“The greatest rate of return you will earn is on your own personal spending. Being a smart shopper is the first step to getting rich.”

Mark Cuban

I think it is safe to say that most of us are searching for ways to put our hard-earned money to work. But what is the most effective method, what will bring you the greatest return on your investment?

You will have to find the right balance of risk vs. reward through a combination of investing in stocks, mutual funds, GICs, real estate, etc. 

HOWEVER

Sometimes the most straightforward and best return for your family is sitting right in front of you. For example:

CREDIT CARD DEBT. 

·         The average Canadian household is holding $4,240 of debt in credit cards. 

·         The average credit card interest rate in Canada is 19%. 

·         If you paid off that credit card, you would give yourself a 19% return on your money. 

It’s that simple. 

If you have no credit card debt, but you have a LOC, student loans, consolidation loans, or a mortgage, you could guarantee a return rate equal to the interest you are paying. 

For example, paying off student loan debt of 7% would equal a 7% rate of return.

You would be hard-pressed to find that return anywhere else without leveraging yourself or taking on some risk to your initial capital investment. 

I understand that paying off your credit card might mean sacrificing vacations, nights out, etc., but not paying off your credit card is costing you insane amounts of money. 

I also understand that paying off your credit card may not seem possible at this time, but I don’t want you to miss out on the benefits of paying it down as quickly as you can (and I have solutions that we can explore together!) 

Example: 

·         $4,240 of credit card debt at 19% interest 

·         Making just the minimum payment of $68/mth would take 23.2 years to pay off and would cost you $14,646 in interest. 

·         Getting rid of this debt is the best bang for your buck with a guaranteed return on your money…19% to be exact, and no risk. 

It’s something to think about. 

Credit cards have their purpose. They are convenient. They offer rewards programs. But don’t trade inconvenience and those rewards for hard-earned cash. 

If you are carrying high-interest debt and want me to look at a solution for you, then we should talk. 

It doesn’t hurt that interest rates have dropped in the past 30 days. 

Paying off your credit card debt might be much more attainable than you think! 

Warmest Regards,

Christina Pentilchuk.