Almost back to zero and my debt has been reduced by almost $900 since the this time last month. I need to keep chipping away at that credit card debt number. It’s getting pretty low, so the snow ball is really picking up speed and has been providing a good feeling with each payment that is made – every little bit is show a deeper impact.

I hadn’t carried a balance on the cards for probably over a year now, but didn’t want to cancel them in case the reduction in available credit would impact my overall credit score and therefore my rates on existing balances.

But with the new credit card rules coming into effect and the current state of lending – I feel that now is as good a time as ever to cancel my zero balances. I’m making good progress in paying down debt and if there are any repercussions to canceling cards – I’m betting that it will help in the long run if I just start making adjustments now.

One thing I do know so far is that I’m thrilled to no longer have any ties to Bank of America.

Also, below is the actual video from Jackie Ramos, in case you want to hear her whole story:

I’ve already made some good progress on my items – not a large sum, but still a few hundred to toss towards my debt.

I’m not a frequent user of ebay, but I have used the site enough – both as a buyer and seller – to understand a few of the components that can make for a positive experience:

1. Build your reputation

If you have an old ebay account – hold on to it (again, similar to a credit card with the longest history). If you don’t have an ebay account, sign up for one now – even if you don’t plan on using it right away. Like financial credit, your history and reputation means a lot in ebay, especially if you’re selling things.

A word of advice though, think of a good name that you won’t mind hanging on to for a while. I signed up for my ebay account a really long time ago and my username is pretty silly, but I won’t change it, regardless of how badly I’d like to, since I have a solid reputation tied to that name that has been built over many years, even though I’m not a frequent user.

Once you have your account, the most important thing is to take care of your reputation whether you’re buying or selling. Your rating helps you stand out from the crowd and reassures others that you can be trusted.

2. Know your goal

The Gordon Gekko strategy doesn’t often work here – it’s best to come in with a reasonable purpose. For example, I’m in debt and I never use what I’m putting up for sale. I’m not going to hike the price so high that I discourage bids and I’m willing to hear offers if they’re reasonable (i.e. reduced or no shipping charge).

3. Be real

Write accurate descriptions, and use real pictures when at all possible.  I’ve used pictures off the internet or suggested photos from ebay before and I’m always met with skepticism. Whenever you’re selling something on ebay, always try and think as if you were on the buyers end – how would you perceive you the seller?

To that end, always provide fast and detailed feedback to the other party – again, remember your reputation is the most important thing you have going for you. A positive review goes a long way.

Although I’m not an ebay pro by any means, the three tips mentioned above have worked pretty well for me. Do you have any tips to add?

From time to time, you need motivation to keep going and keep sacrificing quick hits of happiness to really pay down debt. This movie motivates in two ways:

1. It scares the hell out of you. (i.e. 57 year old woman talking about how she’s considered suicide because she’s in so much emotional pain as a cause of her debt burden)
2. It shines a light on what you, as a consumer, are really up against.

As you can imagine, the credit card industry is a well-oiled machine and they know where to pull and push in order to get the maximum from each and every card holder. It’s really amazing to think of how calculating the system they have created has become.

As I watched, I couldn’t help but think about how the banking and credit card industry advertise their products – both in commercials and disgustingly blatant in-show placements. The goal of advertising and branding is to give a brand a personality – something that makes you feel a certain way and help you develop an emotional connection to them or their product(s).

Credit cards and banks do this very well. Their ads and slogans (Bank of America = Bank of Opportunity) make you believe that they’re friendly companies that just want to help you enjoy your life on your terms. They make dreams come true and are in your corner through good times and bad.

After watching Maxed Out, it’s clear that nothing could be further from the truth.

Again, I love tax season. This year I received a large chunk of money back from Uncle Sam and immediately threw that on top of my existing payments for this month. The result was a (near) 25% reduction in my credit card debt and a 54% increase in my overall net worth. If it weren’t for the big hit to my investment accounts – especially my 401(k) – I would be close to a zero net worth, which at this point sounds really, really good.

I’m not at all concerned about the investment accounts because I’m obviously in it for the long-haul and am a big believer in dollar cost averaging – so the way I look at it, stocks are currently on sale this week. That being said, I am going to start the process of rolling over my old 401(k) to the 401(k) I just started with my new company. I want all of that money working together. Especially once I have my debt paid off, since I plan to put my savings plans in overdrive to catch up on lost time – about a decade worth (man, that makes me angry).

As soon as it hit my account, I assigned each penny to debt. Resulting in two paid-off cards and a significant chunk of the next card in my interest-based snowball plan. In one month, thanks to taxes, I have paid-off a quarter of my credit card debt and increased my overall net worth by about $5,000.

Could I have done this over time by keeping more of what I earn each pay day? Sure. Would I have – probably not. The bulk payments allow me to remove myself from the equation. It’s much easier to be disciplined one day and assign payments than be disciplined 365 days a year and ensure that the extra few dollars in my check make it to a credit card. Also, I can’t begin to express how motivating it is to knock down the debt load so significantly in the span of a few days. I have about $14,000 left to go and freedom from debt seems more attainable now than ever.

I kept track of my accounts in December, but didn’t get around to posting an update due to holiday travel and just plain laziness.  Obviously, I took a step backwards in credit card payments – which really were based on finance charges.  But as always, I’m really looking forward to the next few months since I tend to get a pretty nice tax refund which I apply directly to my debt.  I’m hoping to knock off one of my cards and increase my snowball payment amount.

It’s really encouraging that my overall net worth is nearing positive numbers, but as I’ve mentioned before I know the main number that I need to focus on is how much debt I have on credit cards. I’m really hoping that 2010 is the year that I get out of debt and start building up some wealth while I wait for my student loan payments to start.

Pretty good progress across the board this month – though my savings did drop a bit due to some minor car repairs that couldn’t be put off.  The big news is that I dropped below (above?) the -10K net worth mark.  Though it’s the credit cards that really need to be my main focus.  I was able to put $783 towards them in October, so we’ll see if I can increase that amount to at least $1000 and make it consistent here on out.

So this October net worth update is extremely late, but I wanted to get it up on the blog before I post the November chart in a few weeks.  As you can see, not a lot has shifted.  I need to re-evaluate what money is going to where in order to make sure I’m throwing as much towards my debt as I can.

In fact, this has become even more urgent to me now that I did a quick estimation of the student loan debt that I will have upon completion of my MBA.  For about half a second, I considered starting a student loan debt payment account to begin collecting money to start off with a large lump sum payment.  However, I quickly realized that it would be smarter to pay down all of my other debts in the hope that once the new student debt shows up – it will be the only debt that I will need to focus on at that time.  Sure it will be big – but it will be really nice just to have the one debt item.

Now, that I wrote my intentions, I do have to be upfront in saying that I did just take a vacation. During the vacation I spent about $800 or so.  I take one vacation a year, and many have commented that I shouldn’t be taking vacations or spending money like that if I’m really serious about paying down debt.  However, that money comes out of a “vacation fund” that I do not count towards my net worth and, to be honest, I don’t regret getting away for a bit and recharging the batteries.  In fact, going away on vacation (with a dedicated fund / budget) is a nice way of showing yourself how life could be if you didn’t have to worry about money – which is the ultimate goal.

Anyway, it’s back to reality and time to really start planning for 2010 and how to make the most of it right from the start.  The end of the year is always tricky.  Just like vacation, I have a dedicated holiday or gift fund that I save up throughout the year (not counted towards net worth).  This way, the scramble for Christmas gifts doesn’t impact my budget or debt payment.  Plus, there’s the hope of year-end bonuses and next years tax refund to look forward to.  Usually, a nice boost to the plan.