Debt Management

Considering Lending Money to Friends? Take This Advise

About three weeks ago, I made the mistake of lending a small amount of money to a friend against my better judgement. This friend promised to pay me back in small installments each week over a period of time and we even wrote it down on paper and both signed it. He missed the first …

A Reader On The Cusp Of A Great Credit Rating

A reader recently sent in this question about her boyfriend’s credit, which seems to be on the cusp of being quite good. My boyfriend was recently denied financing on a used upright piano because of poor credit. He actually has enough cash saved to buy it outright, but the fact that he couldn’t receive financing …

Student Loans 101: What To Look For To Pay For College

I recently received this email from a reader: I need some Buyer Beware advice on how to choose a lender for a student loan with a parent as co-signer. My 19 year old will be attending university and he has to take out 100% loans. The annual amount is a hefty 50K. When I review …

The Day After: My Immediate Actions When I Reached Financial Armageddon

Recently, a reader who found himself in a situation much like my own financial meltdown. He read about the real pain of the meltdown and the general plan I began to follow afterwards, but there’s a little gap in the middle that wasn’t really explained. How did I get out of that immediate jam? What …

Categories: Debt Management

A Reader Runs In Place

I recently received the following email from a reader, who I will call Annie: I’ve been reading your site for a while now, and while I do enjoy much of your advice, I must admit there is one thing that really frustrates me. You talk a lot about saving and investing, but what if you’re …

How I Learned The Real Meaning 0f “Six Months Same As Cash”

Shortly after my wife and I were married, we decided we needed to replace several pieces of furniture in our apartment. Our furniture at the time was still the furniture we used during college – in other words, most of it was from the goodwill store. So we did what many people do when they …

Categories: Debt Management

Is Paying Off Debt With a Windfall a Good Idea?

In response to an earlier post on uses for a tax return, Dustin wrote: I noticed that you didn’t have “Pay off debt” as one of the 10 things to do with your refund. Is there any particular reason you chose not to suggest that? The reason that I didn’t suggest using such a windfall …

Categories: Debt Management

Most Frequently Asked Question: Pay Off Debts Or Invest?

Over and over and over again, readers ask me some variation on this question: I have $1,000 in my hand. I am trying to decide if I’m better off paying off part of my credit card debt or investing it. What should I do? The thing is, my answer is almost always the same, and …

10 Steps To Escape From Debt & Build A Financial Future

Late last week, I received a very long and personal email from a reader named Susan. Her situation was dire: between the various payday loans and credit card bills, plus the recent disappearance of a live-in boyfriend, she actually owed more in debt payments each month than she is bringing home. Amazingly, she claimed to …

Categories: Debt Management

Personal Finance 101: Is Debt Bad?

Recently, I received a lengthy email from a reader who had a ton of basic personal finance questions contained within. I thought it might be interesting to start an irregular “personal finance 101″ series to answer and explain some of her questions. Many people out there make broad statements like debt is bad in order …

Transition From Car Loans To Paying Cash For a Car

Continuing the conversation with my readers on the auto insurance issue, in which I recommend switching to liability insurance once your car’s value gets low, Kellie makes a point that’s worth covering: I couldn’t get a car loan for my vehicle unless I had full comprehensive on it. So, I can’t switch to just liability …

15 or 30 Year Mortgages: Which One Is Right For Me?

My wife and I are buying a home this summer and we’re pretty confident on what we’re going to buy based on the local marketplace: a pre-owned four bedroom house. We’ve looked at several in our price range and we’re getting set to make a move. One major part in this decision is determining whether …

Money Merge Accounts: Are They A Good Deal For Home Borrowers?

Yesterday, a reader wrote to me and asked about money merge accounts and whether or not they are a good deal for homebuyers. Of course, this means that I popped open my trusty spreadsheet and started doing some calculations. Hold on, what is a “money merge account”? A “money merge account” is a special home …

The Biggest Risk Of All: You

Whenever I make calculations on this site, I usually involve some calculation in which a person contributes some dollars a month each month to savings in order to make an even comparison of which option is a better deal. Quite often, to the chagrin of my readers who are looking for a “deal,” I recommend …

Categories: Debt Management

An Introduction To Compound Interest With Spreadsheets, Part 3: A Simple Mortgage Calculator

Regular compound interest is (basically) the way most loans and savings accounts work, including home mortgages. Here, we’re going to use a spreadsheet to calculate a home mortgage payment estimator (and even a full payment schedule) using the principles of compound interest. Fire up your spreadsheet and enter the following information into cells: In A1, …

Student Loan Consolidation 101

If you have more than one student loan after college, chances are you’ve been approached by more than one group seeking to consolidate your student loans (if you haven’t graduated yet and have multiple loans… just wait). These groups promise all sorts of things, from a percent reduction in your balance to a low interest …

A Fresh Look At Auto Leases: Does A Savings Account Help?

Recently, a reader left this comment on an earlier post about the auto lease trap: What if you lease a car like a jetta that can be leased for $248 a month and take the difference between what you would be paying if you bought it and put that in a savings account? In other …

Dave Ramsey vs. Suze Orman: Which Plan For Dealing With Debts Is Best?

Recently, AllFinancialMatters posed the following question: which method of getting out of debt works better, Suze Orman‘s or Dave Ramsey‘s? Here are the compared plans: Here’s Dave Ramsey’s Snowball Method for paying off credit cards: Step 1 – Make a list of all your credit cards, ranked in order from the highest balance to the …

5 Ways to Deal With Debt Collectors and Harrassment

If you’re in a situation where debt collectors are calling you three times a day demanding that your debts be repaid, you’re probably rather worried and possibly rather frightened about the situation, especially if you are having difficulty paying back the debts you owe. Even worse, many debt collectors are highly unscrupulous, calling people that …

Categories: Debt Management

Become a subscriber of The Simple Dollar and get a free copy of Trent's e-book today plus exclusive updates.