Transcript Doug Johnson: Good Evening! This is Doug Johnson and this is “The Truth About Debt Relief!” Welcome everyone this evening. Kevin, my assistant, is back in the studio with us tonight. Kevin, how are you doing? Kevin: Oh, I‟m doing great tonight. We‟re not driving around all over the country. Last week, we were driving through a storm in Georgia while I was trying to talk to you on the cell phone. That was a bit difficult. Doug: Yeah, yeah. Thank you for joining us, last week, under difficult circumstances. We have a special show tonight. During past shows, I have interviewed providers of debt relief programs. And I‟ve opened the lines for our listeners to ask questions of those providers. But tonight, Kevin, we‟re going to do something a little different and it‟s based on our requests from our listeners. We‟re going to, uh, bring Doyle Breuchner onto the line and we‟re going to make him available to take questions and offer advice and counsel for the alleviation of debt. Kevin: Good Doug: Yeah. Now, Doyle is founder and director of the Liability Management Group and he was on our show a few weeks ago as you recall. And we had a tremendous response. We got calls and emails and letters all week long from his visit with us. So, we decided to bring him back on and make him available to answer questions. Now, that number to call to speak to Doyle is 800-688-WLAC. That‟s 800-688-9522. Or you can call *9522 on your Verizon wireless. Kevin: And, also, I just want to mention that if anyone wants to talk to us any time during the week, uh, Doug and I are available to, um, listen to their specific situation. Just call us at 615-942-1221 anytime between about 9 o‟clock and 5 o‟clock anytime – that‟s central time – during the week. And we‟ll be glad to just listen to your specific situation and give you some options. Doug: Yeah. And before they open the line and take your calls this evening, I‟d like to talk about a topic of importance. Uh, Kevin, I believe it is important to be aware of all of your options prior to making any financial decisions. Kevin: I agree Doug: I don‟t think anyone would argue with that. Getting out of debt, for most people, is a major financial decision. It‟s a decision that effects them for the remainder of their lives. And you and I see that more so than anyone, probably. Yet, I talk to people everyday who are struggling to make payments on their credit cards or some who are delinquent on their credit cards and they‟re woefully uninformed as to their options. And I see people go and file bankruptcy and they don‟t know that there‟s anything else out there. And, of course, I‟m not against bankruptcy and for some people it‟s their only option. But, I think that people should be aware of other potential options before they go to that extreme. That should be a last resort for most people. Now, I conduct eight webinars each week to educate people as to all their options to get out of debt. Kevin: And, what, what exactly, is a webinar? Doug: Well, a webinar is a presentation over the internet. You watch the video portion on your computer. You listen to the audio portion on the telephone over a conference call. Kevin: So, how long are your webinars, Doug? Doug: Well, they‟re 30 minutes in length. Kevin: ok Doug: uh, huh Kevin: and these are when? When do you, when do you conduct these? Doug: These are, they start at noon and 5 p.m. central standard time and the reason for that is that so that people can listen to these, oh, uh over their lunch hour or while they‟re waiting for traffic to dissipate after work. Kevin: ok, so these are like a 30 minute class over the internet. Doug: Yes Kevin: and, then to get on to one of your webinars which are, like you say, Monday through Thursday at noon. So, you‟re talking at lunch time from noon „til 12:30 central time. Doug: That‟s correct. Kevin: And then 5 o‟clock, say, at the end of the work day. Doug: uh, huh Kevin: They can sit there at their desk. They don‟t want to tell the boss what they‟re doing but they can listen to your webinar. They don‟t have to talk! Doug: Well, most people are off the clock at 5 o‟clock. Kevin: Yeah, and they can wait „til the traffic dies down and listen to your webinar. Then, you know, put on their coat, get in the car and go home. Doug: Right, Yeah. Kevin: Sounds like a good idea. Doug: If, in the central time zone, that‟s a good time. If they‟re not, eh, hopefully it‟s still a convenient time for people ..who are in the pacific time zones or the mountain time zones. Or even the eastern time zones. Some people have flexibility in their lunch hours. Kevin: And they don‟t have to participate if they don‟t want to. They can just sit and listen. Doug: Right Kevin: And they can attend as many as they want. Doug: Sure. Yeah. Kevin: Ok Doug: And it. Yeah. I mean, some people, eh., we know that, uh, talking about your debt is, uh, or debt in general is a private financial matter, matter. Most people don‟t want to, uh, know who people are when they come onto call or conference call or even, sometimes, people calling on the radio here. And, so, we don‟t expect people to introduce themselves. They don‟t have to talk. They can just come and listen and observe. And we‟re fine with that. Kevin: Ok, so then they just go to www.debtrelief hyphen, uh, or dash Doug: I say dash Kevin: ok dash, hypen Doug: That little line Kevin: ok, dash Doug: Some people call it a hyp hen, some people call it a dash. Kevin: The Truth dot com. So, www, uh Doug: dash Kevin: dash. No, no, debt relief . www debt relief dash or hyphen the truth dot com. Doug: right Kevin: ok. And then they, the instructions are there for them to log into the webinar. Is that correct? Doug: Yes. It‟s listed under Learning The Basics, Debt Relief 101. That‟s what they need to click on. Ah, ok. Kevin: Ah, very good. Well, I‟m looking forward to the first one. Doug: Yeah, well thanks. It‟s tomorrow. Kevin: That‟s right. Tomorrow at noon. Great. Doug: OK! Well, it‟s time to open the lines for our listeners to speak with Doyle. Again, that number to call in is 800-688-WLAC. That‟s 800-688-9522 or they can dial *9522 on your Verizon wireless. So, how are you doing this evening, Doyle? Doyle: Hey, good evening Doug! This is Doyle. Doug: Huh, huh. Doyle: Doing well. Uh, by the way, before we get into it, I want to let you know I‟m excited about your webinars as well. I‟ve seen the powerpoint. And, uh, uh, it‟s just, uh, I was just really excited because it‟s, uh, you know, basically a free education for people and kinda goes over all the different options and I think it‟s, just, there‟s not enough out there that‟s just, you know, education, uh, to help people make a decision, uh, that comes with no strings attached. So, I think that‟s a great service you guys are providing. Doug: Oh, well, thank you. You know, it‟s just. All it costs them is 30 minutes of their time. So thank you very much about your comments there. Well, Doyle, we‟re going to take calls, of course, this evening and, um, we had people who called in last time we had you on the show. And they expressed an interest in having a free consultation with you and, so, that was the basis for bringing you back on here, this evening. Uh, prior to receiving some of those calls there were a few things I wanted to ask you about. Doyle: OK Doug: General questions, financial questions, and these are some questions that people had, uh, I believe that they wanted to talk to you about. I want to first talk about debt consolidation. That‟s a very common form of debt relief. Can you explain to us what debt consolidation is and, uh, what you provide in the way of debt consolidation? Doyle: Well, uh, yeah, debt consolidation, uh, is sometimes misunderstood. There‟s really two different, uh, types of debt consolidation. Uh, in the, in the real sense debt consolidation means basically taking a lot of debts and rolling them into one - you know, getting a loan, uh, whether it‟s a refi on a house or an unsecured personal loan and taking your debt and putting them all into one, you know, for a lower interest rate or lower payment. That‟s true consolidation but when you‟re saying debt consolidation, uh, what a lot of people think debt consolidation is, is kind of, uh, uh, misunderstood to mean consumer credit counseling. And, and, uh basically, uh, the way consumer credit counseling works is, and and there‟s a lot of, there‟s hundreds of consumer credit counselors out there. Uh, basically, you know, you get a hold of a consumer credit counseling type company and then they just work with your creditors to, uh, lower your interest rates, and as they say, lower your interest rates and payments and you make one payment to the credit counseling company and they disperse, uh, that payment to your creditors. And that‟s how consolidation and independent consumer credit counseling is supposed to work. And what most people, they think of that like a consolidation but it‟s really not. It kind of is because you‟re just making one payment to a third party company but your debts are not being consolidated. So, there‟s a little misunderstanding about how that works. Doug: Ok. And what is your opinion about the efficacy of, uh, debt consolidation programs administered by credit counseling companies? Doyle: Well, uh, honestly, uh, I don‟t have a very good opinion of them. Uh, uh, because, you know its, the truth is that consumer credit counseling type programs, um, the customer of the consumer credit counseling company is not the person in debt. Um, you know who customer is? It‟s actually the credit card companies. Uh, that‟s who they‟re actually working for. Uh, and.. Doug: So you‟re, you‟re saying that the credit counseling companies work for the credit card companies? Doyle: Exactly! They actually get paid, uh, from the credit card companies a percentage of the amount of debt they‟re able to collect from consumers. And, and, so it kind of creates a conflict of interest there. Uh, and uh, honestly, you know, basically I deal with, uh, people, all the time, every day, you know, talking to them about their specific situation and I just know by experience that, you know, uh, consumer credit counseling companies can be an option for a very small percentage of people. But it‟s, it‟s very unusual for it to actually make sense because of, for a lot of cases they actually don‟t lower the payments. Um, because, typically what they‟ll do is they will lower the interest rate, some, but the payments, typically will remain the same. And for most people that are really struggling with debt, that‟s actually, uh, not enough. You know they need more help than that. So, that‟s one of the reasons. But then the other thing is, you know, this is also something that could, just as easily be done, um, by the person without paying the, you know, counseling fee as well. Uh, so, you know that‟s just a couple of things, uh… Doug: Now Doyle, you said that they work for the credit card companies and that they receive monies or profits from those companies. Yet most of them represent themselves as non-profit? Doyle: Yes. Uh, non-profit is just a way to organize a business. You know, it‟s just another business model. And uh, you know that some of the highest paid salaries in the country are CEO‟s of non-profit corporations? Uh, you know it‟s not that there‟s not people that make money, in fact a lot of money, in non-profit corporations, but the fact of the matter is that the company itself is not supposed to show a profit. So, of course if all the money is paid out in salaries they cannot show a profit as a company. You know, so, really that‟s also another confusing thing to people. You know, if you hear “non-profit” that makes you think that, you know, their just kind of like a public service, you know, and that‟s just simply not true. Doug: My opinion, Doyle, is, you know, people hear “non-profit” and they think it‟s a non-profit, that it‟s a ministry of sorts. Doyle: Right, exactly. And, um, that‟s just simply not the case in a majority of the times. Uh, the other thing about credit counseling type, um, you know, about going back into a debt is, and this one of the other things that I just really don‟t like about doing that is you lose control. Um, you know we‟ve heard, uh, you know, I‟m sure everybody, all the listeners have heard on the news about consumer credit counseling companies that have basically taken people‟s money and not dispersed to the creditors properly or not on time and then they‟re stuck with late fees and everything else. Uh, and even companies that have taken money and gone out of business. And, uh basically the client has just been stuck hanging there, too. So, one of things about consumer credit counseling companies that I don‟t really like is that you lose control as a customer. You lose control of the situation because you‟re hoping and praying that, actually, the company you‟re working with is going to be a good company and forward the money properly. But, you know, a lot of times that doesn‟t happen. Doug: Yeah. Doyle, let me interrupt you and give out the number, again. The number to call in is 800-688-WLAC. That‟s 800-688-9522. You can also reach us by calling in on your Verizon wireless. It‟s *9522. We‟ll take calls whe n we come back. Please stay with us. This is the Truth About Debt Relief. BREAK Doug: We‟re back on The Truth About Debt Relief. Hi, I‟m Doug Johnson. My guest, today, is Doyle Bruechner of the Liability Management Group. Doyle, we have a caller, here. Stand by. Ok. Theresa from Antioch: Theresa from Antioch. Doug: Yes, Theresa from Antioch you‟re on the air. Theresa: Uh, Uh, I‟m in a situation right now where my husband is recently retired and on a fixed income and I, uh, am building a business of my own based on commission level. And to get my business started, uh, between personal and business debt, I‟ve probably racked up about $40,000 on my credit card and I have excellent credit but I‟ve kind of painted myself into a corner. So, I wonder what my options might be as far as getting a handle on this. Um, I can hardly turn around and take a breath. So, Doyle, what do you think? Doyle: I‟m sorry was that Theresa? Theresa: Theresa. Yes. Doyle: Alright. Well, thank you for calling Theresa. Uh, You‟re basically saying your cash flow is not covering your debts with your , is that right? Theresa: Yes, and when the cashflow does come in its incrementally, you know. My level is on commission. My husband is social security and, other, pension income but, basically, to get my business started I kind of over extended myself. Doyle: Right. Well, Theresa, there‟s several different ways that would make sense depending on your situation a little more detail. Are you paying high interest on these credit cards right now? Theresa: Luckily, our credit is good enough that I have been able to pick up more credit cards and dance to another, you know, with a zero or very low interest rate. And when that one runs out, I dance to another. So, I‟ve been doing this dance and I always stay on time. So, I‟ve been doing very good but.. Doyle: Well, one way. There are really two thing to look at because it‟s really a cash flow problem right now. The first thing is to look at the expenditures. And, basically, budgeting. Looking at where the money going. Kind of setting out, working on a 90-day plan and seeing, actually, where you‟re spending your money and seeing if there is any holes that could be plugged in the spending to help alleviate some of the cash flow pressure. Uh, what we find, typically, is just by doing that exercise with our, helping people do that with our clients, uh, we‟re able to save, typically five to ten percent of household income just by, you know because most people don‟t even realize where their spending their money. And it‟s an easy thing to just stop and save and increase their cash flow. So, that‟s really the first thing I would look at. And, the second thing, uh, is, since your interest rates are already low on your credit card debt, um, so, you know you‟re already in a good position there. There‟s no way to really call, and you‟re doing the balance transfers. So, you‟re doing the right things, there, to keep the interest rates low. Um, but your payments are probably running you about 2% of the debt. You‟re probably looking at about $800 per month or so. So, $800 to $1000 or more, just in minimum payments on credit card debt. Uh, so, one other option that you have and this may or may not make sense for you depending on other circumstances. But, you know, you could actually consolidate that into – you have good credit – so, into an unsecured personal loan. Or even a, doing a refinance, or something available so you can get that payment lowered to help increase the cash flow, too. So, that‟s the first thing I would look at to see if we could get your right side up. Doing those two things. And then, basically, when all is said and done and, honestly, you keep going in the hole. Um, you could keep doing that for awhile, you know, while you build your business. So, if it looks like your business, you know, is going to be increasing that income, then you can continue that process until it does cover itself and, then, get on the plan and pay off the debt rapidly. Uh, but, you know if that never did happen. None of us can count the eggs before they hatch. You know, none of us know the future. Um, then, then, you know if that weren‟t happening and you keep going further and further in the hole in the future then you‟d have to look at something more aggressive to be able to take care of that whether that was, like I said, a debt negotiation option but, uh, does that help give you some direction, Theresa? Theresa: It does. I understand that you need to negotiate with credit card companies but it always hurts your credit. Is that the truth? Doyle: Yes, it is. Because when you do a negotiation program, um, no one will negotiate, creditors won‟t negotiate unless you‟re behind on your debt. And anytime you‟re behind on your payments you‟ve got several downsides you have to consider like bad credit, phone calls, collection notices and all that. So, honestly, my goal for my clients to keep them out of debt negotiation whenever possible. That‟s why I would look at those other two things I talked about first. But, you know, like then again for somebody who‟s completely upside down and there just isn‟t a way to pay to pay the credit card, then honestly, negotiation can be, you know, a valuable tool for that person. Theresa: Well, thank you Doyle. That‟s been very helpful. Doyle: Ok Theresa. Thanks for calling. Doug: Yeah, thank you, Theresa, for joining in for this evening. Theresa: Thank you. Bye-bye. Doug: Doyle, I noticed in your literature that it says that, “a typical American family pays $39.87 in interest every day.” Uh, I don‟t know of anyone who would not go to extremes to reduce a water leak or something along those lines if it was costing them $40 per day. Why do you think that people are not overly concerned about interest? Doyle: You know, that‟s a good question, Doug. Uh, it‟s kind of an amazing thing. I, uh, really think it goes back to, uh, our education, the way we‟ve been brought up. Uh, there‟s a lot of reasons why people don‟t really are not that concerned about interest but you‟re exactly right. I mean if we‟re paying $40 per day, which is the average, uh, in just in interest. I mean that is a lot of money. And that adds up very fast. Doug: Doyle, can you hold that thought. We‟ve got another ca ller here. Can you hold that thought for a minute. Let‟s take this call. Mike in Donelson, you‟re on the air. Mike: Yeah, I had a question for Doyle. Uh, when you go about trying to pay off your credit card debt is it always best to start with the card that has the smallest balance? Doyle: Was that Mike? Mike: Yes. Doyle: Ok, Mike. That‟s a great question. You know, uh, when you‟re talking about ordering your debts there‟s actually two main philosophies. Uh, one is just what you said, Mike, to start with your smallest balance and then work through to the larger balances. And that‟s actually very solid. Uh, if you‟re going to be doing this on your own and that‟s what I actually recommend that people do when they‟re doing this on their own. It‟s a very, very good way to do it. And, basically, you just don‟t worry about the interest. You know it doesn‟t really matter the interest rate. You just start with the lower balances. The reason that works is because, um, it pays off the smaller debt it gives you a sense of progress. Obviously, it builds your moral which keeps you going on the program. Not only that, as your getting rid of those debts, the earlier ones, that then frees up the money that you were spending in minimal payments and that builds your, uh, what I call your Spend Smart Factor. That builds that extra amount of money that you can pay the principle onto your other debts even faster. And it‟s a , uh, it‟s a very good roll-up process. So I would recommend that. You know, there are other thoughts out there about paying the highest interest rate debts first. Um, and, um while there are some mathematical reasons why that can make more sense, it‟s really not the best way to go. If you have a large debt with a higher interest rate, you‟re going to be very discouraged, you know, trying to stay on that path for several years to get that first debt paid off. And, so, you‟ll see a lot better results if you start with a smaller balance. And then, there‟s some very complicated mathematical formulas that people use. Uh, one of them is what we call the “payoff method” where you divide your minimum payment into your balances. And then, rate your accounts based on, you know, which one is easiest to pay off. And that‟s another very effective way, too. But I think, for most people, if you just start with the smallest balance – you know, if you‟re doing this on your own – that‟s just what I would recommend for most people. It‟s the easiest and it really makes a lot of sense. Mike: Alright. I was kind of curious. Thank you very much. Doyle: Alright. Thanks for calling. Doug: Yeah, thank you, Mike. Mike: Thank you. Bye-Bye. Doug: Doyle, we have another caller that has another question about interest rates and we left off talking to you about interest rates. Let‟s go ahead and take this call. Doyle: Ok. Doug: Sarah from Nashville. Thank you for calling in. You‟re on the air. Sarah: Hi Doyle. This is Sarah. Doyle: Hello, Sarah. Sarah: I really didn‟t have a question. I have a comment. Doyle: OK Sarah: Um, I think people have been brainwashed, especially in America, about interest rates. That it‟s just a normal way of life and we need to work it into our budget and go ahead and buy the big house, have the big mortgage, and go ahead and buy the big Lexus and have the big car payment. Well, I have a different frame of mind. I feel that it‟s good to pay cash for a car, pay what you can afford. I bought a Toyota at auction and was able to pay cash for it. I downsized and was able to pay off my mortgage. I‟m 50 years old and have been able to, instead of spending money on interest, just take that money and invest it for my retirement. And, um, so now I have money set aside for retirement. I have money set aside for my kids. They‟re in college. And I just wonder what is this, you just feel like people just accept that as a normal way of life? Doyle: Well, Sarah, I mean I‟m happy for you because you‟ve applied to your life a lot of the principles that we teach. And that‟s why that we teach these principals because, you know, interest is such a drain. And it robs, it robs our family of a future is really what it does. And I think a lot of it just goes back to we‟re not taught what interest does. And, you know, if you look at conventional wisdom, people out there – financial planners, financial gurus – a lot of them are focused on asset building. And, you know, you have your stock brokers, insurance agents, your financial planners and conventional wisdom is mostly focused on building assets and they forget about the other side of the equation, your liabilities. You know, your net worth is your assets minus your liabilities. And people are so focused on increasing assets that they forget about their liabilities. They don‟t think it‟s a big deal. So, that it ends up, at the end of their life, you know, looking back, the majority of people, you find out, that their liabilities robbed them of their net worth and … Sarah: Don‟t people, like, when we have a lot of interest, we‟re paying, we‟re having to pay all these people off, that we become a slave to the lender. Doyle: That‟s from a very good book I read. Sarah: Yeah, I think I read that book, too. Doyle: Yeah, and, you know, it‟s very true. The slave to the lender. And, you know, it‟s something we‟re not taught in the mainstream. And I really think that‟s really the main reason we‟re having so much trouble for people in this country is we‟re not paying attention to what‟s true. We‟re just living our lives and we‟re really worrying. We‟re not really planning what we need to be doing. We‟re just getting so busy focused on living our lives that we‟re not thinking about the interest that we‟re paying. Sarah: Well, I‟m getting ready to move my mother into assisted living and I can tell you how expensive that is. She‟s 81 years old and it‟s, like, $3700 per month rent for her assisted living apartment. So, I want, at 81, if I need to go to assisted living I want I want to have the means to do that because I don‟t want my childre n to have to worry about me. Doyle: And Sarah one other point I‟ll make about this, too – and, this is a great, great point – is that it‟s not just the interest that we pay over our lifetime because that‟s horrible in and of itself. You know, we‟re talking hundreds of thousands of dollars if we‟re not on a plan to get rid of our debt but there‟s something called opportunity cost. And that‟s the opportunity loss that we could have had, like you have right now, when you‟re out of debt you have an extra 2, 3 thousand dollars a month now that you used to paying your creditors for your mortgage, and your house and your credit card debt and all that. But now instead of paying it to your creditors you can invest that and then concentrate on building assets. A nd, if you look at any financial charts, you know, with a 6%, a 10% consistent annual return on your investment, you know, if you could put 2 to 3 thousand dollars a month into an account because you‟re out of debt, you‟re going to generate hundreds of thousands, over a million dollars over a pretty quick time frame. Sarah: And you‟ll have great peace of mind doing it. Doyle: Yes, absolutely. And so that‟s the opportunity cost of paying all this interest over a lifetime that most people don‟t even consider. Sarah: Yes. Well, thank you so much Doyle. I enjoyed talking to you. Doyle: Alright. Well, thank you for calling, Sarah, and great job! Sarah: I‟m enjoying the radio program. Thank you so much. Doyle: alright. Sarah: thank you. Bye-Bye. Doyle: Bye-Bye Doug: Wow, Doyle, we need more callers like that, huh? Doyle: We need debts. We need the country, everyone to be like that. That‟s what, that‟s what we‟re trying to get everyone to. Absolutely. Doug: We need her in the studio, next week. Yeah. The number to call in is 800-688-9522, that‟s 800-688-9522. You can also call us on your Verizon wireless at *9522. I also want to mention that during the week our office number is 615-971-0489. That‟s 615-971-0489. We would love to speak to you during the week. We‟d love to hear your comments about our show. We can also be reached through debtrelief-thetruth.com. That‟s debtrelief, it‟s either dash or hypen, right Kevin. Kevin: Yeah, hyphen Doug: He says hyphen, I say dash. That‟s debt relief, hyphen or dash, the truth.com . Kevin: Doyle, you know, I, as you were talking to Sarah, it occurred to me that a lot of people who are getting in trouble with credit card debt because of these seminars that teach people to leverage their..take their credit cards, go to the, pay for the seminar with their credit cards, then using the credit cards to buy stocks, or real estate. In other words other people‟s money to build assets. And, so, I‟m wondering what your opinion of, of that philosophy is. Doyle: Well, Kevin, kind of what I was alluding to earlier when I was talking to Kevin is how people are so focused on assets they forget about the liabilities and the interest cost. And, um, honestly, my opinion about doing things like that, um, borrowing money to invest in stocks, real estate, you know, anything if you‟re borrowing, if you‟re sacrificing, personally, if your borrowing money that‟s going to effect your personal life is that, it is a dangerous proposition. It‟s a gamble. And, uh, I was hearing some music. Do we, are we going into a break? Doug: It‟s time for a break and when we come back, Doyle‟s going to talk about Money Merge Accounts and HELOCS. But please stay with us. This is the truth about debt relief. BREAK Doug: We‟re back with the truth about debt relief. I am Doug Johnson. My guest today is Doyle Breuchner with the liability management group. And we‟re going to take the next caller. James in Arizona, thank you, so much, for holding on here. How can we help you? James: Ah, yes, I, I have a question for Doyle. Doyle: Yep. Hello James. James: Ah, Doyle, why is it important to get rid of the mortgage, ah, mortgage payment while, while we can have, uh, you know, it‟s a tax write-offs. Doyle: Uh, that‟s a great question, James. Uh, actually, I‟m glad you asked that because it ties right into what we‟re talking about before the break. You know, there‟s a lot of financial planners out there who will tell you to never pay off the mortgage because, you know, they‟ll that as the last tax deduction we have. Uh, and basically what they‟re talking about is that, you know, your interest that you pay on your mortgage is, is taken off of your gross income before your tax is calculated. Uh, and generally you‟re talking, you know, about the people in the 25% tax bracket. You‟re talking about, you k now, 25% of the interest that you pay on your mortgage is what you actually get as tax savings, uh, at tax time. So, there‟s some savings there but let me ask you a question. Ok, if you did have a mortgage how much of that tax, uh, how much of that money you were going to pay into interest would you keep in your pocket? James: All of it! Doyle: Well, almost! You have to pay taxes on 45% of it. So, you‟re going to keep 75 cents of it in your pocket even after you pay the taxes. So, would you rather have 75 cents or would you rather have 25 cents? (laughter) Ok, so that‟s the thing. And, I run across clients, sometimes, that are really hung up on keeping their mortgage because of that specific reason. And, I have a simple answer for that. If you want to keep your mortgage, I‟ll tell you what, here‟s a plan, strategy. Let‟s get your house paid off and then when your house is paid off you can pay me the interest, send me 20 thousand dollars a year, at the end of the year I‟ll send you a rebate of five-thousand dollars so you can send it to the IRS to get that tax deduction. So, you know, that‟s basically the way I feel about that. And, just to tie that in a little bit more with the conversation we were talking before the break, uh, there‟s really two classes of debt. There‟s personal debt and business debt. Um, and when I‟m talking about taking debt, personal debt, getting personal debt and investing it in the stock market or any other investment, it‟s a gamble. You‟re gambling with your personal future. Now, if you‟re talking a business where you‟re buying a rental property or something like that and it‟s paying for itself out of cashflow, then that business debt I have no problem with that. You know, it‟s in a business name and it‟s all separate. It‟s not gambling with your personal future. But when you‟re gambling with your personal house and taking that money and investing it – and I, personally have done this – in fact, if you talk to me, uh, seven years ago, I would have said you‟d be crazy to pay off your house because I would rather pay the 6 percent interest and double my money every five years, investing. Uh, and that‟s the way I used to think. And I‟ll tell you what, I lost a lot of money doing that. And I learned a very hard lesson. And now I teach people, we don‟t want to gamble with our personal money. You know, business debt, that‟s a different story but when it comes to your personal money don‟t take on extra personal debt so you can invest with it. That‟s really what I advise. James: Invest in your future. Doyle: That‟s right. Invest in your debt by paying off your debt rapidly and then you can take extra money and play with it in the stock market. And, you know, you can do that and be safe and you‟re not gambling with your future. James: Thank you so much. Thank you. Doyle: I appreciate your call, James. James: Thank you. Doyle: Yeah, thank you James. Doug: Thank you. Doyle, I think a perfect example of that is the young lady who called in earlier, er, who talked about paying off her mortgage and buying cars at auctions and so on. Look what she, she did, she accomplished with that. She had a retirement and funded her children‟s, uh, college. Doyle: That‟s right. And it goes back to the same thing we were talking about. People are so focused on assets but people‟s liabilities are the biggest piece of their net worth and a lot of times it gets overlooked. Doug: It sure does. Now, before the break I started to ask you about HELOC‟s and Money Merge Accounts. There seems to be a lot of interest those areas and a lot of people approach me about that particular issue. Can you comment on that, please. Doyle: Sure, uh, there‟s several companies out there that are marketing, they‟re mlm companies is what they are. Doug: Define mlm for us, here, this evening. Doyle: Uh, multi-level marketing. Uh, you know, basically their marketing is done by, um, word-of-mouth, and, uh, you know, just network marketing type companies. And, uh, their basically marketing a HELOC program where they‟re telling people to, to, uh, get a second mortgage, um, a HELOC, which is a home equity line of credit and, actually, uh, get rid of their checking account and, and deposit their income into their HELOC and pay all their bills out of their HELOC. They actually have no, no assets. All you‟ve got is debt and their saying that because of the way interest is calculated on the HELOC that it‟s not a closed end loan, it‟s an open end line of credit, that you‟re gonna, they‟re touting that you‟re gonna save hundreds of thousands of dollars in interest and get rid of your debt in a half to a third of the time. And, so that‟s really kind of all the rage out there. There‟s quite a few different companies doing that. But my take on it, Doug, is, I‟ve done a lot of research on it, too. I‟ve actually run a lot of spreadsheets on the numbers. Uh, I‟m really good with numbers . Uh, it‟s just something that I like. Doug: I hope so. (Laughter) Doyle: And that‟s why I enjoy helping people with debt. But I‟ve actually run a lot of calculations and numbers and spreadsheets on the HELOC program. And, come to find out there is benefit to having a HELOC. But it is very miniscule. Um, because you have the lowest amount of debt every single day and the interest calculated on the day. On the average 30 year mortgage, it‟ll save a person 3 months just by having a HELOC. Now, where they‟re getting the big savings and what they‟re telling, um, is really because of what they call the discretionary income which is the extra money that, that can be applied to principal. And, you know, you could simply take that extra discretionary income. If you have $1000 a month or $500 per month, extra, and throw it on your mortgage, you‟re going to get the same result and, actually, better because you‟re not going to pay a $3500 fee to join a HELOC program. So, honestly, I believe it‟s smoke and mirrors and, uh, and I can prove it with numbers. Doug: So, can you make that available to us – that research, if – for our listeners who email us during the week? Doyle: Absolutely. Yep! Doug: Ok, it‟s time to take another break. This is the truth about debt relief. When we come back, we‟re going to be talking to Doyle about financial planners and other financial experts who sell products. Please stay with us. BREAK Doug: We‟re back with the truth about debt relief. I‟m Doug Johnson. My co- host, this evening, is Doyle Breuchner with the Liability Management Group. And, I believe Kevin has a question. Kevin: Yeah, Doyle, do you know who won best actor, yet, or have they given out that award? Or, movie of the year? (Laughter) Doyle: You know my wife is over at her friends‟ house watching that right now and I don‟t have any idea. I know she loves it but I don‟t know. Doug: Just think how many people could have gotten out of debt this evening, huh? (Laughter) Well, Doyle, at the break I mentioned financial planners. I mentioned financial advisors who sell products. What is your opinion about that? Are they biased in their advice because they‟re selling a product? Doyle: Well, obviously, anybody who has a product or service to sell is biased and, uh, uh, basically, that‟s one of the problems with the debt industry whether you‟re talking about bankruptcy attorneys or negotiation programs or consumer credit counseling or, uh, debt management services. Whatever you‟re looking at, really, for the most part you‟re just dealing with one option. So, when you go to a bankruptcy attorney or a consolidation company to talk to them about your situation their going to try to roll you into their solution. And, uh, so, yeah, I would definitely say, you know, that‟s part of the problem in the industry is, you know, you really need to go to someone, actually like yourself, Doug, that has the solutions, you know, and has all the different arenas, you know, these different solutions in their, in their pocket to be able to point people to depending on their situation. It‟s not a cookie cutter approach. And that‟s what we do with our clients, as well. It‟s really a matter of finding out where the person is, uh, in their life and not just their debt situation but their personality. I mean there‟s some people that, uh, want to become wealthy. And other people just, simply, want to live out their lives and enjoy it the best way possible. There‟s all these different circumstances, you know, whether their on a fixed income or a college student just starting out or, you know, how old are they and how much time they have before retirement . You know, it‟s important when you‟re looking at debt solutions to work with somebody who has a non-biased, uh, advisor and can point you in the right direction. Doug: Yes. Ok. One of the statistics I continually hear is 4 percent of Americans are making to retirement, er, with a….only 4 percent are making it to retirement with any kind of savings. So, what is your opinion about this? Is, I guess you‟ve covered a lot of the points that explain why but do you have anything to add to that, this evening? Doyle: You know, one thing I‟ ll add to that and, again, it goes back to our education and what we‟re taught but, you know, in this society and what were, you know, pounded into our heads on tv, you know, one thing that‟s really harmful is when people think about, uh, when people don‟t think about what‟s items cost them. Because, you know, they‟re always thinking about the low monthly payment you‟re always hearing about on tv. Uh, for example, when you go to buy a car, you know, the car salesman never talks to you about this one‟s 26 thousand or 34 thousand, uh, it‟s always how much can you afford in monthly payments, you know, “what‟s your monthly payment, now, Mr. Bruechner?” They get you caught up in that monthly payment mentality and, really, I‟m here to tell you, folks, is that mentality is dangerous and that‟s just one example of the mentality that‟s a reason we‟re in the situation we‟re in. Uh, and, you know, you could go on and on but, you know, one other thing is just discipline. I mean, uh, the truth is most people, just like losing weight, getting out of debt‟s the same way. It‟s not that it‟s rocket science. Uh, you could lose weight just by taking less calories in than you expend every day and you‟ll lose weight. That‟s a scientific fact. But it‟s almost impossible to do because we don‟t have the discipline to stick with a plan long term. And, again, I‟m not, it‟s not that we‟re bad people but, I think, uh, it really just goes back to human nature. Without accountability, it‟s hard to stick with something for the long term. Doug: Doyle, I very much appreciate your being part of the show, here this evening. I appreciate all the people who‟ve called in. There are a few people I would like to recognize at this time who have made this show possible and the service that we offer possible. It probably wouldn‟t have been available to you without these people benefiting us. And the first one is Brian Schwarz with Apex Computer Troubleshooter, Theresa Martin with Volunteer Benefits, Vinny Rebas of CEO Space, uh, and Jesse Rucker who is a visionary humanitarian. Thank you for joining us. The truth will set you free.