America Swimming
In Credit Cards
Credit Card Debt Triples In
The Past Fifteen Years

By Kentroversy
In the Sunday June 19, 2005 edition of the BUFFALO NEWS (pg. B9) was an article entitled FED MAY TIGHTEN CREDIT CARD RULES. This article verifies what I stated about credit card debt in my white paper WILL YOU SURVIVE THE COMING FINANCIAL CRASH? -- namely that credit card DEBT has gotten out of hand in this country.
In the chart that accompanied the article, which was itself entitled SWIMMING IN CREDIT CARDS, the following disturbing information was imparted to the reader:
1. Americans used more than 650 million credit cards and charged more than $1.7 trillion dollars in 2004 alone!
2. 1n 1990, there were 281.5 million credit cards held by adults in the USA. By 2004, this has increased to 657.5 million credit cards -- this is an average of 3.13 cards held by each adult in the USA!
3. In 1990, there was $338.4 billion dollars charged on these 281.5 million credit cards held at that time. By 2004, things had changed considerably. The credit card charges in just 2004 alone were $1.67 trillion dollars total on 657.5 million cards now in practically everyone's possession. In today's world, credit cards are ubiquitous.
4. In 1990, the total credit card debt per household was only $2,966.00. By 2004, things had also changed considerably. The total household credit card debt has risen to $9,312.00 -- which TRIPLED during that decade and a half!
5. Perhaps most disturbing is what I am about to tell you...
a) Minimum monthly payment (2% of balance due) = $186.24
b) Time to pay off balance at 16% interest = 43 years, 5 months!!
c) Total interest paid on $9,312.00 = $17,953.44
d) Total repaid to credit card company = $27,265.44
NOTE: With interest compounding -- the 16% APR suddenly becomes 192% !!!
These figures confirm what I discussed in my white paper entitled WILL YOU SURVIVE THE COMING FINANCIAL CRASH? -- and this is but one method among many in which typically dumbed-down Americans are taken advantage of time and time again.
The Federal Reserve is looking toward tightening their credit card regulations because record numbers of people are now having trouble paying these bills --- they are in so far over their heads. These people are not doing this to be nice to those who hold one of their credit cards.
They don't slip that noose around your neck to let you go at the last moment!
Remember that, will you?
© 2005 The Kentroversy Papers
From Jim Mortellaro
The man speaketh truth. There was a time when I owned every credit and charge card known to mankind. Every one. Further, I owned multiple VISA and MasterCards from various banks. I used them all and got myself in debt to the tune of about $15,000. This was a long time ago. It took me three years to pay them all off. Three years, not 5 years. But in the process, I learned one heck of a lesson.
I learned that I was irresponsible. I learned that the use of such cards was a lot like gambling, something I never do. I very rarely drink. Well, I did get pretty blasted on a few occasions, but never made a habit of it. But it's easy to become addicted to credit cards. Just get 'em and charge 'em.
How I paid them off in three years is another story. It was hard. Since that time I acquired only one charge card. That's the Amex type card, where the bill absolutely, positively must be paid in full at the end of the month. Today I own a VISA and MasterCard, but in my business' name. In fact, each of the three cards is in my business name and the business is a PC, Private Corporation.
The issue of credit card abuse is interesting because whilst it is the fault of the individual (in getting himself in difficulty) it is more the fault of the credit card company. Card companies used to send you credit cards pre-approved. Now, they must send you a letter and application which may also claim to pre-approve you. All you have to do is sign on the dotted line and they send you a card.
People somehow collect these cards as if they were kids again and the cards were cher baseball cards. Gotta have more and more and more. Hey, you never know. One day you come to realize that you've gone way too far. You are now hooked and there is no way out. You've maxed out on all your cards and can't use any of them or go belly up.
When that happens, time to go to a nonprofit organization and get them all paid off and ripped up, destroyed.
Today, I am debt free. I pay cash for everything. On those rare occasions where my check is not accepted or cash is impossible, I use a charge card and pay the bill by check by phone BEFORE I get the bill.
This has become an addiction too.
When those letters come in saying you've been pre-approved, rip them up. You don't need or want another card. If you're like me, you're OK to spend what you can afford on the cards, paying the ENTIRE bill at the end of the month, then do keep one or two, which is all you need. But if you are like me the way I was and the way most Americans are these days, dump the cards. DO NOT CANCEL them. Just destroy them.
Canceling the card may damage your already soggy credit rating further. Rip 'em all up and pay the annual fee for the card. Eventually the credit card company will discontinue your card anyway for lack of use. Good.
Remember, you don't have the money ... you don't buy it. You have the money, pay by cash.
Do that long enough and they'll hound you to acquire THEIR cards. Tell them Morty sent you. They'll understand. Heck, they knew me quite well.
There's one born every minute. Don't be one.
Jim Mortellaro




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