I am a regular user of Mary Hunt’s Rapid Debt Repayment Calculators on her website for my own finances and for those of my clients. Last night I was working with the RDRC and I saw something for the first time in all my many years of using Mary’s calculators for their intended purpose, finding the fastest and/or cheapest way to repay unsecured debt . When I put in some figures, the website flashed up a warning in red. According to our calculations, this debt can never be repaid.
At first I thought it was an error, but I checked and I had input the figures correctly. What it means is that although some of the other debts would take a very long time indeed to be repaid if only using the minimum repayment, there were two in the list I was processing which, with their current minimum payments, would never be repaid, could never be repaid. They were designed to keep the borrower in perpetual debt.
Now there’s a sobering thought. I’m not going to offer any explanations of why that might be. I shall leave you to draw your own conclusions. The answer was simple enough, increase the monthly repayment by a few pounds and set it on a fixed standing order and you dent the debt relatively quickly. Continue with the current recommended minimum “‘falling” repayment and you remain in debt until you die. You can never be free.
“Falling” repayment means the monthly amount gets smaller as the debt shrinks relatively slowly. Mary recommends we set a fixed repayment at the monthly repayment rate we are affording now. Then, as the debt gets smaller, the monthly payment goes further and further each month to repay the debt and repayment starts to accelerate startlingly in our favour. It’s the difference between being out of debt in 3-5 years and never ever ever being out of debt.
Check out the Rapid Debt Repayment Calculators on Mary Hunt’s Website Debt Proof Living. There is a small charge but the value is way beyond the price.