Dealing With Excessive Debt

2016_0423-ExcessiveDebtIf you have excessive debt, you should take a deep breath and realize you do have options.

Millennials in general have the lowest credit score and most problems managing their debt, compared to prior generations. But the good news is you have the lowest number of credit cards and lowest debt total compared to other generations.

However, the bad news is that you use credit cards a lot, and make a lot of late payments. Late payments mean lower credit scores.

Additionally, millennials tend to use costly alternative financial services, such as auto title loans, payday loans, pawnshops, rent-to-own loans and tax-refund advances.

Here are some steps you can do to help you get control of excessive debt:
1 – For credit cards, get a lower credit card interest rate as soon as you can – Call up your credit card company and ask for a lower rate.

2 – If you can’t make the minimum payments on time, call your credit card company and work out a payment plan.

3 – Allocate a larger portion of your income to reduce debt. This will be painful, but over time it will work.

4 – Limit your spending. If you don;t have a budget plan in place, now is the time. Limit your spending to only the essentials, and make paying off your debt the number one priority.

5 – Motivate yourself. Reach out to friends or relatives who have been through similar problems. This is a process, and it helps to have support during those low times.

Need more help? Then why not reach out to the NFCC (National  Foundation for Credit Counseling – the nations largest and longest-serving non-profit financial counseling organization.

http://www.nfcc.org/

So don’t fret the debt – take some steps to help yourself and sleep easier.

April is National Financial Literacy Month, Talkin’ Money’s favorite month! To celebrate the importance of being financially literate, we’re going to post financial literacy tips every day.

Apply Good Consumer Skills To Purchases

2016_0422-ConsumerSkillsYou really should apply good consumer skills to your purchase decisions. How so you say?

Well think about it, do you really want to go through life spending more than you have to for things you buy? Or what about paying higher fees for things people get for a lot less, or even for free?

It really just takes an analytical, systematic approach to decision making. In fact, you can apply this to lots of things in life.

Here’s a step-by-step approach that really helps:

1 – Consider the item, thing or service you want.
2 – Look at several options for each – Let’s say three different ones.
3 – Consider to alternatives and consequences of each option.
4 – Make your decision…go ahead, pick one!
5 – Analyze the results of your choice. Did it turn out the way you wanted? What could your of done differently for a better result?

Congratulations! Now that’s applying good consumer skills. It applies to buying a car, renting a house, purchasing a smart phone, even buying an ice cream cone! In the end, if you think carefully about each purchase, you could save yourself big bucks!

April is National Financial Literacy Month, Talkin’ Money’s favorite month! To celebrate the importance of being financially literate, we’re going to post financial literacy tips every day.

Let’s Play Budget Mania!

2016_0421-BudgetManiaTalkin’ Money presents the ever-popular financial literacy game but is really not a game at all! It’s time for Budget-Mania! Where millennials learn about keeping a budget for their spending and saving. After all, if you don’t have a plan then good-bye budget and hello chaos!

Click here and download this PDF form to be on your way to your first budget!

As you can see by this form it’s really quite simple, but like everything else in life, you got to stick with it in order to succeed. It’s a game of pluses and minuses. Income, such as your take home pay from your job, is a plus. Your parents give you money for your birthday, plus. As for the minus, that’s all of your expenses from car repairs to your monthly rent, from paying your health insurance to shopping for groceries.

Add up all of your expenses and subtract it from your income and you are well on your way to winning at Budget-Mania! That’s because you have a plan and that information will help keep you out of spiraling debt.
As my old friend Ben Franklin always said, “An investment in knowledge pays the best interest.”

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The Costs & Benefits of Different Kinds Of Credit

2016_0420-Credit-FrankAll right all you spenders, there’s a subject near and dear to me and that’s on the subject of credit. Now you may be thinking to yourself that poor old Frank Money has no life. That may be true but I’m not poor and I’m not in debt, but thinking about the different kinds of debt can really knock me off my feet.

There are costs and benefits for carrying different types of debt. Some credit accounts are viewed more favorably by lenders than others but all require the ability to repay your debts in a timely manner. For example, there’s non-revolving credit like taking out a mortgage that’s paid in installments. Revolving credit deals with credit cards and fluctuate how much you pay each month.

Believe it or not carrying debt and paying it off monthly can raise your credit scores because it clearly shows how you manage your finances. Just remember the higher your credit score the better you can negotiate lower credit rates.

What Are The Factors Affecting Your Paycheck?

2016_0419-TakeHomePayIt’s just a hunch but I’m willing to bet that a lot of you earning a paycheck don’t fully understand all the deductions that are taken from your gross amount. First of all, these deductions are actually called taxes. That’s right, you’re now in that exclusive club that helps run our country as smooth as it can.

Depending on what state you live in determines how much in taxes you pay. The basic taxes we all pay are Federal Income Tax, Social Security and Medicare. Federal is just how it sounds. It pays for what’s needed throughout our country including National Defense. Social Security is there to assist you financial when you reach retirement age. Trust me, you’re going to need that. As you will with Medicare, that’s also for retirement age to assist with basic health care.

All states are not created equal when it comes to taxes. A number of states have a State Tax and could also have a City Tax. There lots of other taxes out there but I think you get the idea. Death and taxes…I’ll take taxes!

We’re Halfway, Plus 3 Days,
Thru Financial Literacy Month

2016_0401-FinLitMonthIt’s Tax Day! Normally, Tax Day is April 15th, but this year it’s April 18th! Why the change to April 18th? Well, in typical Washington-DC fashion…it’s complicated…here’s the reason why – http://www.usatoday.com/story/money/personalfinance/2016/04/09/tax-day-april-18-year-not-april-15/82095452/#

If you have filed your taxes and signed on the dotted line, then good for you! If this is your first time it’s not that far-fetched that you have joined society; contributed to keeping the wheels oiled and turning so our country can keep moving forward. Okay, sometimes I can get carried away.

With your return due today, we thought we would share another date with you – Tax Freedom Day – This is the day of the year where everything made up to that date goes to Uncle Sam, and after that date, everything you make is yours. In the United States, it is annually calculated by the Tax Foundation, a Washington, D.C.-based tax research organization. In the U.S., Tax Freedom Day for 2015 is April 24, for a total average effective tax rate of 31 percent of the nation’s income. The latest that Tax Freedom Day has occurred was May 1 in 2000. In 1900, Tax Freedom Day arrived January 22, for an effective average total tax rate of 5.9 percent of the nation’s income.

Tax Freedom Day for 2016 is April 27th! Woo Hoo!

April is National Financial Literacy Month, Talkin’ Money’s favorite month! To celebrate the importance of being financially literate, we’re going to post financial literacy tips every day.

As for the second half of the month of April, each day we’re be covering more financial literacy information such as, just what are the taxes taken out of you paycheck, your credit and the benefits of keeping it at a high number, keeping on track using a budget and a lot more.

No peeking! April 19th is tomorrow, and you have just 361 days till your income tax return is due again!

Get wealthy with regular investments, time, and compounding

2016_0416-CompoundedInterestWe’ve all heard and read a thousand times how we should save on a regular basis and the younger you start the more we’ll have when getting closer to retirement. But as sure as the sun rises there will always be something that happens in your life that will make it difficult for you to part with your money to put into savings. That’s why every paycheck you should have a set portion of your salary automatically deposited into your savings account.

The later you wait to start saving, even a year or two, could mean the difference of up to $200,000 or more! Remember compounding interest? Over time your money will make more money for you.

In fact, if you want to have what we financial literacy fans call ‘fun’ here’s a link to the government’s Securities and Exchange Commission’s handy, dandy Compounded Interest Calculator. GO ahead, plug some numbers in and step back, ready to be surprised!

https://www.investor.gov/tools/calculators/compound-interest-calculator

Good old Benjamin Franklin once said: “An investment in knowledge pays the best interest.” So it’s up to you to be a wise investor with your savings.

How Negative Info Affects Credit Reports

2016_0418-BadCredit-FrankMoneyFrank Money here, your financial detective trying to save you money. Ok, listen up all you financial hotdogs out there who don’t pay attention to their credit scores. I’m about to give a lesson in world of hard knocks. Let’s cut right to the chase, bad credit will cost you money. If you’re planning to purchase large ticket items like a mortgage, car loan or even another credit card, you’re going to pay a lot more.

Your credit score under FICO ranges from 300 to 850, with the highest being the best score. I’m guessing anything under 620, you’re going to have trouble even being considered with some purchases without paying extra for insurance of payment.

So pay off your credit cards and get rid of the ones you don’t need. Don’t be late with any of your loan payments, and don’t be afraid to check your credit report, it does not affect your score. It will take a couple of years to build your credit back up to a decent score but it’ll be worth it and that’s coming straight from Frank Money.

Financial Literacy Standards

So, what exactly are the standards for financial literacy? What should a high school graduate know when they walk down the aisle for that diploma? Here are the financial literacy standards we are using to craft the shows we do – ask yourself how much did you know when you graduated high school?