Getting back to zero

That big check I sent off for the car payment hasn't show up as "cashed" yet on my eBanking account. I half-expected this to happen because whenever you send large checks, banks will wait several days for it to "clear". Hopefully it will clear soon and then I can get on with paying off the credit card, and then (insert dramatic music here) I will finally be back at "zero" again. Trust me, this is a good thing.

Everyone I know is in some sort of debt, be it a mortgage, credit card(s), car(s) or whatever it is. No one I know has small debts or is anywhere near "being at zero". Usually, the average debt I see for my age group (27 to 32-ish) is somewhere between $25000 and $45000 or more - not including any medical stuff which will add a few ten thousand more.

I got a few friends who have "consolidated" bills. Personally I think the consolidation thing is a stupid idea. Don't know what it is? This is what it is in a nutshell:

Take all your bills, and get a debt consolidation loan that 'pays' all those bills, then pay back the loan. The monthly payment for the loan is smaller than all the bills combined you were paying previously.

I said this was a bad idea. This is why:

Consolidation doesn't mean you "paid off" anything at all. It just means you handed the bill to someone else and now you're paying them.
In most instances, it will take you longer to pay off the consolidation loan than it did to just pay off your bills "the normal way" in the first place.
Because it takes you longer to pay off a consolidation loan - you are literally wizzing money away. Most people who have get these loans have no credit and get socked with a wicked high interest rate. They have to deal with it because of their sucky credit.

My advice to anyone who's got bills: Pay them off the traditional way, don't get caught in the "miracle cure" of a debt consolidation loan because it's not a miracle. It's just a way for other companies to take your money.

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Getting back to zero

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