Its been a busy and eventful month for me.  I achieved a short term milestone, as I had planned, to break under the $40,000 credit card debt level.  I thought this would bring a sense of accomplishment, but the joy was small and short-lived.  $39,204.92 is my new number, and I guess it still looms large.  Still, as I write this, I do feel a moderate level of achievement.  The plan is working, as I've carved away about $24,000 from my highest debt level.

This month was a month of belt tightening, as the post-holiday bills began trickling in.  My wife is beginning to understand the depth of my resolve, as I frequently interrogate her on new charges showing up on the checking account ledger or our monthly usage credit card account.  She's a good sport about it, and deep down, appreciates the importance of what we're trying to do.  I think she especially appreciates my new miserly attitude, as more often than not, it was me bringing home that new electronic toy that I had just charged to the credit card.

Over on the SavingAdvice forum, a user relayed his experience with a Citi credit card as they move to increase his interest rate.  He currently has a balance transfer rate of 5.9%, plus an ongoing purchase rate at 5.9%, both of which expire in about 2 years.  These are good rates.  Too good, apparently.  Citi sent him a letter, noting that with the hard economic times, it has become necessary to raise his rate to 14.9%.  As with all of these offers, Citi allows him to reject the rate increase by closing the account. In that event, he continues paying the debt under the current 5.9% terms, but can no longer use the card.  As this person investigated options by talking to Citi directly, he found that even if he decides to close the account, Citi will later offer to "re-open" the account as he approaches the 2 year point.  So, as long as this user isn't relying on the card for ongoing purchases, it makes perfect sense to opt out of the increase, close the account, and continue paying the debt down at the attractive 5.9% interest rate.

New rules are on the way to regulate credit card issuers. While the House of Representatives shaped a new bill to reign in issuers (see Credit Cardholders' Bill of Rights), the Senate ran out of time and failed to address it. The Federal Reserve, on a parallel track, has devised a set of rule changes in the same spirit as the Bill that stalled in the Senate. On the down side, the rules don't take effect until July, 2010, giving issuers another year and a half to bleed consumers under the current lax regulations.

The common thread between the two initiatives is broad consensus that issuers have spiraled out of control over the last few years in their exploitation of consumers. Referring to the Fed actions, Sen. Carl Levin, D-Mich., said the new rules "are a good first step, but they don't prevent a number of unfair, deceptive and predatory practices that saddle many American families with crushing debt."

My credit card debt crept up slowly over the years, and hovered around $20,000 for quite a while. It seemed that just when I'd get serious about paying it down, another expense would pop up... a major car repair, soccer and hockey registration for the kids, Christmas. My interest rates seemed reasonable, and I got comfortable with the monthly payments as my salary crept up over the years as well. Paying off debt never became a huge priority.

Last year, after months of enticing from "Flip That House", I decided to invest in real estate. My strategy was to "fix and rent", with an eye towards building income for eventual retirement. I bought a bank-owned property in November 2007 with a new home equity line of credit, topped off with some more credit card debt. The plan was to rehab the house using more credit card debt, then refinance using the much higher value of the house as collateral. The result was a ballooning of my credit card debt to just over $60,000.