Focusing Your Financial Energies

In these unsettled economic times, we offer the following suggestions for your household finances:

  1. 1. Continue to make payments to your creditors if you’re in the process of paying off debt. Having fewer of the proverbial creditors “knocking on your door” means less of a likelihood of additional and unexpected fees and/or interest rate hikes.
  2. 2. Stay in contact with your creditors if you can’t make your next payment. Bankrate.com recently quoted Justin Leach of Toyota Financial saying, “Call your creditors.  So many people are afraid to talk to their creditors.  If the customer calls us without us looking for them, it makes a big difference.”  It is not in the creditor’s best interest to send you to collections, so chances are they will be more than willing to work with you on a modified payment plan.  Be open and honest. And if they ask you for something, such as a letter regarding proof of hardship, get it to them as quickly as possible.
  3. 3. Focus on your emergency savings fund even if you haven’t yet paid off your credit cards and other such debts. Even a savings account or certificate of deposit (CD) of just $1,000 can help lessen the impact of most household financial emergencies that send far too many in our society into a financial tale spin that frequently ends in bankruptcy.
  4. 4. Limit unplanned, unnecessary and/or extravagant expenses such as frequently dining out, expensive vacations, costly gift giving, store-bought bottled water, vending machine purchases, daily lattés, and pricey entertainment.
  5. 5. Check your credit report regularly through www.AnnualCreditReport.com since errors can easily find their way onto your credit report without your knowledge. Some errors significantly damage your credit worthiness in the eyes of creditors!  According to Rod Griffin, spokesman for Experian, they have over 200 million credit records in their system, and their most difficult challenge is keeping everybody’s information straight.  One in four credit reports contains a serious error that may affect the individual’s ability to acquire credit, or worse. Some errors might lead to increased interest rates or fees.  And if the error negatively affects your credit score, there might even be a chance that your car insurance premium could go up. And don’t assume that correcting an error through one bureau automatically fixes the error on all three of the main bureaus.

We all know the saying, “When the going gets tough, the tough get going.” Now is the time to get going on your household’s financial foundation: paying off debt, building savings, and reining in expenses that have kept us living paycheck to paycheck in the past.

If you have any questions, would like to discuss your financial challenges, or are just looking for advice, please call us at your convenience. As always, we are here to help and look forward to hearing from you.

1-877-OUT-DEBT (688-3328)

www.DebtReductionServices.org

Debt Reduction Services and the National Financial Education Center
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6213 N. Cloverdale Rd. Suite 100 Boise, ID 83713