| Card Card Blues By Greg Souther |  |
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If you haven’t received your bill(s) from your Christmas shopping spree, don’t worry, you will. They will show up as regular as the fruitcake you get from your Aunt Betsy. After reviewing the damage, take a deep breath, a second mortgage, and resolve to get out of debt. On the list of New Year’s resolutions, only loosing weight and getting into shape rank higher on our list than reducing our debt and resolving not to do it again! I’m not concerned with your physical shape; I want to help you improve your Fiscal Fitness. So here are some mental and fiscal sit-ups to tighten that expanding waistline of budget. Pay off your credit card balances monthly. Do not make monthly minimum payments. Credit card rates are coming down but many consumers still have cards that charge 1.5% per month for the use of their money. That equals 18% a year. If your credit is good, you can get a card with a much lower rate or even a loan from a bank at a lower rate. If you have to, it makes more “Cents” to take money out of your savings account or borrow money from a whole life insurance policy and pay the balance(s) in full than making monthly payments. Once your balance(s) are paid off, go on a cash basis. If you are like the majority of Americans, you have very little self-control. In a recent report, American’s owe $456 Billion (this is not a misprint) dollars in outstanding bank credit cards and another $92 Billion on store charge cards. That is about $4,800. per U.S. household. Using a cash purchase basis means you pay cash or write a check. Let me give you a word of warning if you use a checkbook, you need to update your checkbook after each check you write. You don’t need any bounced check fees to add to your credit card blues. Plan your spending. Some people call this a budget. I know most people hate the “B Word,” but you have to take your medicine in the form of this exercise. It doesn’t have to be a complicated process with graphs and pictures, but it does need to be realistic and if you are married, you and your spouse must agree on a plan. It won’t work if only one party participates in the plan (alias budget). If you have joined the computer age there are some very good software programs available for budgeting and bill paying. The best known of these is Quicken. However, any good budget how-to book will have the forms. Go to your local Library, check out a book, and get the information for free. If you are in real trouble and the bill collectors are calling, don’t put your head in the sand and ignore them (that only makes’em mad). Be upfront with them. Explain to them your situation and your plan of action to pay them. In many cases, your creditor(s) will work with you by extending your payment terms or lowering your credit card interest rate. If your credit is good most credit card companies don’t want to loose you as a customer. Avoid bankruptcy if at all possible. It sounds nice on the TV, “for $50 we can start you in Debt Relief and stall your creditors.” What they don’t say is that we can ruin your credit for seven to ten years and cause everyone to avoid you like the plague or charge you higher interest rates and down payments than anyone else because you are now a much higher credit risk. For professional help for free, contact Consumer Credit Counseling @ 1-800-251-2227. For more information on the web go to http://www.cccs.org. I hope a few of these ideas will help you resolve to get into and stay Fiscally Fit in 2003! Greg Souther, President of Greg Souther Consulting & Seminars, teaches the benefits of becoming Fiscally Fitness! For more information on ways to improve your Fiscal Fitness visit www.gregsouther.com. 2003 Greg Souther Consulting & Seminars– Do not be reproduce in whole or part without permission from Greg Souther C & S |
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