She Did, Too! $28,000+ In Credit Card Debt Pays Off Within 6 Months
Summary
TLDRIn this finance tutorial, Christy van from Fantastic Finances shares a strategy to quickly eliminate credit card debt. The case study involves an author with fluctuating income who consolidates her debt using a personal line of credit, reducing her monthly payments and focusing on paying off the principal. By strategically managing her cash flow and minimizing interest payments, she successfully clears nearly $330,000 in debt within six months, highlighting the power of financial planning and debt management.
Takeaways
- 😀 The video is about a financial advice channel by Christy van, focusing on managing and reducing credit card debt.
- 📚 The scenario involves an author with fluctuating income, averaging at $9,000 a month, and significant credit card debt.
- 💳 The author has four credit cards with various balances and monthly payments, totaling $1,900 in debt payments.
- 💼 The author's monthly expenses, including rent, are $2,772, leaving her with approximately $4,300 in cash flow.
- 🏦 Christy suggests using a personal line of credit to consolidate the credit card debt, which would free up cash flow and reduce interest payments.
- 🔢 The author is advised to start by consolidating two Capital One cards and part of the Chase card, totaling $9,677.
- 💰 By transferring income into the line of credit, the author satisfies the monthly payment, reducing the balance and freeing up cash flow.
- 📈 The strategy involves gradually paying down the Chase card and then focusing on the Discover card, reducing the overall debt balance each month.
- 🚀 The author is projected to eliminate almost $30,000 in debt within six months by strategically managing her finances and using a line of credit.
- 💡 The video emphasizes the importance of eliminating high-interest credit card payments and using cash flow to reduce debt more efficiently.
- 🌟 Christy encourages viewers to learn financial strategies to save on interest and invest in their future, rather than paying banks.
Q & A
What is the main topic of the video?
-The main topic of the video is about managing credit card debt and using a personal line of credit to consolidate and pay off debt more efficiently.
Who is the author of the video script?
-The author of the video script is Christy Van, who hosts the channel 'Fantastic Finances'.
What is the average monthly income of the author mentioned in the script?
-The author's average monthly income is stated to be $9,000, though it can vary between $7,000 and $177,000.
How many credit cards does the author mention in the script?
-The author mentions four credit cards in total: one Chase, one Discover, and two Capital One cards.
What is the strategy used in the script to manage the credit card debts?
-The strategy involves obtaining a personal line of credit, transferring the credit card balances to it, and then using the author's income to pay down the balance and reduce interest payments.
What is the total amount of credit card debt the author initially has?
-The total initial credit card debt is the sum of the Chase card at $14,437, Discover at $7,710, and two Capital One cards at $5,459 and $3,118, which amounts to approximately $30,724.
What is the approximate monthly cash flow the author has after expenses and debt payments?
-After expenses and debt payments, the author has approximately $4,300 in monthly cash flow.
How much interest would be charged monthly on the line of credit with an 11% interest rate, based on the highest balance?
-Based on the highest balance of $9,677, the interest charged would be approximately $89 per month, but this is an estimate as the actual interest would be calculated on the average daily balance.
What is the final balance on the Chase account after the author's strategy is implemented?
-After implementing the strategy, the final balance on the Chase account is reduced to zero.
How does the author suggest using the freed-up cash flow after eliminating the credit card debts?
-The author suggests using the freed-up cash flow to revolve expenses and save for future purchases or investments.
What is the author's advice for those struggling with credit card debt payments?
-The author advises to stop making high-interest credit card payments and instead use a personal line of credit to consolidate and reduce the debt more strategically.
Outlines
💳 Debt Consolidation Strategy for an Author
Christy van from Fantastic Finances introduces a financial scenario involving an author with fluctuating income and significant credit card debt. The author's average monthly income is estimated at $9,000, with expenses totaling $2,772, leaving a cash flow of approximately $4,300. The author's debts include four credit cards with varying balances and monthly payments. Christy suggests using the author's good credit score to secure a personal line of credit to consolidate and pay off the credit card debts more efficiently. The strategy involves transferring balances from the credit cards to the line of credit, which has a lower interest rate and no monthly payments, thereby freeing up cash flow and accelerating debt repayment. The plan is executed by first addressing the Capital One cards and then the Chase account, with the author's income being used to satisfy monthly payments and reduce the line of credit balance. By the end of the first month, the author's debt payments are significantly reduced, and the process continues with the aim of eliminating all credit card debt within a few months.
🚀 Eliminating Debt in Six Months Through Financial Restructuring
In the second paragraph, Christy van continues to detail the debt elimination strategy, focusing on the author's journey to becoming debt-free within six months. The author manages to consolidate her debts into a single line of credit with a lower interest rate, which allows her to allocate more funds towards debt repayment each month. By strategically using her income and expenses, she is able to pay off the Capital One and Chase credit cards, followed by the Discover account. The author's disciplined approach to managing her finances, including the elimination of unnecessary monthly payments, results in a significant reduction of her overall debt. Christy emphasizes the importance of using lines of credit wisely to avoid the trap of high-interest credit card payments. She encourages viewers to learn and apply these strategies to save on interest payments and gain control over their financial future. The video concludes with an invitation to join Christy's Facebook community for further support and resources, and a reminder of the benefits of using the Fetch app for earning points from receipts.
Mindmap
Keywords
💡Velocity Banking
💡Credit Card Debt
💡Averaged Income
💡Line of Credit
💡Cash Flow
💡Debt Consolidation
💡Interest Rate
💡Monthly Payments
💡Income
💡Expenses
💡Revolve
Highlights
Christy van from Fantastic Finances discusses a strategy for an author with credit card debt.
The author's average monthly income is estimated at $9,000, with potential fluctuations.
The author has four credit cards with varying balances and monthly payments.
Total monthly expenses, including rent, amount to $2,772.
With a good credit score, the author is eligible for a personal line of credit to consolidate debt.
A plan to transfer credit card balances to a line of credit is introduced to free up cash flow.
The first step is to consolidate two Capital One cards and part of the Chase card balance.
After transferring, the Chase card payment for the month is satisfied, freeing up $400.
The author's monthly cash flow is recalculated after debt consolidation.
Interest calculations for the line of credit are explained, considering the average daily balance.
Further payments are made to the Chase account, reducing the balance significantly.
By the third month, the Chase account is paid off, and additional funds are allocated to the Discover card.
The author's financial situation is reassessed, with no more monthly debt payments.
The final steps involve paying off the Discover card and managing the line of credit balance.
The author eliminates four credit cards and nearly $330,000 in debt within six months.
The importance of strategic financial management to save on interest payments is emphasized.
Christy encourages viewers to learn debt management strategies for long-term wealth building.
Invitation to join Christy's Facebook community for further support and giveaways.
Promotion of Fetch, an app that rewards users for snapping receipts, as a financial tool.
Christy shares her personal experience and confidence in overcoming financial challenges.
Transcripts
hello and welcome back to my channel I
am Christy van with fantastic finances
and on this channel I teach velocity
banking so today I'm going to go over a
scenario with an author who contacted me
and has some credit card debt that they
would really like to get rid of as
quickly as possible so due to she is an
author we kind of averaged her income
out at 9,000 a month now she can make as
low as 7,000 or as high as 177,000 but
we wanted to keep it on average so that
in the event she has a low month she may
be ahead on the previous month and it'll
all average out for her she currently
has four credit cards chase at
14437 with a $400 a month payment a
Discover at $ 77109 with a $200 payment
per month two Capital 1 cards one at $
5459 for $200 a month and then one at $
3118 for $1,100 a month now her expenses
do include her rent so the expenses are
listed up here at 27 72 and her debt
payments on these credit cards are
currently $1900 a month so adding her
expenses together taking it from the
$9,000 a month income means that she has
approximately $4,300 a month in cash
flow so her credit scores are really
good so she would be able to get at
least $10,000 in a personal line of
credit to use and transfer these cards
into it freeing up her cash flow Plus
getting her out of debt very quickly so
we're going to start with the Capital
One credit cards the $ 5459 and the 3118
totaling
8677 but we're going to add $11,000 of
this Chase account into here also
bringing her balance up to
9677 so of course that means her Chase
account is now
13437 and the credit card payment has
been made for this month due to she just
applied it as a $1,000 payment in month
one her income is going to go in and we
know that when you transfer your income
into your line of credit that satisfies
the monthly payment due that month so
she doesn't have a payment due on this
line of credit after the $9,000 is put
in her balance will be
$677 we're going to add in her expenses
now at $
2772 and her debt payments at $200 so
why did I just add $200 well we paid
$11,000 into the chase that eliminated
this $400 payment that month so we paid
off Capital One number one and cap one
number two which freed up these payments
is no longer due the only payment she
now has due is the Discover payment for
$200 adding in the expenses now brings
her up to
$3,649 we're going to add some interest
her interest rate is 11% so if you took
the high balance of the account at 9677
it would be about $89 a month but
remember on lines of credit the bank
takes the average daily balance so it's
not going to be $89 a month I'm just
doing that to leave room for air after
the interest is added in her balance
will be back up to
3738 so due to she has such good cash
flow we're going to add $6,000 more to
the Chase account meaning that her
balance now is
7437 on this account that brought her
line of credit balance back up to
$973 but in month two her income goes
again bringing that balance right back
down to
$738 so we're going to add back in her
expenses at $ 2972 now remember that's
the 2772 for her living expenses
including her rent and the $200 payment
that she owes on discover the Chase
payment was satisfied when we put the
income into the account so when you add
the interest in again off of the high
balance of 9738 that gives her
approximately a $90 interest rate charge
for this month bringing her balance to
$3,800 so with the $3800 still leaving
room for more of the Chase payment we're
going to add $6,000 more on onto the
Chase account which means that this 7437
is now
1437 bringing her balance back up to
9800 income for month three is going to
go in at $9,000 bringing her right back
down to
$800 her expenses at 2972 will come out
so will her interest at $91 off of the
high balance bringing her to a balance
of $
3863 what does that mean that means that
in month three she can pay off this
Chase account bringing it to a zero
balance and she can put $4,000 on to
discover so what did that do to the
Discover payment it satisfied it so that
$200 is no longer needed on the Discover
account so that brings her account back
up to
$9,300 and month four we're going to
take 9,000 in again bringing her balance
down to $300 adding in the expenses and
the interest again we at
$3160 now remember the expenses are down
to$ 2772 because that is her living
expenses including her rent so she no
longer has any monthly payments on debt
her balance would be 3160 we're going to
add 3109 to finish paying off this
Discover account right here so this
account is now gone too bringing her
balance up to
$626 and then what happens in month five
well month five her income that all she
can get in there is$
6269 that will pay this account
completely off and now she can use it to
revolve her expenses in and out of until
she decides there's something else that
she would like to buy So within 6 months
she has eliminated four credit cards and
almost $330,000 in debt in six months
just by rearranging her money a little
bit getting a line of credit that would
take over these credit cards giving her
a line to put everything into so that
she can just do her income in expenses
out working that balance down every
single month stopping the monthly
payments the credit card monthly pay
payments are ridiculous so if you are
stuck in making payments on credit cards
you are wasting your money so much of
your payment is going straight to
interest it could take you years maybe
decades to pay off a credit card they
set it up that way because they want you
paying the interest if you use your
credit cards correctly if you get lines
of credit and put your debt into those
lines where you have one line you're
eliminating all of the monthly payments
all of that is cash flow now going in to
work down the debt you're going to win
get strategic start putting your money
where it serves you and stop throwing it
away at these Banks and the interest
that you're paying such a waste you have
better priorities to be putting your
money towards and I hope that you will
learn the strategies so that you can
start saving the interest that you're
throwing away right now gaining wealth
for your future and helping your family
to get the things that they need thank
you so much for joining me today if you
have any question questions or comments
please leave them below I check out the
YouTube comments every day if you
haven't joined my Facebook private
Community please do so there's a link
below I sometimes have giveaways on
there giving away phone calls and stuff
and I'll be glad to have you join us if
you haven't joined fetch yet the link is
below remember fetch gives you points
for just snapping your receipts so that
has been a great asset to me just to
gain extra gift cards for just taking
pictures of my receipts strategize find
your way out of debt by just tweaking
your finances just a little bit where
there's a will there's a way and I know
that you can do it because I did it I
hope you guys have a terrific day and I
look forward to seeing you in the next
video
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