Page 56 - Workbook1E

Follow along with each of Erik and Tracy’s entries and see how to record information about your creditors.
1. The first creditor they listed was an Airline Visa for $1,572 at 17.99% interest for a vacation they took to Florida. It wasn’t their smallest debt, but because of the larger minimum payment of $200, it would pay off the fastest in 9 months.
2. A Blue Mastercard used for holiday expenses and to buy Christmas presents was next for $2,124 at 17% interest and a minimum payment of $148. They’d make payments for 17 more months and Christmas would come around again before this debt would be paid off.
3. They listed Erik’s Student Loan next for $1,564 at 4.22% interest and payments of $95 after the Mastercard, even though it had the same number of 17 payments left and a lower balance because the Student Loan had a much lower interest rate.
4. A store credit card at Ace Furniture for $2,372 at a high 21% interest they used to buy furniture and appliances was next. There were 31 more payments of $100 due before this debt was eliminated. They decided to cut up the card so they wouldn’t be tempted to use it again.
5. City Mastercard used for a variety of purchases was next for $2,879 at 19.99% interest. The payments of $100 would go on for 40 more months before it would be paid off.
6. Another widely used credit card, Capitol Visa was next for $2,060 at 14.9% interest. It would require 46 payments of $60 to eliminate this debt.
7. Next was a credit card at a large Department Store for $1,000 at 21%. The payment was $30 and would continue for 51 more months.
8. Erik’s Compact Car loan was next for $15,153 at 7.2% interest. The payments were $325 and would need to be made for 55 months to pay off the loan.
9. Then Tracy’s new van for $34,340 at 8% interest was next. With monthly payments of $635, it would take 68 months to pay this debt off.
10. U.S. Express was listed next at $1,672 and 12.75% interest because at low payments of $35, it required 68 months to eliminate. They had used the money to redecorate their bedroom.
52 Workbook 1: Building a Spending Plan that Works