Chances are if you’ve been looking for a way to speed up the process of getting yourself out of debt you’ve heard of John Cummuta.  The John Cummuta Transforming Debt Into Wealth System has been around for several years helping hundreds of thousands of people get debt free.

However in this article I’m going to show you exactly how John Cummuta’s system actually works and in the process hopefully help you save some big money.

How The John Cummuta Plan Works

If you read my original John Cummuta Review, I talked about why you don’t want to waste your money on something that you could do completely all yourself.  I also pointed out that John’s plan does work and can get you out of debt, but at a very high cost, in fact just getting into this program will cost you $400.  This is way to much to pay when your already in debt.

It’s also no secret how the John Cummuta plan gets you out of debt, they use what it called the debt snowball plan.  This plan is the simple process of putting your debt in a strategic order to help you pay it off the fastest way possible. Every financial blogger I know has discussed this plan at one point or another, so I’ll just quickly review it for you to help out.

    • List All Debt in Order Form The Lowest To Highest Balance. In this plan you are going pay off the lower debt amounts first because you want to achieve a win as quickly as possible, and paying the lowest amount first will show you that this plan works and can be done.

 

  • Start Paying The Lowest Debt Amount With An Extra Payment.   Once in order start paying the lowest debt first along with a minimum extra payment of $50 or more applied to just that one debt.  This way you can focus on just one debt at a time instead of several all at once.

 

 

  • Pay Off The Second Debt. Once you have the first debt paid off apply everything you were paying towards the last debt to the next debt.  So if your first debts minimum payment was $50 and you were applying an extra $50 towards the first debt you would now be paying the second debts minimum balance plus $100 that was being paid on the first debt.

 

 

  • Continue The Process Until Debt Free. If you keep applying the extra money over time to the next debt you could be out of debt in a fairly quick amount of time.  But whatever you do don’t spend the money on something else keep it going towards the plan.

 

 

  • Build Your Emergency Fund. Now that all of your debt is paid off you need to put an emergency fund in place to prevent you from falling back into the position you came from.  Figure out what one month of expenses cost you and times that by six.  This will be how much money you need to save for your six month emergency fund.  To do this set up an emergency fund now

 

 

And there you have it the John Cummuta Debt Elimination Plan.  I know I’ve skimmed through this process fairly quickly so feel free to leave a comment if you have a question.

Debt Plan Tools You Can Use

If things seem a little complicated for you yet just check out my debt plans page and you’ll not only learn how to get out of debt but how to do it the right way so you’ll never have to worry about money again.

When you break the John Cummuta system down the snowball debt plans the true nuts and bolts of the program.  So take some time and put your plan together and get on the road to financial freedom.

About Christopher

Chris is a personal finance blogger with Stumble Forward helping people avoid life's financial mistakes and live a higher quality financial life.

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Comments

  1. Hi there, I enjoyed your article and wanted to ask you a questions if I could…on John Cummunta’s site it says “detb to wealth” and become a millionaire…I totally understand the snowball effect that you talk about and paying smallest debt first and applying that money to next debt, etc…but I don’t understand the becoming a millionaire part….certainly paying off my mortgage is money in my pocket and having a emergency fund…but how do I keep on the road to millions…by buying more property and paying off those mortgages too? Also…I was reading about mortgage acceleration where you make your bi-weekly payments and then right after the bank takes the money from your account…you make the next “principal payment” the same day or next day so you save the interest off the bottom end of the mortgage and over time….saving a ton of money in interest….have you heard of this and what are your thoughts?
    Regards, Tanya

  2. After you pay off your credit cards,get your emergency fund,and pay off your house,,you invest in your 401k,ira and thats how u get to be a millonaire,, The bi monthly morgage companies charge u money to set that up,,all it is,if u pay bi-monthly you will make 13 payments a yr,instead of 12, You can do that yourself by paying a little extra every month equall to 1 paymeny over a yr

  3. This is approximately what they strategy that is used on another forum, but they
    may have it in reverse. I would like to know how I can increase my income, pay off my
    debts? I am very very low income, and disabled so how do I become a millionaire?
    The above plan is fine if you have money, but if you don’t and can’t save anything, how
    would this work for someone like me? People forget about this, and I feel it is not
    fair.

  4. It is not fair that you have less money than rich people, but life is not fair. The thing they never mention in commercials is that you must spend less money to make the extra payment to your debt. The scam of this plan is that realisticly you will be better off, but not rolling in millions. If you make average income you will earn $1 million in 20 years.
    The wealth part does come in smaller doeses when you invest your money after the debt is paid off. Not in cars and boats, butyour retirement, and the kids’ college fund.

  5. What you are describing is not really Cummuta’s plan. It is more of a combination of Dave Ramsey & Cummuta. Cummuta doesn’t pay off the smallest debt first, he pays off the debt with the highest interest rate. (Ramsey pays smallest first). Ramsey calls it the “debt snowball” and Cummuta calls it some sort of accelerator thing (I can’t recall exactly). Basically, just spend less than you earn, apply the extra money to debts (don’t acquire ANY new debt), keep doing this for the next 10 years and you will be in great shape. DOLLARS NOT DEBT!!!!!

  6. I just received the John Cummuta transforming debt into wealth, and it’s mind boggling how many DVDs and such that are in this package. I don’t carry credit card debt and only have a mortgage payment and car payment, plus a deferred college loan. So, I hope all goes well with this “new system” I just received. I was very skeptical when I ordered it and I am still skeptical about it. I mean, I just spent money that I could have put toward a car payment! So, it’s a catch twenty-two, I guess. We’ll see.

  7. Christopher says:

    I believe it’s a good program and it really does work, however it’s up to you and you alone to follow his instructions and make it work. Let me know how the program works out.

  8. The John Commuta program does really work. My husband and I purchased it a few years back. The whole key to it is discipline. Simply buying the program and gaining knowledge of how to make it work does not eliminate the debt in and of itself. You must discipline yourself to follow the program. It’s just like a diet. Getting the diet food and buying the diet plan doesn’t lose the weight. It’s a mindset … a desire to change your habits. As described in this article, you could do it yourself, but the nice thing about John Commuta’s package is that, first of all, in the cd’s he explains to you the reasons why you want to change … how much you spend in interest, etc. You get a workbook to do a little bit of “homework.” He wants to establish it in your mind why you need to do this before you get started in hopes that it will help you stick to it. Also, he includes a computer program that you enter all your information into. It gives you actual dates of when you will pay off each debt. I found that to be very helpful because it gives you an actual date in your near future that you can look forward to. And it helps you stay on track better. Also, John explains to you his debt situation. This program was not created by John as a way to make money, initially. It was borne out of his own financial distress and as an experiment as a way to get out of debt. He had his family and friends all try the system with their debts along with him. Then when it was successful he offered it to all of us. So he tried and proved it first and eliminated his own debts. I highly recommend the John Commuta plan. Hope this helps someone.

  9. Christopher says:

    KJ,
    Your absolutely right mindset has everything to do with it. If you can’t keep yourself focused through the entire process you may not be able to stick with the program to the end. I also want to thank for the insightful comment, I feel it is a good program and can work.

    Thanks and good luck to getting debt free.

  10. Certified Financial Advisor says:

    The point that is not being made is that everything – 100% of what John Cummuta claims to have found is available FOR FREE on the web and through state/federal consumer affairs offices. It is no massive secret that you will save money by spending less than you make. The shame in Cummuta’s and so many other financial gurus (aka TV predators) is how much consumers are charged for glossy pamphlets and useless CDs designed to boost your hopes – much like the garbage Tony Robbins has been peddling your far too many years. John Cummuta is using the very old commission salesman technique to get as much out of every customer till they complain – then cut them loose and look for the next sucker. When a customer stops spending money, stop spending time with them. Cummuta’s radio ads with a “client” telling listeners that he will pay off his 30-year mortgage with only the money he makes now in 2.5 years is the epitome of misleading. If I have a 30-year mortgage with only 2 years left on it – I, too, can “pay off my 30-year mortgage in just 2.5 years with only the money I make right now.” Infomercial scam artists have been paying folks to flood media and the Internet with good reviews for many years going back to the early 1980s and Charleton Sheets real estate junk. People who are desperate look for what they want to hear. Let them hear what they need enough times and they begin to believe it. Sadly, when we are in dire financial situations, we become more irrational in our behavior. If you want to be “debt free” then live within your means. If you are poor, then you must live like you are poor until you earn more money. Yes, Virginia – there are no miracles – unless you defy the odds associated with the lottery , marry into money, inherit a fortune or successfully rob a bank. Oh yes – you could do business like John Cummuta and prey on the less intelligent.

  11. Christopher says:

    I agree that most of this stuff can be found on the internet and that if you do live below their means they can get out of debt. I’m not doubting that info but the problem is do they want to change? Some people have been in debt for so long that they don’t know of any other way to live. This is why they need a program that will work with them, I’m not saying they should pay John Cummuta $400 or $500 for his program but rather do their research first and find something with proven track record of success such as the Dave Ramsey Plan.

    Any Thoughts or Comments?

  12. I agree with you, Christopher, regarding the financial advisor’s comments. The information may be out there for free, but some of us don’t exactly know how to find it. I, for one, don’t have a financial mind. And if I did stumble upon that information that doesn’t mean that I would understand how to make it work. So I rely on someone with that kind of intelligence to help me to know and understand what I should do. I refer back to my previous comments regarding a diet. All of us know that if you’re overweight and need to lose weight you cut out fattening foods, drink water, and get more physically active … duh! But sometimes, like Christopher said, you’ve lived that way so long that you need a plan to follow. That’s why you have to find a diet plan that you can stick to. For me, it’s Weight Watchers. For others, it’s some other plan. But my point is I don’t think it’s anymore shameful for John Commuta to put together pamphlets and CDs to help you get out of debt than it is for Kathy Smith or any other fitness guru to put together an exercise DVD for you to lose weight. If you follow what the the certified financial advisor above says, then you know how to exercise. The information regarding the correct exercises to do is out there. Go dig it out for yourself, and get exercising. Don’t pay anyone else who already has that knowledge to hand that information to you. But if you want to get technical with all of this, don’t go to that financial advisor either and pay his prices to help you and give you financial advice. The advice he gives you is available somewhere for free, too. But on the other hand, if John Commuta is charging $400 and $500 for his program that isn’t right either. We certainly did not pay anywhere near that price for our program. Ours was somewhere less than $100. I forget the exact amount. But it was a good investment for us, and we’ve learned a great deal from John Commuta — more so than from a local financial advisor that we called for help. We explained our situation to him, asked for his help, and he told us that he couldn’t help us. We would always be in debt with the income that we had. Very encouraging to say the least. So we got out of debt on our own with John Commuta. And as I stated in my first comments, Commuta doesn’t just send you a 10 minute CD telling you all in a nutshell what to do to get out of debt, live below your means, yada, yada. That would definitely be a scam. But he takes his time. He gives you all these CDs and workbook. He makes an effort to help you understand what you did wrong in the first place. How your thinking is wrong about charging things if you don’t have the cash to pay for it. He gives tips on how to handle your money. He helps you understand that the credit card companies want you to be in debt to them and how long it takes you to pay off a credit card if you only pay the minimum payment. Many people don’t realize all of this stuff … especially if your parents have never helped you to understand these concepts while growing up. But he does all of this in an effort to help you get out of debt and stay out of debt because it’s does you no good if you follow his plan to get out of debt but never have a permanent change in your habits. You’ll go right back into debt. So his goal is to help you to know how to control your spending habits and handle yourself with discipline. And to me that’s no different than anyone else making money by sharing their knowledge and information through selling books, CDs, DVDs, etcetera.

  13. Christopher says:

    That’s awesome KJ, I’m glad this program has worked for you. I’m also glad you didn’t have to pay hundreds of dollars to do this either, this seems to be one of the biggest complaints I’ve heard from others.

  14. I was going to post a comment, but there is nothing to add to what Certified Financial Advisor said – BRAVO !
    people it’s easy – leave within your means!

  15. I must say that the “Certified Financial Advisor” isn’t even a real advisor and definitely not even near one. He says that the only way you get more money is by a lottery, robbing a bank or inheritance??? What??? Are you serious??? Have you ever heard of mutual funds? if you deposit 5,000$ dollars one time in mutual funds before age 30 and completely forget about it you will be a millionaire by age 55+ but no later than 59. Yes you spend less while you are trying to get out of debt and once you are out you enjoy your life and buy whatever you want cash only. If you save for 20 years to not even have a million yet, you will have lost your only life you’ll ever have by being cheap. Do this: invest $5,000 in mutual funds, save a good $12,000 for your emergency fund, and then live the life you want to live so by the time you retire you won’t worry about how much you saved, just remove your 1 million+ from your mutual funds and you’re set. If this guy really is certified in finance, then that explains why people waste their money and never get out of debt when they hire a guy like him that will only say, “spend less and hope to win the lottery.” and yet he calls Commuta’s program a scam. A real financial advisor will find a way to get you more money, out of debt and re-direct your cashflow in the most intelligent way. The best part of all is that financial advisors charge 0$ to sit with you and help you out with everything you need. That’s what got me out of debt and completely changed my life. I am more than happy to help out ANYONE (including that “certified financial advisor”) who wants to know more about getting out of debt and investing to be set for retirement.

  16. CashLover , please post your math about how $5k turns into $1M in 30 years. Seems quite unrealistic to me.

  17. Bill Williams says:

    I use to do this with my old 30 yr mortgage. First o got an amortization schedule, which listed each payment in sequence with the principal amount and the interest amount totaling up to my monthly amount. Then what I would is the following:you pay your total April 1st amount with one check (lets say its payment #8 of 360) and you write on the mom line payment #8 of 360 and you enclose a second check for the principal only on payment #9 of 360. On the memo line you write “principal for payment #9 of 360″. Then on May 1st you now pay payment #10 of 360. We were able to eliminate the interest due on payment #9. We were able to save quite a bit of interest charges over the period of the loan while reducing the total principle owed. This method is easy in the beginning when the principal portion is very low compared to the interest, its get a bit more difficult later in the loan when ..say the principal amount is equal to the interest amount. By that time it may be better just to bank the extra money cause you would have shaved quite a few years of the payment schedule. Any thoughts??

  18. Christopher says:

    I agree this method could eliminate interest fairly quick but once you got into the higher principle payments it would become much tougher to handle. If you were able to eliminate debt elsewhere first before tackling your mortgage first you may be able to put more cash towards this method. It would be interesting to see an illustration of this method month by month to see how much interest someone could actually eliminate from their mortgage.

  19. Eddie Mattison says:

    Wow, all of this sounds encouraging. From reading your comments I can see I have some homework to do. My question please, after talking to a representative over the phone last night and finding myself intrigued, is that Riley (the man I was talking to) said that you can pay directly to your principle when you pay your credit card payment. That people don’t know this and the crredit card companies don’t tell you this, but it’s true. Meaning, when I make my payment, somehow I can pay toward what I owe and , what, defer or put off paying toward the interest? How does that work? I’d sure like to do it! Is it true? How can I maybe defer or something else, the interest and pay directly toward the principle? (Or is it like the writer in one of the first paragraphs said, “Make a payment right after the first payment comes out of your account”, or EVEN POSTS and then make another payment and all of that second payment goes straight to what I owe and none to interest.

  20. CashLover’s statement “if you deposit $5000 one time in mutual funds before age 30 and completely forget about it you will be a millionaire by age 55+ but no later than 59″ has a grain of truth to it. If the mutual funds achieve a return of 18% every year for 30 years, then your $5000 will grow to $1,000,000 by the time you are 59. But… historically mutually funds haven’t had rates of return of 18% every year. Looking at just the past 10 years, only about a dozen funds averaged more than 18% (most of them are gold funds and a few international funds such as Fidelity’s Latin America fund). I doubt that those same funds did or will achieve 18% over a 30 year period. It’s more likely that a person would put their $5000 in a diversified mutual fund or several different funds to be diversified. Diversified funds haven’t returned 18% over the last 10 years. For instance, the Fidelity Balanced Fund returned 6.38% over 10 years. And, doing the math assuming 6.38%, if you deposit $5000 one time in the Fidelity Balanced Fund before age 30 and completely forget about it you will have $33,550 at age 59. Sadly, not even close to a million dollars.

  21. It is a fallacy that people can become millionaires through their 401ks. 401ks were meant to be part of f 3-legged stool to include pensions and social security. Corporations are culpable in allowing the masses to believe 401ks can stand alone w/o the other two “legs of the stools”. As Alan said, return rates on 401ks are not reliable…just like the stock market. Many families are now in dire straits due to this over-reliance on 401ks. See link below.

    http://www.cbsnews.com/video/watch/?id=4955194n

  22. Preacher says:

    I’ve read all of the comments above and have come to one conclusion…all is vanity. With all of the financial wisdom being bantered about, no one has yet answered the poor woman’s question above with very very low income. The Truth is none of these ideas address the real problem, which is not income but identity. It is the idea that my self worth and my net worth are inextricably tied together. No monetary plan alone can address this moral dilemma.
    Debt is a self inflicted prison we’re in and we think money is the key that leads to the exit. When in reality the door is locked from the inside and money is just an external tool that is only as good as the hands it’s in and the motives behind them. If you have a car that runs poorly, just buying a good repair manual or giving it a new paint job wont fix the problem. At some point, someone will have to go under the hood to repair what’s wrong inside. You can’t fix an internal problem with external means. As long as what we drive continues to drive us…as long as where we live means more to us than how we live, then who we are will continue to be defined by what we have, thus confined by what we owe. Think outside the box. The real problem isn’t external financial debt, but an internal moral dilemma. No monetary plan, no matter how well intended, can eliminate that.

  23. yourescrewedunlessyouredonaldtrump says:

    The truth is unless you’re a multimillionaire you will NEVER be financially secure. You think you own a home? You own a mortgage; the bank owns your home and the bank owns your car. If you went to college, you probably have student loans and unless you’re in a high earning profession (doctor, lawyer, engineer) forget about paying those off any time soon. Even if you do “live beneath your means” a devestating illness can come along and wipe out your entire life’s savings. If you have kids, you’re saddled with them for 21 or more years. I can be debt free but how sucky is it to have to pinch pennies for the rest of your life? What Cummuta should be preaching is multiple streams of income and quitting your wage slave existence.

  24. A.T. McCloud says:

    Preacher, while I agree with your well intended comments, you didn’t answer the poor woman’s questions either. All of the comments are great ideas, but they are just that ideas. And everyone knows, ideas are nothing without action. The simple truth is that we think the label “millionaire” is some magical person with no problems in life. The reality is, being a millionaire just means you have more money than nearly all of the population, it doesn’t mean all your problems are solved. Spiritual guidance is necessary, financial guidance is necessary, but neither guarantees a worry-free life.

    These “systems” all count on one thing, that they can sell you something because they have information you don’t. They take information that is available for free on the internet, at the library, or other places, repackage it in a nice shiny format and come up with clever catch phrases to make it sound as easy as walking and chewing gum, but in reality it’s all a matter of discipline. If you are on a fixed income, you’re first priority should be getting out of debt. I am sure you will find that without those debts looming over you, your stress level will go down significantly. Here’s the reality though, this will not be a quick fix like these programs suggest. You’re not going to be debt free in 20 minutes. You’re going to battle for a long time to get there and above all else, it will require a determination to finish the job. Find an extra $5, or $10 or whatever you can to send in to that lowest credit card or other payment you have and just keep at it until it’s paid off. Then as the program suggests move on to the next one. It’s slow going. It’s tedious. It’s boring. But it’s also PROGRESS. You didn’t GET to this point overnight, so what makes you think you can get out of that quickly? Just keep going. The journey of a thousand miles, begins with a single step. This is no different. Just know that YOU ARE making progress and keep at it. There IS a light at the end of the tunnel and it is not a train. But the tunnel may seem to be a longer one for you because you are not able to pay these things off as fast as other people.

    Remember the tortoise and the hare story? Both finished the race, but the overconfident hare finished second because he didn’t take advantage of his gifts. But both finished. Progress is progress no matter how small and eventually you can finish, but you must first begin and then just continue to put one foot in front of the other. I have nothing to sell you so I won’t tell you you’ll be debt free in 2.5 years or that one day you’ll be a millionaire, but I WILL tell you you can get out of debt if you can just begin and then stay the course.

    GOOD LUCK!!!

  25. @ A.T. McCloud…

    You are very correct in what you say. It’s always very interesting to me though how ppl of limited means are always encouraged to become debt free by paying off ALL of their bills (which are usually high interest credit cards and loans b/c the entire credit system is predatory), but rich ppl (e.g. Trump) are encouraged and do take advantage of the many loopholes available including filing bankruptcy several times. They file like its no big deal…just a chance to start again. The ppl of limited means in this country have truly been mind f*&^#@ and have become drones enslaved to those who have no intention of doing what they tell us we should.

  26. http://dollarsnotdebt.blogspot.com/

    Paying off all you debt is not complicated, but it is difficult. I can tell you that the John Cummuta plan is not a scam, it is a re-programming of your habits. I blog about my experiences with the program.

  27. inf9antz says:

    To answer the poor disabled woman: First off your selling yourself short with poor and disabled or similar adjectives. Opportunity surrounds everyone. if your gonna sit on your hands and mumble poor me i wish someone would take my troubles away-your gonna be waiting along time. 2nd- there are 2 sets of rules for people who are employed and those that employ themselves and or others. different tax rules, different investment rules and many more loop holes for ppl that take risk. Life is not ez, everyone experiences ups n downs but there are simple truths out there: OUR NATION preaches consumerism buy buy buy sell sell sell(sound like jim cramer) when they should be rewarding conservatism.

    live below your means whether u make 30k /yr or 200k
    limit ur debt- some debt is good like a mtg but dont get suckered into chasing rates or trading up to larger n larger homes.
    Pay urself first- save 10% of yrly income- F everyone else ur more important they come 2nd
    even if you can only do 3% /yrly hey its something
    ur dollars are like lil employees- put them to work safely
    what do like to do? can you make xtra $$ by doing? a p/t biz?
    Dont quit ur day job just yet.
    forget traditional iras and 401k- find a self directed plan that you can invest in businesses and real estate or taX LIENS ETC…

    FINALLY REALIZE THIS TAKES EFFORT AND TIME!!! AND NO YOU DONT START THIS ON A MONDAY AND BY FRIDAY YOUR MARK ZUCKERBERG.
    AND ALSO MONEY IS NOT EVERYTHING BUT IT MAKES LIFE EASIER AND HEALTHIER.

  28. Nadine Andrton says:

    I don’t know if anyone else answered this because I didn’t read all the posts, but I want to answer Tanya’s question about building wealth to become a millionaire. When you have all the debts paid off, including the mortgage, and have your 6 months expense account set up, start applying all of the money you were previously paying toward debt toward investments of some type. Maximizing 401k accounts is a great recommended one. Another is investing is any of the many index funds out there, which spreads out the risk. A lot of people took hits from the stock market, and that happens. Typically that is recovered over time if you are using a dollar cost averaging plan like the 401k does where you put in a regular amount every month. There is software that shows not only the order that debts should be paid off for the shortest time to achieve debt freedom, but there is also a feature that shows the reverse – how to put the use of earning interest to build your “fortune” where before you were paying interest to enslave you in debt.

  29. inf9antz, since you were the only one who even attempted to answer the woman’s question … Just what do you mean, “opportunity surrounds everyone”? I didn’t get the impression she used a “label”; she was just describing her circumstances. Obviously, there’s little to nothing this woman can do because SHE HAS NO MONEY. Sure, she may well have skills to offer, but where’s the MONEY to invest in a biz? She doesn’t have the upfront money. Live below your means? I’m sure she does, people of low income have no choice. My situation is almost exactly hers, except I’m not disabled, thank God. Who are you to judge her? You do not know what her disability is. But regardless, the bottom line (pardon the pun) is, SHE HAS NO MONEY and you can’t start anything without money. I’ve been trying to start up an online business for some time now, but I desperately need a little cash to invest or I won’t be able to pull it off. I have a degree and years of professional experience — and I work part time in a factory for a little above minimum because of my age and, mostly, the economy. I spent a great deal of time looking and found nothing else.

    I am $25,000 in debt. At the moment, that is a fortune to me. None of my creditors will accept a $5 or $10 payment. It got that way due to an illness. That’s right — an illness. Things happen, friend. We don’t all need to change our “habits.” We need to not get sick! And we need jobs that pay decent wages.

    I’m sorry, but “opportunity” is not always there. Not for the likes of us. The real answer to the woman of low income is, there is really little you and I can do. The info here isn’t really being directed to us. The advice here is for people of at least middle-class income.

    Your only option, as is mine, is bankruptcy — if you can afford a lawyer (don’t try to file without one) and the filing fee. Try to find a lawyer through a law school. And you will not come out of it smelling like a rose; you are not Donald Trump. You will be creditless for years. I’m especially scared because I don’t have the years someone younger would. I’m just waiting until I can find someone to do my back taxes (my case is complicated since I worked abroad). I don’t owe taxes but I don’t know how to do those kinds of forms myself. And then I can file and finally, at least, get the creditors off my back.

    badmama, perhaps you can respond to this here and then we can start communicating. People in our situation need support and, sometimes, sharing of info.

    I would love more than anything to pay off these debts and keep my credit. But my income just doesn’t allow it. Period.

  30. The defeatist attitude of someone in $25,000 debt is ridiculous. Bankruptcy is NOT the only option in that case, and financial responsibility is NOT just for middle class income people and higher. It’s all about percentages. If I make middle class income, I can then live in a middle class neighborhood and drive a car that is a step up from a beater. If I make less than middle class income (and that was the case for me at one time) then I live in an apartment that is not in the very best area of town and I ride the bus, and perhaps I don’t have cable television or an expensive cell phone plan or I don’t eat out pretty much ever, etc. Creature comforts are for people with bigger incomes.

    People with low incomes are not destined to only have low incomes. Find a second part-time job (I did that when I needed more money). Increase your knowledge somehow so that you can demand more money in your current job or some other job. Sell stuff. $25,000 in debt can be gone quickly (within a couple of years or so) if you focus on it. You can make $1,000 a month delivering pizza at night if you want.

    The aforementioned Dave Ramsey plan really helps people who have no clue how to handle debt.

    The Debt Snowball…list debts smallest to largest, stay current with all of them but pay a little extra toward the smallest one until it is gone. If you CAN’T do this, then you MUST sell things OR get a second job OR cut your lifestyle to the bone or maybe some or all of the above. Once the smallest debt is gone, take what you would have paid toward it plus the little extra and pay that toward the next smallest one, and so on. Every time you eliminate a debt, you have more money each month with which to attack the next debt. It’s not that hard, and you don’t need big income to make it happen.

  31. Christopher says:

    Will: Well said, I agree with you 100% the Dave Ramsey Plan is so simple. A self determined person could knock this debt down in a few years if they were seriously determined. However that is just what it takes, self determination. To prove my point while working in financial services back several years ago I came across a woman in a similar situation and I explained the same plan and the only reason she didn’t do it was because her lawyer had brain washed her that bankruptcy was the only way and no matter what I said she wasn’t going to change her mind.

    The truth is a plan is only as good as the person who is willing to prove it. Thanks for the comment.

  32. Besides the rational financial advise John Cummuta gives, listening to his audio book helps to re-program the way you think about finances. That is something that most people won’t get online reading something. The debt payoff part makes sense, does work and agreed that the info can be found in many forms. That aside, the thing that impressed me while listening to the program, was how I started to think about the Advertising & Credit Industries in particular. I now do look at all advertising with a bit of skepticism and with the financial downfall we’ve been through, it’s pretty obvious how greedy the credit industry is. I guess these things should have been obvious to me all along but somehow they weren’t. Considering how many people have credit card debt, I guess I’m not the only one.

    As to what Will said above is very true. My wife and I paid off $32,000 in debt in 1 3/4 years. The only thing we owe on now is our mortgage. The lady who thinks bankruptcy is the only way is wrong. I have a feeling it’s more of the fact that she doesn’t want to make the effort. It’s a hard road and not quick enough for her. I think that too many people these days have what I call “Fast Food Mentality”. No matter what it is, they want it…and they want it now!

  33. Will, Michael and anyone else who needs to hear it:

    It’s amazing how Americans are hoodwinked, especially these days. Here’s some cold facts for those of you who have not “been there,” at least not in your maturity:

    We’ve never had an economy like this in the lifetimes of most people alive today. Wherever you started out, it was in a different world at a different age. I know, I started there, too, and worked hard over the years to at least build up to a middle class life for a single person. Nothing wrong with saying that, it’s what it is.

    It would never have been considered middle class if I’d had a family to raise. I didn’t even have credit cards until my mid-40s. It took me 13+ years to pay off a student loan. Unfortunately, I wasn’t in a high-paying field, but I was very good at what I did. We all operate with the talents we’re given.

    I lived cash-and-carry til I got credit, and for 99% of the time afterwards, always within my means. I’ve never owned a new car in my life. It’s not an appreciating cost so it just didn’t seem wise to take on that burden until I had raised my income. In my field that was going to take a tad longer. I did ok with used vehicles and was fortunate enough to have a mechanic who kept me running. I’ve never owned property of any kind. Never could save the down payment from what I made up until I went abroad. Facing that reality, I felt any house would end up owning me. In the end, I was right. Since ’08, everyone in my bracket who went for it got hit with foreclosure. A studio apartment was the most I’d ever had.

    And I would dearly love that luxury today.

    My bills always, always got paid. When a lifelong dream I finally went for after years of research didn’t pan out, and cost more than I had expected, I took off for a faraway land to earn the money to pay off debt I had accrued going for it. It would have taken a lot longer to pay it off in the U.S. I had to start thinking of my age and the expected years I had left — that sort of thing. I was unencumbered. I got offered more money than I’d seen before and it made perfect sense to go for it. As you get older, the future open to you gets less. Every financial adviser worth their salt will tell you that.

    Then there’s your insistence that I just don’t want to bother paying off my current debts — accrued, as I had said, through illness and not through indulgence. I don’t know what indulgence feels like.There is simply nothing left after paying basic living expenses. Nothing.

    I’ve not yet filed for bankruptcy. I want to pay these bills. I can’t. It’s as simple as that. I’m currently paying off a few dollars here and there to my auto mechanic for repairs to my 14-year-old Ford. There aren’t too many decent jobs around anymore. Most that were lost are not coming back. Yet, I haven’t given up looking, and continuing with freelancing which is the only hope I have left.

    After I arrived home from losing my job abroad, I looked everywhere for ANY KIND OF JOB. So here’s the answer to your preaching about a “second job”: WHERE ARE THE JOBS? Second job???? Where are the first jobs???? The times we lived in when you spoke of yourself, and when I was young … are no more. You will probably be around my age before you see prosperity again.

    Ever tried to pay off $26,000 on $8.50 an hour? You don’t have to be particularly good at math. Calculate how long that would take.

    “… cut your lifestyle to the base.”

    I didn’t know whether to laugh or cry. I guess I can laugh. You obviously don’t know what the base feels like. Really feels like. I do. I live it now. And let me assure you, it isn’t pleasant. There’s nothing more to cut!

    Cable TV and Internet are paid for by the owner of the house.

    I haven’t been out ANYWHERE since I was abroad over a year ago. Even there, although I was enjoying life (what happened to that in all this?), I had been trained by a lifetime of thrift and was careful. Getting sick … whew! Then I had to use more of my credit cards and my payments increased, so I committed the sin of using them for the emergencies they were intended for.

    I haven’t bought a stitch of clothing other than support socks for the factory, in over 2 years. Even before then, I was never into the designer thing. I actually hate shopping.

    Honey, the suggestion about selling things made me laugh the most. I’m sure there are people who have things to sell, people who’ve lived where they are for a long time. But … hmmm … did you read my posts? I think I said I worked abroad. For some people, that means storing your belongings. But where no company is paying your expenses, it means you get rid of everything you can’t carry except a box or two of sentimental stuff your sister has agreed to hold. And everyone I know with a limited income has already sold everything off. What skills they have, like me, they’re trying to do something with. Not every skill lends itself to an immediate income.

    Even Suze Orman speaks of quality of life. Life is meant for living, for enjoyment, not just survival and lifetime sacrifice just to pay off creditors. And for many of us of very low income and advanced age, it is real sacrifice and it could well be a lifetime.

    Imagine yourself a late-50s female, slaving away at a job that is literally killing you, with an income 85% of which is taken by rent and electric bills alone. The rent you pay is the very cheapest in the region, and it’s not even your own apartment. Oh, and extra housecleaning — on top of your factory job — nets you a little rent discount.

    A car, desperately bought cheaply with leftover credit in an area without public transit near your family who has agreed to help you. Amazing how friends disappear when you become poor. The car is needed for this job which is the only one you could find after looking absolutely everywhere. You’d've been more than happy to ditch it if you’d gotten a nibble in NYC or any other place with transportation. In spite of the blunt fact that at your age you’ve paid your dues and hard physical labor should be long in the past (if at all, you did go to college for which you already sacrificed 13+ years of payments), these are times most alive today never lived through before, and you are anything but picky; you’re not above doing anything respectable to earn your way.

    You have no life left at all. None. You tolerate it because of the little hope you have left that through steely determination you will come out of this. You do have an 8-year-old laptop computer you bought in Japan during more prosperous times. That laptop — thank God it still works — is today your only contact with the outside world. Before you started at the factory, you went hiking sometimes which you enjoy. Now you’re so exhausted the energy just isn’t there.

    You’re still trying to set up an online business in addition to getting more freelance clients, but you do need to purchase some stuff and pay fees to get the businesses legally registered. So you keep getting stopped because of money. You’d love to make some new friends and new business contacts, by going to lunches and conferences and such, but again just the transportation takes money and THERE IS NOTHING LEFT AFTER BILLS. You can pay yourself first, as I have all my life, til the cows come home. But these days I end up taking from that stash to make rent, or gas, or a bottle of shampoo.

    I’m sorry it’s just not politically correct anymore to admit it openly: Sometimes it’s not a matter of scrimping and saving and living within your means. Sometimes the means are just not enough. Sometimes … you just HAVE TO MAKE MORE MONEY.

    I’m 3,000 miles away from the friends I’ve known most of your adult life, who think I don’t want to see them anymore when the reality is I can’t afford to see them, to go home to my real home. I have to stay here where at least I have a few relatives who will not let me go hungry. Since I don’t know how long I’ll live, I don’t know if I’ll ever see them again.

    Who the hell do you think you are?

    badmama, I’d love to hear from you again. Maybe you can chime in here. These people apparently don’t know anyone in our circumstances or they wouldn’t judge so quickly. So I’ll say it again: Unless you can increase your income so there’s something left over after bare survival (and it’s got to be a little more than $10 a month, your creditors won’t accept that), and you can find a program in which your debt is reduced to a level that can realistically be paid off in a few years … we are just the people bankruptcy was designed for. As a way to start over when no other way is open. Either we don’t have the income to make the payments, or the payments would take way too long or even all the years we have left. I don’t know what disability you have and I wouldn’t dream of making any assumption about what you might be able to do. You are the only one who can make any judgements. It’s a very serious move. It takes a long time to re-establish credit.

    But it will no matter what we do. We already live in bleak conditions. We deserve to start over. NO older person should have to endure the rest of their years in bare survival mode just to pay off creditors. For most who fell this far, it was through no fault of our own. And the mistakes we did make … I admitted mine but, funny, I still don’t think my punishment fit the crime.

    Cummuta’s program, like any program of any kind, was never intended for everyone. It certainly isn’t intended for me. Best wishes to you!

  34. Ana…Don’t you dare tell me I don’t know! In my earlier years I collect pop bottles, yes that dates me doesn’t it, and kept them in my closet for emergencies so I could turn them in to by some food. I worked two jobs, both where nothing special…one was landscaping at an apartment complex the second one was cleaning up construction sites AFTER I left there. I lived 2000 miles away from my family. If you want to cry about being poor and not having anything. Watch some of the stories on the news about people in Somolia, Uganda and other places around the world! THEY DON’T HAVE ANY CHOICES AT ALL! So don’t freaking cry to me about how unfortunate you are. THEY LITERALLY HAVE NOTHING! Sounds like even though you are in precarious position, at least have a roof over your head. You have family that will give you money to survive if needed. AGAIN I SAY…THEY FREAKING HAVE NOTHING!!! You see women who are fleeing where they grew up with their children. Walking hundreds of miles in a barren landscape. They’ve lost children along the way and have to leave them right where they died! Even the poor here in America have it better than that. Go ahead…file for bankruptcy and start over…it’s your choice. But drop the ‘woe is me’ crap. You’ve got it better than a lot of other people in this world.

  35. I really feel, Michael, that this preaching and capital-letter screaming needs to come to a stop so others here can continue to share what this site calls for. It’s especially low class to invoke the tragedies of underdeveloped countries to attack someone. Let’s move on now. I believe I tried to contribute. Now let’s move on to others.

  36. Ana, I can understand a few of your comments because my husband and I have had hard times over the last few years. And there has been not enough to even pay all the bills let alone buy other things. So we’ve done without many things like using clean dish towels to wipe our hands at supper because we couldn’t even afford one roll of paper towels, using soap to shave because we couldn’t afford a can of shaving cream, and on and on. Have you tried any food pantries as help? I have had to swallow my pride and make use of them. And it has been a big help. But as far as nothing to sell … you may think you have nothing to sell but look around you and be creative. There are many times that people have things they just want rid of. They would rather just get it out of their way than to try to sell it. Look around you and watch. You may see something worth selling that someone doesn’t want. My brother is young and is handicapped with an inherited hip disease and has a rod in his back since an early teenager. He refuses to try to get SS disability because he doesn’t want to rely on the government and other people working to pay his way. He can’t go out and get a physical labor job, but he also can’t get an all-sitting job either. So they rely mostly on his wife’s job to support them. But in the city he lives in there are many, rich and middle class alike, that when they have something they don’t want they’ll sit it out by the road with the common knowledge that if you want it, take it. If it doesn’t get taken it will be picked up by the garbage. This may sound like dumpster diving, and maybe it is of sorts. But my brother has found MANY items from perfectly good computer stands, Sears tools, exercise equipment like a Boflex, good furniture, piles of unused, uncut lumber, baby beds and changing tables, you name it! So he picks it up, takes it home, and sells it. He has been able to use that money to pay bills, buy gas for his car, and buy food. It’s definitely not something that you want to go around bragging that you do it. In fact, you may have to swallow your pride sometimes to do it. But it’s one way to beat poverty and not let it get the best of you. So that’s why I say, keep your eyes open. I have people give me things quite often just because they don’t want it. Look for those opportunities and have a yard sale or sell it on Craigslist since it’s free. (Just be cautious!) And don’t forget about scrap metal. If you see someone has an old, junked refrigerator or washing machine, sheets of metal stuff, anything find a way to take it to a scrap yard. Just be creative about it. Sometimes there’s money to be made right under our noses. We just have to look.

    Best of luck!

  37. kjm, nice to see you chime in. Actually, I really put in my story not to wallow, but to prove a point about what it’s like to “be there” today as opposed to having been there in other times. Good God, it’s not just me! It’s affecting millions of people today. Nor can I imagine it’s helping the rest of the world’s population.

    Discussions about being debt-free in 2-3 years are nice, it’s why I came on. It gives a feeling of hope that’s just no longer there for so many. But how many people today can spare $1,000+ per month? It’s been so long since I’ve even seen $1,000 at one time! The lady who is disabled was the first respondent I was able to relate to, besides yourself. And I’m a lot luckier than she because I’m not disabled. But it sounded like our financial challenges were similar so naturally I addressed her in my responses.

    Anyway, I can certainly see where you’re coming from, kjm! In times when finding other uses for soap can be a challenge, paying off debts can sometimes seem like a joke.

    I really don’t have anything to sell. I moved to Japan several times in the past decade and got rid of absolutely everything I couldn’t carry. I work all weekend so I couldn’t take part in others’ yard sales. As for going around the neighborhood, scrap yards and such, and taking things … I would do it gladly if I had someone to do it with. How does your brother manage to lift furniture and other heavy things? You really need someone to work with — someone on the same shift as you. :-) But it’s a great idea for those who can pair up.

    I’ve done some local tutoring so that provided some help last school year. If you live in a suburb of a major metro area like I do, tutoring jobs aren’t that hard to get, and they can pay more than selling occasional things would. It’s a bit harder for me this year because of my work schedule, but I’m trying to get students again. I wasn’t kidding about the physical exhaustion, though. We can’t call in sick and I’ve had a bad cold the past couple of days.

    If you have a math background, you can pretty much earn a living with private tutoring. Are you good at math? Maybe your brother? I don’t have the math so tutoring for me would be just a sideline.

    Cummuta’s program talks about being debt-free within a reasonable time, 2-3 years, and respondents mainly talked about either buying this package or some other or doing it yourself. Even if you’re in a position to make the payments, why not just follow the principles in it yourself without spending the money for the program? It’s like these programs people sell that purport to teach you how to clean up your credit. There’s really only one thing that cleans up credit, besides making sure your credit reports are accurate, and that’s time. It takes time to clean up your credit and it takes time to pay off debt. For some of us, time isn’t on our side.

  38. pablocruz says:

    I wold like to know why his program which is touted as “Totally Free of Charge…No Shipping, No Handling!” wanted my Credit Card authorization for $6.95 for shipping? WTF?

  39. To get out of debt fast, make weekly payments. Instead of 100.00 per month, pay 25.00 per week. This will lower your average daily balance and reduce your interest paid. It is easier to lose 25/ week than 100/ month. I paid off 30k in credit card debt using this method. It hurts but it works. I have 700 left but just spent 500 on tires but I am going to keep it going. Even with Christmas coming, I will be credit card debt free in 6 months. Then its time to destroy my mortgage.

  40. I will take my experience a step further. I am 42 with a 260k mortgage. Upon completion of my payoff of the credit card, I will chase my mortgage. I plan on refinancing my mortgage on 5 year arm at 2.75 through sovereign bank. Currently, I am at 5 percent. I am going to do a 30 year amortization in case something goes horribly wrong. Needless to say, if I pay my new mortgage and continue paying what I am paying in the credit card, I will be at a 131k balance before my mortgage adjusts. With any luck, I will downsize my current home and buy a house in cash and be debt free or close to it by the time I am 47. In regards to the 401k investments people mention in previous post. NFW! That has been a disaster for me. Will it come back, sure, but it simply doesn’t payoff. Try to figure out what you will have if you put 10 percent if your pay away. Your better of buying a classic car or baseball cards. I would do the minimum for a company match and hammer debt service. I pay 1000/ month in interest alone on my mortgage. That is by far the biggest payment I have. Get away from coventional ways of thinking. It doesn’t work. If it did, there would be millionaires on every corner. Get debt free. Get lean! Buy some cool stuff you can enjoy and sell it later for more. No taxes! No market fluctuation.

  41. Christopher says:

    That’s an interesting perspective Will. I agree with you for the most part, the downside is that if your plan doesn’t work you might get hammered with all the interest you will have to pay on a 30 year mortgage. However, if you can stick to with it, it’s possible to be out of debt in 5 years.

    Let me know how things turns out.

  42. Howie Feltersnatch says:

    For years, I’ve heard John Cummuta’s ads on the radio pitching his debt reduction program, “Debt to Wealth.” The ads promise that he can simply and quickly show you how to not just reduce your debt but to eliminate it and build vast wealth. It sounds so good but it’s not at all clear from the radio what Cummuta is actually selling. (Note: Some folks think his name is spelled Commuta – it’s not – it’s Cummuta)

    Not knowing much about Cummuta or his organization, I did some research and rooting around which revealed some concerning things I feel compelled to share and warn others about.

    First, I called the toll-free phone number for Cummuta’s company. The eager saleswoman began by pressing me for my personal contact information. I refused but that only slightly delayed her polished sales pitch. She began by saying that Cummuta’s program had been around for 18 years and claimed that it shows users how to eliminate their debt 3 to 5 times faster that what they could do on their own by simply using the money they’re already earning. She further added that it wasn’t a debt consolidation program and included tips for building wealth.

    After asking her multiple times what the cost was and not getting an answer, she then took the tack of telling me that the materials (CD or cassette tapes, workbook, etc.) would be shipped via UPS for a mere $6.95 shipping fee and that I wouldn’t be charged anything for the first 30 days. Then, she finally admitted the cost: I would make “just 5 payments of $79.99 each” to which she quickly added, “…that’s a lot less than most people pay in mortgage interest and credit card interest.”

    After pressing me to buy it again, she asked why I wasn’t interested at this time and I told her that it sounded like a lot of money. Not missing a beat, she quickly and confidently replied, “$400 compared with the amount of debt you likely have I’m sure is small…”
    While I didn’t buy the program myself, I have reviewed a copy of it obtained from a customer. My advice: save your money and don’t go another $406.90 (total cost) into debt to buy it. You can find far better advice at a small fraction of the cost ($20 or less) in many venues, especially and including any decent book dealing with personal finance, debt and spending, etc.

    Also know that Cummuta’s outfit has been awarded a grade of ‘F’ by the Better Business Bureau (BBB) for their questionable sales practices and lousy customer service. BBB records show dozens of complaints filed primarily relating to sales tactics, refund and billing issues, including unauthorized charges on credit and debit cards. (The rating of ‘F’ from the BBB is the lowest possible rating out of 13 categories spanning from ‘A+’ to ‘F.’ ).

    In surveying the complaints lodged against Cummuta, I quickly became aware of an even bigger problem than his selling of a grossly overpriced debt reduction advice program. He has even bigger fish to fry in his selling of personal coaching services for thousands to more than $10,000 dollars. (A subtle warning of this agenda can be found on his website where it says in reference to his CD and workbook product, “It’s a proven system you can implement yourself, or we can help you if you wish.”)

    The “help” is an even more grossly overpriced service which Cummuta and his minions sell. Cummuta recruits seminar leaders around the country to sell his products and coaching services (trainees have to fork over $295 and pay a $900 annual licensing fee to Cummuta). His web site brags that, “The average seminar, including product sales, can net you several hundred to several thousand dollars – FOR A HALF DAY’S WORK!” Funny he doesn’t make that statement to consumers when he’s selling them all of his overpriced, mediocre materials.

    Cummuta coaches use high pressure sales tactics to sell their costly services and the coaches’ qualifications are highly questionable. This came to light recently when Massachusetts Secretary of State William Galvin accused a Utah-based Cummuta coach, Darin Floyd Beal, of defrauding a Worcester, MA woman out of $100,000. The woman got in the clutches of the Cummuta coach after she responded to a radio ad for Cummuta’s “transforming debt into wealth” program. After buying Cummuta’s advertised program, the complaint details that the woman shelled out $9,270 for her Cummuta debt coach. Her coach then urged her to take out a $100,000 home equity loan and invest in “promissory notes” which he claimed could pay her up to 27 percent. After leaving Cummuta’s organization, it became clear that Beal had absconded with his investor’s money and his since declared bankruptcy listing over $5 million in debts.

    All of this is yet another reminder that whenever you are considering buying any product or service, you should examine and compare alternatives. In Cummuta’s case, the analysis says you should avoid him and his pricey, poorly-rated services.

  43. Christopher says:

    Wow, what a great comment Howie. I heard a John Cummuta ad the other day on the radio and it said that 2 million people have bought their program. This doesn’t mean however that 2 million people have actually solved all of their debt problems with this program though. I also believe the cost of this program is far to much even if it’s less than a mortgage or rent payment. When your living on a shoe string budget it’s hard to justify a program that will put you in the red.

    I believe their are much better and much cheaper programs available such as the Dave Ramsey Money Makeover Plan. In fact, if you can do a little research on the net you can actually get all this info for free from Dave’s site, and if you want to go a step further for less than $20 you can get the book as well. That’s much cheaper than paying $400 to a program that you are not certain will work.

    Thanks for the comment Howie, I look forward to hearing more from you.

  44. thank you howie for the cummuta info i’am neck deep in credit card dept all do with being laid off for the last 4 years taking jobs that don’t pay very well and credit card companies calling every day . i will figure this out how to get out of this soon thank you jim

  45. BIGGEST LOAD OF CRAP!!!!!!
    This company is ridiculous! Their practices are shady, at best. Do NOT.. I repeat… DO NOT make the mistake of getting mixed up with this company!!! Save yourself money, headaches and menacing phone calls! I regret ever calling this company in the first place.
    To even return their lousy ‘free’ trial nonsense you must call a special # to request a ‘return authorization’. I am so furious I can hardly see straight.
    I suspect John Cummuta may require contact from my atty before all is said and done.
    UGH!!!!

  46. Reading through this, I have to say that for the average person with huge debt or even no debt, the Dave Ramsey plan is the best, most common sense I’ve seen. My wife and I used it to pay off over $100K of debt. It’s not rocket science and Dave will tell you that. He didn’t invent it. It was how our grandparents lived, below their means without bringing on debt. He offers most of his advise for free on his website, or you can find his Baby Steps anywere on the web. Best of all, you will not pay a lot for it, or anything if you research it enough. In fact, his Financial Peace book isn’t very much and you can actually probably check it out for free at your local library. I would suggest looking for a Financial Peace class in your local area. They are held all across the nation in churches or civic organizations. Now this 13 week course does cost money. $100 or so. But it has all of your class materials and access to his budgeting tools online for so long. The great thing is, once you pay for the class, you are a lifetime member and can take the course as much as you want anywhere else as a refresher at no cost. It is a video series and group setting. You get his Financial Peace Book, Workbook, some budgeting forms, and a set of CD’s with the audio of the DVD’s. Working with other groups is good too because you see that your debt issue is common and you work through it together. I loved the class. Dave did a great job on the videos.

    Even without any books or classes or spending any money, the trick is creating a budget every month to tell your money where it is going to go before you spend it. If you don’t designate where it is going to go, it will leave you. So each month, you write out where every dollar that you make is going to end up. If you have money left over after your bills, designate that left over money to something so your budget balance is zero at the end of your budget. Here is you Dave would have you invest that extra money in your budget; If you don’t have $1000 cash saved for emergencies, it goes toward that. If you have $1000 cash but have debt, the extra money goes to the debt. If you don’t have debt (except house), but don’t have three to six months of living expenses in a cash account or money market, it goes to that (emergency fund). If you have your emergency fund, you need to start investing in your retirement. If you are investing 15% to your retirement, start a college fund for your kids (if applicable). If you are doing all of that, then pay off your house. After you pay off your house, your really in a great position to enjoy your hard work you’ve done to be out of debt and plan for your future. He teaches these baby steps in that order.

    Bottom line…it takes discipline. It won’t happen just because you read a book that has a lot of great ideas, or because you go to a class or seminar. If you haven’t trimmed all of the fat out of your spending to pay off debt, are you trying hard enough? If you have trimmed it all and still can’t make ends meet, are you working a second job for a while to pay it off? It takes motivation, discipline and sacrifice. The good thing is, you own your budget, so if you want to budget for movies and fun, do it. It’s your money. A budget isn’t to constrain you, it’s to make sure you get the benefit of the money you make before it escapes your pocket because you didn’t plan for it.

    I don’t know anything other than what I read about the Cummuta plan, but I imagine it is similar to Dave Ramsey’s with a few minor differences (but a whole lot more expensive). Does it work? I bet it works to if you’re willing to discipline yourself to budget and stick to it. I will mention that Dave Ramsey’s plan is a Christian based program with scripture references and a session about giving to your church or other charitable organizations that even adds another level to financial freedom, the ability to help others because you don’t have debt. Anyway…good luck to those seeking financial freedom. Just buckle down, make a budget and stick to it and that will transform you financailly no matter who you read or who’s program you follow.

  47. Christopher says:

    Well said David. I agree the John Cummuta Plan may work just fine but Dave Ramseys plan is common sense and very inexpensive. Thanks for the great comment.

  48. It doesn’t matter whose program it is, Dave Ramsey’s or John Cummuta’s. If you’re so much in debt you feel you need to buy a program, you shouldn’t be spending the money on a program when you can research it for free.

    I don’t know about Ramsey’s. I wouldn’t touch Cummuta’s. In addition to being scammy, being debt-free in 2-3 years just isn’t possible for most people today. Even in this country (U.S.) alone, half of the entire population now lives on a low income. Do the math. It takes hefty payments to retire a 5-figure debt and when 70% of your take-home goes towards rent alone … well, what can you say?

    I have no intention of sacrificing my senior years due to a debt an illness prevented me from paying off to begin with. I always lived within my means and still believe in doing so, but when disaster hits … you deal with it the best you can. No one’s in a position to play judge and jury. I speak only for myself. I won’t be a slave to debt.

  49. The reason I came to this site is that I heard Cummuta on the radio the other day invoking God and Scripture, something I had never experienced from him. Dave Ramsey is genuine, if you need a plan, go with Dave. Thanks for all the input.

  50. Mike Smith says:

    I purchased the Cummuta plan a couple years ago. I had no CC debt but following it allowed me to drop over $35k off the principal in 2-years. The plan does work and was well worth the $265 I paid. Yes, there are sites with this info but listening in the car allowed me to follow thru with it. $265 for an audio book…still worth it for me. I am now seeing the snowball effect on the mortgage and several $k in the bank.

    Just my personal opinion.

  51. Michelle says:

    I’m a single 57 year old parent of 1 child left at home. I have been working hard to save for retirement. Unfortunately I started late in life and spent any extra money on family when in need. I still live paycheck to paycheck, but I’m doing the snowball method to get out of debt before I retire. It looks like it will be after I’m 60, when my son graduates high school.
    One of the things I was trying to do was combine 2 of my loans to get a lower interest rate, but was turned down because of my income to credit ratio. What hog wash! I’ve NOT been late on any of my bills in years! Is there someplace that I could possibly get a loan without the hassle (at a low interest rate)?

  52. Christopher says:

    Hi Michelle. Check out my article on Lending Club http://stumbleforward.com/2010/10/25/online-loans-how-to-get-a-loan-on-lending-club/
    Lending Club is a peer to peer lending service that allows to borrow money from others and I’ve found to have a lot less restrictions. Check it out and let me know what you think.

    Chris H.

  53. Leslian says:

    How can Cummuta’s or Ramsay’s plan work if your income falls far short of your monthly bills? We were barely paying all of our bills totaling over $7000 each month including mortgage, health insurance, car payments, auto insurance, utilities, and credit card bills. However, this amount does not include groceries, gas, taxes, student loans, or life insurance, all of which add to the $7000 figure. Recently I discovered my income will decrease by over $3000 a month within 30 days. This loss is due to a contract which will not be renewed as the job will no longer exist. I have a part-time job, but that income is less than $1500 each month. I am diligently looking for full-time work, but in the mean time, how does one stretch $1500 to cover this ridiculous amount of debt each month, much less pay extra to eliminate debt? I don’t see how this plan can work with any income versus any amount of debt as the system boasts. At least 75% of my monthly financial obligations will have to go unpaid, won’t they?

  54. Christopher says:

    Wow Leslian it looks like you are facing a serious situation. The truth is their is no pretty way around this kind of situation. My suggestion is to cut back on whatever you don’t need and some of these decisions will be tough to make. For example maybe you will need to sell a car and down grade to something less expensive, or get rid of your cell phone, or even sell your house and move to something with a lighter payment. I know this sounds tough but you got to do it.

    I faced this same situation back 4 years ago. I was really tight on money so I started to look for ways to earn a buck. I had some old CD’s and music equipment and I sold it all. I had a couple of snowmobiles and I sold them. I also started a couple of websites which help pay the bills as well. The point is I did whatever I could to improve my situation even if it was to save a dollar.

    Finally, I suggest you keep a budget to track your progress. It will also show you where their might be some holes in your budget as well. The best tool I suggest to do this is Mint. Mint is an online based budgeting program and does most of the work for you. On top of that it’s free. You can check out my review on it here http://stumbleforward.com/2010/10/18/budgeting-solutions-why-you-should-choose-mintcom/

    I hope this helps, let me know if you have some further questions.

    Chris H.

  55. Leslian says:

    Thanks for the suggestions. We have been cutting costs since 2008 and nothing seems to materialize into actual savings. I spent two years struggling to modify our mortgage — a daunting task that finally succeeded in reducing our mortgage by $500 a month. During this two year period, however, we exhausted tens of thousands of dollars in money market, savings, IRA funds, and even life insurance cash values to hold on to our home, keep our kids in college, and pay other bills. We switched healthcare providers to save $620 a month. I traded in one vehicle for another to save $150 a month, and we paid off another loan amounting to $260 a month expecting to see a small bit of relief; and yet this $1530 is nowhere to be found in terms of savings. We haven’t taken a vacation since 2007, and we don’t eat out or spend any leisure funds whatsoever as they are nonexistent. I have been working with a consumer counselor for over a year to get my credit cards paid down, but it will be three more years before they are paid off. My husband and I have both had extra part-time jobs for several years now.If we can somehow hang on for one more year, we will have no car payments, which should help tremendously. Everything we’ve done so far should have helped, and yet it hasn’t. I can’t seem to detect the black hole where this supposed savings is hiding itself. We have absolutely no extra funds at the end of each month, and beginning Aug. 1, we will have an even great income/debt ratio. I feel like we’ve done all of the right things, but nothing has succeeded in helping. I will definitely check out the budgeting website to see if that helps.

  56. Christopher says:

    Trying your best is all you can do Leslian. I know things don’t look good right now but just keep your focus on making your payments and getting those cars paid off. Once that debt is paid apply all the debt you were paying on your cars towards the next debt and keep paying them down. Then once you get all of your debt paid off except for your mortgage build an emergency fund that will cover up to 3 to 6 months of your expenses.

    Also here is an article I recently wrote that may help you speed up the process of paying off your debt. It has some great tips in it, check it out here http://www.mydebtreliefoptions.com/2012/06/15/6-tips-to-paying-off-debt-faster/

    I know this sounds like it’s to easy to work but just keep your focus, it’s the small things that add up over time that make the biggest difference.

    Chris H.

  57. It’s a matter of personal preference – Dave Ramsey vs John Cummuta. I like Ramsey’s books (I can skip over the religious stuff that way) but he irritates me on tape or on TV. I *really* like to listen to Cummuta’s tapes and I think he has a book too.

    Some have mentioned that the material is available elsewhere. Sure – perhaps the concepts can be found elsewhere. But it’s the WHY that I need pounded into my head for motivation. I play Cummuta’s tapes over and over in my car.

    Any of these programs can be found for a fraction of the cost on ebay. I highly recommend them. After listening to Cummuta’s tapes countless times I just upgraded to a big packages of CDs – a half dozen programs or so – on ebay, unopened, for $60. Money well spent IMO.

  58. My husband bought the debt to wealth package John C is selling, we have it paid off after” 5 easy pmts of4 79.99″ Then somehow Prosper Inc. the coaches John suggests to use, contacted us… Boy do they have some great sales people… they know how to get to the purse strings, they convinced us to open 2 credit cards to split the $15,000.00 cost to become debt free and financially sound in 5 to 7 years. We’re 59 and 60 and through K-Mart devalueing their company stock to 0 and taking it off the stock market we lost 22 years of 16% weekly income in that company stock. Mind shattering to say nothing for our retirement… We have a small amount set aside for retirement, but not nearly enough, so we thought, 5 to 7 years would be just fine for us… I have been paying our credit cards off with a version of snowballing, paying the highest intrest card off first, then on to the next one. I have paid off $35 k in the last 5 years, wish I would have known about the weekly pmts rather than the once a month pmt. Oh well, I still have a car and truck pmy that I may try that on… anything to save some of the intrest chgs. Anyway back to the coaches and the 15 k that they want at the very begining.. we put it on our 2 cards that night, and afterward had a chance to think and decided that it was just too much money to go back INTO Debt. We canceled next day, but they don’t want to accept no. The sales man called again tonight and spent another 45 minutes to an hour with my husband, mind you we have already invested over 5 hours in 2 days already, and wants to call again tomorrow and talk to both of us. HE is VERY convincing, but we just have to say NO. It’s terrible that we can’t trust to have someone give you an honest to god leg up and help another out.

  59. I was sorry to hear about the couple who got hoodwinked by a slick salesman into buying a “system” they could have studied on their own. The bottom line is, whether you pay off your debts or file for bankruptcy, this “program” really does nothing but subtract more money from you. I’d leave it alone.

  60. You seem to forget that all of this goes right out the window if you don’t make much money and have a pile of debt. None of this will work if you’re a pauper. You will not become a millionaire or even close to a hundred-dollar-aire by any of your methods if your outflow is more than your inflow…and if your inflow is practically nothing. This is nothing but a scam to make millions for the con artists who put this BS out there for stupid people to grab onto because they can’t do simple math or work out even the most basic logic problem.

  61. Nadine Anderton says:

    It has been a long time since I’ve posted, and years since I was involved in this program when it was known as FINL (Financial Independence Network Limited). But the principles haven’t changed, and they can work for almost anyone who really wants to succeed. I’m responding to “Fred,” who doesn’t seem to want to succeed, so he probably won’t even try to and then he can demonize the program instead of his own lack of trying. Fred, you may have too much debt to succeed. That’s not John Commuta’s or anyone else’s fault, is it? So stop with the blame. Next, some of the debt can probably be paid off very quickly, as you will pay off the smallest debts first, regardless of the interest rates on them. Some small debts dollarwise have high interest rates, which you will no longer have to pay once the debts are gone. To succeed, you have to put what you would have paid on those debts to the next on your list, or you won’t succeed. An important factor is to determine the distinction between “wants” and “needs.” If your spending is limited to “needs,” you are a long ways on the road to success. You may also have to make sacrifices of things that you already have -but don’t need – to contribute to paying down your debt. If you really are bringing in less than you need to pay your debts and aren’t able – or aren’t willing – to do what it takes, you may have to file bankruptcy anyway – but don’t blame that on any program out there. It’s your choice, just like the debts you made are. John has a right to make money with his plan – and it is the best I’ve come across in the 25 plus years since I was introduced to it – and it is certainly not a scam.

  62. In total agreement with those who are questioning this whole package. First, those who are in a position can do all this themselves without handing over more money — or going into even more debt — to make marketers like John Cummuta rich. Second, I must add my voice — again — to those who state the basic, common-sense fact that paying off debt and becoming wealthy afterwards requires MONEY.

    I’ll say it again: paying off debt requires money. Those without it … ain’t gonna get far. Some people will never be able to pay off debt with the money they already have. Simply because that money is used for housing, food and other necessities. For some — many today — there’s simply nothing left over. Nothing.

    The real secret is making more. And those are the pundits I follow.

  63. Nadine, I don’t get the impression that anyone was “blaming” Cummuta’s program for getting into debt. That assumption is nothing short of ridiculous. People get into trouble with debt for various reasons and we have no way of knowing anyone else’s situation. I can speak only for myself as far as how the debt happened. In my case, a combination of some mistakes I made plus the economic crisis. And the thing is, I had believed all my life in living within my means and had done so 99% of the time I had credit. The 1% was the mistake, a terrible time when the means just weren’t enough.

    But that’s the last time I’ll ever try to justify to anyone else what happened with me. I don’t have to justify and neither does anyone else here. What is it about Americans that we must judge others who have little so harshly? I put in my 2 cents on Cummuta: maybe a scam, maybe not; a program based on ok principles I still think people can do on their own; if your debt is too high and/or your income too low, you’ll most likely need bankruptcy which is perfectly fine for a new start; definitely not for me.

    Anyway, I wish everyone the best whatever you decide.

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