Family Fiscal Responsibilyty

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 Each member of the family must understand that there is such a thing as fiscal responsibility and if credit card abuse is done by any one member of the family, the privilege of that credit card is going to be taken away

In most families, there is one person whose job it is to take care of the family budget.  It usually is dad or mom and it is that adult’s job to make sure all the bills are paid and that the family budget is healthy so the family can afford the good things everyone needs to live a comfortable life.  This is an important job because no family can continue to function without a viable and realistic budget.  Many have said that if a lot of companies or even our country were to be run with the same sense of reality and making the books balance that the average mom uses, we would all be better off.

The only problem with this system is sometimes its easy to look at the family budget as “mom’s problem” or the problem of whoever it is that takes care of paying the bills.  So when a serious problem comes up like an explosion of credit card bills, mom can get pretty overwhelmed especially if there is no way to curb credit card spending so there can always be enough on hand to pay those bills off.

This is where taking on the challenge of beating high credit card debt has to be everybody’s job.  For starters, everyone needs to know the limits on spending.  It does no good if the person who does the budget knows exactly how much everyone can spend on food, entertainment and new things but nobody else follows those rules.  If the other spouse and the kids are out on the town on a spending spree, that is going to overwhelm the budget. 

But the family unit can really become a powerful force for change when it comes to taking on a mountain sized credit card debt.  It will take some skill to present the challenge to the family that defeating this foe must be a family job and everybody has to get into the act.  But if you do get everybody in on the challenge and take it on as a big adventure, not only will it bring about a lot of family unity, it can be a lot of fun too.

The attack plan must be seen as just that, an aggressive attack on the credit card problem that can threaten the family’s financial safety.  That is cutting costs. Have everyone in the family come up with one way to save money each week.  It might be as simple as turning off their lights before leaving for school or as ambitious as giving up cable TV or cutting in half the amount of times they have to go to the movies.  If each person can contribute one big cost savings a week, that sense of accomplishment and self esteem for pitching in to win this war with credit card debt will pay off.

In the same way, if each member can think of ways to increase income, that can really help the budget out. It might mean the kids picking up more chores so dad and mom can work second jobs for a little while.  It might even mean that the kids will do some chores or take part time jobs and add a little to the budget from what they make.  But whatever the contribution, if everybody gets into the act, the family can win against credit card debt.  And that is a worthwhile family project.

Student Credit Card-A Training Ground

College student credit card is really meant to be treated like a training ground for learning more about credit cards. It should not be make an instrument of debt (college student credit card debt).

Credit card debt doesn’t shy away from anyone who doesn’t want to shy away from it. It treats everyone equally irrespective of whether the person is a seasoned professional or just a college student. So college student credit card debt isn’t uncommon either.

Since the credit limit on college student credit cards is much lower, the college student credit card debt cannot rise to the levels it does for other credit cards. However, college student credit card debt is an even bigger menace because a lot of students are already in debt due to the loan they have taken for their education.

If they pass out of college with college student credit card debt, they will have to payback not just the loan they taken for studies but also their college student credit card debt.

Since most of the college students are inexperienced in the usage of credit cards, they can easily fall prey..

In fact, college student credit card debt is one reason why the credit card suppliers keep a lower credit limit on college student credit cards. The solution for avoiding college student credit card debt is similar to what it is for avoidance of any type of credit card debt.

So, the first thing for avoiding college student credit card debt is to understand the concept that credit card is not free money and that whatever you pay-for using your credit card has to be paid back to the credit card supplier when your credit card bill arrives. So don’t treat credit card separate from hard cash.

Avoid overspending e.g. do not buy things just because they are on sale, sales keep coming and going and there are always better offers each time; buy only those things that you really need. A good thing to do is to prepare your monthly budget and follow it religiously. Never budge from your budget. Another very important preventive measure for avoiding college student credit card debt is to avoid going for a second credit card.

Some students have a tendency to go for multiple credit cards just because the credit limit on college student credit cards is very low. However, this is a perfect recipe for getting into a college student credit card debt. This is how college student credit card debt builds up. One credit card is more than enough for any student.

Being Straight With Debt Councelors

‘Credit card debt’ is the worst of all nightmares. A successful credit card debt settlement is like getting a new lease of life. Credit card debt settlement is a wonderful stress relieving mechanisms. Once you are done with your credit card debt settlement, you are assured of a much better life. All those nagging phone calls and mails will become history and all that surmounting tension would be gone. That’s why credit card debt settlement is so essential.

You can approach credit card debt settlement in 2 ways. You can either go for credit card debt settlement all by yourself or you can take advice from a credit counselling company or a professional. Any of these credit card debt settlement methods are fine, as long as they work for you and help you get debt-free quickly.

If you go for credit card debt settlement all by yourself, you will need to analyse the various options available to you e.g. checking on various balance transfer offers available in the market, checking the short term loan options with the banks etc etc. However, if you want to take credit card debt settlement advice from a professional, you should be able to trust the advisor fully. So you need to check the credentials of the credit card debt settlement advisor/company.

There are hordes of people and companies that advertise “credit card debt settlement in one day” or something of that kind which will look just fantastic. Such credit card debt settlement offers/advice are generally not genuine. Moreover, you need to understand that credit card debt settlement cannot happen overnight (unless you win a lottery or something like that). So, beware of such agencies.

That said it’s important to mention that there are a lot of good credit card debt settlement advisors/companies available too who will not only give you genuine credit card debt settlement advice but will help you throughout until you are finally out of debt. Their advice may, in fact, more than compensate for the fee that they charge you for credit card debt settlement.

 These credit card debt settlement companies/advisors will be able to help you in the best way if you tell them your current financial situation correctly. Your future plans are important too, as they might influence the decision on ‘What route for credit card debt settlement would work the best for you’.

Moreover, once you are done with your credit card debt settlement, you should also take measures to avoid falling into that pit again.

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Renegotiate For Low Interest Rate

You Can Actually Renegotiate A High Interest Rate

If you have a credit card debt in the thousands of dollars and have an interest rate above 15%, what that means is that a large portion of your monthly payment is going to go toward the interest servicing.  And that again means that your balance will go down slowly which is very discouraging especially if you are still using the credit card .

The challenge of tackling a massive credit card debt can seem almost impossible at times.  When you look at the many bills rushing in each month and then you start going through that credit card bill, the idea of bringing the bill down can be overwhelming.  One of the reasons that makes the battle to win over debt seems so hard is the ridiculously high interest rates credit card companies are allowed to charge.

How often have you looked at the average interest rate that the credit card companies are charging you and thought, “I sure wish there was some way I could bring that interest rate to half or less”?  If you could just get that interest rate down under 10% or even lower, that alone would help you reduce the burden of repayment

There may be a way to actually get a credit card rate you can live with from the credit cards  companies. The problem may actually stem from the fact that you never ask.  It goes back to that old advice which says– “You don’t know until you ask.”  Sometimes, its most likely that if you call the credit card company and explain to them the situation, they might have the resources to negotiate a rate with you that you can live with and offer you the same services a credit consolidation company would offer. 

It’s good to take a moment and look at the world through the eyes of the credit card company.  They are in business to keep good customers who pay their bills.  For credit card Company, the worst kind of customer is one who is constantly late on their payments or doesn’t pay at all so they have to go through the expense of nagging those customers for the money. 

So rather than see you dump them or take your debt elsewhere like to a credit consolation service or a second mortgage, its better business for the credit card company to cut your rate and continue to make some money off of your debt.  Competition is just as intense for the good customers in the credit card world as it is in any other business.  So if you pay your bills and are the kind of customer these companies like, you have a bit of leverage with them that you may not have known you had.

Make sure when you call the credit card company to renegotiate your rate that you talk to someone who can actually change things.  And bring some clout with you.   Be prepared to cancel your credit cards or move your debt to another card or credit service.  If you let that credit card company know you are unhappy because of the rate, they will have some kind of program to keep your business.  They aren’t going to tell you about it but its there.  And if you are persistent and want it bad enough, you can get the credit card companies to play ball your way and give you a premium interest rate you can live with

Credit Card- Who Pays IN Divorce?

If the divorce is a shared responsibility so each spouse can work with the other to adjust the financial picture in an advantageous way, then how to separate the credit card debt should be part of that planning.  Part of that planning is how to use shared assets to pay down that debt.  You may have a home that will be sold, retirement accounts or other assets that were set aside for the future of the marriage.  Before you sell those things,   close those accounts and distribute the funds, look at using the outcome to retire that shared debt.

 When a marriage comes to an end, it’s always a tragedy.  Of course the rending of the family unit and the difficulty for the kids is the hardest thing about separating at divorce.  But the difficulty of separating one house into two can be difficult and tedious to say the least.  You have to go from one checking account to two, two homes instead of one and separate accounts for everything from credit cards to utilities.

The is an additional overhead to how to handle a divorce situation if in addition to splitting your assets, credit card debt that may have been a part of the shared family financial picture also must be split up.  To the credit card company, that family credit card is the property of that shared entity which was the marriage.  So when the union splits up, the transition from a financial point of view of your accounts separating is not over night.

So one of the many issues to be discussed and a plan made for is how to separate that credit card debt.  Whoever continues to hold the family accounts will continue to get those bills and be expected to pay them.  Now the least preferable way to handle the debt is to build the payments into any forced settlement agreement such as child support.  So at the time the divorce is final, the amount of the debt and the payments that must be made could be calculated and half of that put into the amount that the income generating partner must provide.

But that leaves the management of those credit card debts to one partner and the other one just has to pay a set amount.  And if the credit cards get used by either partner, that legal amount would have to constantly be changed and that would prove to be a constant headache of administration.

But it’s likely some of that debt load will live on past the divorce.  In those cases splitting into two individual accounts may be the way to go.  In that way, if the family was carrying $10,000 in debt, if each marriage partner walks away with $5000 of the debt, that is at least fair and equitable and how each individual handles that debt is up to them.

There are two ways you can go about splitting the credit card debt.  If the debt is with a carrier with whom you can negotiate and conduct a dialog, getting a meeting or having a conference call with the managers there would be productive.  The credit card company would far rather negotiate with you how to handle this debt load then deal with it chaotically after the fact.  So they may be willing to set up separate individual accounts and split the debt for you.

But you can always use the method many of us have used to manage credit card debt up until now.  Each of you can set up some new separate credit card accounts.  You no doubt have dozens of credit card offers coming in that you can use to kick off this process.  Almost always part of the set up offers for these accounts are balance transfers.  So if you take out individual accounts and use the balance transfers to move each partners shared part of the debt to those accounts, that would be a clean way to split the debt up.

There may be adjustments to be made to the 50-50 split idea based on who is the primary bread winner and maybe who ran up the debt and on what.  But by negotiating the terms of how you are going to separate the credit card debt when you separate the marriage, that will be one more than that you are handling in a mature and responsible manner in the middle of a very tough situation.