What is Credit Blur?
Several years ago I heard a speaker talk about what he called “Credit Blur” when a person becomes almost overwhelmed with their current financial situation, they don’t know how to beat it, so they simply ignore it. I actually think it does not have to be as dramatic as that – these days with the hectic lives that we lead, most people don’t really have a handle on their financial situation.
Some years back a friend of mine met with a couple who were worried about possible repossession of their home. When asked, “What is total amount of your current mortgage” the couple simply replied “£300 per month”. When asked “OK, so how much do you actually owe the building society?” they replied “£300 per month”. When my friends then shifted the question to “What is the current interest rate you are borrowing at, the reply was “£300 per month”. They had “credit blur” and simply knew only one thing – that the mortgage payments of £300 per month were crippling them.
Get Clarity
Most of us do it at some time or another – we spend and don’t always keep track of what we’ve spent and we don’t know whether we are paying too much interest on the money we have spent!!
A few questions for you:
What is the current limit on your credit cards?
What interest rate are you paying on purchases?
What interest rate are you paying on balance transfers?
What interest rate do you pay when you use a credit card cheque?
What is your annual fee on your card?
What is the total balance on all your cards?
It is very important that you know the answer to these questions. There are ways to make your money work very, very powerfully – and to make other peoples money work very powerfully.
Sometimes when I am teaching in a seminar I have people tell me they don’t use cards for instance – they want to avoid debt. I then ask them “What type of debt do you want to avoid?” You see, if you are trying to avoid GOOD debt – which can help you build wealth – then you are shooting yourself in the foot.
Remember – As Robert Kiyoaski (Rich Dad Poor Dad) says, GOOD debt is one of the ways the wealthy become wealthier.
Keep your eyes on my website: www.rohanlive.com
