FPU Week 4: Dumping Debt

Lots to talk about and I'm behind, so let's kick it off:

Starting off with some statistics for 2009:

1.) Total amount of consumer debt in the United States stands at nearly $2.5 TRILLION dollars. That works out to be nearly $8,100 in debt for every man, woman and child that lives here in the US. We're talking about consumer credit - which does not include debt secured by real estate. So if you're thinking that number has mortgage values in it, it doesn't.
Roughly 36% of all consumer debt - as of November 2009 - of this type is what is termed revolving credit, which is defined as credit which is repeatedly available as periodic repayments are made. The most common type of revolving credit would be credit card debt.
The other 64% of that debt is derived from loans that are not revolving in nature. This type of debt would include automobile loans, student loans, and loans on boats, trailers or even vacations.

2.) The average new car loan is over $30,400.

3.) According to information gathered by the US Census bureau, there were approximately 173 million credit card holders in the United States in 2006 and that number is projected to grow to 181 million Americans by 2010. These same Americans own approximately 1.5 billion cards - an average of nearly nine credit cards issued per credit card holder.

4.) This data also tells us that Americans carried approximately $886 billion in credit card debt and that number is expected to grow to a projected $1.1 trillion by the year 2010. This works out to over $5,100 in credit card debt per cardholder (not household) and that number is expected to increase to over $6,500 by 2010.

Statistics courtesy of money-zine.com. Edited for space.

The sheer magnitude of these facts alone is enough to reject the entire notion of lending altogether. Have you looked at your recent credit statements?  Lenders are now required to show how long it would take to pay off your debt paying just the minimum payment.  I have a $1400 credit card debt that would take 17 YEARS to pay off using just the minimum payment.  Kudos to Congress and President Obama for getting that done!  That single revelation should be enough to get people "gazelle intense" about paying off their debt!

We have started to become "gazelle intense" on our debts.  We have sold some items on Ebay and Craigslist, and are putting that money towards our debt snowball.  My wife has resolved to pay off some 5 debt accounts by the end of this summer.  It is challenging yet encouraging.  I am so blessed to have a wonderful wife who supports me and our endeavor to become debt free!  She is the rock that keeps me sane.  I am most definitely the nerd and she is the free-spirit, though we both have cross-tendencies.  I can spend in a frenzy and she can be a tightwad...rarely.

NERD ALERT:  I have already begun budgeting for April.  I now LOVE getting bills in the mail before the month starts so we can map out our spending; it's like a game!  (We'll see how excited I am 16 months from now.)  Our debt snowball shows us being debt-free in 36 months, so we're going to have to keep up the momentum to get there.  I, personally, would like to beat that.