Debt

Credit Card Interest Typically Compounds Daily – Here’s How to Take Advantage of That

A few weeks ago, I posted an article on the idea of interest that accrues daily. Here’s a brief explanation; check out the full post for more details: Some banks will accrue interest daily. Some even accrue it continuously. Rest assured, the more often a bank accrues interest on your debt, the worse it is …

Categories: Credit Cards, Debt

Should Your Partner’s Debt Keep You Out of a Relationship?

Recently, a reader wrote to me with what would have been a stellar reader mailbag question except for the fact that it was full of personal details. I attempted to edit the email down to something that could be shared without identity concerns (as I never want material readers send me to ever come back …

Categories: Debt, Getting Started

Rent vs. Buy: Which is Better?

Is it better to rent a place to live or to buy one? It’s a question that I get asked multiple times per week in some form or another. Usually, it comes from young couples who are being pressured by older people in their life to get out of renting and buy a home or …

Categories: Debt, Housing

Alternatives to Payday Loans If You Need Cash Immediately

Payday loans are an incredibly poor deal for the customer. It’s a loan with an absurdly high interest rate. If you take out a payday loan, you’re going to come out the financial loser almost every time. They almost always cause more problems than they solve. Almost everyone knows that payday loans aren’t worthwhile, so …

Categories: Debt, Getting Started

4 Steps to Take If You Loan Money to Friends or Family

This article first appeared at US News and World Report Money. A friend or a family member is struggling with a financial problem. That person comes to you and asks you to lend money to help them through their crisis. What do you do? This situation comes up quite often in tightly-knit families where there …

Categories: Debt, Family

Does Good Debt Exist?

A long while ago, I wrote about the idea of good debt and bad debt: There are several fairly similar definitions of each kind of debt, but generally they either revolve around the terms of the debt (low interest rate debts – usually below 7% or so – would be “good debt”) or the purpose …

Categories: Debt

Five Steps You Need to Take If Bill Collectors Are Contacting You

This article first appeared at U.S. News and World Report Money. You failed to pay a bill when you were out of work or you forgot about an old debt. Suddenly, debt collectors are contacting you through the mail and on the phone. It can be frightening, particularly if you’ve never been in such a …

Categories: Debt

Why Lending Money to Family Is a Bad Idea

I have very few fundamental rules of personal finance that I follow. Spend less than you earn is a big one, but once you get past that, there tend to be exceptions to most rules in life. However, there is one principle that I’ve followed for a long time that has never guided me wrong. …

Credit Card Debt Getting You Down?

This article first appeared on U.S. News and World Report Money. Personal finance writers, whether on the internet, in magazines, in books, or elsewhere, are usually very strong advocates of investing. There’s good reason for that, of course: assuming that you’re in a financially stable position, investing in things such as the stock market or …

Categories: Debt, Investing

How to Pay Off Debt

There are few things quite as painful as looking ahead at your future and seeing nothing but debt. So many people today graduate from college with extensive student loans and consumer debt on top of that. They struggle to find a job and, sometimes, they never find the job that they want. Sometimes, people get …

Categories: Debt, Getting Started

How to Fix Your Credit Properly

Sometimes, it seems like you can scarcely turn on your television or radio or web browser without seeing someone offering you a great solution to your credit woes or proper protection against credit worries. Pretty much anything involving the word “credit” is a hot commodity. There are thousands of businesses out there who want to …

“House Poor” Versus Controlling Your Own Destiny

Anyone who’s been awake to watch the changes in the economy over the last five years is familiar with the burst of the housing bubble. Too many people were given mortgages that were bigger than their budgets could handle and when those people couldn’t pay, the banks that offered those mortgages were in serious trouble. …

Categories: Debt, Housing

Low Home Mortgage Rates and Early Payoff Info

Over the last few years, home mortgage rates have drifted up and down between 3% and 4.5% for a thirty year fixed rate loan. That’s astonishingly low, especially considering savings accounts were giving out 6% returns in 2006. (I remember those days… 6% in a savings account. What I wouldn’t give for those days to …

Categories: Debt

How to Deal with Debt Collectors: Your Consumer Rights

Money has been tight, there’s no doubt about it. The Great Recession has taken its toll. But even before a financial crisis shocked the economy, American wages were stalled. According to the Social Science Research Council, the typical American earned $2,200 less in 2010 than in 2000. And while we all want to pay our …

Categories: Debt

Do Low Interest Loans Change the Rules For a Mortgage?

A lot of different “rules” are passed around regarding the size of a mortgage that a person or a family should take out in order to afford a home. One common one I see and hear repeated is that you should never take out a mortgage that has a value of more than twice your …

Categories: Debt, Housing

Debt Isn’t Required

Like a lot of people in my twenties, I spent much of that decade in a rush to saddle myself with a lot of debt. I owed money for my education. I owed money for my car. I owed money for my home, too. I had this strong sense that I needed all of those …

Categories: Debt

Need Help With Payday Loans? How To Escape The Cycle

I had a long conversation with a reader whose brother seemed to be caught in an endless cycle of payday loans. He works about thirty hours a week earning about minimum wage at a convenience store. About two years ago, his car broke down and in order to get it back on the road very …

Categories: Debt, Getting Started

Should I Cosign a Loan?

I get this type of question all the time. A family member or a friend is trying to get a loan for some reason. Those evil banks won’t lend them any money. They want you to cosign their loan for them. It won’t cost you anything (so they say) and it’ll help a friend out! …

Categories: Debt, Family

Does a Extra Payment Have an Impact On Your Mortgage?

Let’s look at a “typical” mortgage. Right now, the average American mortgage is $235,000, so let’s use that as our baseline. The Seattle Times reports that, right now, the average 30 year fixed mortgage rate is 3.42%. So, let’s use those numbers. We’ll look at a 30 year fixed mortgage at 3.42% that borrows $235,000. …

Categories: Debt