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?
Friday, August 31, 2007
Sunday, August 26, 2007
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.
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.
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