My recommendation — don’t buy this book. There are much better credit card debt reduction books out there.
First, some of what the author says is simply incorrect. For example, he claims that the “real” interest you pay is many times greater than the stated APR (for example, 12.9% is really 116%). He gets the higher rates by dividing the amount of interest in the minimum payment by the amount of your payment that goes to reduce your balance. An example from the book: You owe $5,000, your minimum monthly payment is $100, your interest/finance charge is $53.75, and $100-$53.75=$46.26 goes to reduce your balance. So the author claims you really paid $53.75/$46.26=116% in interest, ignoring the fact that the $53.75 was calculated on your outstanding balance of $5,000! If it were as the author suggests, then you could reduce your interest rate by simply paying more than the minimum. (Pay $200 in the example above, and the rate drops from 116% to 37%!) Paying more than the minimum will, of course, reduce the dollar amount of interest you pay over time, but it doesn’t change the rate which is based on what you owe — not what you pay.
Second, the author’s advice is incomplete. He favors using a bank loan to pay off credit card debt and gives little information about techniques such as balance transfers. I agree that a bank loan has some merit, but it has one major downside: You are trading unsecured debt for secured debt — probably your house! (What else do you have to offer as collateral for a loan of any size?) If you default on credit card debt, bill collectors come after you. Not fun, but a lot better than having your house foreclosed on!
Finally, the book is tedious to read. The author takes way too long to make each point. Part of the problem is that he seems to be on a personal crusade against credit card debt. I agree whole-heartedly that credit card debt is a form of bondage and that the lenders are out to get as much as they can from you. However, from the title, one expects this to be a “how to” book, not a running editorial on the evils of the credit industry. Say it once, then get on with telling me “how to” — that’s what I bought the book for!
Rating: 1 / 5
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My recommendation — don’t buy this book. There are much better credit card debt reduction books out there.
First, some of what the author says is simply incorrect. For example, he claims that the “real” interest you pay is many times greater than the stated APR (for example, 12.9% is really 116%). He gets the higher rates by dividing the amount of interest in the minimum payment by the amount of your payment that goes to reduce your balance. An example from the book: You owe $5,000, your minimum monthly payment is $100, your interest/finance charge is $53.75, and $100-$53.75=$46.26 goes to reduce your balance. So the author claims you really paid $53.75/$46.26=116% in interest, ignoring the fact that the $53.75 was calculated on your outstanding balance of $5,000! If it were as the author suggests, then you could reduce your interest rate by simply paying more than the minimum. (Pay $200 in the example above, and the rate drops from 116% to 37%!) Paying more than the minimum will, of course, reduce the dollar amount of interest you pay over time, but it doesn’t change the rate which is based on what you owe — not what you pay.
Second, the author’s advice is incomplete. He favors using a bank loan to pay off credit card debt and gives little information about techniques such as balance transfers. I agree that a bank loan has some merit, but it has one major downside: You are trading unsecured debt for secured debt — probably your house! (What else do you have to offer as collateral for a loan of any size?) If you default on credit card debt, bill collectors come after you. Not fun, but a lot better than having your house foreclosed on!
Finally, the book is tedious to read. The author takes way too long to make each point. Part of the problem is that he seems to be on a personal crusade against credit card debt. I agree whole-heartedly that credit card debt is a form of bondage and that the lenders are out to get as much as they can from you. However, from the title, one expects this to be a “how to” book, not a running editorial on the evils of the credit industry. Say it once, then get on with telling me “how to” — that’s what I bought the book for!
Rating: 1 / 5