How to Reach Your Goal of ‘Eliminate Credit Card Debt’, Part 1

Yes, you can get out of credit card debt.

This is the first of a two-part guest post series by my husband, Adam Townsend, known here on Tenacious Me as “Mr. Man.” I wanted Mr. Man to write this post because he directly dealt with the representatives at AAA Fair Credit Foundation on our behalf to understand how their debt management programs work and how they would benefit us specifically.

Life is expensive. Getting by every day requires a huge investment, and few of us spend enough time thinking about how to budget our money or achieve our financial goals.

It’s even more financially difficult for our generation; each one of us who went to college starts out his or her adult life with at least $12,000 to $15,000 worth of debt, if not more.

Once you get into a career – at least in the publishing industry in which my wife Laura Lee and I work – you have to work low-wage jobs for at least the first few years to establish yourself and build a resume.

It’s easy to take on more debt to finance your necessities until you start making more money, but it’s also easy to find yourself in a pit from which you can’t escape alone.

That’s why Laura Lee and I enrolled with a nonprofit credit counseling agency – AAA Fair Credit Foundation. Not only are our monthly payments lowered enough to allow us to save for unexpected dental work, blown tires or medical problems, but the nonprofit agency also negotiates with our creditors to lower unfair rate increases.

We hope detailing our experience here will help you organize your finances, eliminate your debt and achieve your financial goals.

You’re Getting Screwed

The good news: New federal regulations for credit card companies go into effect this summer. They restrict late fees and over-limit fees, as well as arbitrary rate changes.

The bad news is: Because of this imminent legislation, creditors are taking any excuse to hike rates on customers.

It doesn’t matter if you pay your bills on time, it doesn’t matter if you’ve been loyal for years – Citibank and Chase and the dozen or so other major credit issuers will jack up APRs to 30 percent at the slightest whim.

I won’t go deeply into all the technical reasons why this is the case, but it involves a particular state statute in Delaware that allows usurious practices, and a U.S. Supreme Court ruling that mandated that Delaware’s laws must be honored by ever other state.

South Dakota also instituted laws that allow mobster-style lending to attract finance industry business, and the court subsequently upheld those laws nation-wide as well.

Go online and look at the “About Us” section on your credit card company’s Web site. They’re probably incorporated in Delaware.

Learn more about these usurious practices in a Frontline PBS investigation from a few years ago — it’s about as fascinating as you can make consumer finance.

What to Do About It

Luckily, AAA Fair Credit Foundation has the market power to negotiate with your credit card companies for you on your behalf. We heard about AAA Fair Credit Foundation through one of Laura Lee’s friends who completed their program.

We’ve had a good experience with AAA Fair Credit Foundation so far, but I expect you can enroll with any similar nonprofit organization with a simple phone call.

This is dangerous territory, however. The market is swarming with scammers and con men who promise to do what AAA does but instead steal your money.

Make sure the organization with which you enroll is a nonprofit and is legally allowed to do business in your state. In California, you can see licenses and other business information at the Secretary of State’s Web site.

Also, you can sign up for a free membership at, which catalogs the licenses and tax forms of nearly every nonprofit corporation in the country. GuideStar is especially valuable because it can be difficult to tell the good ones from the bad. Even organizations legally incorporated as nonprofits can still steal your money. GuideStar lets you look at all yearly financial statements and tax forms so you can get a good idea of the legitimacy of the organization.

Finally, when you do decide what organization you want to work with, make sure to read Fiscal Fitness: Choosing a Credit Counselor guide from the Federal Trade Commission. It’s full of important information and questions to ask to ensure you’re in good hands.

The best test, though, is to talk to someone you trust who has had a positive experience with the organization you’re considering. Don’t go just by this blog post.

Read part two of “How to Reach Your Goal of ‘Eliminate Credit Card Debt” where Mr. Man details the debt management program process as it worked for us.

Adam Maxwell Townsend is an artist, writer and totally awesome husband. You can view his published cover illustrations, fine art, courtroom illustrations, informational graphics and other art here. To read some of his other writings, search “Adam Townsend” at The Orange County Register. He is employed there as a newspaper reporter and illustrator. You can also email him at

Did you find this post helpful? If so, please share it with others. Thanks!

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6 Responses to How to Reach Your Goal of ‘Eliminate Credit Card Debt’, Part 1

  1. Joanne says:

    It’s frightening how the credit card companies can hike their rates at whim. I guess a good reminder, too, to really be aware and considerate of our financial practices this New Year.

  2. Laura Lee Bloor says:

    Isn’t it scary? Even when you do everything right, you still get penalized for it. Good luck with your financial goals this year, Joanne, and thanks for your input!

  3. I paid off my credit card debt last year – there really is nothing quite like the feeling of getting rid of that! It’s not easy, but steady payments really do help. I used every trick in the book I could to speed up my repayment. But I got it done, so I know it can be done! Best of luck to you both – keep at it, because it’s worth it in the end. 🙂

  4. Crys says:

    I shall have to forward this on to Kevin. Because seriously, damn. Debt blows.

  5. Laura Lee Bloor says:

    Congratulations, Stephanie! That is really amazing, not to mention inspiring! I know we’re doing everything right, but with the dirty tricks the credit card companies are pulling, we knew we needed help, which is why we went with AAA Fair Credit Foundation. Thanks for the encouragement!

  6. Laura Lee Bloor says:

    Thanks, Crys! Yes, yes it does. And the credit card companies aren’t playing fairly right now, so it’s time to fight back!

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