Entering the debt is as American as mom’s apple pie and fireworks on the Fourth of July. And ‘the American way! Unfortunately, if your way, you can be so in debt that is living paycheck to paycheck, using credit cards and home equity loans to make ends meet and pay for unexpected expenses. Perhaps the despair of ever being able to buy a house, have a comfortable retirement, or take a vacation with their children. (We touched a nerve?) Is likely to be largely abandoned the American dream.
Many lenders say consumers should spend too much because they are irresponsible, but recent studies tell a different story. For example, a 2006 study based on information from the Federal Reserve Board, USA reveals that wages have not changed (after adjusting for inflation) since 2001, while the costs of basics such as housing, medical care, food and Household Essentials
increased. In other words, not all consumers in the United States are in debt because they are wasteful, but we all had a national pay cut.
Well, for consumers at all income levels are intended to
its borders – even you, which is undoubtedly why you chose this book. But more likely, has yet to take decisive steps to improve its financial situation. You can not have even recognized the state of your finances, let alone change their lifestyle and be more careful with their expenses. Even if you’re aware that you are in a financial risk, you probably do not know what to do with your situation. It can be frozen by fear and confusion.
If you’re trying to keep up with their financial obligations, but you feel like Sisyphus, the poor, struggling to keep pushing the rock and roll on it, is in the chapter on the right. From here, we give you the information needed to take control of your finances and turn around.
Take stock of your finances
You need a clear idea of the current state of their finances, to find the best way to deal with their debts. Here’s how you can begin to take stock of your finances:
fr Compare your monthly expenses with your monthly income.
Prepare for a shock. Most people underestimate the amount actually spent on what they earn. In making this comparison, he soon realizes that you are using credit to finance a lifestyle that can not pay, and is spending its way to the hospice. If this is the case, it must reduce its expenditure to meet its financial obligations, and may need to do much more than that, depending
severity of their financial situation.
Copies of the Order of fr credit histories of three credit reporting agencies: Equifax, Experian and TransUnion. We provide contact information in Chapter 2. Your credit history is good or bad picture of managing your money: who owes you money, how
which should, if you pay your bills on time, if you are over your credit limit, and so on. Since the highest interest rates charged on credit cards and loans is a direct consequence of having a lot of negative information in your credit history.
fr Discover your Fico. Your FICO score, which is derived from information in your credit history is another measure of financial strength. These days, many lenders make decisions about you based on this point more than the real information in your credit history.
We realize that things are beyond their control – such as bad luck and rising prices – may be partly responsible for their debt. We also know that it is likely that at least partly responsible. For example, you can
- We pay little attention to their finances. They forget to pay your bills on time, you pay no attention to the balance in your checking account to bounce a lot of checks and / or have a lot of credit accounts.
- Maintaining high balances on their credit cards. Consequently, they can afford to pay the minimum on the cards, you pay a lot of interest on your credit card debt and all debt that has lowered his FICO score.
- They have little (or nothing), the savings should be used to pay all the credit for unexpected expenses.
- Poor management of their finances, do not know how to use them properly.
The National Foundation for Credit Counseling a survey among its members, the credit counseling agency in early 2006 to determine the reasons were important consumers filing for bankruptcy. The survey showed that 41 percent of consumers blame their failure on poor money management skills, 34 percent attributed to the loss of revenue, and 14 percent reported an increase in medical costs.
If compulsive spending is the cause of his financial problems, assistance from an organization such as Debtors Anonymous (www. debtorsanonymous.org) or a mental health therapist. Compulsive spending is an addiction like alcoholism, and you can not win alone. You’ll always have debt problems if you can not control their spending.
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