Banks and credit-card companies typically charge off debts once they’re 180 days past due, and the Federal Reserve does not separate charge-offs from debt payments when reporting national credit-card debt-reduction figures. According to a CardHub.com study analyzed by MoneyNews, lenders charged off a record-breaking $83.27 billion of credit-card debt last year, which accounts for the lion’s share of the $93.2 billion drop in card balances.

Debt reduction due mainly to lender charge-offs

According to government reports, as of January 2010, credit-card balances have been declining for 16 straight months. But according to the CardHub.com study, the first quarter of 2009 was the only time during that 16-month period when consumers actually paid down card balances. In that quarter, consumers paid down card balances by $46.9 billion, and lenders charged off an additional $17.59 billion. After the first quarter of 2009, national card balances either increased or remained steady.

Credit-card debt is down, but not paid down

The CardHub.com study suggests that consumers have not, after all, been paying down credit-card debt, and the record-breaking lender charge-offs for last year evidence the financial pressure faced by many Americans. Credit-card debt charge-offs were a record-high of 10.1% in the third quarter of 2009. The rate was somewhat lower in the last quarter, but the situation is expected to become worse. According to MoneyNews, Moody’s Investor Service predicts that the charge-off rate will reach 12% in 2010. By way of comparison, in the fourth quarter of 2006, a year before the current economic downturn began, the charge-off rate was a mere 4%.

Which is not surprising

It should come as no surprise that unemployed and underemployed Americans are still financially stressed and leaning on credit cards and emergency cash loans. Increased charge-offs by lenders is just one more ripple in the ever-expanding ripple effect of the recession.

What the New Credit Card Reform Does For the Consumer

The new credit card reform, which came into effect this year, forbids credit card companies from increasing high interest rates to consumers whenever they like; however, there are other fees that have to be accepted by consumers such as the zero balance and inactive card fees. On account of this, credit card companies are frequently tightening up lending to customers, especially to those with not so good credit. This is being done to reduce the risks involved in lending, especially when it comes to charging ridiculously high interest rates to paying customers as a reimbursement for losses. This is one of the main reasons why payday loans are so attractive and one of the most popular means of acquiring money.

Making Things More Simpler for the Consumer

These are small cash loans ranging anywhere from $100 to $1000 awarded to consumers who have met a certain criteria. However, the loans do come with a due date; therefore, many payday lenders are within their right to provide extensions on due dates. One of the advantages of acquiring these loans over traditional loans is that the qualifications aren’t extensive and obtaining them are a lot easier with payday lenders online where you can apply and have your application approved within 24 hours.

A Steady Job May Be Your Only Requirement

Most banking facilities that offer loans and credit card stipulations normally require a high credit rating, a flawless credit report, an extensive employment history (2 years maximum) as well as a minimum of two years in your present housing and possibly more requirements. These types of stipulations or criteria don’t exist with payday cash loans; with the exception of a stable place of employment for substantiating repayment, everyone should qualify.

Knowing What You Are Getting before You Get It

On account of the simplicity in obtaining a payday loan, they’re classified as high-risk loans and high-risk loans have much higher interest rates starting at 15% -30%, while the APR could range anywhere from 300% to 800%. Because of this, anyone getting these types of loans are instructed to repay them by the first due date in order to avoid penalties for late payment or extension fees. These fees can add up quickly and if a loan is allowed to incur interest as well as unnecessary fees, it becomes more difficult to repay.

You will find that pay day loans have striking similarities with credit card debt and various other types of loans. Nevertheless, if consumers were more knowledgeable of the advantages and disadvantages found within the terms and conditions, they will be more prepared to make accurate decisions.

Do you know what a mutual fund is?

A mutual fund is the name applied to an investment vehicle where multiple investors combine their money in order to buy an assortment of stocks. The stocks that are included in the fund have been specially selected according to each investor’s financial goals. For instance, some mutual funds are focused primarily on earning an income from the fund’s dividends, while another may be focused on seeing growth or a certain level of improvement for fund stocks. As an investment vehicle, a mutual fund is carefully targeted towards a particular objective upon which the investment group has agreed.

Who is in charge of the mutual fund?

A mutual fund is closely monitored by a portfolio manager or a team of portfolio managers. These managers choose which stocks will be a part of the fund and make other investment choices on behalf of the investors. Such choices include when to buy stocks, which ones to buy and when stocks should be sold. The fund manager is responsible for all of the important decisions made on behalf of the group and should, therefore, be selected very carefully.

How many stocks does a mutual fund have?

Every mutual fund is different. Some may only have 25 stocks, while others may have hundreds. This really depends upon the fund’s objective, how many investors the fund has and how much money each investor has in the fund.

Can money be taken out of a mutual fund?

Yes. If an investor needs emergency cash or even if she just changes her mind on the investment, money can be withdrawn from a mutual fund. If the stocks contained in the fund are up, an investor may realize a profit when withdrawing from the fund. Conversely, if prices have dropped, an investor may also realize a loss when withdrawing from a mutual fund.

Is it better to invest in a mutual fund or individual stocks?

This really depends on the investor and the investor’s financial goals. A mutual fund is sometimes less risky, because the investment is diversified over a variety of different stocks. Therefore, if one stock performs poorly, the investor may only realize a small, temporary loss while other stocks in the fund may continue to perform well. However, if that investor were only investing in one stock that ends up performing poorly, the loss is more noticeable. Smart investors realize the value in diversification, which makes mutual fund investments a good choice for many.

Do I need a lot of money to invest in a mutual fund?

A mutual fund is often the investment vehicle of choice for those who don’t have a lot of money to invest or those who are new to stock investing. Because investments made to the fund are under the supervision of portfolio management, a mutual fund is also a way for people to learn more about investing without having to do a lot to manage their investment on a daily basis. Of course, wealth education calls for learning a lot more along the way and selecting the right mutual fund is very important in the entire process. However, it doesn’t require a lot of money. This makes mutual funds a good consideration for beginning investors.

Weakened incomes plus increased spending equals increased consumer debt

Although there are signs that things are picking up, many experts believe recent economic growth cannot be sustained without increased spending by consumers. Consumers may be doing just that, thanks in some part to payday lenders.

The Federal Reserve has reported that in January 2010 U.S. consumer debt increased for the first time since January 2009. According to MarketWatch, in January 2010 the total seasonally adjusted debt (a measure of total debt incurred by individuals) rose at an annual rate of 2.4% and increased by $4.96 billion, for a total of $2.46 trillion.

A minority opinion is borne out

Based on a survey of economists, MarketWatch had expected a $6 billion decline in January. Instead, January 2010 marked the largest increase in consumer debt since January 2008. Not all the experts agreed with the forecasted decline and a few even predicted an increase.

According to MarketWatch, Ed McKelvey, an economist for Goldman Sachs believed that weakened incomes combined with recent reports of increased consumer spending could only mean that consumers were purchasing more items on credit. The Federal Reserve report concerning the January 2010 debt increase now bears that out.

Personal loans are the main source of the increase

Non-revolving debt rose by 5% or $6.62 billion to make up the lion’s share of the overall debt increase. Non-revolving debt includes such things as such as auto loans; personal loans including easy cash loans, overnight loans, and other types of internet loans; auto financing; and student loans. Not surprisingly, given all the recent consumer-unfriendly changes concerning credit-card borrowing, such as reduced lines of credit and higher interests rates, credit-card debt decreased. In fact, January 2010 was the 16th consecutive monthly decrease in overall consumer credit-card debt. Credit-card debt dropped by 2.4% for a healthy decrease of $1.67 billion, bringing the national total down to $864.4 billion.

Now that the recession is over, people are still having a difficult time managing. Though the market is showing some signs of stabilizing, people are still trying to get out from under the huge debt they stored up. If you are one of the millions of people who are struggling with debt survival, here are some tips on how to handle your finances.

How to handle debt

There are some things to do if you have debt. Here are the most important:

1. Budget. Get on a strict budget. This is of premiere importance when you are mired in debt. You want to know where the debt problems are and what you’ve done to create it. Write down everything you spend for a month—from your daily coffee to child care. Get specific with where your money is going down to the penny. Once you have that, then categorize your items as necessities or discretionary.
2. Plan. Have a debt plan to pay down your highest interest cards first. You want to minimize the time you are paying on them because they are costing you more in the long run. The best thing to do is write everything down and start paying one by one. Work on the highest, then the next, etc., until you work your way down to the smallest debt you have. For bigger amounts it may take a second job to help, but you’ll be thankful you made the extra effort when your credit card debt is gone.
3. Consolidation. Should you consolidate or not? We’ve all seen the commercials for consolidation. They advertise as if the one move to work with them will solve all your financial problems with one phone call. That is not true. The basics of a consolidation company are that you are taking one big loan to cover all of your existing payments. It can work if you are willing to sever your credit card payments afterwards. Also, beware of consolidation firms that ask for large upfront fees to fix your credit. You can do that yourself with some care and organized work.
4. Be honest. It’s important to do some self-analysis and find out why you got into debt in the first place. Was it due to overspending? If so, why? Is there an emotional reason you are spending so much? If you knew you didn’t have the money, what compelled you to buy anyway? You need to know what beliefs are going on in your head when it comes to spending and be willing to change them. The worst thing you can do is get on track financially, only to fall back into your old patterns of spending.
5. Collectors. If your debt gets to the point of having collectors call, you need to know what your rights as a consumer are. Debt collectors cannot harass you or abuse you. They cannot imply that you have committed a crime or imply that you will be arrested if you don’t pay a debt. You have the right to tell them to not call you at work or home.

Moving forward with debt

It’s important to understand the rules of debt and how to manage it. Understand that it is up to you whether you want to get out of debt for good. A lot of it involves taking a hard and cold look at your former actions, and then being proactive about changing them in the future.

In a struggling economy, families find it especially hard to find satisfying, yet inexpensive weekend activities. This doesn’t mean that a good time cannot be had on a budget; it simply means that adults have to find creative ways of planning family activities that will not break the bank or do not require elaborate credit card spending. The following suggestions are affordable and can be enjoyed by small and large families alike:

Rent Movies from the Library

Public libraries offer DVDs at much lower prices than most rental stores do, and some even loan them out for free. Titles are generally the same that would be found in a retail store, and movies are usually loaned for at least a week. One of the best inexpensive weekend activities that families can enjoy together is a movie marathon, and public libraries all across America make this an easy, affordable way to enjoy a little family time.

Community Events

Every community hosts public events that are family friendly and offered at little or no cost. This means that the entire family can participate in local activities together while saving money at the same time. Events can range from free concerts to cultural activities and can usually be found in a local newspaper or by calling a local Chamber of Commerce.

Join a Community Sports Team

Sports are a great way for children and their parents to learn the value of teamwork and discipline. Team sports also help families maintain good health and adequate physical exercise. Most are offered at very reasonable rates and give family members an activity each can enjoy together as either a spectator or as a player.

Volunteer Activities

Inexpensive family activities don’t always have to be recreational in order to be enjoyable. Volunteer activities are rewarding in a variety of different ways. Not only do families learn to come together to help others and build a sense of community, but most also meet interesting people who enrich their lives in the process. Volunteer activities are usually free or may require a very small, but affordable monetary donation.

Have a Garage Sale

Everyone has junk that they used to treasure, but now have little or no interest in. Someone else may be able to get some use out of these items and selling them at a yard sale is a great way of making extra money to pay off credit card debt or for spending on a planned family activity. Children and parents can easily participate by donating their items and spending a day working together to create an income stream that the entire family can benefit from.

Host a Board Game Night

This can be done at home, at a neighborhood park or even at a local coffee shop, but inviting a few other families to join in on a board game marathon is a great, fun and wildly inexpensive way to enjoy a weekend. Most people have board games that are collecting dust in their homes that can be used to host a board game tournament or just a friendly family get-together.

Elaborate family outings are fun, but inexpensive weekend activities are often discovered to be the most enjoyable since they are not accompanied by stressful spending. They also create an opportunity for families to enjoy themselves even when living on a budget. Anyone who is interested in plain, simple fun is encouraged to try a few of these while teaching children that it is possible to have a good time without going into debt in the process.

When it comes to credit cards, many consumers have been getting shafted. All of the major banks providing credit cards have gotten away with reaping profits, and they have no problem lobbying and distributing the money to any Washington lawmaker that get in their way. Washington lawmakers are getting this dirty money from these banks to keep their regulatory laws and their profits in tact so it will not affect the credit card industry if it becomes law in a few years. During George W. Bush’s presidential terms, if anyone attempted to change any provision regarding the credit card regulatory laws, the changes were usually fizzled out and swept under the rug. The credit card industry was fine and there were more choices for the consumers and there was no reason to amend anything. There was no credit card reform in sight.

On the other hand, the United States has been in a recession and we have a new president and an administration in Washington, and they have made credit card reform one of their top priorities. The credit card industry is directly linked to consumer debt and as a result, the industry must be reformed. In May of 2009, the Credit CARD Act of 2009 was implemented. However, the bill’s first provisions were not in effect until just recently.

Things you should consider if you are a credit cardholder.

1. There must be a written notice forty-five days in advance by the credit cardholder if your interest rate of your credit card has increased.
   This will eliminate the unethical practice of allowing lenders to raise your interest rates on your account that is outstanding, delinquent, or unrelated to other credit card companies.
2. Credit card companies are prohibited from changing terms of your original contract. They can no longer charge you at any time or for any reason.
   You will no longer get an automatic late fee on your credit card because the payment due date fell on a non-business day or non-work day at your bank. If your due date falls on a holiday or a weekend, the due date will fall on the next business day and this is now required by law.
3. Credit cardholders are allowed twenty-one days to pay their credit card balances instead of the minimum fourteen day period.
   Credit cardholders are now given three billing cycles to pay off their balances via existing terms if the interest rate has skyrocketed.
4. It is required that all payments are allocated in portions of the credit card balance with the highest interest rate descending the lowest interest rate.
   Your highest rates are paid first, which was not always the case before.
5. Limitations on the limit fees that are now three per credit card account.
   Unlimited limit fees are very common; many lenders had this practice in place for credit cardholders that exceeded over their credit limit.

The credit card companies do not want you to read the Credit CARD Act of 2009.

There are more provisions in the Credit Card Act of 2009; this is just the tip of the iceberg. Credit card companies could not care less about consumers; they have no trouble raising interest rates, limit fees, and other restrictions that have not even reached the full level of potential in regards to regulation. The thing that is most shocking about these new regulations mentioned above is that banks and credit card companies would not agree to any of these provisions if they were not enforced by the law.

Credit card companies and banks will not stop their unethical practices for the sake of the consumers.

Several banks are still spending large amounts of lobbying money trying to halt this legislation, despite public outrage about the bailout money fiasco several months ago. These banks are attempting to make it easier on the credit card industry by watering down the Credit CARD Act’s provisions. This is an indicator that the credit card companies and the banks have abused their credit card practices and screwing the American people in the process for the past two decades.

For more information about the provisions of the Credit CARD Act of 2009:

http://www.govtrack.us/congress/billtext.xpd?bill=h111-627

Related Video:

It's going to take some time, but it is definitely worthwhile.

In part one of this series on getting rid of credit card debt, we discussed both drastic and practical ways of approaching financial recovery. Now that you have considered those first steps, it is time to figure out what to do next in order to embrace debt-free living. The following suggestions are certainly not easy, but those who are now in full debt recovery will tell you that they are certainly worthwhile.

Get on the phone and discuss your credit card debt

Now that you’ve created a snapshot of your debt, go down your list and call each credit card company. If you are late on a payment to them, explain why and give them a date by which you can send a payment. Even if it is a small payment, be honest about when you can send it in and then do exactly that.

If you do not have frequent late payments or are not behind in your bill, and if your FICO score is decent, call each credit card company and try to negotiate a better interest rate than the one that you currently have. One way of doing this is to single out one of your cards with a more affordable rate and call the companies with higher rates to inform them that you are considering sticking primarily with the one with the lower rate. Or, another way of approaching this is to research companies offering better rates and tell the credit card companies with higher rates that you are considering changing to one of those cards because of the rate difference. If a lower rate is not immediately offered, don’t be afraid to ask them to lower it. The worst thing that can happen is that they can say no and, compared to the high interest rates that you’re paying, that shouldn’t be nearly as frightening.

If the credit card company refuses to lower your interest rate, consider moving your debt to a card with a more comfortable rate and, after doing so, you may consider canceling the high rate card.

The road to debt recovery begins with a single month

After cutting your credit cards and/or negotiating a lower interest rate, look at your monthly personal budget and very carefully calculate the largest possible payment you can make on all of your balances each month. Next, add ten dollars to the minimum payment requirement offered by each credit card company. Now, add up all of the minimum payments, plus the ten dollars that you added in the previous step. If the minimum amount that the credit card company allows you to pay is lower than the maximum amount that you can afford to pay each month, go ahead and subtract the lower amount from the higher. The remaining sum is what you should consider applying to the card that is charging the highest interest rate.

After the high interest rate card is paid off, you may consider canceling that card, but don’t stop there. Now it is time to go back to the beginning and repeat the entire repayment process all over again by focusing on the card with the next highest interest rate. Do not lower the amount that your calculations permitted you to pay before the first highest card was paid off, however. Instead, continue to designate this exact same amount out of your personal budget for paying off credit card debt until it is all gone. Continue to repeat this entire process of paying your credit card debt off by assassinating the highest interest rate cards first and working your way down until you are left with cards that have affordable rates and you are debt free.

Carefully consider emergency cash options

Once you are debt free, if you ever find yourself in need of a cash advance, before turning to a credit card, carefully weigh that option against that of a loan till payday or an installment loan from a personal loan company. Always know your options, study them closely and select the one with the lowest repayment terms for your personal budget.

Making a hard decision is the first easy step to a debt-free life

It takes some sacrifice and a lot of discipline, but you really can get rid of credit-card debt for good. Relax. Breathe. Others have done it and you can too. Paying off credit-card debt can seem overwhelming when you look at your statements each month and realize that you’re not even putting a dent in it. You may have tried getting personal loans, applying for extra cash till payday, or even working a second job, but you still feel like you’re drowning in debt.

It isn’t easy to break the credit-card spending cycle but it is, in fact, completely possible. You first have to believe that financial recovery can be achieved and then you have to make the commitment to work hard at it.

Simple (but not-so-easy) steps to financial freedom

Cut up your cards. If you’re ever going to get your credit-card debt under control, you must stop adding to it. There’s no room for negotiation on this one: Cut up your credit cards. This can feel like a drastic action, but if you’re serious about getting out of debt, you cannot use credit cards.

Consider other emergency-cash options. If the thought of not having any credit cards is too much for you to handle at first, choose one card to keep for emergency use only. Store that card in a safe place or give it to someone you trust, but don’t carry it in your purse or wallet. If the card has a high credit-limit, consider asking the credit-card company to lower it. Remember, when you’re in need of emergency cash, a credit card is not your only way out. You can get a short-term loan or an installment loan online even if you have bad credit, without the risk of over-spending.

Don’t be too quick to close accounts. Don’t be too quick to close your credit cards before you’ve paid them off. Many people have made the mistake of closing their accounts when they cut up their cards, without understanding the negative effects this action would have on their credit ratings. For one thing, closing an account stops the clock on that part of your credit history. If you’ve had credit cards for a long time and have made the payments as required, that history can have a positive impact on your credit rating. Closing an account can also negatively affect your debt-to-credit ratio, which can have a direct affect on your credit score. So cut up your cards, but do some research and ask around before you cancel any accounts.

Be honest with yourself. Take an honest look at your credit-card statements and tally up what you owe. This is scary for people who purposely avoid looking at the bottom line because of the stress it causes. Ironically, however, not knowing what you actually owe can be the most stressful part of all. Make a list of your account balances and make a note of the interest rate on each. List the balances in descending order of interest rates, so that the account with the highest interest rate is at the top of the list. Next to each entry, write down the minimum required monthly payment. Finally, note the name and phone number of each credit card company.

Make a realistic personal budget. Once you’ve decided to get serious about credit-card debt recovery, have cut up your cards and taken an honest look at what you owe, take some time to make a realistic personal budget setting forth your monthly income and expenses. Look at what’s left after deducting the essentials – rent or mortgage, car payment, utilities, food, etc., — and decide how much of your disposable monthly income you can devote to paying off your credit-card debt.

What’s next?

Read part two of this series for suggestions about what to do next. There, you’ll find advice about negotiating with credit card companies and getting rid of account balances with high interest rates. If you exercise some willpower and resolve and take these suggestions seriously, you really can find your way to a debt-free life, once and for all.

Millions of people are struggling to pay off their credit card balances right now. In the current economy, with many people facing unemployment and others losing their homes to foreclosure, it’s important to keep your expenses under control. If you owe money on credit cards, consolidating those debts can reduce your monthly expenditures and help get you back in the black.

When you consolidate debts, you take out a loan in the amount of your combined card balances, at a lower interest rate than you’re paying now, and the new loan proceeds to pay the cards off.  Your monthly payment on the new loan will be lower than the total you were paying on your old debts, making it easier for you to find your way out of debt. Follow this simple five-step process to get your finances back under control:

1. Add up all your credit card debts

Pull out all your recent credit-card statements and add up the total amount you owe.  Remember to include store charge-cards, too. Then add up the total monthly payments you’ve been making on your credit cards recently.

2. Calculate your monthly income and expenses

Add up your net monthly earnings and any other monthly income you receive. Next, add all your monthly expenditures – rent or mortgage payments, utilities, transportation costs, insurance, loan payments, food, entertainment, and all your other regular monthly expenses.

Most people pay a different amount on their credit cards every month. Instead of making a consistent payment in a set amount, they pay whatever they can after taking care of all their other expenses. Once you’ve figured out your monthly income and expenses, you’ll know how much on both essential and discretionary items and you’ll be in a better position to budget for paying off your credit-card debt.

3. Choose the loan that works best for you

There are several ways to borrow a lump sum that will pay off your credit-card debts and consolidate them into one monthly obligation:

Home equity loan: If you own a home with equity, your bank or mortgage company might be willing to provide a home equity loan. For instance, if they lend you $20,000, your mortgage will be increased by that amount. The great thing about using your home equity like this is that it allows you to pay off your credit-card debts at a relatively low, mortgage-interest rate rather than double-digit, credit-card rates.

Cash-out refinancing: This is another way of tapping into your home equity. You take out a new home loan that’s larger than your old one, pay off your old mortgage and use the remainder to pay off your credit cards. Although you’re likely to see an increase in your monthly mortgage payment, you might be able to keep it more or less constant by refinancing at a lower interest rate.  Either way, you’ll save money.

Personal loan: If you can’t use equity in a home to consolidate your credit card debts, you can sometimes get a personal consolidation loan. Unsecured personal loans are not generally as economical as borrowing against your home, but you’re still very likely to pay less interest than you do on your credit cards. Don’t forget that credit unions usually offer more favorable personal-loan interest rates than banks do.

4. Weigh the risks before you decide

If you’re hoping to use your house as collateral for a credit card consolidation loan, be aware that there are risks involved. If you can’t manage the new payments on your mortgage (and they’re likely to be a bit larger), you might be faced with a foreclosure.  Loss of your home is not ordinarily a risk you run by defaulting on your credit-card payments.

5. Spend wisely

Once you start getting your finances back in order, be careful not to undo all your good work by running up huge balances on your cards again. It might help you to cancel most of your cards and keep just a couple for emergencies and other necessary expenses. Establish a monthly budget and stick to it. Managing money carefully doesn’t mean you have to deprive yourself of all the fun stuff.  It just means that your monthly obligations will come first.  By budgeting carefully, you’ll pay your debts and household expenses and have money left over at the end of every month.

Online resources can help your small business.

If you’re a small business owner and have managed to survive the economic downturn of 2008 for this long, then you’re already a survivor. Of course, many small businesses have survived by using credit cards to improve cash flow and take care of expenses. That debt can build up very quickly, and can become unmanageable if, for instance, you are unable to meet minimum monthly payments on your credit card.

Options To Get Back On Track

While this article is not legal advice, it presents some options for getting your small business back on track even if it is heavily burdened with credit card debt. If you have a credit card for your business, but the business’s credit history is tied up with your own (a very common scenario), then you should be doubly tenacious in eliminating that credit card debt because it can affect your personal credit history severely.

Government Help Is Available

The government has a Seed and Venture Capital Finance page, which contains a wealth of information on how to obtain government grants for small businesses and how to approach private investment firms that invest in small businesses on behalf of the government. The government’s Loans, Grants, and Taxes page is another site where small businesses can easily find not only grants open to them, but also private “angel” investors who provide venture capital for small businesses.

The National Association of Small Business Investment Companies (NASBIC) is the professional association for the Small Business Investment Company industry and is the oldest venture capitalist organization in the world, having operated since 1958. You can find out the specific steps to take to obtain financing from Small Business Investment Companies by visiting their web page that lays it all out, step by step. Though microfinancing is mostly thought of as a program for developing countries, there is microfinancing available in the U.S. as well. Grameen America provides small loans to low-income individuals for investing in income generating activities. It also helps small businesses build credit by reporting to Experian, which is one of the three main credit rating bureaus in the US. A wealth of information is available on their website, www.grameenamerica.com.

Research Is Key To Sucess

The common thread for obtaining help from any of these institutions is that you must have clear and adequate records, including a well thought-out business plan to approach them for assistance. The Small Business Administration has instructions for how to write a business plan to help you create a business plan to get the financial help your business needs.

Couples need to make debt relief a priority discussion when considering marriage. A new national survey for Fidelity Investments is showing some interesting results. Many couples aren’t in agreement on basic financial issues and don’t even discuss finances in any depth. Here are some of the topics those questioned stated they didn’t cover with their significant other:

• When is each person planning on retiring?
• How much money do they need to save to retire on time?
• What types of debt will be considered priorities to pay off?
• How much insurance coverage is each expecting to have?
• What budget will they follow and for how long?

Oddly enough the same poll was given two years ago and there has been a general decline in communication, although the economy has drastically turned for the worse. For example, two years ago 79percent of couples stated they didn’t agree on retirement plans, including the time to retire or if they would continue to work after retirement.  This year’s survey showed that same number is up to 82 percent. Other numbers in the most recent survey follow suit.

An expert predicted the results

Nicholas Yrizarry, a financial adviser in Virginia, stated that he thinks the results of the most recent survey are accurate and logical. His belief is that the recession has pushed people to focus on “putting out fires, dealing with debt relief, worrying about interest rates, credit card debt, over-mortgaged homes and job insecurity.”

Although reason suggests they should be making financial discussions a priority, most aren’t. Yrizarry added, “You’d think it should raise some eyebrows, and they would say we’d better start thinking about this, but actually they just shelve it even further, defer the inevitable.”

The survey

The 2009 survey shows that only  45 percent of couples make decisions together on daily household management of finances like budgeting and expense payments.  The norm is for one person to take the helm at finances.  Amy Gunnerson of Pittsburgh, Penn., a agreed with her husband that she would pay bills. “My husband doesn’t want a part in the daily decision making. He’d rather focus on work, while I decide what the priorities are. …It works for us.”

President of Barber Financial Dean Barber said this is typical of families because normally one spouse is “adamant” about finances while the other “really could care less. … It makes it very difficult, though, and puts a lot of stress on a marriage.” Experts agree that this isn’t the most beneficial way to handle life because when one person has different expectations, there could be potential problems.   Also, if the family dynamic changes, say with divorce or death, the financially passive spouse is left in the dark.

Discussions about retirement are also put on hold by 62 percent of couples.  Again, this could potentially cause problems if one plans on retiring early, but there aren’t enough finances to maintain their lifestyles.  Financial Planner David Summerhill of Summerhill & Franke stated, “Retirement planning isn’t just about an amount of money. It’s about having an age when the retirement is going to happen for each person, having a plan to make it happen and having a contingency plan if it doesn’t.”

Financial discussions

One of the most surprising results of this year’s survey is that only 15 percent of all couples believe they could handle full responsibility for household finances if necessary.  With these kinds of numbers it’s imperative couples begin having dialogues about finances.  Retirement planning, debt relief, savings goals and investing options are all topics that need to be discussed and decided up on periodically throughout a marriage.

Ever wonder how you can rack up such a huge credit card debt so fast? Many people tend to use their credit cards at grocery stores, mostly buying convenience foods. Why the lure of these items? Why is it that people would rather spend money on pre-made convenience foods that they could make for themselves for a fraction of the cost? For one reason, these foods make a hectic life a little easier. Many baking mixes, for example, brag on their packaging, “Just add water,” while other mixes, such as stuffing, say, “Ready in 5 minutes.” Is the lure of these foods so great that we would willingly go into debt just to shave off a few extra minutes of cooking time?

The pull of these products is mainly due to advertising. When you see a commercial for a popular pancake mix—you know the one where the mom is shaking up the mix and water in the container—what is that message telling you? That it’s easier to buy their products versus putting an extra three minutes of making it yourself. The truth of the matter is, if you were to buy the ingredients and blend them yourself, you would get a better tasting, cheaper product than you could buy on the shelf—and for pennies.

Healthier and Cheaper Alternatives

Staying on the pancake mix idea, you could blend the dry ingredients, using whatever flour you want, such as whole wheat or grain versus the highly refined flour used in the commercial mixes, and store them in food storage bags until you are ready for it. Then, when you want to make pancakes, you would simply place the desired amount of your homemade mix in a bowl and add in your wet ingredients. It’s pretty much the same process you would go through with the commercially made mixes.

Not only are these homemade mixes cheaper, they can potentially be healthier for you. It really depends on the ingredients you use. Instead of using refined flour and sugar, you can use a whole grain flour and Stevia or Xylitol. Or, save the sweetener for when you actually mix your wet ingredients in, especially if you want to use honey or molasses instead of a dry sweetener.

By making your own mixes, you know exactly what is going in your food versus the commercially prepared mixes. But the best part of making your own mixes is that they come out to cost 10 times less than the store-bought counterparts. Say a box of pancake mix costs $2.79 and you can only get one batch out of the box. That’s an expensive batch of pancakes. Now, let’s say that you can get an entire bag of flour for that much, and you only use 2 cups. This option is much less expensive, saving your credit cards for more pressing emergencies.

There are other homemade convenience foods that you can create, such as cake mixes, pudding mixes, syrups, sweetened condensed milk, and so much more. There are no limits to how many convenience foods you can make at home. The key is to figure out what your favorite convenience food has in it, and start experimenting. Or, you could just search the internet for recipes to get you started. The sky’s the limit!

Control What You Eat…For Less

When you make your own homemade convenience foods, you are able to control what you are eating, for much less money, and you save how much you are spending on your credit cards. Because if you can create your own mixes, you can begin living within your budget and relying on your credit cards less. While saving on your credit cards, you can also save on your waistline. By creating your own homemade convenience foods, you can put in healthier ingredients, which when used, you can then begin to bring your body’s health into balance. When everything is balanced, you will then begin to lose weight. It’s all part of the process—you start living frugally, and you lose weight in the process! How cool is that?

Commercialism is everywhere, and one can’t seem to survive without being expected to run up credit card debt. It’s the “gotta have it now” syndrome, and it is ruining your health. Think you are immune to this syndrome? Let me ask you: do you have at least one credit card? Are you depending on payday loans to get you through the month each month? Well, I am afraid to tell you—you have the syndrome and it is going to eventually wear you down due to lack of sleep and an abundance of worry about your finances. Following are budget busters that will ruin your credit every single time.

What are budget busters? These are the things that are advertised on every single television and radio station…on every single website…and in every single magazine. It’s those items that are “hot”, “new”, and “different”. Those items that you see everyone buying these days without understanding why they would buy them, and how they can afford them. Things such as Blackberries, 3G cell phones, or the latest television technology. You know the type—hot one day, and in the trash the next. But these “gotta have it now” items are what makes you throw caution to the wind and create huge credit card debts. These are the items I call “Budget Busters”, because they bust your budget in a big way. Some examples of these budget busters…

Real Estate

Investing in real estate is a good thing if you do it correctly, but unfortunately, not many people do it correctly. Have you ever watched some of the real estate buying shows on HGTV? If you have, then you know what I am talking about. Many of those people on the shows appear to be very greedy—they want all of their wishes to be met, and if even one thing is missing, then they keep searching. Often, their searches lead them to the very top of their budget, and some actually go over their budget just to get every item on their wishlist. Credit cards become the new type of cash for many of these couples.

Examples of this include several young couples, or even single people, who buy three or four bedroom houses with a two car attached garage in an up and coming neighborhood, and you know they are going to be sacrificing a lot just to get this big of a house. Why are they buying such a big house when they are just starting out? Whatever happened to the “starter house” that many young couples bought many years ago? Starter houses were just that—a house to get them started on the path of home ownership, and a way to get their feet wet on learning to make wise real estate decisions. Budget savers would actually go for a starter house that has maybe two bedrooms, and a bathroom, with no garage. This is budget busting at its most extravagant.

Auto

New cars, while they smell great and run great, they depreciate by half in the first year. Buying a new car is the worst budget buster you can make, because you will never be able to get that much money back when you either try to sell it or trade it in for a new vehicle. Buy a used car that is a few years old, and you will save a lot of money this way.

By avoiding these budget busters, you will not only be able to cut out your credit cards, but you will also be able to save money for your future retirement. It’s worth it to settle for less until you are able to get what you want.

They gave me a mulligan on my bill

It was the weekend before a big pro-am golf tournament in Waukegan, and I had been honing my game for months. I was so psyched, I felt like I could have given Tiger a run for his money. I was hitting every green, going up and down like a pro and putting like a fiend. My buddies were amazed; Hank even asked me when I was going to Q school. That’s how good things were going. At the 19th hole, I even spotted my gang a round of brew. I couldn’t miss.

The night before tee time, I had a dream that I was being chased by a spider. This was a normal occurrence for me, as I suffer from arachnophobia. Apparently, I became so frightened that I jumped out of bed – while still asleep – and ran. I ran straight into a glass table and slashed open my left foot.

Spiders shattered my weekend

I’d plunked down all of my spare cash getting ready for the tournament, so I didn’t have anything left to pay for the ER bill. That’s where personal loans came in handy. I was able to apply from the hospital via phone, and the money was in my bank account by the end of the day. That’s what I call service.

And get this. Even though I have less than perfect credit, I was still able to get my hands on some quick cash thanks to those personal loans. Why don’t I have perfect credit? Well, if you must know, my golfing obsession has outpaced my ability to pay at times. I went through a rough patch where I had to file for Chapter 7 because my credit card debt had run amok. However, part of the appeal of applying for personal loans is that it didn’t matter what had been going on with my credit. My income met the requirement and I was approved for the money I needed to take care of my hospital bill.

A painless process

They performed what’s known as a “soft” credit check, or soft pull. The fact that I got personal loans appears on my credit for me to see, but it doesn’t appear in such a way that other potential lenders can see. Since it isn’t their business that I busted up my foot running from an imaginary spider, or that I needed personal loans to pay the bill, I don’t see why it should have to appear on my credit report. Do you?

All in all, I was bummed that I missed the tournament. But there would be other chances. Golf is in my blood. Next time, I’ll make sure there is no precariously placed glass furniture nearby. But if you find yourself in a spot like I was – maybe it’s a bill you need to pay to avoid having your electricity shut off. Better yet, perhaps it’s your little girl’s birthday and you need to buy a present at the same time that you’re being extorted by Columbian “coffee merchants” (long story, better left unsaid). Whatever the case, personal loans are a tool to dig you out of your sand trap. I’m glad I made that call. If you need a boost, don’t wait -  make the call!

Related Video:

Thanks to some unreasonable and unjustified bad press, payday loans have come to be regarded in some quarters as a bad thing for consumers. Basic principles of economic science say that if we, as individuals or as a nation find ourselves in sudden monetary troubles, more often than not, it’s because of some flawed practices and policies that get entrenched in our behavior over a period of time. Gradually, such behavior leads to a crisis and that’s what we face today. Payday loans are not the source of the crisis, they are a small but very powerful tool to help you in overcoming any such crisis in your life.

The purpose of payday loans

Payday loans are designed in such a way that they take care of the following extremely important aspects:

• Payday loans or short term cash advances are extended to you against your next monthly paycheck. So in essence they are meant to be very short term, so that you can take care of your normal or urgent expenses in a very convenient and easy way. In the present recessionary situation, with pay cuts and job cuts looming over all of us, this is not an extraordinary situation to be in.
• Also, considering the prevalent reluctance of banks to lend money for personal loans, due to a variety of reasons like the credit crunch or your bad credit ratings etc, payday loans in contrast provide an easy way to fulfill your monetary needs in these times when other sources of credit are drying up.
• So basically payday loans are designed to act as a shield; to protect you and your loved ones against any sudden monetary shock(s). In that sense they are nothing short of a blessing.

But where do problems start?

So you are asking, if payday loans are all that good, then what about all those articles that you have read warning you about the so called ‘hidden traps’ that lie in them? Well, the problem lies partly in our spending habits that have been ingrained into us from so many decades of prosperity. According to Demos, a firm that specializes in public policy research, the general credit card debt leapfrogged by 315 percent during the period between1989 to 2006. This shows that availability of easy credit has made us more and more dependent on it, playing havoc with our saving habits. This has got to change. Payday loans are not meant to make you dependent, they are meant be used as quick fix and easy solutions to your immediate fiscal problems. However, for that to happen, you must be responsible enough to plan and utilize your cash advance with good helpings of intelligence and accountability

What must you do with your payday loan?

• First and foremost, the amount of the payday loan that you apply for should correspond directly to your current needs for which you need cash. E.g. if you are short of cash to pay off your electricity bill, then take out a payday loan that can take care of this bill, nothing more.
• Plan your budget carefully, and see how you can make the best use of your payday loan. Payday loans could be very helpful in a number of situations like during a vacation, for home improvement etc., all depending on how you plan your budget. Also remember to plan enough savings so that you are able to pay off this loan with your next paycheck.
• It’s perfectly human to be tempted to spend the cash in hand according to your so called ‘instincts’. While it might be understandable to do so when you have a surplus of expendable cash, it doesn’t make sense to spend thoughtlessly on credit. Payday loans demand accountability.

Like any other thing in our life, payday loans could either be used or misused. They are a great blessing if we make a thoughtful and responsible use of them.

Personal loans have been a great financial support for many in the United States. And now, with the trouble credit cards can get you in, personal loans may be a greater support than ever.

The ease of credit cards

The concept of carrying cash everywhere you go has been taken over by the idea of using credit cards. Carrying a credit card is simple and is safer and less to carry around than carrying huge amounts of cash whenever you go. Unfortunately, using a credit card without keeping track of how much you’re actually spending could leave you penniless. We need to understand what can happen if we don’t manage our credit cards efficiently.

Some helpful tips

Here are some very useful tips when using credit cards. It’s important to follow these tips so that you can keep your credit cards on track and even help increase your credit score. The higher your credit score, the higher your reliability factor with some people.  But not with personal loan companies. Companies that loan personal loans typically don’t run credit checks so your credit score has no bearing on them.

1. Be aware of your credit limit

Be aware of your credit card limit and make sure you never charge more on your cards than this limit. Credit card companies charge enormous over-limit fees. Though the tendency to be bowled over by your desires dominates at times, it is important that you implement discipline to avoid being in duck soup later.

2. Select the most economical payment method

You can end up paying extra fees unnecessarily just because you opt for a particular payment plan. If you opt for a high payment plan that you end up not being able to pay, you will get charged late charges which can be added to your balance then you could even get over-limit fees. That’s a lot of fees. It is important that you find out the most economical method of making your bill payments. You can always pay more if you have a little extra money each month.  Be sure to get information on the different reasons that your credit card company may charge you extra. Once you are equipped, then you sure will make an efficient move.

3. Pay more than the minimum due

When you get your credit card bill showing you the outstanding balance you owe the company, it normally gives you the minimum amount you have to pay. If you don’t want to end up paying big interest amounts on your credit card, pay more than the minimum if there is that possibility. Lump sum payments from time to time will help you clear your balance faster. Your credit card company may also increase your credit limit on your card, for being such a good customer.

4. Pay on time

Don’t ever be late on a payment.  Not only will you get a big late payment charge, but you may even have your card cancelled. It may help to have auto-pay from your checking account directly to the credit card company.

5. Keep yourself updated

With the changing government policies and rules, every financial institution is prone to changes. You need to keep up to date on your information and the latest changes that could have taken place in your credit card company. This will save you unpleasant surprises. The same applies when you have taken personal loans with fluctuating interest rates.

6. Take out personal loans if needed

Opt for personal loans instead of using your credit card. You can use personal loans to make payments to avoid late charges or over-limit charges. You can also use personal loans to avoid worry over what charges the credit cards may be charging.

Another Round of Bad Shopping Habits

The third of the more notable books in Sophie Kinsella’s Shopaholic series is entitled Shopaholic and Baby, where main character and ultimate shopaholic Becky Brandon (nee Bloomwood) is happily married and pregnant with her first child.  Though the previous novels demonstrated how Becky was able to wean herself off her neurotic spending habits and learned a lesson or two in managing her finances, this new installment shows how old habits just keep coming back.  Specifically, now that she is with child, Becky resorts to even more justifications regarding her shopping rituals and credit card use.  For first-time mothers, it is easy to relate to Becky’s logic; however, wanting to give your baby the best need not run toward frivolity and envy.

Only the Best for Baby

Becky’s notorious materialism reaches greater heights in this novel, as she is pictured on the quest for the handsomest celebrity home with a shoe room to boot, as well as engaging the services of an A-list obstetrician.  Of course, her daily shopping sprees also move to a higher level—while hunting for the most coveted designer baby clothes and shoes, she just has to find matching outfits for herself.  Though her antics are fun to read and laugh at, it is difficult to believe that such a person exists—unless we’re talking about new celebrity moms like Nicole Richie or Jessica Alba.  Or maybe even Britney Spears a few years back, assuming she wanted to do things other than shaving her head.  A regular mom-to-be with enough financial resources would still be reasonable in adjusting to her new condition and preparing for that much-awaited arrival, yet might find herself in a bit of a situation born out of excitement and anticipation.  Doctor’s appointments, medication, and extra expenses to cover the baby’s needs are expected, which will continue well into the baby’s birth.  While plans for the baby’s future may already be under way, the immediate concerns may run over any set budget.

Happy Payday

Times like these don’t need to be stressful, and you certainly don’t have to deprive yourself or your baby.  For emergency expenses, or when the budget just won’t cover everything you need, take out payday loans.  But remember, the important thing here is to know your priorities; thinking Becky Brandon-style just won’t do.  You will have to list your priorities, and these should only include what you need, versus what you want.  Or, if you are confident that you will be able to pay off the loan realistically, you can very well add on a few extras and conveniences that will make the upcoming event a bit more special.

Payday loans are there to help you out, to make things easier, to assure you that some help is available when you need it—and only for good reason.  For today’s practical mom, baby’s arrival need not keep up with the hype of celebrity living—what is important is bringing a healthy baby into the world, whose future is hopefully bright and secure. As for Becky Brandon, here’s hoping that this new responsibility will give her a bit more character and reason, and that she will plan for her family’s future instead of her next shopping extravaganza.