American Attitudes About Credit Card Debt--Not a Big Thing?

The Associated Press ran an article the other day about how the subprime mortgage industry mess is now causing some people to default on their credit cards. I guess this is logical. When people run into money trouble, they start charging more or taking cash advances off their credit cards. The article said that serious delinquencies--those 90 days delinquent--were up about 50 percent or more in the value of accounts at least 90 days late compared to the same period last year.

The article also predicted that defaults will be even worse after the holiday season, and mentioned that economists say Americans have a long standing attitude that credit card debt is not a big thing.

I am lucky that I do not have a mortgage, so I don't have to worry about this aspect. I have had credit card debt for too long, and I want to get rid of it. Speaking for myself, I think credit card debt is a big deal. I think what happens to many, including myself, is that you accumulate debt on credit cards quicker than you realize and then you are in a pickle.

The best thing is to not use credit cards. I feel badly though for those caught in the mortage mess who are just trying to survive now, and haven't gotten their heads cleared about it yet or figured out a game plan.

Pay By Phone: The Good vs. the Bad

Pay by Phone, or whatever you call it, is another one of those decisions you have to make. When you are paying a credit card by automatic payment, many times there is a fee--sometimes as much as $14.99 or higher. That is bad, as that is money that gets slapped to your balance. And for those of us with high balances, that only makes it worse. Out of sight, out of mind, maybe, but that is just a little more each month that is tacked onto an already high balance.

The good side of these pay by phone options is that you know exactly what day the check will hit your bank, so you can plan for it. If I schedule my Discover card payment, for instance, for the 12th of the month, I know I will need that much money in my account to cover that amount, and if I don't have it, I can transfer some money into it for that day.

With a paper check, you don't have the luxury of knowing exactly what day it will hit.

I know--this is a silly problem, but I have been so used to paying my credit card bills by pay by phone for several years. I did it this way as a money managing tool. It made me feel good to know when the checks would hit, and then I wouldn't chance an overdraft. The bad side is it has helped to grow my balance.

Over the next few months, I am going to try to wean myself from this habit, maybe even starting this month. If I can, I'll be around $180.00 less in debt per year for every credit card I have.

Minimum Payment Confusion

I again talked with CitiCards today about my balance. I get worried because each time I call, I get a different story. I need to improve my FICO and credit score, and I need to do it by April if possible. So getting the right info is important. Today I called the 800 number to see how much I need to bring my account current. I could swear that last month when I talked with them, they said I was about 60 days late. I need to avoid going 90 days late at all costs.

I made a payment then, and I called back today to ask the same question. They said I was current but over the credit limit (I knew I was over the credit limit.). I know I am not good at math, but this is ridiculous. If I was about 60 days late last month and made a payment to hold it stable, I would think I would still be in the same position this month, but I am suddenly current??? I kept asking and asking about it and even asked to speak to a supervisor about it. And they all said I was current but over the credit limit.

I am going to accept their answer, but hope this is not an example of if it sounds too good to be true, it probably is.

I just don't understand why you get different answers all of the time.

Living on $12,000 a Year

I just read an article on msnbc.com about a woman in her 40s who has gone back to school and is living on $12,000 a year. She does this by living on alimony and a school grant. She never mentioned what degree she is seeking. She says she is not only living but thriving on this amount of money.

If she says she is, who am I to argue with her? I know that she wants to study hard and do well, and that she doesn't want a job eating into her study time, but I can't help but think that having to think that hard about every dollar you spend is time wasted too. More power to her, but in her shoes, I think I would rather just find a way to make more money.

Here is the link:

http://articles.moneycentral.msn.com/SavingandDebt/LearnToBudget/SurvivingAndThrivingOn12000AYear.aspx

Wal*Mart Screws Up Again

What in the world is wrong with Wal*Mart? It seems they have stuck their proverbial foot in their mouth again. The retail giant that has had so much bad press over the years takes a few baby steps in the right direction, only to kick itself in the behind again.

Is there no one awake at the public relations wheel at Wal*Mart?

Apparently not. Unbelievable.

The latest is the news that came out today that they are suing one of their former employees who was brain injured in a collision with a truck to recoup the insurance money they paid out on her.

You can read the sad details with the link at the bottom of this post.

I know that accident victims aren't supposed to double dip--in other words get money for the same injuries twice, i.e, from the Wal*Mart insurance company and also from the trucking company. But she was not made whole, and she will need expensive care all of her life.

I have two thoughts on this. One is that she really should have gotten a higher settlement. Maybe it is her lawyers' fault and they should be sued for malpractice. Get some of their money back from them. (This is a good suggestion.)

And, even if Wal*Mart is entitled to that money, again I say what is their problem? Don't they know this is going to be another PR nightmare for them?

If they want to subrogate and get money back, they should not have tried it with this victim. Makes them look greedy, greedy, greedy, and they should have known better. Shame on them.

http://articles.moneycentral.msn.com/Insurance/KnowYourRights/EmployersGrabAccidentVictimsCash.aspx

Phished!

I can't believe it but I got phished! In other words, my identity, at least as pertains to Paypal, was stolen.

Paypal says to be careful not to click on any links in suspicious emails. I got an email that said it was from Paypal and it looked real. It said to confirm some information. I wondered it about it, because I had just used Paypal and didn't think they needed to confirm any info for me, but went ahead and clicked on the link anyway. I made no changes.

But that was enough for them to get my account. Suddenly an item was charged to my Paypal account that I knew I did not order. I was distressed because that was my only 2nd transaction through Paypal, and it was an unauthorized one!

I called Paypal and then had me change my password and security codes. They are going to refund my money. So I am happy now.

Paypal says anytime they send you an email, it will have your first and last name on it. This is important because the phishing email addressed me only as "Dear Paypal User." Be careful of this, as they made that illegal charge only one day later. At least I caught it quickly, and there was no real harm done to me. But unbelievable that this happens.

Things Look Up for Loopot

First, thanks to all who sent good wishes my way for little Loopot, my cat. He had been ill, drinking water all of the time, and using the litter box all of the time.

I took him to the vet on Saturday, holding my breath. The vet checked him and said she thought it was one of three things: thyroid, diabetes, or kidney problems, the latter being the worst case scenario.

It turns out it is diabetes, and I think we caught it early. She wants to try to treat him with just a food diet first, and if that doesn't work out, then go to insulin. He also has a bladder infection that we are treating.

I have to say that after the first day of the new diet and the antibiotic, he is acting more back to normal. I am so happy. The food diet is not cheap--the cans are $1.50 at the vet, and $1.30 at Pet Smart, but it is cheaper than doing the diet and the insulin!

When she called me with the news, tears stung my eyes, I was so relieved. I know he has diabetes, which isn't "nothing," but I was afraid it was kidney disease, which is much worse.

Part of the problem of being in debt is not having money available at times like this. If he had needed an operation, I probably could not have done it. So I feel relieved that at least for right now, all I have to do is buy some special food. And keep working at getting out of debt.

Getting the Best Insurance Rate

Insurance is on my mind right now. In my current job, I have life insurance but not very much. I am single, no kids, so I don't really need a lot of life insurance, but sometimes you still want it to be part of your mix.

I have approached my "relative" boss about giving us some more options for insurance, but he seems unimpressed with the idea. I don't understand--it would cost him or the company nothing it seems, as we would tap into our association's group rates.

Well, anyway, I have good health insurance, but measly life insurance, and no disability. Just for the heck of it, I thought I would check some Websites to see what some prices might be.

For me, term life would probably be the better choice, as I am not really looking at life insurance as a way to save money. But for those who do want to use life insurance as a way to accumulate cash value, they might want to check out their whole life insurance.

Right now, I am more concerned about disability insurance, so I filled out a form on that . We'll see what I get back. I'd rather do it through our company, but that may not be an option.

Poor Little Loopot

My poor little cat, Loopot, is not well. I am not sure what is wrong. The last couple of weeks he has been drinking immense amounts of water, eating even more than he normally does, and going to the bathroom all of the time. It didn't really occur to me that there was really a problem until about 2 weeks ago. I really didn't have the money to take him to the vet, but I did this past Saturday. I had to take money out of my law review course money. I know that is not good. I was trying to wait until my next payday to take him to the vet, but last week, he seemed worse, and I just couldn't not take him. I'll just have to make up that money another way.

The vet says he probably either has a thyroid problem, diabetes, or kidney problems. Thyroid would be the best scenario. I guess diabetes would be the next, and the kidney problems the worst. I will find out tomorrow or Tuesday. He is very alert, so that is good.

I am really worried about Loopot. Prayers please that whatever wrong is fixable (and it would be better if it were not real expensive.) But sometimes you just have to spend the money.

Merchant Accounts

As consumers, we are always wanting to get the best credit card rate, if we choose to use credit cards at all.

But merchants are also looking for the best rates--better credit card processing transaction rates. Depending on what kind of businesses they are in, merchants can have an easier or harder time getting a good rate.

For example, brick and mortar retail stores are not considered very risky, because retailers can swipe the customers' cards and get the consumers' signatures on credit card purchases, which prevents a lot of chargebacks. So it is pretty likely that some companies would give a retail store a good retail store processing rate.

On the other hand, some internet retailers might be considered risky and have a harder time getting a good rate, because they cannot swipe customers' cards or get their signatures, which can lead to a lot of chargebacks.

For companies that are considered very risky or that have been rejected by a solution provider, they might consider applying for merchants services off shore. There are some drawbacks to using offshore processing providers, but Ms. Merchant Account states they work only with the most reputable international credit card processing agencies to protect their customers from fraud and other bad practices.

Online Promotional Codes

On my local news tonight I found out some valuable info just in time for Black Friday! Go to your search engine and type in "Online Promotional Codes." A list of links will come up that can take you to online promotional codes. These are the codes that you type in when you order online. There are some great deals, and for great stores like J. Crew, Victoria Secret and even Walmart.

I didn't have time to really study the lists of stores and codes, but I am glad to know it is there. I will definitely peruse them before I do my Christmas shopping in about a week or two.

Happy shopping and saving!

When Creditors are Evil

There have been too many stories lately about creditors breaking the law and getting away with it.

I do want to emphasize that I think people who have debt need to pay it back. Period. But not at the hands of creditors who will stop at nothing to get their money back.

First I read an article on the Web (sorry I cannot find the link) about how many people who have filed bankruptcy are now being hounded again about the very debts that were supposed to discharged under bankruptcy. Unbelievable!

The article went on to say that the creditors are slow at reporting the discharge on purpose, so other companies that have bought the debt go back in, and sometimes people pay the debt years later when they don't have to. The article went on to give some devastating examples of this.

Then I read another article about how creditors are now freezing bank accounts with social security money in it, when that is prohibited by the federal government!

http://finance.yahoo.com/expert/article/moneyhappy/53832

We are talking about elderly people who then have no money for food, rent, medicine, etc. The problem is exacerbated by people who have direct deposit of their checks. While direct deposit has been a help to many, in some cases such as this, it can be a nightmare. It can take a long time to switch back to getting a regular check in the mail, and by that time, bank fees and overdraft charges have probably eaten everything up.

We need to do something about the creditors who overstep the law and get away with it. Maybe the law needs to be updated to exact steep punitive damages on companies who break the law in this way. Our elderly people deserve better.

New Career--Professional Survey Taker?

I was welcomed into the world of my newest career--that of professional survey taker, or so they said. I had been doing online surveys for a couple of companies, but not really making any money, so clicked on a link for paid focus groups and such and signed up for a few.

Well, the ads started coming at me like those online porn ads used to. Ad after ad, all looking like casino slot machines almost. Ads for surveys, games, prizes, cash, etc.

All well and good if they are legit. I started worrying that maybe my computer would be infected some how. But so far OK.

I am working full time and going to school full time, so I don't have time for a part-time job. But I need some extra money. So the surveys seemed like a good idea.

But one problem is, most of the surveys take up a whole lot of time. I wish they could pare them down somehow.

Also, it is hard to separate the wheat from the chaff? Which are legit, and which are scams? Are they all legit?

I know some professors who used to teach at Vanderbilt University's Owen Graduate School of Management who were into online research and such. Because I know they were into this kind of thing, makes me think it is legit.

But I have already gotten stung once so far by one of this companies putting through an unauthorized charge to my checking account. I can't tell which one, but my bank removed it today.

I am going to be careful in proceeding. I want to do the surveys, because the idea appeals to me, but I don't want to waste more money than I make, and I will have to be vigil for other unauthorized charges.

But then as a "professional" survey taker, I guess I can take that challenge on.

Would love to hear comments from others who have done these type of surveys.

Stupid Tax

If you are a fan of Dave Ramsey, like I am, you know the term "stupid tax." That is his codeword for something you have done with money that is stupid beyond belief.

Of course, I have paid more than my share of stupid tax. (Should I apply for a refund?)

But probably my most stupid one involved a piece of athletic equipment, and you guessed it....a credit card!

At the time, I was in my fitness mode (unlike now. While in school, I haven't had a chance to exercise at all.) I was enamored with the exerciser that looks like you are walking--you just move your legs back and forth and there are arm pieces that go in tandem. I can't remember the name of the equipment--I think I have blocked it out of my mind, it was so painful.

I was enamored with it, because it looked like fun, and also it was quiet. This was important, as I could exercise in front of the TV and hear the TV, and I live in a condominium, and it would be quiet for my neighbors.

Well, I saw them on sale at K-Mart, so I go trudging over to K-Mart, all excited. On top of the sale, I could get an extra 10 percent off if I applied for the store credit card and bought the item that day. It was not an impulse item, as I had wanted to buy it for a long time. But the smart thoughts stopped there.

I applied for the card, got it, and charged the equipment--$200. I put it in the car and drive home thrilled. I get the awkward package up the stairs into my place, and couldn't wait to put it together.

Unfortunately, I could never get it assembled correctly. It looked right, but if I got on it and started walking on it, one side would basically collapse. I worked and worked and re-did it and re-did it, and it would never work.

Deflated, I called my handyman and asked him if he could put it together. He came over, took it apart, and then back together and charged me $50. It was a bargain!

The problem is, it still wouldn't work right. It still kept collapsing on the same side. I knew then there was something wrong with it, because the handyman would know how to assemble it.

Well, before long, I trudged it out to the trash, and someone else picked it up. Buh bye!

But the cost didn't go away. My money was so strapped, I only paid the minimum on it. Over the months and years, the fees and late charges added up, and now I owe about $2,000. That is definitely one of the debts I am paying off this year, no excuses.

At least I can say I did my part to keep K-mart solvent.

Stupid tax!

Questions to Ask Before Making a Purchase

Last week was a mixed bad week for me. I paid off a few small loans (yay me!) but didn't pay attention to my checking account and ended up bouncing some transactions. Not really bouncing, as my bank pays my overdrafts, but still sticks me with NSF fees. I wasn't being vigil about my account, and it happened again. Anytime I am not vigil, this happens. All I had to do was deposit $50 in my account and there would have been no NSF fees. Jeez.

I read in the local paper not along ago some tips about making purchases. The paper has a column entitled "Ms. Cheap," and she always has some good hints about how to save money and get free items.

Quoting another writer, Mary Hunt, Ms. Cheap listed these questions to ask yourself before opening your wallet:

1) Do I need it really?
2) Could this be considered by any reasonable person to be a planned purchase?
3) Will this make my life better or add to the clutter and chaos?
4) Don't I already have something that will do just as well?
5) Do I have the cash to pay for it right now?
6) If I walk away from this purchase, how will I feel a month from now?
7) Am I willing to sleep on my decision for 48 hours?

Good advice, I think. I think I will pay particular attention to # 6 and 7.

Military Have Special Rules Regarding Payday Loans

I am certainly not a fan of payday loans or cash advance companies. I know it is a proliferating business as in Nashville you see these companies everywhere. Maybe not in the best of neighborhoods, but literally everywhere else. They straddle almost every corner of every intersection.

I read something interesting the other day. That a law was passed in September capping the interest these companies could charge those in the military. It also legislated that these companies could not go after deployed military people in default of these loans. (My wording is not exact.)

It makes sense that the companies could not prosecute those who are deployed. They are not here. But why give them a better interest rate than everyone else? I think I read that that military people could not be charged more than 36 percent APR, whereas everyone else who uses those services are charged 385 percent APR or higher.

Why discriminate here? I think everyone should be capped at a lower rate. As I said, I am not a fan of payday loan companies. It is close to usery, if not usery. But the idea is not a bad one: Give someone a loan on their paycheck. But why does the interest have to be so outrageous? Why couldn't someone charge a more reasonable interest? I wonder if anyone would be able to start "Wal-marting" this industry? Open up a bunch of payday loans at a lower interest and make the others come down on theirs.

Money Habits are Contagious

I read an article today in Yahoo Finance "Getting Rich is Contagious--So Catch the Bug." How true it is. Why do all the important articles come out about 20 years after I need to read them?

Not that it is not common sense. But tell that to a 20 something.

For me, I never had money troubles growing up or in college, thanks to my parents who were good providers.

I have always thought, and this article confirms it for me, that I got into some bad habits with money when I was in my 20s. I had always thought that it seemed like an excuse though to blame it on that.

But the Yahoo article points out that the money contagion is like the fat contagion that has recently been discussed in the news. Hang around with fat friends and you may get fat. (This has been a problem for me in the past too--when I am with my overweight friends, I feel thin and am more likely to overeat).

Likewise, you pick up money habits from those you hang around with. If all you have is broke friends, being broke seems like the norm, and you are more likely to be broke too. If you are around thrifty or investment minded friends, then you are more likely to be that way.

When I was in my 20s, I ran around with a lot of people who had bad money habits. They used plastic all the time and didn't have a good source of income. I had a good source of income, but they wheedled me into doing things I couldn't afford. Of course I could have said no, but they were my friends. They were older than me and I looked up to them. I was a dummy!

Of course I have known better for a long time, and in recent years have actually done better. I still have too much debt, but I did cut up my credit cards a couple of years ago. And I am much better with watching my money and not spending friviously.

I think the main problem is that when you develop a habit in your 20s, you are still impressionable, and it is hard to shake. I know--it has been hard for me to shake it. But I am shaking it, and I am more careful to not get into lockstep with those around me, unless it is a good habit!

"The Secret" and Money

By now, all of you have probably heard of The Secret. The hoopla The Secret created a few months back has more or less settled down now, but its message remains with many people, including me.

Basically, The Secret is based on the Laws of Attraction. In other words, like attracts like and be careful of what you wish for, as you may get it.

I take this to mean that rather than wishing not to be sick, you should wish to be well. Even when you are wishing to not be sick, the universe focuses on the word "sick."

Many may think this is a bunch of hooey, but I think it has merit, and I am trying to incorporate it into my life as much as possible.

This is a partial list of what I am focusing on:

The universe is sending the right man to me, and he is on his way.
I am healthy and will remain that way.
I have many people in my life who cherish my friendship and love me, and I will never be lonely.
People appreciate me for my mind and spirit; they appreciate my input
I have abundance of wealth, more money than I need.

Well the last one is a little exaggeration, but part of The Secret is to think as if what you want is already happening, and then it will come true.

I was at a business meeting the other day, and the speaker was offering a variety of inspirational messages.

He did not say the words "The Secret" specifically, but it was what he was talking about, I am sure. He said to always keep a $100 bill in your pocket to make yourself feel prosperous and to keep $20 bills lying around the house for the same reason. He didn't explain, but I think it is part of that "acting as if."

Speaking of that, I know that tuition check will not clear my account until after tomorrow and I will not have any NSF due to debit card transactions before then!

Due Dates are Important

I think a lot of my problem with debt (not all of course) is due to my inattention to small things (or big things, however you want to look at it) like due dates. I don't know how many times I have been tunnel-visioned at work and just let a due date go by. And by and by. I don't know why that has happened. But in my editor job, I would get so pressured at certain times,
I literally would not think about anything but work until I met the deadline. And due dates were sometimes the casualties.

It is like things just slip by me. I know I should do a calendar when things are due, but I just haven't done that.

Take today for instance. I almost forgot to call the electric company and make a payment arrangement. If I hadn't done that, my power might have been off in a couple of days. We have had a rough summer, and my bill is higher than normal because of the extra air conditioning needed. I needed to make an arrangement to pay at the end of the month, because it is more than I can pay right now.

I called today and arranged for that to happen. Had I forgotten to do that, and called tomorrow, it might have been too late. Then my power could have gone off, and then I would have had to pay the whole bill anyway, and I don't have the money in my account right now to do that.

Whew. Disaster averted. But it is things like that that get me in trouble. Inattention to details. I can't wait until I don't have to worry about this anymore.

The Devil is in the Debit Cards

I am really tired of holding my breath about my checking balance, and hoping that this check or that check doesn't clear for a couple of days.

I finally figured out that I should help manage my account by using my debit card less, particularly towards the end of my pay period. If you use your card a lot and then one stray check or another clears befroe you were expecting, you can get hit with some unwelcome NSF charges for those debit charges.

There has been a lot of news lately about how banks can stiff you by the order they choose to send your charges through. For example, on any given night, my bank will send through the largest charges first, whether checks or debit charges, followed by the other charges in descending order.

That has caused me great grief in the past. Say I have $100 in my checking account, and I have made debit purchases of $5, $10 and $15. Then I write a check for $89, and that check clears a day before I expect. That check at my bank would go through first, which would then bounce all three of those debit charges, assuming they go through my bank on the same night.

I have talked with my bank representatives before and asked why this happens. It seems like the debit charges should clear first, since they are smaller amounts, there are more of them, and I made those charges first. But no, say my representatives, they have polled their customers, and they said they would prefer the largest charges to go through first????? Well, they didn't poll me. By sending the larger charge through first, they will earn three NSF fees, as opposed to only one if they had done it the other way.

In recent weeks, I have held my breath many times, worried that a string of debit charges would go through at an inopportune time. Worse case scenario, it could wipe out a huge part of my balance. Luckily, that has not happened.

But what I have decided to do is that at the end of my pay period, when the dollars really count--is to try to pay cash for all the small things, like newspapers, coffee, gas even. It would be better for me to deduct some money from my checking account and pay for those things. That way if there is an overdraft charge, it would only be one from the withdrawal, rather than a bunch for small purchases.

I am really looking forward to the day, hopefully soon, when I don't have to hold my breath anymore.

Warranties Can Be a Life-Saver

There are a lot of pros and cons out there about buying home warranties and extended warranties and such. I have become a big believer in them, and this year my home warranty saved my butt.

My air conditioning unit was on borrowed time--I can't believe how old it was, and my fear was it would go out on me and I would have to replace it. Some people who live in my building have had to pay as much as $3,000 when that happened to them, and generally I am not in a position to have that much money on hand to pay for a repair of that magnitude.

I know some people say, rather than paying the warranty premiums, just save the money and have it on hand--an emergency fund if you will--in case of needed repairs. That is all fine and well, and the best situation if you can do it, but it is hard to have that much in an emergency fund all the time. There have been times when I have had that much money in the bank, but when I have had to use it, it has been hard to replenish it.

All I know is that when in April my air conditioning broke, if I had not had the home warranty, I would literally be toast. My building is a hot building, and I think it would be impossible to be here when the temperatures start soaring. In April when this happened, it was only around 80-85 outside, and it was already sweltering inside. I was having trouble sleeping, and my pets were panting.

Imagine how it would have been this summer when temperatures outside reached 100 degrees F, and stayed that way for about a month! There would have been no way.

Apparently my bill in April would have been about $1,000 without the warranty, a bargain compared to the money others in my building have had to put out when theirs were on the fritz. But it would have been $1,000 more than I had, and I definitely would have been in a pickle.

With the warranty, all I had to pay was $55. I will bet my money on the warranty.

I did a bad, bad thing

I did a bad, bad thing, but for a good reason. I submitted a letter today, saying I needed to make a hardship withdrawal from my 401K for tuition and tuition-related expenses. Yes, I know it is stupid, because I have to pay a 20 percent penalty and 10 percent tax on it.

But there is really no other way for me to pay the expenses. If there were, I wouldn't touch it. I took this out of my small 401K at my new company. I would never touch my big 401K at my old company, the fund that is doing so well. So I feel better about that. My big retirement fund is actually doing well.

My justification is that I really, really need the money and I have no other way to pay the expenses. Also, I don't have to worry about the money every single day. Worrying like I have been doing can't be good for me.

So now I can rest easy. I can pay for my education.

And when I graduate, I can start putting a whole lot of money into my new 401K.

And I can feel good that I still have a really good 401K balance in my other fund.

So, maybe it is not so bad??

Help for Those Facing Foreclosure

There has been a lot in the news in the last couple of days about what Bush wants to do for those facing foreclosure. He is getting a lot of flack about this from some quarters. I am no Bush fan (that is an understatement) but I do think that what he wants to do has some merit.

Yes, many of the sub prime borrowers probably shouldn't have had mortgages to begin with. But they were trying to own their own homes. And the lenders didn't have to approve them, but they did. Yes, maybe some of these people were in the subprime category because they are bad with money and can't manage it well. But it still seems like some forces beyond their control were at work here too.

Anyway, Bush is wanting to put in place some measure that will help some, but not all of those in trouble. I am not an expert at this, and don't know all the details, but from what I do know, I think it is a good idea. After all, if a bunch of people are suddenly in trouble like this, it can't be good for the economy, right?

There is also a group of people out there (as evidenced from some money message boards) who seem to think that these people should not be helped at all. After all, they say, we paid our mortgages, and we do things the right way--why should we help them out?

I understand what they are saying, but I always marvel at people who think they are ever above making a mistake or doing something wrong. Just because they haven't gotten into a mess yet, does that mean they never will? Bad things happen to good people.

What's the Real Story About Credit Card Debt?

Before I get into the topic, I must say I have been having terrible problems logging into this blog. I never have trouble logging into my other blog. I hope the login issues are not symbolic of my troubles with debt!

Liz Pulliam Weston, a money expert with MSN Money, recently wrote an article titled "The big lie about credit card debt." In the article, she states that a GFK Roper poll and Bankrate.com were inaccurate in saying that the average American is around $9,000 in debt and are in "debt denial." Not only that, but she says the majority of U.S. households have no credit card debt, using the Federal Reserve as her source.

Her reason for writing the article, she says, is to dispel the credit card myth, and more importantly to point out that the myth gives false comfort to those who think they are average for having credit card debt and "are charging down the road to financial ruin."

My point is, the average person may not have $9000+ in credit card debt, but how many people took out a loan, including a home equity loan, to pay off the credit card balances? I would say quite a few, probably.

At the same time, an article in Investors Business Daily, says there is a jump in credit card borrowing and there is trouble brewing. The article said that balances on cards rose 11 percent in May and June, and with two exceptions, it was the highest rate since the recession in 2001-2002.

I can understand Weston's not wanting people to feel secure in having so much credit card debt, but it seems like Americans are generally in debt, and what difference does it make what the source of the debt is?

Budget Busters

I am so tired of living with debt. I would be out of debt now, but decided to go to law school, and that has prevented me from paying off my debt that I could have otherwise. I don't have regrets about law school, but I do have regrets about the debt, which started long before I started school.

I can't wait to pay it off. That won't be this year, my last year in school. It could be the year after though, depending on how hard I hit it. I want to hit it hard.

I found a short article on the Web the other day, compiled by Bank.rate. Titled "6 Budget Bombs," it talked about the things that can sabotage your budget. Do any of these resonate with you?

1) Cut out all the fun stuff. I guess this one speaks for itself. Too much fun stuff can be fatal to your budget. Being in law school, I don't have much time for fun stuff, but I do like to eat out. Being single, that is an easy way to get together with people. But when you do it multiple times a week, it wreaks havoc.

2) Be hit or miss with savings. Guilty!

3) Overuse debit card. Guilty! There is nothing worse than overdrafting using a debit card. I have not gotten in the habit of writing down the amounts like checks.

4) Pay only the minimum on cards. Guilty! That will definitely end after I get out of school though.

5) Live without emergency savings. Guilty! Having a good emergency fund is more important to me now that I have changed jobs and don't have sick days. My previous job had a much better safety net, with sick days and short and long term disability, none of which I have now.

6) Spend more than you earn! Guilty! Even though I have gotten better at this in the last couple of years, and will continue to get even better with it.