How to get completely out of debt including your mortgage in less than five years, without having to make extra money!!! : LUSENET : TimeBomb 2000 (Y2000) Preparation Forum : One Thread


All Americans get into debt as soon as they graduate from High school when they purchase their first car. Since they live with their parents and basically have no living expenses, quite often they drive a fancier car than their parents. Then as time goes on, they purchase a few more things on time, and before you know it they are deep in debt. Then they get married and buy a home.

Presently a good basic beginner home costs around $150,000. When you borrow that amount, in 30 years you pay back to the bank at least $450,000. So $300,000 you pay out in interest, if you pay for 30 years. During a lifetime of buying everything on time, Visa Cards, cars, furniture, carpeting, appliances, piano, sprinkling system, boat, motorcycles, loans for College education for your children, loans to pay for their weddings, etc. etc. etc, you can add another $200,000 in interest. That is a total of a half million dollars paid in interest during a lifetime!!!

Can you figure how many years you have to work for a half million dollars??? Does that not blow your mind? That is what youve been doing all these years! You must put a stop to living like that, otherwise you will retire totally broke! Can you see now how rediculous it is to get into debt in the first place? Can you see now that being in debt all your life, you make the Banks rich, and this strategy will keep you poor for the rest of your life? Would it not be much better to try and live your life in such a way, so you could cut that half million in interest into only $100,000 or less during a lifetime?

I understand there are some things you must pay on time, like a home. But to pay for it for 30 years is totally stupid! But almost 100% of Americans do that! And the bankers love their stupidity! Americans just dont know they are stupid. They have heard about plans to pay off a home faster by paying extra principal, but they are so deep in debt, they never get around to setting up a plan to pay off their home sooner. Does that sound familliar? The things that matter most like personal financial freedom is not being taught in the High schools. Most things you learn in High school you never use in everyday life. Children grow up seeing their parents buy everything on time, so they just copy them and do the same thing! Then as they grow up, their children do the same thing!

There is another way to live your life and that is what this information is all about, so lets get into the nitty gritty right now. You have to have a plan and then stick to that plan. I will teach you a System, that will get you totally out of debt in about five years or less, including your mortgage. Then when you are totally out of debt, use that two or three thousand dollars extra per month and invest it wisely every month to create wealth. You could buy rental property.

The first thing we did was buy a small home in a small town for only $21,000 and we paid cash. You can get some real deals in small towns. Now I rent out that home for $650 per month and the rent paid back my original investment in about three years. Now we receive $650 per month for life! And that amount will increase with inflation! That was a very good investment. We now are looking for more deals like that.

First things first. You have to take a serious look at your payments and bills situation and see where you can cut corners immediately. Most Americans buy new cars every few years. Bad financial strategy. That must stop if you want to become financially independant. My wife and I both drive ten year old cars.

They are both Ford Probes. Excellent cars and very stylish looking. Quite often people think they are new cars. In fact they both have about 180 thousand miles on them. They are excellent transportation and nothing to be ashamed about. If you are driving fairly new cars, you must sell them and trade down. You can buy a very nice car about 3 to 5 years old for three to four thousand dollars. Always buy from a private party. In the nineteen sixtys and seventys a car with sixty thousand miles was considered junk. Now cars last much longer. Find a car with about sixty thousand miles on it and you save big bucks!

Then look at other things that are luxuries which you really dont need and hardly ever use. Just get rid of them and sell them. There, now that is a start to financial freedom. But you have a long way to go. Now sit down with your spouse at your kitchen table and go through your monthly bills and write them all down. Do not include utilities like electricity and water, etc. Those you cannot do anything about. Now rearrange those bills with the smallest bill with the lowest payment on top and the largest bill on the bottom, which will be your home mortgage. I will make some assumptions and write down on the next page a possible scenario of payments, so youll understand how this this System works.

Sears. $200 balance.............$50 per month.

Piano. $500 balance............ $100 per month.

Visa #1 $700 balance..............$100 per month.

Visa #2 $1350 balance.............$150 per month.

Car #1 $1800 balance.............$200 per month.

Car #2 $2400 balance.............$300 per month.

Loan #1 $4400 balance..............$400 per month.

Loan #2 $6000 balance..............$500 per month.

Mortgage $83,700 balance.............$700 per month.

Total debt $101,050. Payments $2500 per month.

This is what you do. This is a plan of attack. You MUST do this, or you will be in debt for the rest of your life! Pay the bankers all your life and you will eventually retire poor! Try to live more frugal, so you will have some extra money left over at the end of the month. Lets assume you can scrape together $200 extra per month that you usually would just squander on junk.

You take that $200 and immediately pay off Sears.

Now you have $200 plus the $50 Sears payment to attack the piano bill. That is $250. You pay the piano off in two months.

Now you have $350 per month to attack visa # 1. You pay that off in two months.

Now you have $450 extra to pay off Visa #2. You pay that off in three months.

Now you have $600 extra to pay off Car #1. You pay that off in three months.

Now you have $800 extra to pay off Car #2. You pay that off in three months.

Now you have $1100 extra to pay off Loan #1. You pay that off in four months.

Now you have $1500 extra to pay off Loan #2. You pay that off in four months.

It took only 22 months to pay off all your bills, except your mortgage. Now it is time to attack your mortgage with all you've got!

Now you have $2000 extra plus the $700 per month house payment which is $2700 per month to attack your mortgage balance. You can now pay $32,400 per year on your mortgage!

You will have to consider the amount of interest. However, that amount per month will dwindle down very fast as you continue attacking your mortgage balance. Simply add up all the months and you can see that with this scenario, you would wipe out a $100,000 debt in less than 5 years!

You will have a set back once in a while, like if you need a new washing machine, etc. Simply pay cash and continue your attack. Follow this System and you will save several hundred thousand dollars in a lifetime! This is money that you now can use to invest for your retirement! Good luck, and I know you can do it, because weve done it. May the force be with you!

-- freddie (, February 01, 2000


This is the best info you've ever read about getting out of debt. I urge you to print it up and mail copies to all your friends and relatives. Also email to your friends. Good luck!

-- freddie (, February 01, 2000.

Many books have come out in the last few years with this threadline as their subject.

"The Richest Man in Babylon" (1926) "The Tightwad Gazette" (1987, etc) "Your Money or Your Life" (1990) "The Simple Life" by Roth

It works. I'm at age 44 and I'll own my home this year.

It's scary how we're all being "farmed" by the powers that be. Our entire society including the newspapers, television, the internet, the banks, insurance, medical practice, energy sources, taxes, environmental laws are now all "fences" to keep the "herds" in place.

Perhaps this is as it always was. If it isn't a feudal lord or a priest overseeing the "masses," it's a strong armed "bully" or an "entreprenaur" (or conceiveably a computer geek!)

Meanwhile, we "serfs" have to do the best we can to get out from underneath.

Best regards,

-- Joe (, February 01, 2000.

Boy - do I agree with all this.....I have always paid off my credit card on a monthly basis.....

I have been fortunate to have a good paying job for about the past 5 years - I paid off my car/other loans the first year and started making a few extra house payments...After the first year, I accelerated making extra house payments (kept thinking of all the interest I was saving).......When y2k came on the horizen I REALLY started accelerating house payments - (paid off my $124000 mortgage last January).......I didn't want a y2k depression causing me hardship.

I'll tell you - having no debt is great! Now I can really save for a rainy day...My job is fizzling out now - so I can really not worry too much as I can live very cheaply on a month-month basis.

-- mmmm (, February 01, 2000.

Freddie, great post! I'm surprised that there haven't been any rebuttals, though, as a lot of people I know always seem to have a "ya but" type of reason for why they "can't" get out of debt. Some of them actually CAN'T, because they are so far in debt that they are borrowing more and more each month just to pay off their bills, as their bills are more than their income. It's true! I guess they are either going to have to miraculously find a much better paying job, or end up going bakrupt.

I followed your method, insofar as staying away from credit as much as possible. But MY parents drilled it into me that credit was BAD and to be AVOIDED, from the time I was old enough to know what credit was. So I didn't ever have all these credit bills to pay off. The only thing I've EVER gotten a loan for is real estate.

In 1977 I bought a piece of land for $16,500. It had a spring and a creek, so i didn't have to drill a well. I built my own septic system. I built a one room cabin with a porch and a sleeping loft for about $2000. Very basic. And I sort of forgot to get a building permit. Bad. Very bad. But now it's been over 20 years, and the house is legal (20 year statute of limitations on building permits here in Oregon) I should feel guilty. I don't.

I made $125 per month payments on the land until it was paid off after 12 years. I paid cash for the cabin. I paid cash for the four or five additions I built onto the cabin. I SAVED my money until I could AFFORD to do the additions. I had the land paid off when I was thity- four years old. Meanwhile, I'd been able to put the money I WOULD have been paying into a big home loan into real estate. I have now built a new, larger, fancier house for myself and my family, plus three rentals, all paid for in cash. The rental income will be our main income after we retire. I plan to build maybe two more rentals in the next few years, if my back holds out.

Folks, it really can work. Don't be a slave to materialism and to the bankers. Set yourselves free. Buy what you can afford. Don't buy what you don't need. Pay into a savings account for your future house or land BEFORE you pay buy all the other stuff you think you need each month.

It works!

-- jumpoff joe a.k.a. Al K. Lloyd (, February 01, 2000.

Good for you in not getting a building permit. We Americans can only be a free people if we say "screw the permits!" I have been in business for my self for over 40 years. Still don't have a business license! If you want to be free, you have to make yourself free!!!

-- kww (, February 01, 2000.

One way to keep out of debt is to live below your means. Do not even try to keep up with the Jones. Our motto is "If you can't pay cash for it, you can't afford it". We keep the old car going and save the money in the bank to buy a replacement when necessary. We pay all credit cards every month in full. We paid cash for our small house. Do not impulse buy. Research before buying big ticket items. Ask yourself "Do I really need this? Can I live without it?" Plan ahead.

-- Homeschooling Grandma (, February 01, 2000.


Excellent post. Excellent advise, which I would follow to the letter, except I am married to a spouse who has a "money is to spend" attitude.

I'll come home to find she's squandered several hundred dollars on fancy clothes for the kids, decorations for the house ...junk! Now, I don't want to get a divorce, talking doesn't help (we won't agree), so I have a dilemma.

Does anyone else have good strategies for dragging a reluctant spouse along with this idea?

-- No Polly (, February 04, 2000.

No Polly, the only solution I can see for this is to have separate money. You save yours, she spends hers. Then she CAN'T spend YOURS.

My wife isn't exactly a spendthrift, but she sure likes to spend it on things I don't see buying. Fortunately, she earns a lot more money than I do, so I can't say much, I guess.

-- jumpoff joe a.k.a. Al K. Lloyd (, February 04, 2000.


Good advice! Do you mind if I put this in a small community newsletter? There are lot's of people out there who need to read this.


-- Mabel Dodge (, February 06, 2000.

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