My Personal Finance Journey

Category Archives for Get Out of Debt

Personal Bank Loans vs. Family Loans

————————————————————————————————————————
Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
————————————————————————————————————————

Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

The following is a guest post. Enjoy!

No one likes to be in debt, but taking out personal loans from time to time is often necessary, especially if the loan is for an investment – e.g. to buy a first house, finance your education, or get a start-up business off the ground.   
There are well-documented problems that borrowers can encounter with high-interest loans, whether that is caused by poor financial management, or taking out a reasonable loan but not understanding the terms. Even if we are unable to pay a loan back as quickly as we had initially agreed, there is help available for borrowers to consolidate their debt and get out from underneath it. In certain states and counties, debtors who get behind on their payments can actually wind up in private prisons run by contractors, even though debtors’ prisons have been mostly illegal in the USA since the Civil War.
However, if you find yourself blessed with friends or family who have disposable cash to hand (and like you), there is a great temptation to take a loan from a personal acquaintance instead of a bank or lending institution. And, it makes sense: it’s often quicker and easier, with less red tape and better terms (perhaps your friend or family member has even offered to let you pay back the loan interest-fee), and on a whole, it somehow feels less scary; no paper-work or intimidating payment reminders from the bank. But as they say, buyer beware.

Are family loans worth it?

The danger with borrowing money from someone you know is that money can become a divisive issue; indeed, it is an issue that has been known to destroy relationships and ruin friendships. In fact, an overwhelming number of marital problems and divorces are down to money-related conflicts, which should serve as a strong caution to even the most amiable friend or relative who might offer you financial help.
One major stumbling block with family loans is that people may not be honest with you – i.e., the money may be more important to them than they initially indicate. The importance of recouping that money, and the lender’s expectations as to how quickly you’ll pay them back, often goes unstated.
Furthermore, you may take their generosity for granted and assume they’ll ‘let it slide’ or that they’ll understand if you can’t make your repayments every month. It is easy to allow one month of non-payment turn into two months or four; sometimes, it turns into a year, with the hope or assumption that the loan has been forgiven. It is easy to imagine how this might fracture the relationship.
An interesting study was conducted by Carnegie Mellon University – we have a tendency, especially in situations where we are borrowing money from a friend or family member, to confuse fairness with self-interest. So at the end of the day, which is more important to you: money or your relationships?

How about you all? Would you be willing to give a loan to a family member or have you ever taken out one of these? If so, how did it work? Did it create any family stress? Did you have a written agreement?

 Share your experiences by commenting below!

***Photo courtesy of http://www.flickr.com/photos/ronnie44052/1486794482/sizes/l/in/photostream/

The Power of Negotiation and Options in Student Loan Repayment – Lessons from a Reader’s Experience

————————————————————————————————————————
Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
————————————————————————————————————————

Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

One of my favorite things about blogging about personal finance is that once couple of weeks, I’ll receive a question from a blog reader asking how I would handle a certain situation in personal finance or about what other options he or she might have but has not yet thought of.

I really enjoy this real life interaction because it allows me to use the knowledge base I’ve accumulated over the past 3-5 years to help regular folks optimize their situations. In addition, it exposes me to accounts of how some of the PF topics and theories discussed in the blogosphere actually work out in real life. Sometimes, the theory falls far from the application, and sometimes, it is spot on correct. It all really just depends!

Shown below is a student loan repayment situation faced by a reader that recently contacted me asking about any options they may have overlooked prior to their discussion with a collection agency handling their loans:

Thanks so much for letting me contact you about this huge struggle my husband, and by proxy myself, is going through. 

He went to Lehigh Valley College, a now CLOSED school, for 1.5 years back in 2002/2003. He took out around 4 Sallie Mae loans and one federal loan for a total of around $40,000. The interest rates on the Sallie Mae loans were higher than most credit cards. He didn’t find a job right away out of school, and when he did finally find a job, it paid next to nothing. He couldn’t afford the payments they were demanding, so he just ignored them… and ignore them he did.  

The federal loan is now paid because they garnished his wages and tax return for 2 years. The issue now involves the 4 Sallie Mae loans, which had been turned over to Allied Interstate (a collection agency) after he had defaulted. He made a deal with Allied to pay $375 a month for something like 13 years at an interest rate of essentially 0%. The total still to pay down at this point is to about $62,000 (down from $70,000 originally).  

He is making about $42k a year with his job, which does thankfully include health insurance. He does not have any other significant debt aside from the student loans, and we do have an emergency fund. 

Allied stopped taking the $375 per month loan payments in October because they started demanding higher payments. We contacted a lawyer at the beginning of November because they broke their agreement. We won the law suit. Now, the issue is that Allied sold the loan to another collection agency after we won the suit. So, we are going to have to go through all o the negotiations again. Since he took out 4 loans through Sallie, the new agency (NES) is referring to them as 4 loans rather than one loan as Allied did. 

The $375 that we were paying with Allied was do-able. However, since he hasn’t had a payment taken out since the end of October, I told him to save the money he’d pay because NES probably will want a nice down payment. But, I think he’s spent it. He is a spender, I am not so much anymore. Like I said, I want to get it paid off, and the more he pays each month, the shorter the term of the payment. But I don’t know if he follows my logic on that. He just doesn’t want to change his lifestyle and current spending habits.  

I cannot find ANYONE to help me. He signed for these loans, but under false pretenses. Every sort of loan payment help or loan forgiveness refers to federal loans. Seriously, I have done so much Googling on the subject and I am at a loss. I don’t know where to turn. If he deserves some sort of help with this issue, I want to be sure he gets it. 


Listed below were my preliminary thoughts on the situation:
From what I am hearing, it sounds like the debt collection agency and Sallie Mae are really actually trying to work with you all already to get it paid off, first by reducing the interest rate, and then also offering to consolidate things (which sometimes, but not always, can be a good idea). I would first just double check what interest rate they will be charging going forward to make sure it is favorable, but that is one thing that would definitely be negotiable for you all. 
Having established that, the next thing I would think about is what the current monthly payment will be with this new collection company and define whether or not it is do-able with his income?
To be honest, if he is making $42k per year in his job, and just has one debt to pay off (the low interest student loan debt – no credit cards), $375 per month sounds like a fairly realistic amount (although painful). I think the real issue that needs to be addressed is his behavior, first from the side of actually realizing that he needs to send in payments for his debts (i.e. they aren’t going to magically disappear if he ignores them), and second, getting control of his spending.

If I were you, I would sit down with him PRIOR to the call with the company and talk through his income/expenses to determine what is a feasible amount to be paying. They might be willing to give you an economic hardship deferral for other REAL obligations (such as utilities, low income, credit card debt), but not for the fact that money is low because he is overspending each month on consumer items.

So, once you talk to the new collection company, determine what the new amount is you’ll be paying. Then, think about why it is or is not do-able to meet? Remember: it is to his benefit to pay down his debt sooner rather than later, provided that it economically feasible.
If there is a good reason why it is not do-able, there can be other options to look in to such as an economic hardship deferral (which another reader I recently helped with student loan debt qualified for because his income was below $40k per year), although that may be harder to qualify for given his good income level and lack of other debts. 

Listed below is an update from the reader after the call to the collection agency:

We called NES today. They are consolidating the 4 loans into one, and they agreed to a down payment of $800 today, $700 by the 31st, and $400 each month thereafter. They are doing a matching pay program, so every dollar he pays, Sallie Mae matches it. We are down from 13 YEARS to 6 YEARS!!! He’ll have to pay taxes on what Sallie matches.

So this is pretty much amazing. Of course, he didn’t save everything that the company should have been taking out since October and we’ll have to take some from my savings to pay the down payment, but it’s a relief regardless. He just has to remember to always have the money there because if even one payment gets bounced the agreement is void and we’ll have to pay the entirety of the loan without any help from Sallie Mae. 

I have found a few websites to help him with the saving, including Smarter Bucks. Have you used this site? I am also going to help him get set up on Mint, like I am, so he can really look and see where his money goes each month. He’ll have $100 a week to spend as he wishes, whether it’s going out with friends or on electronics or whatever, so I hope he listens to my advice and is willing to learn how to budget. 

I will think of this as a blessing in disguise. Thank you for your help.

As you can see by reading the update from the reader after her and her husband’s call to the debt collection agency handling their student loans, they seem to have landed a pretty nice repayment deal! In fact, it actually appears that Sallie Mae genuinely does want to help them pay off the loan.

Key Lessons to Learn from This Situation – Options and Negotiating in Student Loan Repayment

According to much of the personal finance theory I’ve read the past few years, student loan debt is generally regarded as “not-that-bad” because 1) a college degree gives you a good return on investment by allowing you to attain a rewarding career, 2) it generally has a lower interest rate than consumer debt, and 3) it is generally much more flexible with the terms of repayment than other debts such as credit cards.

While the first two points listed above are fairly straight forward and clear to see for most people, the 3rd point is the aspect I’ve discovered people with student loan debt are actually the most interested in. Essentially, they want to know what their options are and what is acceptable to negotiate in regards to student loan debt.

 Because of this inherent interest that people have in what options they have regarding student loan debt repayment, I thought it would be useful to review some of the lessons that can be gleamed from the reader’s experience above:

  • Lesson/Option # 1 – The interest rate of your student loans is definitely negotiable. 
    • The readers above negotiated the rate they were paying down to almost zero (~0.01%).
  • Lesson/Option # 2 – Look in to whether or not a student loan forgiveness program applies to your specific loan.
    • This was not applicable to the reader’s student loan. However, if you are going in to a career as a teacher, doctor, and other forms of public service, it is very possible to be eligible for loan forgiveness (especially if you have a federal student loan). At the very least, it is worth asking! 
  • Lesson/Option # 3 – Ask if your student loan provider offers matching for your loan repayments. 
    • This was a pretty sweet deal that the reader was eligible for (I didn’t know before now that matching of student loan payments even existing!). However, it’s hard to pass up free money such as this, so at the very least, it’s worth asking your student loan provider if this is available. 
  • Lesson/Option # 4 – Consider whether or not you would qualify for economic hardship deferral. 
    • Essentially, economic hardship deferral means that you can get your student loan payments reduced for a certain time period if your current income is low or you have a very high debt to income ratio. 
    • This is definitely a powerful option to consider if you meet the qualification(s). Again, at the very least, it’s worth having the discussion with your provider to ask. 
    • When you call, make sure to have all of your records handy, including your current income, debts, and all set expenses such as rent and utilities. 
  • Lesson # 5 – If you start to have trouble making the required and/or minimum payment on your student loan, inform your provider immediately. Do not ignore your loan! 
    • As we saw in this story with the reader above, by just going silent and ignoring his student loans, they did not go away – a default occurred and the loan was sent to a collection agency. On top of that, the reader’s credit score was likely also negatively impacted.
    • Instead, it is better for both parties to stay in communication and determine how best to work out the situation. 
  • Lesson # 6 – If you are having trouble affording loan repayments, isolate the real root cause.
    • In the case of the reader described above, they were having trouble with repaying their student loan. 
    • However, in talking through the details, the root cause/problem was not in fact an overall shortage of money. It was 1) making sure to acknowledge that the student loan needs to be paid in the first place, and 2) getting handle of spending levels to free up the necessary cash. 

How about you all? Are you currently working on repaying student loan debt?

 If so, have you discovered any “hidden” options or negotiation points along the way that you wish you knew at the start of the process?

 Have you made any mistakes along the way as well?

 Share your experiences by commenting below!

    ***Photo courtesy of http://www.flickr.com/photos/justinstravels/4955154459/sizes/l/in/photostream/

    How Have Attitudes Towards Debt Changed Since the 2008 Credit Crisis?

    ————————————————————————————————————————
    Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
    ————————————————————————————————————————

    Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

    The following is a guest post. Enjoy! 

    Since the global credit crisis in 2008, personal budgets and disposable incomes have been strained. Recent government austerity measures have been adopted by various nations attempting to balance returns to economic growth and their debt.

    Attitudes of the Past

     

    Given these measures, have consumers been able to successfully manage their domestic budgets? The perception of personal debt pre-credit crisis is well publicized, with households adopting relaxed approaches to credit cards, personal overdrafts, etc. Recent studies have been performed with alarming outcomes showing that the average US citizen owes circa $8000 of unsecured debt, with around a third of that amount being in relation to credit cards.
     
    This attitude to debt is also leading to developments in lenders strategies as many consumers took debt pre credit crunch and have simply been managing this in the previous year’s, however have not been able to repay core debt. leading to many banks having to take further losses as back in the 2008 – 2009 financial periods.

    Present Attitude Towards Debt

     
    From 2009, lenders have seen consumers micro manage their debt as opposed to repaying it as consumers perform their own research in the types and cost of their debt. For example, in the past, consumers were likely to focus on one method of debt to manage their monthly budgets (i.e. paying for day to day spending with credit cards). In actuality (assuming a monthly salary is paid), it would be cheaper to use an agreed overdraft limit with a lender (hence avoiding high monthly charges) to pay down the core debt on the credit card, which most likely is being charged at anything from 18-27% APR and manage their daily spend with an overdraft. This is very similar to the way a business manages its own cash flows (i.e. short term solutions for short term problems).
     
    Many businesses have awoken to the above movements in consumer behavior and noted the problems with households trying to reduce their core debt in agreement with its providers. Additionally, many debt solutions bodies can be found in the market to help consumers manage their budgets resulting in agreements with providers resulting in affordable solutions.                

    How about you all? How do you think attitudes towards debt have changed in the years since the 2008 credit crisis?

    Share your experiences by commenting below!

    ***Photo courtesy of http://www.flickr.com/photos/pinksherbet/4257485778/sizes/l/in/photostream/

    Don’t Let the Stigma of Debt Keep You From Getting Help

    ————————————————————————————————————————
    Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
    ————————————————————————————————————————

    Click here to enter my free $51.95 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is January 31st, 2013.

    The following post is by MPFJ staff writer Travis. Travis is a customer blogger for CareOne Debt Relief Services, and also appears weekly at Enemy of Debt.  Travis candidly shares his personal journey to pay off $109,000 of credit card debt and the tips he’s learned along the way. As a father and husband, he provides a unique perspective on balancing debt, finances, and family.
    For thirteen years, I hid our mounting credit card debt from my wife.  I never denied that we had credit card debt, but I never told her just how much debt we had accumulated.  The truth is, I didn’t even know the exact number because I was afraid to add it up.  Whenever I tried, I just shook my head and stopped adding.  After the number got so big, it just didn’t seem to matter anymore what the exact number was.  It seemed so hopelessly out of control. 
    Yet I didn’t do anything about my debt, besides continuing to increase it, until I absolutely had to. 
    I’ve often wondered why I didn’t do something about my debt sooner.  I used to think it was simply because I was ashamed of my debt.  That’s certainly part of it, but I now think there’s more to it for me, as well as millions of other people struggling with debt:

    Afraid to Admit Needing Help

    Admitting that I need help is extremely difficult, and that doesn’t just apply to my debt situation.  Whether it’s being overloaded at work, unable to perform a home improvement project, or even doing tasks to keep the household running, asking for help feels like admitting I’m a failure (especially since our culture seems to prize individual success without any help!). 
    Bankruptcy is considered by many as the last resort debt relief option, and nearly 1.8 million people filed for bankruptcy in 2011 (complete statistics could not be found yet for 2012).  That’s a lot of people waiting until they have absolutely no other option before getting help.

    Not Aware of Options 

    Speaking of bankruptcy, I had thought that was the only real option for debt relief.  Given the negative stigma attached to bankruptcy, people avoid it unless absolutely necessary.  I was surprised that there were other options such as debt management (the route we ultimately chose) and debt settlement.

    Add Money To the Equation 

    Try this:  Close your eyes and think about what you would consider a successful person.  If you are like many people, “Rich” is one of the first things that come to mind.
    Whether we want to admit it or not, our society largely equates lots of money with being successful.  If you admit that you need help with debt, you admit that you have problems managing the most recognizable status symbol in western civilization.

    Why It’s Better To Talk About It 

    I could have never began my journey out of debt if I hadn’t swallowed my pride, raised my hand and said, “I need help.”  I would have never learned what my options were had I not opened my mouth and asked questions within the online community of my would-be debt relief provider.
    For a very long time, I was afraid my friends and family would think less of me because I was in a debt relief program.  In all honesty, I still am not 100% comfortable with being completely open about my situation.  But, it does make it easier when I remember that everybody I know has a mortgage, a car payment, credit card payments, or even all three.
    Am I really all that different from them?
    Those that I have told have been nothing but completely supportive.  I’ve learned some of the most useful financial tips and techniques simply by talking with others about money.
    It is true that I was forced to admit I needed help when I could no longer make my monthly payments.  Many people need something to give them that final “push” to enable them down the path of getting help.

    Maybe you’re struggling with debt, and you’re looking for that push.

    Talk about it with someone.  Reach out for help.  You’ll be glad you did.
    How about you all? Did you have a hard time admitting you needed help with debt?  Do you talk to your friends and family about it?  How did they react?


    Share your experiences by commenting below!

      ***Photo courtesy of FreeDigitalPhotos.net

      Are You Considering the Opportunity Costs?

      ————————————————————————————————————————
      Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
      ————————————————————————————————————————

      The following post is by MPFJ staff writer, Kelly Gurnett. Kelly runs the blog, Cordelia Calls It Quits, where she documents her attempts to rid her life of the things that don’t matter and focus more on the things that do. You can also follow her on Twitter and Facebook.


      Of all the things we consider when making a financial decision, there is one factor we often overlook: the opportunity cost. Yet, it’s this factor that most greatly affects the overall course of our lives.


      Say you’re planning on getting a new car. The things you might take into account when debating this expense are:


      • Whether to lease or purchase.

      • Whether to buy new or used.

      • Which brand and model best suits your needs.

      • Which car is the best value for the price.

      • What dealerships are currently running sales.


      These are all immediate, value-based considerations: What will get you the best product, for the best price, to meet your current needs? But, the thing most of us don’t consider is: What will I be forfeiting, or trading off, to make this purchase? What opportunities am I denying myself, right now or in the future, by making this decision?


      It’s this disconnect from our choices and their consequences that gets many of us in to financial holes.

      It Made More Sense When We Were Kids

      When you’re a kid, holding your $10 of saved-up allowance money and standing in front of the shelves at the toy store, it’s all about opportunity cost. 

       We can use our $10 to buy a handful of cheap little toys, or one bigger, cooler toy. We can buy Toy A or Toy B. All we have is the money in our hand, and whatever we decide to buy with it, we’re making the choice that is the toy we want, above all others. We know that we’re giving up having those other toys in order to have this one.


      It gets muddier when you grow up. Loans and credit cards and payments that stretch out over decades make all of our financial decisions seem much less concrete. We can buy all sorts of things without having to think about the trade offs, because the purchases are spread out over long, abstract periods, making the concrete amount of money we’re ultimately spending feel less immediate.


      We can buy a house, two cars, take yearly vacations, and we don’t think of these expenses in terms of choosing A over B. We think of them in terms of how much we can afford to pay out over X number of months.


      But, this thinking distracts us from what we’re really doing: locking ourselves into years of payments that could wind up costing us some very real, and very dear, sacrifices down the line. Every time we make a purchase, we’re (even if unconsciously) choosing that we won’t be able to have other things.


      And the opportunity costs aren’t just other things we could be buying—they’re also the standard of living we’re setting ourselves up for.

      A Real-Life Example (Mine)

      When I was fresh out of college, making my first full-time paycheck and with credit card offers flooding my mailbox, I jumped straight into the consumer-driven lifestyle. I bought a new car. I bought a new, grownup wardrobe. I bought brand-new, trendy furniture for my tiny basement apartment. I went out all the time. I didn’t deny myself a concert, a better computer, or even a caramel macchiato if I wanted it.


      Why should I? I had the money to keep up with my payments. That was all that really mattered, right?

      Wrong. Thirteen years after I graduated college, I am now less than a year away from making my final payment in the debt management plan I’ve been working through for the past 4 years—all to pay off the debt I racked up when I was young and incredibly careless. In my 13 years of dealing with the opportunity costs of the bad decisions I made, here is what I’ve learned I was trading off, without realizing it:


      • The ability to work at a job I cared for, because the job I hate is the only one that’s been able to let me keep up with my bills.

      • A savings account/retirement fund/emergency fund. I recently read an article on how much savings you should have built up by each age in order to enjoy a fairly comfortable retirement. I’m barely 1/3 of the way towards what I should have had built up at 20, not at 31 where I am now.

      • Peace of mind. Every time someone in my house gets sick…every time our cars need repairs…every time something breaks in our house, it throws me into a panic because I’m already stretched thin meeting our monthly expenses. There is no margin for error. There is no room for the unexpected.

      • Stress. Because our budget is so tight, and I’m so terrified of getting into another bad situation, every financial decision I find myself faced with—whether it’s buying one brand of toilet paper over another or wondering when we can afford to fix a leaky faucet—is a major source of stress. I am frugal, first and foremost, out of a sense of fear. I hope that once my debts are paid off, I can learn to have a healthier relationship with money, but right now, it is a very broken, very tense relationship.


      All this could have been avoided if I’d realized, way back then, that my spending decisions weren’t made in a bubble—they had very real, and long-lasting, consequences for everything I could buy and do and be for the next 13+ years.


      Believe me, it’s a lesson I know now, and won’t ever forget.


      How about you all? Do you consider the opportunity costs of your choices? What would you do differently if you did?

        ***Photo courtesy of http://www.flickr.com/photos/59937401@N07/5930043516/

        Using A Debt Consolidation Plan To Pay Off Debt

        ————————————————————————————————————————
        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
        ————————————————————————————————————————

        The following is a guest post. Enjoy! 

        MyPersonalFinanceJourney.com has written a lot about credit card debt and how to effectively save for emergencies and pay off your debts efficiently. For some people, however, you might already be past the point of even knowing where to start with tackling your overwhelming debt load.

        Debt issues trigger strong emotional responses in all of us, and feelings of guilt, helplessness, worthlessness, frustration, anger, and betrayal are all normal. For this reason, it might be difficult to admit you need outside help, but working with a professional to help you get out of debt could be the best decision you ever make.

        What Are Your Options?

        If you’ve never dealt with this type of debt load before, you might assume that bankruptcy is your only option. The idea of wiping the slate clean appeals to us when we’re at our most frustrated (who wouldn’t want a do-over at some point in their lives?).

        The truth is that bankruptcy should only ever be considered as a very last resort. The long-term effects on your financial situation could set your dreams of a solid foundation going into retirement back years and years.

        You might be able to find counseling to help you organize your debts, talk to your creditors, and come up with a payback plan, but it can be difficult to find someone who will stay with you as you go through the entire process.

        How Does A Debt Consolidation Loan Work?

        Part of the reason you’re struggling with debt is that there are just too many different bills to deal with. Every few days, it’s a credit card bill, a car payment, insurance, a medical bill, or a utility bill. It’s so easy to get behind and have one check bounce, creating a domino effect of missed payments.

        With a debt consolidation loan, you borrow the amount you owe on all of your debts and pay everything off at once. You’re left with a single loan, which is much easier to budget for and remember.

        On top of the single payment, you may also end up with a lower interest rate. Some debts you have (credit cards especially) have outrageous interest rates, and your debt consolidation loan could potentially end up being cheaper.

        The real key to this type of loan is having a lower monthly payment. If you were constantly struggling before, you’ll now be able to determine a monthly payment that fits your budget and income. You’ll stop living right on the edge and now have the opportunity to build up a small emergency fund and get back on track.

        A small word of warning: lowering your monthly payment sounds great, but you should also remember that any reduction in payments means it will take that much longer to get out of debt.

        ***Photo courtesy of http://www.flickr.com/photos/ranna/2838594490/sizes/l/in/photostream/

        Are Debt Management Plans Worth the Cost?

        ————————————————————————————————————————
        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
        ————————————————————————————————————————

        The following post is by MPFJ staff writer Travis. Travis is a customer blogger for CareOne Debt Relief Services, and also appears weekly at Enemy of Debt. Travis candidly shares his personal journey to pay off $109,000 of credit card debt and the tips he’s learned along the way. As a father and husband, he provides a unique perspective on balancing debt, finances, and family.

        My story is simple:  My wife and I accumulated $109,000 in credit card debt.  But we’re on our way to paying it off.
        The first question I get asked is, “How in the world did you rack up that much debt?”
        The answer really boils down to the fact that we consistently overspent day after day, week after week, month after month for 13 years.
        From there, the story gets more complicated because the next question is, “How are you paying it off?”
        In July of 2009, my wife and I enrolled in a debt management program (DMP).  A DMP is a program in which a debt relief provider negotiates with each of your creditors a lowered interest rate and a monthly payment that results in the debt being paid in full within 3-5 years.  In return, your lines of credit are closed, eliminating your ability to rack up additional credit card debt. We make one monthly payment to our debt relief provider, including a monthly service fee, and they disperse the right funds to each creditor.
        In that description, the thing that people pick up on most is the fact that we pay a monthly service fee for our DMP.  Some don’t agree with paying a fee to an agency to help you get out of debt.  It feels like a scam to them.  This usually leads to some prodding with the intent of  convincing me that I overlooked a way I could have eliminated my debt without paying a monthly fee.  
        The Statement:  “You can call your creditors and ask them to lower your interest rate.”
        My Experience:  I called each of my creditors, and even after threatening that I would no longer be able to pay them each month if they didn’t help me, none of them agreed to lower my interest rates.
        The Statement: “I heard that credit card companies have hardship programs that will lower your interest rate and your monthly payments – and they are free.”
        My Experience:  While it is true that many credit card companies do in fact have such hardship programs, at the time I was investigating debt relief options in 2009, I did not know this and NONE of my creditors offered it to me.  Additionally, most of the hardship programs are only valid for a year.  Even if all 13 of my creditors would have agreed to put me in a one year hardship program, it would have been impossible to pay off $109K of debt in that length of time.  When my year ran out, I’d be seeking options once again.
        The Statement: “Debt management programs don’t do anything that you couldn’t do on your own.”  The suggestion implied here is to cut expenses, increase income, or both. Learn to live below your means and pay down your debt.  No service fee needed.
        My Experience:  This method certainly works. Except not everyone can do it on their own.  I compare it to someone that is desperately trying to get in shape and lose weight.  They try to do it on their own by promising to exercise regularly and eating healthy. For some, this works out perfectly, but some are met with failure because but it takes a level of discipline, motivation, and accountability that they just cannot find within themselves.  These people sometimes find success by enlisting the help of a personal trainer.  The trainer provides the structure needed to help the client achieve their goal.
        As far as getting my finances back on track, I’m one of those people that needed a personal trainer.

        My debt relief provider is my financial personal trainer.  Their progress tracking tools, and interacting with other customers in their online community provide me motivation.  The fact that my accounts are closed and I risk having my creditors rescind their agreement if I open new lines of credit, or miss a payment, provide discipline.  Even more importantly, my debt relief provider has resources available that have helped me learn how to track my expenses, budget, and for the first time in our marriage live within our means.

        How Much Did My DMP Reduce My Interest Rates?

        Our debt management program also has an important advantage over attempting to eliminate debt our own by way of the reduction of interest rates.  Prior to enrolling in the DMP,  the interest rates on my lines of credit ranged from 6% all the way up to 29.99%.  After enrolling in the DMP, my interest rates now range from 1% to 13%.

        How Much Does My DMP Cost?

        Had I continued just paying the minimum payments, it would have taken over 30 years to pay off my credit card debt, and I would have paid about $156,000 in interest.  With the program, my debt will be paid off in 60 months, paying $38,000 in interest.  For my $50 a month service fee ($3000 over the life of the program), my DMP will save me about $118,000, and years of debt repayment.
        If you’re in debt, it’s important to know that you have options.  A debt management program is just one of many choices available.  The best thing that someone struggling with debt can do is to fully educate themselves on all the options, including doing it on your own, debt settlement or even bankruptcy.  Knowledge will enable you to make an educated decision.  A debt management program isn’t the right choice for everyone.
        It was, however, the right choice for me.

        How about you all? Do you think Debt Management Programs/Plans are worth the cost? Have you ever participated in one yourself, or know anyone that has?

          ***Photo courtesy of photostock / FreeDigitalPhotos.net

          Who Manages Money Better – You or Your Government?

          ————————————————————————————————————————
          Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
          ————————————————————————————————————————

          Click here to enter my free $74.52 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is December 31st, 2011.

          Often times, when I talk to individuals about the personal debt they carry (especially in the form of consumer debt), I get the feeling that they feel alone and/or isolated because of the money they owe. Because of this, they feel very unwilling to share the details of their debt or reach out to others to help them.

          However, the truth of the matter is that there is no reason to feel isolated or alone because you carry debt. In fact, many individual people AS WELL AS entire governments of countries are facing problems with debt in today’s society. In this way, debt has truly become a problem/issue on the global scale.


          The purpose of this post will be to take a look at the current levels of debt that individuals are currently carrying and then compare this level to the amount of debt that governments hold in an effort to see who in today’s society is doing a better job managing their finances – people or the government.

          Current State of Individual Debt

          Thanks to Creditcards.com and independent.co.uk, I was able to dig up the following statistics about personal debt in the world today:

          United States

          • The average college graduate in the US has approximately $20,000 in debt.
          • The average credit card debt per household with credit card debt = $15,799. The overall average unpaid balance (includes people that pay off their entire balance each month) is $3,389.
            • Personally, my takeaway from this pair of statistics is that once people decide to go down the path of having credit card debt, the magnitude of the debt becomes very serious/huge!
          • The average household total debt – including credit cards, mortgage, home equity, student loans, etc – for all U.S. households is $54,000.


          Europe
          • The average household total consumer debt (excludes mortgages) in Europe is $2,068 USD. The average for the UK is about twice this value.
          • I had trouble finding reliable statistics about the average total debt in Europe. However, there was one report from TheDailyBeast.com that mentioned that the average household debt in the UK was 183% of the average annual disposable income, and that this figure was very high for a European country. 
            • According to BBC News, the average disposable income in 2008 in the UK was about $23,000 USD. 
            • So, a rough estimate of the total household debt in the UK would be 1.83 x $23,000 USD =  $42,090.
            • We’ll consider this a high figure for Europe. And, as a conservative estimate for the average European household debt, we’ll use half the UK value, equaling $21,045 USD.

          Current State of Government Debt

          So, above, we obtained an approximate picture of the current state of personal debts both in the US and Europe. Now, let’s take a look at how the money owed by the governments of these nations stacks up against the personal figures to see who is actually doing a better job managing their finances – people or governments.

          According to a recent report, the following statistics give an overview of the current levels of debt carried by the governments of Europe and the US:

          • By the end of 2011, the US government is projected to be carrying a per-capita debt of $32,000 USD. 
            • In the year 2000, the per-capita debt carried by the US government was almost 3X lower at $12,000 USD. Wild stuff! It’s been a costly 11 years!
          • By the end of 2011, the European governments, on average, are projected to be carrying a per-capita debt of $29,000 USD.
            • In the year 2000, this average per-capita debt carried by European governments was almost 2X lower at $17,500 USD. 

          Conclusions – Do You or Your Government Manage Money Better?

          While I admit that there are many facets to analyze in determine the quality of “managing money,” examining the statistics listed above can give us a good indication of whether governments or individuals are performing better at staying out of (or at least minimizing) debt.

          In the US, the average personal debt is almost 68% higher than the per-capita debt carried by the government. This data indicates that the US government, for all of the mistakes that it most likely has made, is doing a better job than its citizens at reducing debt.

          In Europe, the opposite seems to be true in that the government seems to be worse-off at getting in to debt than the individual citizens. Using our rough average obtained for personal debt throughout all of Europe of $21,045 USD, we ascertain that this is almost 33% less than the per-capita debt carried by the government.

          Thinking about these conclusions, they tend to make a lot of sense (at least to me personally).

          First, I know for a fact that obtaining credit is MUCH easier in the US compared to pretty much anywhere in the world. For example, one of my Peruvian blogging friends was telling me that it is a HUGE process simply to get a small balance on a credit card in his country. I’ve heard similar stories from my Chinese graduate school friends, and I have experienced this tight-credit phenomena when I was living in Spain. Because of this, it makes sense that relative personal debt levels would be higher in the US than other locations.

          Additionally, I know that the governments in Europe are “bigger” than in the US in that they offer more public programs. A good example of this is public health care. Thus, it at least partially makes sense that the government debt figures are relatively higher than personal debt in order to keep these government programs going.

          An Outstanding Set of Questions To Ponder….

          As is generally the case with global economic issues such as this, an investigation often generates an entirely new set of questions. Thus, an interesting set of outstanding questions to all of this is the following…..

          It’s no doubt that individuals in the US are in large amounts of debt.

          • However, are individuals in the US actually worse about getting in to debt and not paying it off because of a lifestyle/culture issue? 
          • Or, do people in the US simply have greater access to credit and therefore, are more likely to get in to trouble with debt than people in other countries? 
          • If people in other countries had the same access as Americans did, would they fall in to the same problems?
          • And, if the amount of debt people are in boils down to an credit access issue, how do governments know if or where to draw the line between a good amount of credit for a healthy economy vs. extending too much debt? Or, should this be something that is set by free market forces?

          Clearly, I don’t have the answer to all of this, but it’s something interesting to think about!

          How about you all? What’s your take on the questions posed above? 


          Share your experiences by commenting below!

            ***Photo courtesy of http://farm1.static.flickr.com/44/142421323_28d03a8c5a.jpg

            Four Letters That Will Help You in Your Debt Payoff Journey

            ————————————————————————————————————————
            Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
            ————————————————————————————————————————

            Click here to enter my free $201.40 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is November 30th, 2011.

            The following is a guest post written by Frank Collins. Enjoy! 

            Four Letters That Will Help You in Your Debt Payoff Journey

            Many people don’t realize the value of letter writing. In fact, many of your rights regarding credit card and debt can only be exercised if you send a written letter. Sometimes simply calling the bank or business isn’t enough to strike a deal with your debt. Here are a few letters to keep in your arsenal of tools for attacking debt.

            Debt Validation Letter

            Use the debt validation letter with debt collectors in the first 30 days after they contact you about collecting the debt. The debt validation letter tells the debt collector that you dispute the validity of the debt. Once the debt collector receives your letter, they can’t contact you anymore until they send valid proof that the debt is yours and they’re supposed to be collecting it. If they don’t have the proof or can’t get it, then you don’t have to deal with that collector again, for that specific debt at least.

            Credit Card Billing Dispute Letter

            You don’t have to pay for billing mistakes as long as you recognize and report them in a timely manner. You have 60 days from the date the billing statement was mailed (or emailed) to you to report the error.

            While you can call your creditor to report the error, the law specifically states that you should report the error in writing. There’s no harm in doing both. In your letter, list the billing error and state why it’s inaccurate. Then, the credit card issuer will acknowledge your letter and take steps to resolve your complaint. Make sure you report the errors quickly so you’re not held liable for them.

            Debt Settlement Offer Letter

            If you’re behind on your account payments by 90 days or more and you don’t think you can afford to catch up or pay the balance in full, you can send a debt settlement offer letter.

            In the letter, state that you’re having financial difficulty and would like to settle your account. List the amount that you’re able to settle for and wait for the creditor to respond. If the creditor accepts your settlement offer, be prepared to send your payment before they take the offer off the table.

            Pay-for-Delete-Offer Letter

            With the pay-for-delete-offer, you can knock out your past due debt and improve your credit at the same time. The pay-for-delete letter offers to pay your account balance in full, and in exchange, the creditor agrees to remove negative information from your credit report. Keep in mind that the pay-for-delete is just an offer and the creditor isn’t obligated to give in to your request. In fact, you’ll have to get your letter to just the right person, a supervisor or executive, for the offer to be accepted.

            Sending Your Letters

            On the time sensitive letters like debt validation and billing error dispute letters, it’s a good idea to send them via certified mail with return receipt requested. That way you have proof of when the letter was sent and received. You can use this proof to appeal to a higher authority, e.g. the FTC, if the creditor doesn’t respond in a timely manner.

            How about you all? What rights or strategies have you exercised in order to help payoff (or better manage paying off) your debt? 


            Have you tried sending in any of the 4 letters mentioned above? 


            Share your experiences by commenting below!

            Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

            • Thanks so much for such an informative article, Frank! I must admit that learning about all of these rights people have/techniques that people can use to help manage their debt payoff made me feel quite in the dark, as I have fairly little experience in this area.
            • However, I imagine that a lot of people are in the same boat as me in that they don’t know that many of these rights/strategies are available to them. So, thanks for laying them out in plain sight for us to analyze!
            • It’s also interesting that despite all of the technology available to debt-companies these days, there are apparently still many official actions that can only be managed and handled through good ole-fashioned mail! haha This was also the case I experienced recently when opening a self employed 401(k) account with Vanguard. They required that the hardcopy application be sent in via the US Postal Service.
            • @ Debt validation letter – 
              • Interesting! This sounds like a good way to at least delay (or maybe eliminate all-together) being bothered by certain debt collectors. 
              • One thing I’m curious about though is what exactly is required for “valid proof” that the debt they’re collecting is correct? Is there a standard form for this, or can it just be an “overdue balance” statement from the credit card company?
            • @ Receiving receipt confirmation when sending important debt reduction letters – 
              • In my experience, whenever you’re sending a letter either by physical mail or email that is not SPECIFICALLY requested by the receiving party, you always have to be prepared for the likelihood that it will simply be ignored and/or lost. After all, if they’re receiving hundreds of pieces of mail per day, why should they place your note at the top of the pile?
              • As such, it definitely makes sense to have a way to validate that the receiving party actually did receive the letter. Paying the $0.30 extra for delivery confirmation can go a long way to helping you achieve your goals in this case! 
            • @ Not being scared of your creditors – 
              • Lastly, I think that another important thing to point out with the whole process of paying off your debt is to avoid viewing the company to which you owe a debt as some powerful, evil entity that has the power to SUCK OUT YOUR VERY SOUL! 
              • As you can imagine, at the end of the day, the company to which you owe money is just made up of normal people who want to accomplish their goals and add value to others’ lives. Because of this, it actually is in THEIR best interest AS WELL AS YOURS to work with you in order to get you to pay off your debt. 
              • Often, I think people are surprised at how flexible debtees can be in helping their debtors pay off their debt, either by being flexible with interest rate or even payoff terms overall. Typically, this flexibility can only be discovered if you take action and ask about what you can do. After all, the worst that can happen is that they say, “no.”

            ***Photo courtesy of http://farm3.static.flickr.com/2105/2510296904_408a716826.jpg

            Carnival of Personal Finance #337 – Black Friday 2011 Statistics – November 28th, 2011 Edition

            ————————————————————————————————————————
            Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
            ————————————————————————————————————————

            Click here to enter my free $201.40 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is November 30th, 2011.

            Welcome to this week’s Carnival of Personal Finance, a weekly listing of the top personal finance articles around the blogosphere in the following categories – taxes, money management, investing, career, debt, frugality, credit, economy, finance, real estate, saving, and budgeting.

            It’s amazing to think that it’s been almost 27 weeks/editions of the Carnival since the last time we hosted (back on May 23rd of this year). Summer, Halloween, fall, the 1st ever Financial Blogger Conference, and Thanksgiving have all come and gone. Time sure does fly! However, it’s good to be back hosting again, and I’m looking forward to getting through December and spending some quality time with family for Christmas.

            The theme for this week’s carnival is a wrap-up of some interesting summary statistics of consumer shopping behavior during Black Friday 2011 and over this weekend!             I hope you enjoy the posts and finding out what and how much consumers have been purchasing over the Black Friday weekend and that you can stop by My Personal Finance Journey on my non-carnival days as well!

            This week, we had 55 total submissions, only 9 of which were spam or duplicate submissions, so the quality was high this week! Flexo and Revanche are doing a good job keeping spammers at bay. However, I suppose that by simply not using BlogCarnival.com to handle carnival submissions, you can avoid a lot of the spam that comes your way through that website.  

            Listed below are this week’s top 3 editor’s picks. Congrats to the three winners!

            1. Our #1 pick of this week is by PKamp3 from Don’t Quit Your Day Job, who presents Should the Less Attractive Receive Additional Benefits?, and says, “The subject of equality in the workplace (and the dating market) with regards to attractiveness is in the news due to a new book on the subject (mentioned in the article). Since any topic on attractiveness (being such a subjective quality) is bound to be controversial, I felt the need to explore the topic of benefits for the unattractive. I like this article as much for the subjects matter as the discussion it sparked in the comments!”


            Jacob’s Comments – In this post, PKamp3 discusses the fascinating subject of the various economic and social benefits taller, slimer, attractive people have in life. Afterwards, he asks (given the evidence from a recent study) whether or not less attractive folks should receive benefits to counteract this trend.


            In my experience, I have ABSOLUTELY seen that attractive people 1) fair better in relationships and 2) seem better able to obtain jobs. In fact, if I think back on the jobs I’ve held over the years since finishing my undergraduate studies, the vast majority of the people I worked with were 1) pretty healthy looking (in a broad sense) and 2) not-repulsive to look at (sorry to be blunt, but didn’t know of another gentler way to say this). Think about your workplace – is this the case also? 

            2. The #2 pick of this week is by             Darwin from Darwin’s Money, who presents Income Disparity is Actually Good. Here’s Why, and says, “With all the outrage from the Occupy movement, you’d think income disparity is a bad thing. Well, it’s not and here are the reasons why.“


            Jacob’s Comments – Darwin (a fellow chemical engineer – rock on!) always comes up with interesting twists on his articles. In this one, he examines the income disparity gap that is present in the United States (the whole motivation/complaint behind the Occupy Movement) and proposes that it is actually a BIG MOTIVATOR for a lot of people in the fact that it gives people something to shoot for. Irregardless of your political viewpoints on the income gap, I think you’ll find this article interesting!


            3. Our #3 pick for this week’s Carnival is by Roshawn Watson from Watson Inc, who presents Broke People Afford Everything!, and says, “Your lifestyle is pretty impressive, except for the fact that you’re a financial fake. I just want to know one thing: how do broke people afford EVERYTHING?


            Jacob’s Comments – In this article, Roshawn discusses something that I (unfortunately) see all too often. What myself (and Roshawn) see is that it really is impossible to determine how TRULY WEALTHY someone is these days, since even people who are broke can literally buy anything they need in order to “keep up with the Joneses” using a credit card and racking up more debt. Take a look at this article to learn more about this disturbing topic.

            ———————————————————————————————————————————————————————-

            Total Amount Spent By Consumers on Black Friday

            On Black Friday 2011 (November 25th), consumers spent an historical high amount of 11.4 billion Dollars! Wow! That sure is a sizable amount of money! 

            ———————————————————————————————————————————————————————-

            And, listed below are the rest of this week’s great article submissions, separated by category for targeted reading.

            FRUGALITY

            Annabelle from Shopping Detox presents How frugal is the $500 Law & Order box set?, and says, “It may seem crazy expensive, but buying the complete series of Law & Order is kind of *saving* you money.”

            Teacher Man from My University Money presents Black Friday and Cyber Monday Shopping Tips and Deals, and says, “I am definitely not a fan of waiting outside in the cold at 4 AM, pushing and shoving with other people in order to save twenty bucks on a laptop. However, any time I can sit on my butt, in my pajamas, with a warm cup of coffee, and save a lot of money, I am all for that!”

            Fanny from Living Richly on a Budget presents 25 Gifts Under $25, and says, “Need gift ideas for under $25? Here are gift ideas for almost everyone on your list.”

            Adam Williams from Rabbit Funds presents Dear Retailers: I want Thanksgiving back!, and says, “I’m outraged. And you should be too. Black Friday is officially taking over Thanksgiving. Is this nation so obsessed with profits that we will throw our heritage and family traditions out the window?”


            CREDIT

            Ryan Yates from Deliver Away Debt presents Cash is King, Isn’t It?, and says, “Paying cash for your monthly purchases gives you real-time feedback about how much money you’ve spent and how much money you have left. It’s just too easy to over spend when you swipe a card.”

            ———————————————————————————————————————————————————————-

            Most Commonly Purchased Items

            1. The most commonly purchased item was clothing. 

            2. The second most commonly purchased item was some type of electronics product (23% of total Black Friday shoppers). The most popular electronics product was flat-screen TVs, which came ringing in ahead of computers (a drastic change from last year).
            3. The third most popular product was toys (11.5% of Black Friday shoppers).

            ———————————————————————————————————————————————————————-

            REAL ESTATE

            Martin from Passive Income Now presents How to Choose a Property to Rent in Your Community, and says, “The best way to find a rental property in the area you live in.”

            BUDGETING

            Eric J. Nisall from DollarVersity presents Black Friday Proves People Are Just Lazy With Finances, and says, “People claim to have trouble budgeting & managing their finances, yet each year they plan meticulously for holiday shopping. What exactly is the difference?”

            Jason from One Money Design presents Tips to Design on a Dime, and says, “When you don’t have the budget to create the beauty desired according to the “magazine standards.”


            SAVING


            Martin from Studenomics presents The Solution to All of Your Financial Problems in Your 20s, and says, “All you need to know to solve your financial problems.”

            Colin Williams from Humble Savers presents Christmas Is Coming! 20 Quick Money Saving Tips, and says, “20 quick money saving tips for the festive season that will stop you having a cold sweat when that credit card bill arrives in the new year.”

            Lindy from Minting Nickels presents My Six Month Spending Fast, and says, “I don’t participate in spending fasts anymore, because I already did one, and it lasted six months. This article is about that experience. “

            Mr. Money from Smart on Money presents Navigating Black Friday with Your Android Phone, and says, “For dedicated shoppers, the promise of a bargain on Black Friday is too tempting to pass up. Android users already know that a smartphone is a valuable shopping assistant, but you can get even more out of Black Friday with the help of some specialty apps.”

            ———————————————————————————————————————————————————————-

            Most Popular Retail Stores for Black Friday 2011 Purchases

            1. Wal-Mart – The fact that shoppers turned to Wal-Mart first/most for their purchasing shows (to me) that they were very interested in finding good products at the cheapest price possible.
            2. Target
            3. Amazon
            4. Best Buy – featuring an amazing 58% conversion on getting shoppers who come in the store to purchase something. 
            ———————————————————————————————————————————————————————-

            CAREER

            Nicole from Nicole and Maggie: Grumpy Rumblings presents The WOH/SAH decision: Finances, and says, “Nicole and Maggie discuss the working outside the home vs. staying at home parenting choice from the perspective of temporary financial independence. What factors should you consider, and how should you prepare?”

            Paula from Afford Anything presents Give Me Money! Finding Freelance Work, and says, “Briana says: “I’ve been pursuing a ‘career’ as a freelance writer … but I’m still not making enough for a full time income. 11 months later and the stress of getting a ‘real job’ is even greater than before.” Here’s my epic, 2,000-word response to her question, with advice that applies to any industry, not just writing. The real question is not “Where can I find work?” The real question is: “What work is worthwhile? What work is a waste of time?””

            FINANCE

            Neal Frankle from Wealth Pilgrim presents How to Control Spending In 5 Minutes A Month, and says, “You may think it’s impossible but I’m here to tell you that you can control spending easily. The first step to doing that is to know what you spend. Make sense? Now, if you are sick and tired of hearing me suggest that you use software to track your spending like You Need A Budget, you have an alternative. You can get the big picture on spending in under 5 minutes a month. Oh…and that includes spending 3 minutes making yourself a nice cup of coffee.”

            Money Thinker from Money Thinking presents Why Discounts help Businesses, and says, “Money Thinker explores why gimmicks like Black Friday work so well for the business and the consumer…”

            INVESTING


            Dividend Growth Investor from Dividend Growth Investor presents Should you follow Buffett’s latest investments?, and says, “Warren Buffett is one of the most successful investors of all time. Investors who closely followed Buffett’s moves in the Berkshire Hathaway (BRK.B) stock portfolio between 1976 and 2006 would have significantly outperformed the market. So should investors follow his latest moves?”

            Div Guy from The Dividend Guy Blog presents Uncommon Portfolio Diversification, and says, “Besides fixed income and equities or sectorial and geographic diversification, are there any other ways you can look at your portfolio to make sure it is well diversified?”

            IS from Intelligent Speculator presents Yahoo As Alive As A Zombie, and says, “Have you thought about putting money into Yahoo?”

            Echo from Boomer & Echo presents Are REITs Worth A Look For Yield Hungry Investors?, and says, “Even after the rally, most Canadian REIT’s are still paying juicy yields over 5%. For investors looking for stable monthly income from their portfolio, Canadian REIT’s are definitely worth a look.”


            MONEY MANAGEMENT

            Miranada from Financial Highway presents 45 Ways to Save Money, and says, “Do you want to start your own business and make a little extra money? It can seem daunting at first, since there are so many others out there trying to get something started. Here are 4 creative business ideas that can help you get started. “

            Green Panda from Green Panda Treehouse presents Barriers That Prevent us From Saving Money, and says, “Why are you not saving up money?”

            FMF from Free Money Finance presents Finding the Life Insurance That Is Best for You, and says, “What type of life insurance is right for you? This post will help you decide.”

            Squirrelers from Squirrelers presents Inheritances and Blended Families: Who’s the Priority?, and says, “The topic of inheritances can be an emotional one. This tension can be heightened in the case of blended families, where there are might be different priorities and agendas. This post discusses this topic, within the context of a specific scenario.”

            Miss T. from Prairie Eco Thrifter presents Why Donations to Charity are Important, and says, “Throughout history, money has been donated to the needy, as well as food, clothing, tools, bedding etc. These donations were often organized through the Church and it was considered the duty of the wealthier classes and merchants to give to the poor. These days, this generous attitude to giving to the needy is not so well defined. Why is it important that we donate to charity? Here are just 5 good reasons:”

            Crystal from Budgeting in the Fun Stuff presents The Mall Is Hazardous to Your Financial Health, and says, “Despite all of these temptations, I was able to get out of the mall after our walk without spending a cent. However, it was a lot tougher than I would have anticipated to keep my money in my wallet—I actually stopped and “browsed” several times even though I had only come to the mall to walk”

            Peter from Bible Money Matters presents How to Protect Your Money When Ordering Goods or Services for Future Delivery, and says, “There are circumstances where using a credit card over cash or checks is really the most prudent approach.”

            Jon the Saver from Free Money Wisdom presents Tips for Buying Furniture Online, and says, “There are some tips for buying furniture online that could potentially save you even more money.

            ———————————————————————————————————————————————————————-

            Total Number of Shoppers and Average Spending

            On Black Friday 2011 (November 25th), a total of 226 million headed out to online and brick-and-mortar stores to make purchases.


            On average, each shopper spent $398.62. How much did you spend?


            Source – http://money.cnn.com/2011/11/27/pf/black_friday/

            ———————————————————————————————————————————————————————-


            ECONOMY


            Glen Craig from Free From Broke presents Occupy Movement Protests: A Revolution or a Waste of Time?, and says, “What are these Occupy Protests, what are they protesting, and what have they accomplished so far? People seem pretty divided over the Occupy movement, either supporting or hating it.”

            Bret from Hope to Prosper presents What if Everything you Know about Money is Wrong, and says, “What if all of the financial advice is wrong? What if the conditions are changing and the old rules no longer apply?”

            OTHER

            Chris from Experiglot presents Interest Deficit Disorder, and says, “A unique problem that I have.”


            Mike from The Financial Blogger presents When is it Time to Call it Quits?, and says, “When do you move on to something new?”


            Cathy Moran from Money Health Central presents For Every Thing, Even Shopping, There Is A Season, and says, “Blow off Black Friday: studies show the best shopping deals are next week.”


            Venita Gresham from Dumb Little Man presents How to Appreciate the Pain of Financial Problems, and says, “In short, I am forever scarred by the bad financial experience, and that’s fine with me!”


            Barbara Friedberg from BARBARA FRIEDBERG PERSONAL FINANCE presents 5 Simple Tips for a Wealthy Life, and says, “Money is important… to a point. Don’t forget the other components which contribute to a wealthy life.”


            Chris Holdheide from Stumble Forward presents Auto Insurance Fraud: Don’t Do It!, and says, “Learn how to avoid becoming a victim of Auto insurance fraud and what you can do to prevent it.”


            Sustainable PF from Sustainable Personal Finance presents 5 Tips to Help You Downsize Your Lifestyle, and says, “One of the most effective ways to live a more sustainable lifestyle is to downsize. If you are ready to downsize your lifestyle here are a few tips that can help you get on the right track:”


            Money Beagle from Money Beagle presents Quiznos: Not Worth It Even At Half Price, and says, “Some places should be avoided no matter how great the deal.”


            Shaun from Money Cactus presents How to Follow Through on Your Thoughts, Achieve Goals and Kick Ass, and says, “Being more accountable will improve your personal finances out of sight. here is how you can find ways to improve your accountability along with some handy tools to help. “


            Dan Meyers from Your Life, Their Life presents The Importance of Charity – Why You Should Give, and says, “Did you know giving money away is important to building your wealth? Find out why!”

            Well, that concludes this week’s edition of the Carnival of Personal Finance! To all of this week’s participants – it was an honor to be able to read and get involved with such high quality articles! Please remember to link back to this post if your article was included here and to promote via social media when possible.

            Currently, there is no one scheduled to host next week’s carnival, #338, which would occur on December 5th, 2011. As such, if you’re interested in hosting next week’s Carnival or another future edition of the Carnival of Personal Finance, you can apply using this form.  


            When the upcoming schedule gets finalized, be sure to submit your articles for next week’s edition, using the following handy submission form.

              ***Photo courtesy of http://farm4.static.flickr.com/3279/3067820964_7421309fe8.jpg
              ***Black Friday 2011 stats courtesy of http://www.npdgroupblog.com/2011/11/they-came-with-a-purpose/, except where otherwise noted

              1 … 3 4 5 6
              >