Using the last option, you have to be vigilant to put that money you’re not spending on the basics towards paying off the high interest debt. I’ve seen people start to spend that cash and not make as big of payments to tackle the high interest loan. A year or 15 months later they haven’t paid off the high interest debt and the 0% is about to roll into high interest on the good size balance accumulated over the last 15 month.

@hanwagu9967

Жыл бұрын

yeah, if people had the discipline already this wouldn't be an issue.

@tylerowens2192

Жыл бұрын

@@hanwagu9967 agreed

Fantastic video! New subscriber!

New subscriber here! thank you for these videos.

Love these balance transfer videos! I have never needed one in the past until this past year...I rarely have debt but this past year my 3 teens had expensive car issues within a 3 month period and I didn't want to take money out of my emergency fund. I used my HELOC to pay for the repairs then transferred the 3k balance to my Navy Federal Platinum card with zero balance transfer fee. It's currently at 0.89% interest for 12 months. I have a 20k limit so it doesn't affect my utilization. I won't spend on that card just use it for this sole purpose. Now I'm building a sinking fund for extra car expenses. 😀

@rob_berger

Жыл бұрын

We did something similar back in the day. We didn't have credit card debt from everyday spending. But we used 0% credit cards to pay off other types of debts, like a HELOC.

@ceciliaruns72

Жыл бұрын

@@rob_berger I hope to get to the point where I never need to cover unexpected expenses with loans and zero percent credit, but it's a good option in the meantime! Thanks for the great info!

@hanwagu9967

Жыл бұрын

why do you have an emergency fund if you aren't going to use it for the emergencies you had? Instead of using your EF, you took on debt from HELOC then xferred to NFCU with .89% for 12 month.

@hanwagu9967

Жыл бұрын

@@rob_berger back in the day🤣 it was so much easier back in the day as you stated, because no BT fees. I blame all the credit card abritragers (was I one of them?) back in the day for credit card companies changing course; however, even with 3-5% BT fee now, that is much better than the 19-30% compounded daily at least for the short term if you are able to pay off within the 15-18month intro period.

@ceciliaruns72

Жыл бұрын

@@hanwagu9967 I had just purchased my daughter's 1st car in cash for 7k which ended up having multiple issues, I ended up spending 12k total on it in a year. At the time when all the cars needed work, I only had 6k in my emergency fund which would have left me with 2k if I had paid for all the car repairs. As a single mom of 4, that puts me in a very vulnerable position with a large house payment and lots of expenses. I chose to utilize credit to preserve my emergency fund in case of job loss.

Just don't charge anything on the balance transfer card. My bank charged interest on the purchases, lesson learned the hard way.

This video came 2 week late for me... just got a discover card for BT to pay off my car loan which is at 9%. Just got the loan started at the end of dec22. Hope to pay off within the month with a 18month BT.

@hanwagu9967

Жыл бұрын

yeah, you might want to check Discovercard's cash-like transaction category. Sounds like a cash-like transaction to pay off your car loan, which may not qualify for 0% BT. I suppose you'll find out on your first bill.

Hi Rob and thank you for the video and for all the hard work you do. I want to ask for your advice on my credit card debt; I owe $17,000 on one card and $700 on another card. I make $18 an hour working full time. I have no kids, pay $580 in rent, $70 on my phone, and usually about $100 in gas every two weeks. My highest debt is with the BankAmericard Rewards Visa Signature (current minimum monthly payment is $330 and the interest is 11.5%) and the lower debt card is with American Express. What would you suggest for me? Thanks again and I hope you're doing good.

Is there a card that I could take out that would let me transfer my sisters credit balance to my card? My credit is great.

Rob, love your videos. I have to say there are a number of topics that your perspective has really proved useful. Many, many thanks. Were you in the USMC? I seem to remember seeing you with a cap, maybe. If so, Semper Fi. I have a question....I use or have reviewed lots of tools that you have covered. (I personally use New Retirement now as my main planner after seeing your review. I love it, I'm in retirement so it's really useful.) My question - do you know a tool (e.g. Excel) that is available for tracking income so I can see where I stand in a current year relative to; tax ranges, IRMAA ranges, potential NITT tax...things like that. A tool which would show your MAGI for IRMAA consideration, how much capital gains is potentially subject to NITT, what range the next marginal dollar of tax will fall... I'm sure you know my situation, I am early in retirement and trying to max out Roth conversions while not running afoul of other items. I have a really interesting tax situation if you care to hear the details I can send them, but, in summary - I have run MANY scenarios to see what is the lowest, lifetime taxes paid projection I can hit. At the moment, for my wife and I the best scenario is to convert the Roth's completely or nearly through 2025. This does mean hitting the 32% range. The difference between two other scenarios is not much but I am leaning towards doing more soon as the market is down and conversion is at a discount. Again, many thanks.

@jackcapone4375

Жыл бұрын

@ʀᴏʙ ʙᴇʀɢᴇʀ Sorry, Rob, what does that mean 'write me with the line...?" I tried calling it, no answer.

@noreenn6976

Жыл бұрын

@@jackcapone4375 Rob will not ask you to call him, we're having issues with spam comments in the chat asking people to call a bogus phone number, this is not Rob posting that number, please disregard that phone number

any cards with no transfer fee? I know that Navy Federal Credit union offer no transfer fee and first year is like 1% interest fee

Is capital return bad?

Can you talk about ETF EQQR for rising rates for this year? or is it to late? JP Morgan told me to move 1/4 of my equities into this for 9 months? Wanted to get your opinion

Rob sir.. please give us your home office tour for a change 😀

One question, we dont usually use Credit Cards in Europe (at least not in Spain) we use Debit cards most of the time, why so many people use Credit Cards in USA?

@user_namehere

Жыл бұрын

Good question, I honestly have no clue. In America there's a lot of advertisement for you to get credit cards and purchase things with a payment plan. I guess it's a way to trick people into buying more stuff because "it's just $20 a month". If I had to guess, the majority of Americans are not taught how to use a credit card properly especially a lot of the middle and lower class. I think that's what really gets people in a bind with debt.

@chadwickwood9843

Жыл бұрын

I use a credit card primarily because of the grace period (between purchase and paying the statement) , the cash back/points and because fraud protections are generally better. I do pay the balance in full each month. Not a good idea to carry a balance.

@bridgecross

Жыл бұрын

Both credit and debit cards have fraud protections, but credit card protections are a little stronger. Fraudulent charges on credit cards can be reversed. For debit cards, the funds are withdrawn directly from an account and if you wait too long you're out of luck. Catch it within 2 days and you're out 50 bucks, up to one month and you're out $500, after that the money is just gone.

@rapfreak7797

Жыл бұрын

@@chadwickwood9843 same here. I would guess most viewers of this channel do that as well.

@KneelB4NoMan

Жыл бұрын

Because many Americans suffer from “Veruca Salt Syndrome”, and live for Instant Gratification. Our schools don’t properly teach money management or consequences of debt, and unfortunately this ignorance is passed down through the Generations.

I think the strategy you posed is a bad one. The strategy of making purchases on the 0% purchases card for x months seems ok in theory; however, let's be really honest here: if you can't afford to wind down the debt you are carrying on the high interest card, then how are you going to afford payments for both cards to pay off the high interest card, especially before the 0% BT ends? Each credit card will have a higher minimum payment than if it was minimum payment on just one card, so you are gonna have to come up with more each month, which if you had you would be winding down your high rate card in the first place. Plus, why are you charging stuff rather than paying cash/debit card? The cash back and points argument is a false one, because cash back and points are designed to get you to spend more, and there are plenty of studies which prove you spend more chasing points and cash back. What will invariably happen is that you will max out the 0% intro card and be stuck carrying debt on both cards at high rates after the intro period. You are better off simply doing the 0% balance transfer taking the 3-5% hit, which is much lower than the 19-30% interest. You definitely need to read the fine print on how payments are directed, etc. The 0% balance transfers that don't have 0% purchases, which means that only BT is 0% and the purchases will be charged interest right away. Folks should also note that credit card issuers have expanded the cash-like charges category, which could make 0% purchases not 0%. The only reason to do a 0% BT is giving you BT period of 0% if you are able to pay off in that time and not tempted to run up more debt. Take the 5% hit which is far less than the 18-30%, but it's a 5% on top of 18-30% if you don't pay off in the BT period. Other options is use credit counseling service to take short term credit hit until you can pay off debt at 0% to low rate negotiated by consumer credit counseling.

@noreenn6976

Жыл бұрын

I used Rob's strategy when paying down debt. Transferred my CC balance to a 0% BT card, it saved me lots of money each month that I used to pay down my debt even faster. I stopped using any CC during my getting out of debt period. I paid down the debt before the 0% BT expired. This method can be used to successfully pay down debt.

@hanwagu9967

Жыл бұрын

@@noreenn6976 i believe Rob's strategy in the video was to start charging on the new CC with 0% purchase period. I wrote that it is probably better to just take the 3-5% BT hit which is far lower than the cc interest, because if you could afford larger payments that carrying two credit cards will require, then you'd already be winding down your cc debt to begin with and there wouldn't be temptation to fall behind on both cards. I also wrote that it may be better, especially if you are going to stop using cc during the period of debt payoff, to go with consumer credit counseling, which will prevent you from getting new debt and ccc will negotiate lower to 0% rates until the cc is paid back. Once you pay off debt and disenroll from ccc, then your credit report will no longer have you being enrolled in ccc and you can go on from there.

Please stop promoting credit cards - you are charged 3% at the restaurant, for example, and you get back 2%. Always use cash when possible

@chadwickwood9843

Жыл бұрын

What are you saying? The restaurants I go to charge the same price regardless if I use a card or pay cash. Are you talking about the fee the restaurant pays to the processor?

@kinpatu

Жыл бұрын

Very rare to find a restaurant in the US at least that gives a discount for cash payments. Anyway, no one with debt should be eating at a restaurant. Ever.

@bridgecross

Жыл бұрын

The only vendors I see consistently charging different prices for cash or credit are gas stations.

@aaront936

Жыл бұрын

If you're only getting back 2% at restaurants you need a better card.

@hanwagu9967

Жыл бұрын

@@chadwickwood9843 don't know what scott is talking about specifically, but you are in fact going to pay the credit card transaction costs because businesses pass that along to the consumer in their prices.

Found this video really interesting since am in credit card debt myself. Also, was wondering if you ever made a video talking about front-end load mutual funds. Came across FKINX today. Seems to say it has a 0.61% expense ration and also has a 3.75% front end load. This seems really expensive compared to most actively managed funds but I’m wondering if I’m reading the numbers wrong.

chase slate and boa americard are bal xfer cards that sometimes run bonus' of 0% fee bal xfers with 12-16mo 0% interest. back a few years ago I was able to use the BOA americard to xfer my student loans (unique to this card i think), to the card limit, and then xfer that bal to the slate card, and repeat until all the cards were full. doing this trick of linking 2 bal xfer 0% fee cards, i was able to transfer about 16k worth of student loans @6.7% interest and save about 1400$ in interest payments. 700$/card is a lot better value when compaired to other signup bonus cards, and these were kind of low value cards I never would have gotten anyways. good video, bal xfer game is dangerous though, like lighting a fire to stop a forest fire. one downside is that now i get relentless offers in the mail for other bal xfer cards coz im probably in that "HENRY" catagorized list of consumers who are bad with money. edit: as I was doing this trick, the 60-120 day signup bonus period ended up being the limiting factor for how much loans I could arbitrage, since each transfer took about 7 buisness days (1.5 weeks). I was able to transfer around credit limits from my other chase cards to get a high limit for the slate card which is why this worked for me. later after about a yr of inactivity I was able to product change both of these useless cards to more valuable ones, the BOA card actually gave me a signup bonus for product changing which was unexpected.