USAinDebt

Would you pay money to lend yourself your own money? No? Well if you wouldn’t do so, why would you take an Refund Anticipation Loan?

It probably seems easy at first: sing a paper and walk out with a check against your coming refund. Yes but no! Your tax RAL will cost you much more than you can imagine. As an example, H&R Block’s RAL cost is about $230 for a $3000  refund. And you get that refund on a Emerald Card with 36% APR!

Such loan makes no sense. You are way better filing with e-file and getting the refund deposited directly into your bank account. It only takes about a week after the e-filing to receive your funds.

Tags: e-file | filing | hr block | taxes | ral

As per the latest reports, Americans are  ’above their ears’ in debt - $48 trillion - and soaring. 9 out of 10 households in the US owe money - in mortgages, car payments, credit cards, student loans, medical bills, various payday, credit union and personal loans. And unless you are one of those lucky exceptions, you probably owe green. If so, read-on: here are your first golden steps in becoming debt - free.

When dealing with your debt, the first thing to do is to summarize your responsibilities. In another words, understand how much you owe. And in order to do this, you will need a couple of simple things: Microsoft Excel, Internet, a phone and a couple of hours of free time.

For starters, create a new Excel file and password-protect it. Go to Excel, click on “Tools” then “Options”, click on the “Security” tab and look for the box “Password to open”. This is where you are going to put your password. After you have typed the password, click on “Ok”, re-enter the password (for security) and voila, your document is protected. Save it.

Your next task to do is to type in “Creditor” into the first box (A1). Write “Owed” in B2, “Available” in B3, “APR” in B4 and “Minimum Payment” in B5. Save. Next, list the names of your creditors in the first column, one name per row. Save again. The next step is to contact each creditor that you have listed in the first column and obtain as much information as you can. Against the name of each creditor you should fill out what’s owed, what’s available, what is the APR on the credit and what is the minimum monthly payment. Save frequently to avoid loss of information!

After you have everything listed, it’s time to summarize your debt. You will be using Excel’s Auto Sum function for that. Let’s do it with the numbers in column#2, “Owed”. Click on the first number in that column, hold the “Shift” key on your keyboard, and then click on the next empty box underneath the last number in that same column. This way you should have selected all the numbers below the “Owed” column, plus one more empty box. When that’s done, click on the Auto-sum Button which looks like the Greek letter Sigma - “Σ”. This will add all the numbers that you have selected and display the result on the bottom. The great thing about Auto Sum is that if you change any of the numbers in the column, Excel will automatically re-calculate the result! Do the same for the “Available” and “Minimum Payment” columns. Save.

Let’s summarize what’s been done. You have just made the first step towards your financial freedom. You now know exactly how much you owe, what are you minimum monthly payments, how much all those credit lines cost you per month and how much credit you have available. Good job!

Tags: credit | debt | debt-free | loans | apr | autosum | excel

Companies spend a lot of money on advertising their products to the public and unfortunately that good advertising often works: people tend to buy products that they have seen on TV or read about in the magazines. Sometimes, however, those products are not the best buy. They are expensive because of the brand they are sold under at the same time they are no different that the rest of the products on the shelf. Generic, or otherwise called store brands can often save shoppers lots of green.

A good example is CVS. What does a regular CVS customer buy? Cosmetics, medicine, household supplies. So let’s get two separate carts and shop. Shampoo, toothpaste, face cleanser, pain reliever, cotton swabs.

Cart 1: contains Head & Shoudler’s Dandruff Shampoo, Classic Clean; Crest Vivid White Night Toothpaste; Clean & Clear Oil-Free Daily Pore Cleanser; Advil Ibuprofen Coated Gel Caplets; Q-tips. Total for this cart: $35.00.

Cart2: CVS Dandruff Shampoo 2 In 1, CVS Bright White Whitening Toothpaste, CVS Oil Free Acne Cleanser,Pain Relief Rapid Release Gel Caps Extra Strength, CVS Cotton Swabs Flexible Plastic. Total for this cart: $13.39.

Looking at the above, it is easy to see that the CVS store brands have saved us $21.61, which is a nice piece of change. Worried about the quality of what you are buying? Compare the ingredients and you’ll see that they are 100% identical in most products! Why pay for the brand name when you can have the same for less?

Tags: cvs | save money | store brands | generic

If you happen to be in debt then the likelihood is that you consider credit card to be a dirty word! Credit cards account for the majority of debt in this country at the moment, but did you know they can also help to get you out of debt?

The latest credit card trend is towards balance transfers. Transferring your credit card balances from a high interest card to one of the many interest free credit cards that have fixed nine, twelve or eighteen month offers can knock hundreds of dollars off your bills and give you a little breathing space to get your credit card balances cleared. But if you are not sure where to look for these offers then a website like About Your Money can help.

About your money is a comparison site that has access to plenty of the latest interest free credit cards and the related offers. The site is really comprehensive, complete with a comparison table and a guide to help you choose the interest free credit cards that will best suit you. If your debt is more extensive though, you might want to take a look at the personal loans section instead.

Now is the time though. With 2008 approaching and bringing a fresh start with it, now is the time to look to clear your debt.

Here’s 12 excellent articles, combined in our Carnival of Credit Report Stories. Have fun reading!

Karen Halls presents Bankruptcy Vs Bankruptcy Alternatives posted at
A Bankruptcy Lawyer’s Blog, saying, “When you’re beginning to find it difficult to pay off your debts you might consider filing for bankruptcy as your ultimate debt solution. But have you considered other options before you finally declare personal bankruptcy?”

Aaron Wakling presents Improving Your Credit Score - Fundamental Factors posted at The Credit & Credit Card Blog, saying, “To understand how to improve your overall credit rating, it is imperative you understand what factors influence your FICO score.”

Eric Hudin presents Estate Planning Tax Advice - Why You Need It and Where to Find It posted at My Estate Planning Career Blog, saying, “Taxes are something you have to pay all of your life, and if you do not plan ahead, they will be something your estates will be paying even after you are gone. So making sure that you get quality estate planning tax advice when you are arranging your final affairs is one way to ensure that your heirs, and not the IRS, receive the bulk of your estate.”

Allen Taylor presents Investing - Determining Your Goals posted at Investing World Today, saying, “Much like an exercise program, you will want to determine your
goals before you begin to invest. Your goal might be retiring in 20-30 years, kids college funding or, if you got started a bit late, retirement in the next 5 to 10 years.”

Tim Ramsey presents 7 Steps to Debt Freedom posted at My Debt Relief Blog,
saying, “For anyone out there who has ever forgotten a payment or found themselves with more debt than their income could pay, you know how aggressive some of these creditors can be.”

Eric Stanley presents How The Recent ?Credit Crunch? Could Affect You posted at
Personal Finance Blog Articles, saying, “With banks and financial intuitions unsure on the risks involved with lending to one another, a ripple effect is being sent out
into the rest of the lending world.”

Thomas Humes presents Guidelines for Building Wealth posted at Wealth Building World, saying, “Review my guidelines for building wealth.”

JASMBA presents Getting Ahead posted at Getting Ahead.

Matthew Paulson presents The First Thing’s First: Prioritize Your Debts posted at
Getting Green.

Larry Russell presents Diversify To Avoid Investment Fraud posted at THE SKILLED INVESTOR Blog, saying, “Stories about financial fraud often seem to include the phrase
“his or her life savings.” There should never be a moment during your lifetime when your life savings are not heavily diversified across many investment vehicles and firms.”

Colin Robertson presents How Long Do Negative Items Remain on a Credit Report posted at The Truth About Credit Cards.com.

James presents Notorious Practices of Payday Loan Companies posted at ZooLaw.

That concludes this edition. Submit your blog article to the next edition of credit report stories using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Definitely take a look at what Philip Brewer @ WiseBread has to say about 401(k)!

Here’s an excerpt:

‘The twin advantages of tax deferral and a corporate match make the 401(k) the foundation of most people’s savings plan. Putting in enough to get the maximum corporate match is almost always the right choice–a good corporate match is so much money, funding your 401(k) usually even comes ahead of paying off debt. Sometimes, though, it makes sense to put money other places.’

Read When NOT to put money in your 401(k) on WiseBread

You basically have two options when filing: you can either file for Chapter 7 or Chapter 13, depending on your situation. The main difference between the two is that Chapter 7 involves liquidation of property as opposed to Chapter 13, which works more like a repayment plan.

Chapter 7 Bankruptcy, also know as a “straight bankruptcy” or “liquidation bankruptcy” Chapter 7 is the most common in US. About one million Chapter 7 bankruptcies were filed for the year of 2006. A filing under this chapter could be done either by an individual, a partnership, or a corporation or other business entity. Individuals with higher income will most likely not qualify for this type of filing. Chapter 7 does not offer a repayment plan, instead the debtor surrenders all non-exempt property to a bankruptcy trustee, who sells it and puts the proceeds towards repaying the debt. It is possible to discharge certain debts when filing under Chapter 7. You won’t be able to discharge taxes, spousal and child support, student loans. This one stays on your credit report for up to ten years, even if your case is not approved. Filing fees are different for different states, but you should expect to pay a sum above $1000. Cost could be higher for businesses. Debtors must attend obligatory credit counseling within 180 days prior to filing bankruptcy petition.

Chapter 13 Bankruptcy, or a “wage earner’s plan” offers a 3-5 years debt repayment plan to the debtor, and it also allows a defaulter to keep their property. About half a million Chapter 13 filings were done in 2006. This bankruptcy is meant for individuals with a steady income, who can afford to make monthly payments towards their debt. A 3-year plan is proposed if the debtor’s income is below the state median, and a 5-year plan is proposed if the earnings are above the state median. A Chapter 13 filing stays on your credit report for up to 7 years. Debtors must attend obligatory credit counseling within 6 months prior to filing bankruptcy petition. Chapter 13 doesn’t let you discharge family support, restitution, student loans, old taxes and DWI judgments. Filings under Chapter 13 are usually more complicated than Chapter 7 therefore this plan is associated with higher filing costs. You must not miss a single payment, skipping a disbursement will dismiss your case.

Filing for bankruptcy is a tough step to take, but unfortunately sometimes individuals have no other choice but to go that way. Even though, before filing you should re-check all your options again. Remember, bankruptcy will stay on your credit report for up to 10 years, and this move should be your last resort.

Tags: bankruptcy | chapter 7 | chapter 13 | debt | credit

Collection agencies can be a real pain in the neck. Their representatives are annoying, rude and they won’t leave you alone until you pay them. Besides that, a collection agency is capable of ruining your credit profile for up to 7 years and that can really hurt you in many ways. So if you have one of the abovementioned annoying persons calling you, read on.

Before anything else, let’s clear up what is a collection account and what is a collection agency. Simply said, a collection account is opened on a bill that you haven’t paid for a while. Like your cell phone bill, or your credit card payment – if your cell phone carrier or bank for some reason haven’t received any payments from you over an extended period of time,  they will do a couple of things. First, they will try to call you. Second, they will mail you. And third, if they still haven’t heard from you, they will sell your bill to a collection agency. What happens is that the collection agency pays the money you owe for you, and takes over your bill. So now you owe that money to a collection agency. They will open a collection account under your name, get your credit reports and post a collection record on usually all three of them. Then they will get your contact information and start harassing you by phone and mail.

Read the rest of this entry »

We all have heard how important the credit score is how good credit history is going to save you money and how a higher credit score will make our life easier. However there are still people out there how don’t really understand how important is to take care of their financial profile and keep it in good shape. Maybe this article will give them the boost they need to start paying more attention to their credit history & score and start paying less to the creditors.

So what is the real cost of bad credit? Besides financially, bad credit will hit you with a lot of stress as well. You can barely get a normal credit line, your low score will prevent you from financing your car, your house or your education.  And if you have a family on your back, that could really hurt your household. A 2006 survey by DivorceMagazine.com showed that 18% of the divorces in young families are caused by financial problems. You can even be denied a job on the basis of your credit report. Bad credit will really force you to flush money down the toilet. For nothing. Higher fees, high interest rates and low credit lines will keep you in the same circle and you will need a ton of green to get out of it.

Poor credit profile will cost you more on everything: you mortgage, your car, you credit cards, your school loans. Consider this: Based on your score, a $150,000 mortgage can cost you anywhere from $926 to $1411, a $485 difference per month. In a matter of fact, most of the auto insurance companies also check your scores and keep them in mind when calculating your premium. That’s right . Bad credit equals higher insurance premium. When you are looking into renting a new apartment, the landlord or the broker also checks your report. You may be denied to rent if it doesn’t satisfy their requirements.

My thoughts: make fixing your credit profile a priority. There are numerous ways you can help yourself and all that it will cost you is nothing more but a little bit of your spare time. Check the “Debt” section of this website, read the articles that are posted there. You will get many ideas and tips on how to start managing our debt and your financial profile, which will ultimately result in money and nerve savings.

Tags: score | fico | credit | loan | debt | bad credit

Here we have 40(!) great  articles on everything Finance. Welcome to the Blog Carnival of Twentysomething Finances! Thanks to everybody who participated!

Steve Faber presents - How to Avoid Foreclosure posted at DebtBlog.

ChristianPF presents How to budget with ING direct posted at Money in the Bible | Christian Personal Finance Blog, saying, “ING Direct is my secret budgeting tool. Here are a few steps to start budgeting using ING Direct.”

Silicon Valley Blogger presents Stop Overspending Now! 14 Ways To Conquer Binge Buying posted at The Digerati Life.

Sara Goldstein presents How to choose better-quality clothes posted at The Bargain Queen on Fashion and Beauty, saying, “On limited collage finances, it’s essential to stretch your clothing budget as far as possible — and that means buying things that won’t fall apart after the first wear. Here’s how to pick better-quality clothes.”

Michael Cohen presents Why You Shouldn?t Buy Classmates Stock posted at Classmates.com Sucks.

KCLau presents Should you focus on Increasing income or reducing expenses? posted at KCLau’s Money Tips, saying, “Cash flow chart involves simple mathematic calculation: Saving = Income - Expenses. Savings is the priority since it appears first in the equation. To increase saving, we can either increase income, reduce expenses, or doing both at the same time. Which option requires your most attention?”

Frugal Panda presents Fly or Drive: Which is Cheaper? (A Definitive Answer, Once and For All) posted at Frugal Panda.

Ryan Russell presents Is Debt Consolidation A Good Idea? posted at Care on Credit, saying, “Debt consolidation comes in several forms, including credit counseling, balance transfers, and debt consolidation loans, so review your options carefully before making a decision.”

Joy Miller presents 10 Online colleges offering credit for life experience posted at Online College Blog, saying, “Several reputable, regionally-accredited colleges and universities allow you to earn credit for life experience.”

Sagar Satapathy presents The Amero: An Introduction, A Short History, and What it Would Mean for Our Economy | Currency Trading.net posted at Currency Trading.net.

Roshawn Watson presents Do Your Friends Keep You Broke? posted at Watson Inc, saying, “I was shocked to learn that your income will often mirror that of your five closest friends. I had to ask myself who is in my inner circle. Learn from billionaire J Paul Getty. He said that if he were down to his last five dollars, you wouldn’t find him in some cheap restaurant trying to eat all he could. He would rather be in a nice hotel lobby drinking coffee with visionaries and leaders. His rationale was that the people he wanted to be a part of his future were at the hotel not the restaurant. Believe him.”

Matthew Paulson presents Be on the Lookout: Con Artists Stealing Guardianship of Senior Parents posted at Getting Green.

Larry Russell presents Understand the confusing securities market motion picture posted at THE SKILLED INVESTOR Blog, saying, “Securities markets are usually very quick to adjust prices to reflect new information. However, this price adjustment process may take longer and be more volatile, if the new information is ambiguous.”

Juan Millon (1mil) presents Creating My Own Website: Step 3 Registering A Domain Name posted at Millionster.com.

Sam presents How to Save on a Home Mortgage Loan, Mortgage Refinancing, Second Mortgage Loan. posted at Surfer Sam and Friends, saying, “How to Save Money on a Home Mortgage Loan All Interest Rate Quotes Are Not Alike Don’t Let Closing Costs Scalp You”

Roshawn Watson presents Two Financial Questions You SHOULD Ask Your Friends posted at Watson Inc, saying, “Strife over money has severed many good relationships. When it comes to discussing finances, avoidance is understandably our medicine of choice, especially when friends are involved. However, perhaps avoidance is not the best strategy”

Mike Lazear presents The Great Office Escape posted at The Great Office Escape, saying, “A great way to save in your 20s is to resist the temptation of car ownership! Reap the benefits by seeing your savings rise and experience some other bonuses along the way to being car-free.”

John Crenshaw presents Pay Off Mortgage, Lose Tax Deduction? posted at Truthful Lending dot Com, saying, “The home ownership tax deduction is one of the most commonly misunderstood aspects of home ownership. Find out why it’s ok to lose that deduction when you pay off your home.”

The Free Geek presents Broke? Alcoholic? How to Drink on a Dime: 10 Surefire Tips posted at Free Geekery.

Dax Desai presents 4 China Stock Picks posted at Dax Desai, saying, “4 Great Chinese Stock Picks & 1 Day Trading Pick”

the baglady presents Early Retirement May Not be Optional for Twentysomethings posted at xynny.

FIRE Getters presents Live Rent Free and Earn as a Caretaker posted at FIRE Finance.

Logan Flatt, CFA presents How to Get Ahead In America (2nd of a 12-Part Series) posted at PowerWealth.com, saying, “If there is one refusal that has been central to my financial success in America, I would say this is it.”

ChristianPF presents Do I need an Emergency Fund? posted at Money in the Bible | Christian Personal Finance Blog, saying, “How an emergency fund can make or break you financially.”

Super Saver presents Time To Plan for 2007 IRA Contributions posted at My Wealth Builder.

Dianne M. Buxton presents Global Impact Charity Engages With a Broader Vision posted at manifestingsuccess, saying, “How early do you want to start? Now? Get wealthy, help others and join the system that is going to do it. No cost to you or anyone you refer.”

Shawn Edwards presents Video — 5 Simple Steps to Get Your Finances Under Control | Desty Online — Online and Offline Businesses posted at Desty Online.

KCLau presents Build your Financial Dream House with a Financial Consultant posted at KCLau’s Money Tips, saying, “Architects design and build real houses. Similarly, financial planners design and build your financial house.”

Mr Credit Card presents Overstock.com Credit Card | Overstock Credit Card Review posted at Ask Mr Credit Card’s Blog.

Jason Elder presents Personal Loans With Bankruptcy posted at A Bankruptcy Lawyer’s Blog, saying, “Here I discuss a few things you may not know when dismissing personal loans in your bankruptcy”

James presents Payday Loan Tips and Tricks posted at Payday Loan Cheapskate.

Shelby Crutchley presents Appliance Insurance - Security, or a Rip Off? posted at Island Girl’s Money, saying, “This entry is about the benefits vs. cost of over-insuring yourself for certain things, like appliances.”

Jimmy Atkinson presents 25 Ways to Earn More and Work Less posted at Ask the Advisor.

Michael@TSM presents Fall TSM Travel Writing Contest: Win $125! posted at Traveling Stories Magazine.

Aaron Wakling presents Credit Checks - What They Are And What You Need To Know posted at The Credit & Credit Card Blog, saying, “Credit checks involve sensitive personal data. Therefore, many people are concerned about precisely who they’ve entrusted with their records. Fortunately, the Fair Credit Reporting Act has established unambiguous rules governing credit checks.”

Millionster presents How Rich Dad Changed My Thoughts About Money posted at Millionster.com, saying, “I was first introduced to Robert Kiyosaki’s books by a good friend of mine — a CEO from Las Vegas. His parents were both business owners so he pretty much had a good head start in his financial education — suffice it to say I took his recommendations in full confidence.”

poetloverrebelspy presents Comparing Foreign Websites for Deals posted at Less Than a Shoestring, saying, “Wasn’t sure if the above post or this one http://nobudgettravel.wordpress.com/2007/10/11/baring-my-budget-london/ would be more your speed. I write about thrifty travel options.”

Michael Bass presents Escaping credit card debt without filing bankruptcy. posted at Debt Prison, saying, “Escape credit card debt without filing bankruptcy or debt settlement.”

Wenchypoo presents Holiday Dinner Rip-offs posted at Wisdom From Wenchypoo’s Mental Wastebasket.

Silicon Valley Blogger presents How Much Credit Have You Turned Down? Maybe Half A Million Dollars Worth posted at The Digerati Life, saying, “Thanks!”

That concludes this edition. Submit your blog article to the next edition of twenty something finances using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Tags: credit | debt | insurance | investment | retirement | savings | blog carnival