Advice on How to be Debt Free for Life

In a review of the book "Debt Free for Life: The Finish Rich Plan for Financial Freedom," Tara-Nichole Nelson of Inman News says that author, David Bach, gives mostly well-worn advice around the evils of credit card debt and not spending what you don't have. David Bach is the best-selling author of eight "Finish Rich" books.
photo credit: shehan365

Bach, however, does offer a new twist on becoming debt free by providing a structured plan to follow. Bach's book outlines the plan and he offers an online Debt Wise Program (free for a month) to help you learn how to manage your debts. The program has you enter all your debts and it gives you a monthly plan to pay it off and a target date for being debt free. His plan works with the credit bureau, Equifax and allows you to monitor your credit score on a quarterly basis.

Nelson feels that the plan is good but she says, "It is a fairly simple endeavor to set up your own debt payment plan and track your progress, gratis. You can even do it online for free through sites like Mint.com, which will both give you the plan and also link directly to all your credit cards and track both your spending and your debt elimination progress automatically. And it's free! (But I said that already)."

She also says that your credit score doesn't change very much quarterly but you can monitor it for free, 3 times a year, from the government mandated site, AnnualCreditReport.com, by ordering a report from one credit bureau every 4 months.

The book provides the formula for the Debt Wise "Fast Pay" system, which Bach calls "Done on Last Payment" (DOLP) "The idea is extremely similar to the plans espoused by nearly every money expert, where you pay the minimum payment on all your cards every month, but double or triple up -- dumping as much disposable income as possible -- on the card with the highest interest rate or highest balance or, in Bach's version, highest "DOLP" number -- a ratio of balance owed to minimum payment." says Nelson.

Bach also emphasizes paying off your credit cards that require the fewest payments, first. Nelson adds, "Every time a card is paid off, the cash that was going toward that monthly payment is added to the account with the next-lowest DOLP number. As I see it, any of these programs will work well for a motivated debt-eliminator."

Bach's book offers the structure for those who have resolved to get out of debt in 2011. He offers tips on all types of debt including student loans and how bankruptcy and credit counseling can help.

To read the full story, go to Inman News.

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Posted on January 27, 2011 11:44:31 by Blog Author