Easy credit has made so many people got used to the idea of spend first and pay later. Enjoy now and suffer later. It is common to have people paying for stuff like new hand phones, holiday trips, stylish wedding photos, branded watches, fine dinning, Flat screen TVs and other household appliances using the ubiquitous credit cards. The best of way getting out of debts is of course not getting into it in the first place. Simple said then done right ?

Step 1

I will work out the amount of cash I need to survive for the month. This amount can include a bit of entertainment money. The idea is to do a budget, rather than torturing myself. Then I will set aside the amount from my pay cheque and the balance all goes into the outstanding credit card loans.

Step 2

Add up all the debts from all the credit cards, the total amount will give me some perspective on the magnitude of the situation. Bursting the credit limit of one Gold Card usually means RM10,000 and a platinum means RM20,000, 2 Gold cards and a Platinum means RM40,000. If this amount is a shocker to me .. then it may just save me from bursting another card. But don’t fret! Be cool about it.

Step 3

Work out how long I need to settle all the debts, if I were to follow step One (above) diligently. Is it 6 months? It is 12 months? Is it 2 years? Is it 3 years ?. If the time required to payback is a shocker to me … then it is also a good lesson to me. But don’t fret! Be cool about it.

Step 4

Redeem all loyaty points if the amount is significant, and cancel all the current cards; stop the bleed. Before that, apply for new cards with balance transfer facilities that offer very low interest rate / processing fee. Transfer all the balance into these cards. This will …

Destroy all the balance transfer cards, once the transfer is done. Forget about new loyalty points and auto debit facilities. From now on, pay everything by cheque or cash. This will help me to be able to prioritize the bills to be paid. For example, if I only have the cash to pay for 3 out of 5 of the following bills, which one will I choose?

Maintain a relentless debt reduction attitude.

Last but not least, find new sources of income, make something good out of this predicament. Making lemonade out of lemon.

Please check out the youtube video clip below :

http://www.youtube.com/watch?v=cmAm8GNJ_IA

The above steps are only suggestions, each person’s situation is unique and if you need assistance to get you out of your debts, you can contact the BNM Agency below :

AKPK is an organisation appointed by BNM, to help counsel people with debt problems and provide advice on money management and budgeting. They will work with you to develop personalised debt repayment plans with your financial service providers. (Their services are free.)

The introduction … 

36 Critical illnesses cover is also known as; 

a)     Dread Diseases cover

b)     Crisis cover

c)     Living Assurance cover 

Well…… a rose is a rose by any other name … They all meant more or less the same 36 diseases. Different insurance companies will use different names for them. Some choose to vary the definitions and/or covers a bit, so as to differentiate themselves from others, giving their sales person one more point to convince their customers, their policies is slightly better than the rest.  

Of course, we all know there is no free lunch; every benefit has a cost in it. As consumers, we need to know exactly what we want, and we choose the plans primarily according to the major things we want to cover and the frills should be secondary. 36 Critical Illnesses (CI) can be grouped into 6 areas.

Equating the human body to a car is just for the purposes making this subject less morbid and easier to understand and to remember. I have no intention of making fun of these deadly fellows, I am sure if one of them were to fall in love with you … it will be no joke.

I hope my analogy will not make things worst for you. If you can’t find the connections between the illnesses and the car problems, please just ignore those words in purple italics.

a) Heart and Blood Circulation (7 out of 36) – these involve the heart (cardio) and the arteries and veins (vascular). Like the ‘car engine (pistons & plugs) and the fuel tube system’. 

b) Brain and Nervous System (15 out of 36) – these include all the illnesses and conditions that happens to the brain, the spinal cord and nerves that control the body and limbs. It is the ‘Car Electronics Control Unit (ECU) & wiring’. 

c) Major Organs (5 out of 36) – these involves the vital organs such as liver, lungs, kidneys, heart and bone marrow.  This is like ‘Changing of Engine parts such as engine block, radiator and oil filter, unclogging and replacing piston chamber valves’. 

d) Chronic diseases (2 out of 36) – these are serious diseases that can happen at any part of the body. (Cancer and terminal illnesses). Maybe we can compare it to ‘VERY serious rusts on the body or engine of a car’. 

e) AIDS (3 out of 36) – AIDS and HIV related. ‘err… salt water got into every part of the car, it is a matter of time …but don’t know when the rust will start, once start the deterioration of the chasis will be fast and soon the vehicle will have to be scraped’. 

f) Permanent damages (4 out of 36) – relating to hearing, speaking, seeing and serious burn. ‘Very rare vintage car with no spare parts available, once the head lights, horn, side mirror or chasis get really beaten up, there is no way to find parts or to repair’. 

The common official names for the 36 illnesses are …. 

a) Heart and Blood Circulation (7)

• Heart attack

• Serious Coronary Artery Disease

• Coronary Artery By-pass Surgery Heart Valve Replacement Surgery

• Surgery to Aorta

• Pulmonary hypertension

• Aplastic anaemia 

b) Brain and Nervous System (15)

• Stroke

• Encephalitis

• Bacterial Meningitis

• Parkinson’s Disease

• Alzheimer’s disease

• Multiple sclerosis

• Serious accidental head injury

• Benign brain tumour

• Brain surgery Coma

• Apallic syndrome

• Motor neuron disease

• Muscular dystrophy

• Paralysis (Paraplegia Tetraplegia)

• Poliomyelitis 

c) Major Organ (5)

• Kidney failure

• Chronic Lung disease

• Chronic liver disease

• Fulminant hepatitis

• Major Organ transplant 

d) Chronic Diseases (2)

• Cancer

• Terminal Illnesses 

e) AIDS related (3)

• AIDS due to blood transfusion

• Full Blown AIDS

• Occupationally acquired HIV infection 

f) Permanent damages (3)

• Blindness

• Deafness Loss of Speech

• Major burn

The above listing is based generally on Great Eastern Life policy. I will explain a bit further in my later articles.