OPM. With all that cash in the bank, you will sleep very well knowing you can always pay off the mortgage or make the payments, live well during a job crisis etc.

All debt reduction must be done by reducing the "balance owed" no matter what. The simplest way to do that is to NEVER let that balance increase for non-essentials and frankly, NEVER CHARGING AT CHRISTMAS TIME.

ANYONE who needs help in that regard should go at once to CCC, the Consumer Credit Counseling Service and get help. It is the most cost effective way to get out of debt and improve you credit standing. In the 70s the mantra, "buy it now before the price goes up" drove the accumulation of debt. In the hyper inflation of the late 1970s, it seemed like a "sensible thing to do". People even paid 17-20% for mortgages if they could even get one.

As we know, deflation and foreign competition put an end to such things leaving people "working for the banks". No matter what the Residential Realtors say, your home is NOT "your best investment". In terms of real dollars, it usually keeps pace with inflation.

The smartest debt reduction possible is to make one extra payment (or more) on your mortgage because in reducing the balance you are saving the interest costs and the compounding while building equity and bring in the "payoff term". DO NOT buy into any bi-weekly schemes even if your mortgage company sets it up for you. Such schemes carry hidden charges and origination fees which can be avoided by simply marking the "extra payment" on the check in big bold letter: PAYMENT FOR REDUCTION OF PRINCIPAL". And making sure your next computer printout reflects that in fact the balance owed is reduced.

NUMBER TWO for debt reduction is "PAY CASH" for most things (even groceries). Some people kid themselves by paying with checks and trying to work the float. forget it. Paying cash makes people very "price conscious" and that in turn alone will save them money.

While affordable housing at $100,000 seems like a joke considering that such homes sold between $10-20,000 in the 1960s, those who sacrificed to buy them then reaped a harvest because in the right area, the homes just by keeping up in real dollars have gone to the $100,000 level. Few stay in such homes longer than the 5-7 years.

In addition, the tax write offs for mortgages at that level are a scam. The standard deductions on a short form are often greater than itemization.

Prior to 1985-1990, the operating premise of most people who got into debt was that they would pay back in TWO WAYS:

a. in cheap inflated dollars

b. with ever increasing Salary and job promotions.

In many cases, "things worked out".

The starter home for a Dual Income couple making $150,000 between them does not mandate that they live in a starter neighborhood but rather that they "stretch" for as much as they can possibly handle.

Sometimes that is a recipe for disaster. Often it is not because the equity build up they can make with ONE EXTRA PAYMENT PER YEAR on a 30 year note is large and enables payoff in slightly over 23 years.

-- Anonymous, December 08, 2000

am I better off paying an additional $100 on my principle every month, or, making aditional payments on my motgage? sign me confused...

-- Anonymous, December 08, 2000

What's the point of paying everything off? I plan to have huge mortgages on killer real estate my entire life, spending the shit out of every buck I've got so that I don't die with millions sitting in the bank or in estate property.

Unless you really want to "set your kids up" (I don't plan on it), you're better off "dying broke". As the book by the same title puts it "The last check you write should be to your undertaker...and it should bounce!"

-- Anonymous, December 08, 2000

ed, if your additional monthly payment is devoted exclusively to reducing your principal, that will result in your mortgage being paid off sooner (and consequently, more cheaply) than if the same sized payment were instead applied to a combination of interest and principal. This is why cpr is suggesting enclosing a check "for reduction of principal" along with your usual monthly payment.

Make cents, if you're spending to the hilt, how do you protect against paroxysmal loss of income.

-- Anonymous, December 08, 2000

Freddie! You son of a bitch, where the hell have ya been? I liked this thread the first time you posed it, still trying to get the Mrs with the program.

-- Anonymous, December 08, 2000

Uncle Deedah, you better tell your missus to get going with the program. I did this about ten years ago. I now have no debt. I have a substantial amount of $$$$ stashed away. I'm 64 and retired and having a ball. It's a great life with no monthly bills!

I told a good friend about this system at the same time I started. His missus did not want to do it. My friend, 67 years old now is still working, he still has a mortgage and car payments.

Real stupid, especially since he knows better. I guess he'll be working till he dies, thanks to his selfish old lady!

Every time I post this system, all I get is negative remarks. I guess they are as stupid as my friend who will work till he dies.

There is more to life than working until you die.

Unc. make it work for you and get started January 2001.

Good luck!!!

-- Anonymous, December 09, 2000