The Path to Financial Freedom: A simple and easy guide to assist you in reducing or eliminating the negative flow of money Learn how to live within your budget and how to have your money earn money. Discover how to live within your income, reduce or eliminate the negative flow of money and to have your money earn money. Step 1: Reduce or eliminate the negative flow of money. The negative flow ∗ of money is credit card interest, impulse buying and gambling. Contrary to what most people think, the average monthly interest rate on a credit card, if you pay the minimum amount required by the bank is: 70% - 90% Yes, you read that right! To determine what the interest rate of your card(s) is to divide the finance charge by the minimum payment. Let’s say you have a credit card with a $5,000 balance due at 20% APR. ($5,000 x 20% = $1,000) This is the yearly amount the bank will charge you to use the credit card. The bank bills monthly; so $1,000 divided by 12 months equals $83.33. The bank no longer calls it interest; it is now referred to as Finance Charges. Since a credit card is not an installment fixed loan, and is in effect a revolving payment, the bank sets the minimum payment due. This minimum payment is approximately 2% of the balance. In this example 2% of $5,000 is $100. So here is the whole picture: You owe $5,000. You pay the minimum payment of $100, of which $83.33 is the Finance Charge, leaving only $16.67 to be applied to the principle. Now, divide your Finance Charge ($83.33) by your minimum payment due ($100) and you get 83.3% interest for that month! Since only $16.67 us being applied to the debt, if you divide $5,000 by $16.67 it will take you approximately 299 month (24.9 years) to pay off this credit card. That is, provided you don’t purchase any more on that card, it could take you to infinity. Now, let us look at this scenario:  If there are any past due payments, late charges or over limit fees, deduct them first. Let’s say you have several credit cards totaling $20,000 or more. At an average monthly interest rate of 80% or more, you will pay back $120,000. That is $20,000 on principal and $100,000 on interest. This is ridiculous! What in the world did you buy that was worth spending $100,000 on interest? There are really only 2 cures for this problem: 1. Pay off your total balance each month (not likely, the credit card companies deliberately gave you more credit than you can comfortably handle). 2. Enroll in a Creditor Approved Debt Modification Program. The National Institute for Consumer Assistance (NICA) is designed to reduce principal liability. The program works as follows: A certified financial counselor will work out a payback plan that you can comfortably handle and will have you debt-free in 3 to 4 years. Let’s say you owe a total of $20,000 or more. We will negotiate with your creditors to accept a 50% reduction. The remaining debt will be paid back over 3 to 4 years at 0% interest. The payments are held in your personal interest bearing account until payouts become due. Your total savings with this program at a $20,000 debt level is $10,000 in principal and over $100,000 in potential interest. This public outreach campaign is designed to assist consumers affected by the current economic climate. This program will cover all 3 steps to financial freedom: 1. Reduce the negative flow of money. 2. Live within your budget. 3. Have your money earn money. There are only two requirements to be approved for this program: 1. You must owe at least $10,000 in combined credit card debt and/or medical bills. 2. You must be serious in paying off your debt. For a free no-obligation consultation, please visit: www.nicaonline.info . The Path to Financial Freedom: A simple and easy guide to assist you in reducing or eliminating the negative flow of money Learn how to live within your budget and how to have your money earn. designed to reduce principal liability. The program works as follows: A certified financial counselor will work out a payback plan that you can comfortably handle and will have you debt-free in 3 to. companies deliberately gave you more credit than you can comfortably handle). 2. Enroll in a Creditor Approved Debt Modification Program. The National Institute for Consumer Assistance (NICA)