dave ramsey Flashcards

Terms Definitions
according to the wall street journal ______ of americans are living paycheck to paycheck
when it comes to debt if you tell a lie or spread a _____ long, enough, eventually it becomes accepted as the ____
debt has been ____ to us with such intensity for so long that to imagine living without it requires a complete _____ shift, a completely new way of looking at things
1910: in the sears catalog, credit card was called ____
Jc penny
_____ didnt believe in debt and would not allow credit to be given in his stores. It wasnt until after his death in 1971 that credit was widely accepted in ______ stores
Henry ford
_________ hated debt and would not offer credit on cars for 10 years after general motors began offering credit
frank mcnamara
established partenships with several new york city restraunts and his goal was to allow patrons the ability to pay for meals with a single payment card the first credit card
west coast bank of america issued a little piece of plastic called the bankamericard(____) to its customers later that year american express was born
1970: only _____ of american  owned credit cards
1, loan
2, destroyed
myth 1
Myth: if i _____ money to a friend or relative, i will be helping them
Truth: the relationship will be strained or ______
1. cosigning
2. repay
Myth; by ______ a loan, i am helping out a friend or relative
truth: the bank requires a cosigner becuase the person isnt likely to ____. be ready to pay the loan and have your credit damaged
cash advance
Myth 3
Myth: ________ _______ rent to own, title pawning , and tote the note lots are needed _______ for lower income people to help them get a head
truth: these are horrible greedy rip offs that arent needed and benefit no one but the owners of these companies
80% of ____ in america are first generation rich. that means they started out with nothing, did smart stuff, and become _____ thats the opposite of what were talking about here
playing lottery
myth 4
Myth: the _____ and other forms of gambling will make me ___
truth: the lottery is a ___ on the poor and on people who cant do math
texas tech university did a study on the texas lottery and found that people without a high school dimploma spent an average ____ a month playing the lottery.college graduates spen ____ a month on average
Myth 5
Myth: ___ payments are a way of life and youll always have one
Truth: staying away from car payments by driving reliable used cars is what the typical _______ does
that is how they became millionaires
the average car payment today is____ per month over 64 months
myth 6
myth: _____ you car is what sophisticated financial people do. you should always lease things that go down in value there are tax advantages
truth: consumer reports, smart money magazine and a good calculator will tell you that the car ____ is the most ___ way to finance and operate a vehicle
myth 7
myth: you can get a good deal on a ____ car
truth: a new car loses ___ of its value in the first four years this is the largest purchase most consumers make that goes down in value
myth 8
myth: ill take out a 30year mortgage pay ___
truth: life happens and something else will always seem more important. never take out more than a ___ year fixed mortgage
15 year mortgage
cheaper in long run to a ____
Myth 9
myth: its wise to take out an ___ or a ____ mortgage if " i know ill be moving
truth: you will be moving when they ___
The adjustable rate mortgage is here to keep the ___ from losing money it transfers the ____ of higher interest rates to you
credit card
myth 10
myth: you need a ______ to rent a car or make ____ online or by phone
truth: a ___ card does all that
credit card
myth 11
myth: i pay my ____ off every month with no annual payment or fee.  i get brownie points, airm miles and a free hat
truth: when you use cash instead of plastic you spend ____ less because spending cash hurts
myth 12
myth: ill make sure my ___ gets a credit card so he or she can learn to be responsible with money
truth: teens are a huge _____ of credit card companies today
myth 13
myth: the home equity loan is good for _______ and is a substitute for the emergency fund
truth: you dont go into ____ for emergencies
myth 14
myth: debt ____ saves interest and you get a smaller ____
truth: debt consolidaion is a _____
brand loyalty
you will stick to the same card forever
debt consolidation saves little or no ____ because you will throw you low interest loans into the deal
you cannot ___ your way out of debt
_______ payments equal more ___ in debt
myth 15
myth: debt is a ____ it should be used to create prosperity
truth: the________ is slave to the lender
when surveyed the forbes 400 were asked, what is the most important key to building wealth? ____ replied that becoming and staying ___ free was the nymber one key to wealth
quit ____ more _____!
you must ____ money
______ something
part time ___ or ____ (temporarily)
debt snowball
use the ______ _________
it is where you list all your debts to pay them off
gazelle intensity
technique of getting out of debt is -______________
buyer beware
"Caveat Emptor" means __________ _______________
companies use every angle to aggressively compete for your ______
1. personal selling
2. financing as a marketing tool
3. tv, radio, internet and other media
4. production positioning
four major ways
production postioning
brand recognition
shelf position
a "significant purchase" is normally anything over _______
significant purchase
our bodies go through physiological changes when making ___________
we all have that spoiled, red faced,grocery store kid living inside of us. his name is _____
power purchase
you can always spend more than you ____. You must develop ____ over ______ by following these steps
step 1
Wait ____ before making a purchase
consider your buying _____.
No amound of stuff equals _________ or fulfillment
step 3
never buy anything you do not ___________
opportunity cost
step 4
consider the "_______ _______" of your money
step 5
seek wise ____
( from spouse or if single accountability from someone else)
Food. clothing. shelter ( utlities). transportation
credit score
one more myth
myth:  you ned to take out a credit card or car loan to " build up your _________ _____."
truth: the _____ score is an "i love ____" score and is not a measure of winning financially
fair issac corporation
fico stands for ____ _____ _______
account information is removed from your credit score ___ years after the last activity on the accoun except for a chapter 7 bankrupty which stays on for __ years
beware of credit clean up scams. the only informationthat may be legally removed from credit report is ______ information
___ of those credit reports contained mistakes of some sort and ___ of them contained errors serious enough to result in the denial of credit
__ of the credit reports contained credit accounts that had been closed by the consumer but incorrectly remained listed as open
listed the same mortgage or loan twice
you should check your credit ______ which you can now do for free
experian, Transunion, and equifax
three credit bureaus
white collar
identity theft is the fastest growing ______ ______ crime in north america
fraund victim
place a ______ ______ alert on your credit bureau report ( stays on 90 days without a police report)
police report
get a _______ _______
80% of identities are stolen by people you know
remember this is _______. You owe ________ and should pay ________
fraud victim
contact the _____ ____ division of each creditor and furnish _________
Be _______ this will take some time. You know have a new _______
an updated vrsion of the 1977 Federal Fair Credit Reporting Act (FFCRA) requires a credit bureau to ____ all inaccuracies within ____ days of notification of such inaccuracies
write a seperate letter for each inaccuracy
staple a copy of your credit report to each letter
circle the account number
to clean your credit report of inaccurate information take the following steps
You should also request that inquiries be removed. all these letters should be sent _____ mail with return reciept requested to prove when they recieve the letter. If the credit bureau does not prove the accuracy of the account within __ days request that they remove the ____ account from your file
the best way to pay debt is with a ____
A collectors job is not to help your overall situation. His only job is to get your ________
collectors are trained _________ or ___________
They are typically low- paid positions with high _______
They are taught in their traning to evoke strong _____
your necessities
the way to counteract this technique is to ALWAYS pay _______ ________ first, and then you set the order of payment
________ a consumer law was passed by congress called the federal fair debt collection practices act (FFDCPA)
to protect you from unfair collectors. The law technically only applies to collection agencies ( not your creditor) but later court cases make most creditors also abide by the FFDCPA
The act states that ________ is illegal, and restricts a collectors call between the hours of ____ and _____ ( unless they have your permission)
certified mail
the act also allows you to demand that a creditor cease calling you at ____. You should request this in writting by ______ ____ with a return reciept requested
the act even allows you to insist that a creditor stop ____ contact except to notify you of ______ proceedings. This is called a cease and desist letter
no collector or creditor may _____ a bank account or _____ wages without proper and lengthy court action except in the case of delinquent IRS or student loan debt. All such threats are a bluff
your plan should include as much prompt _____ of debt as possible but you must set your priorties of repayment
credit report
do not let a collector use your ___ ____ as a paper club
pro rata
when you are unable to pay the minimum payments, use the ____ ____ plan
process by which the holder of a mortgage sells the property of a homeowner who has not made interest an/ or principal payments on time as stipulated in the mortgage contract
think of the repo man. repossession is taking something back (like a car) for failure to make payments
a legal procedure for dealing with debt problems of individual and business . and stays on your credit report 10 years
a court ordered attachment that allows a lender to take monies owed directly from a borrowers paycheck, only allowed as part of a court judgment
surrender of collateral
in a bankruptcy proceeding, a debtor can give up property (collateral) to the creditor in exchange for a clean state
broadly refers to a borrower not being current on his or her payment
eventually if you are making no payments and have cut no deals you will get _____
typlically lawsuits for under ________ are filed in general sessions court (or small claims court) which is a fairly informal proceeding
before you are sued you will be served by the local sheriffs department and typically given __ days notice of the court date
in court, if the debt is valid,even if you fight, you will ____. From that date you will generally have 30 days before the ______ becomes final and ____ or attachments begin
slow pay
at any time during the process you may settle with the creditor or their attorney in writing. If you are not able to reach an agreement, you cna file with the court a "____ ____ motion," called a "paupers oath" in some states
if you are going to ____, get it in writing
electronic access
never give _____ ______ to your checking account
never give _____ ____ checks
annual fee
fee charged by credit card company for the use of their credit card
annual percentage rate
cost of borrowing money on an annual basis takes into account the interest rate and other related fees on a loan
home loan secured by a deed of trust or mortgage in which the interest rate will chang periodically (ie annually) typically adjusted based on a published index such as treasurt bill or LIBOR brought on as a result of high interest rates in the early 1980s as a way for banks to transfer the risk of higher interest rates to the consumer
balloon mortgage
home loan in which the sum of the monthly payments is insufficient to repay the entire loan, a final payment comes due, which is a lump sum of the remaining principal balance
credit card
tool used to finance a purchase
debt card
type of card often bearing the seal of a major credit card company issued by a bank and used to make purchases unlike a credit card the money comes directly out of a checking account also called a check card
debt consolodation
act combining all debts into one monthly payment typically extending the terms and the length of time required to repay the debt
debt snowball
preferred method of debt repayment includes a list of all debts organized from smallest to largest balance minimum payments are made to all debts except for the smallest which is attacked with the largest possible payments
a decline in the value of property the opposite of appreciation
grace period
time period during which a borrower can pay the full balance of credit due with no finance charge
home equity loan
credit line offered by mortgage lenders that allows a homeowner to borrow money against the equity in their home
a long term rental agreement and a form of secured long term debt
information that has been passed on but not true
your believe system the way you see or percieve things
tax deduction
expense that a taxpayer is allowed to deduct from taxable income examples include money paid as home mortgage interest and charitable donations
buyers remorse
regretting a purchase soon after making it
to buy an item with credit, paying over time
having a beginning and an end
opportunity cost
the true cost of something in terms of what you have to give up to get the item the benefits you would have recieved by taking other action
rule of 78
pre payment penalty in a financing contract the portion of a "90 day same as cash" agreement that states that the entire loan amount plus the interest accumulated over the first 90 days becomes due immediately
credit bureau
an agency which colects the credit history of consumers so that creditors can make decisions about granting loans
chapter 7 bankruptcy
chapter of the bankruptcy code providing form liquidation of the debtors assets in order to repay the creditors certain assets or aggregate value of assets or the debtor may be exempt based on state law
disposiable income
amount of money left over after all necessities and expenses are paid
a sellers intentional deception of a buyer which illegal
pro rata
debt repayment plan by which the borrower repays each lender a fair percentage of the total debt owed when one cannot make the minimum payments on ones debt
food, clothing, shelter (utilities), transportation
four walls
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