The Holidays are over. The wonderful days of feasting and parties, of drinking and celebrating, of turkey and egg nog, are gone for another year. It is sad, in a way, but that really doesn't matter in the least, because they're over. Get to work.
Holidays are only fun because they are breaks from the norm. The norm is work and there is a lot to do. This will be a year of change. We have more than just a change in Administrations in our Government, we have a change in the whole philosophy we will be governed by. Like it or not, this year will be very different and the Practical American will be ready.
Do not be distracted by all the debate and quarrelling we are about to hear. Do your job, whatever it is, efficiently and cheerfully. At the same time, learn to do as many things as you can. If you have a trade, say plumbing, learn carpentry and/ or electrical work. If you have a brand new IT degree, good for you; now learn a trade. Got an MBa? Wonderful, learn the hospitality business. Why?
Simple. We are entering a time of change and one of the biggest area of change will be the economy. No one knows what twists and turns the job market will take, The more things you can do, the more sure you are of employment.
Take care of yourself physically. We do not have a clue how the whole health care mess will turn out, but if you are healthy, your worry goes down a lot.
Pay down your debts. I know that I write that a lot, but it is one of the keys to financial success. If you have to work two jobs for a while, get to it. In uncertain times, you absolutely do not want debt. At the same time, watch your spending. I don't think anyone should live like a recluse, eating Ramen noodles and cheap hot dogs, but use a bit of sense and don't overdo your luxuries.
In short, use your head and get to work. Those are the keys to, not just surviving, but thriving in the New Year.
Showing posts with label debt. Show all posts
Showing posts with label debt. Show all posts
Thursday, January 5, 2017
Wednesday, November 2, 2016
After the Election - Watch Your Back
I do not use this blog for politics, but today, I am making an exception. The elections will be over soon and no matter who you support, watch your back. No matter who wins, things will not be good. If either candidate gets control of congress and thus gets their way, you will see the deficit, the National debt, go through the roof.
Both are proposing programs that will cost unbelievable amounts of money. On problem, we are broke and deeply in debt. Yet, they are both proposing tax programs that will not come close to even balancing the budget, must less paying down the massive debts.
This makes our standing in the World economy a wee bit shaky and this will effect both the value of the dollar and the willingness of foreign governments to invest by buying our Treasury bills. Add to this the pledge both behave made to raise the minimum wage (which will just be passed on by increased prices) and the shakiness of our economy and you will, I guarantee this, see inflation and job loss. This is called stagflation and it is a nightmare.
In addition, medical costs are rising, in large part due to the incredibly stupid mess of Obamacare. How long gas prices will stay low depends on the whimsy of the Saudis. Increased oil prices drastically effect food costs as well as home heating.
Things will not be good. The solution? First, stay healthy. Even if you are insured, not only are your premiums going up, your deductibles are also rising. For example, in Arizona, you will likely have a $5000 + deductible. So, stay healthy.
If you have a job, keep it. Hold onto it like grim death. If you dislike your job, learn to like it. If you become unemployed, you will be in deep difficulty.
Most of all, pay down your debts as quickly as possible. If that means skipping a ball game or a dinner out, live with it. If that means your kids can't have the latest, most fashionable shoes, they'll get over it. Do not put Christmas on your charge cards. Again, no one likes cutting back, but you really need to get rid of your debts.
Learn to do as much as you can around your home. A lot of repairs are simple. It is easy to cook instead of depending on take out and cooking yourself is cheaper than buying frozen dinners. Do it yourself, within reason, should be your motto.
Eventually, things will perk up again, but you have to be sensible. Watch your back. Watch the backs of friends and family. You have to, because, Uncle Sam is not going to be your buddy for a while.
Both are proposing programs that will cost unbelievable amounts of money. On problem, we are broke and deeply in debt. Yet, they are both proposing tax programs that will not come close to even balancing the budget, must less paying down the massive debts.
This makes our standing in the World economy a wee bit shaky and this will effect both the value of the dollar and the willingness of foreign governments to invest by buying our Treasury bills. Add to this the pledge both behave made to raise the minimum wage (which will just be passed on by increased prices) and the shakiness of our economy and you will, I guarantee this, see inflation and job loss. This is called stagflation and it is a nightmare.
In addition, medical costs are rising, in large part due to the incredibly stupid mess of Obamacare. How long gas prices will stay low depends on the whimsy of the Saudis. Increased oil prices drastically effect food costs as well as home heating.
Things will not be good. The solution? First, stay healthy. Even if you are insured, not only are your premiums going up, your deductibles are also rising. For example, in Arizona, you will likely have a $5000 + deductible. So, stay healthy.
If you have a job, keep it. Hold onto it like grim death. If you dislike your job, learn to like it. If you become unemployed, you will be in deep difficulty.
Most of all, pay down your debts as quickly as possible. If that means skipping a ball game or a dinner out, live with it. If that means your kids can't have the latest, most fashionable shoes, they'll get over it. Do not put Christmas on your charge cards. Again, no one likes cutting back, but you really need to get rid of your debts.
Learn to do as much as you can around your home. A lot of repairs are simple. It is easy to cook instead of depending on take out and cooking yourself is cheaper than buying frozen dinners. Do it yourself, within reason, should be your motto.
Eventually, things will perk up again, but you have to be sensible. Watch your back. Watch the backs of friends and family. You have to, because, Uncle Sam is not going to be your buddy for a while.
Thursday, May 5, 2016
The Pitfalls of Debt
I am going to give some advice, something I rarely do. I am sure you have heard it before but this is one of the most important things you can do. Avoid debt. If you are in debt, pay it off as soon as possible, even if you have to scrimp on everything to do so.
Debt is crippling. When you start paying interest on money you owe, you are immediately losing. Even at low interest rates, when you carry a debt for years, you are costing yourself a lot of money. Of course, some things almost always have to be paid off over time. Few of us can pay cash for a car or house. If you are that fortunate, consider yourself blessed and take advantage of your good fortune. If you are like most of us, use your head. Do not buy that really cool sports car when a nice, sturdy sedan will suffice and do not buy more home than you need. Very few need a huge house on a large lot. Buy what you can afford and be happy, very happy, when you pay it off. Get the best deal you can and make sure, even if you have to eat Ramen Noodles a few nights, that you never miss a payment. Do not even be late on payments, penalties are unnecessary expenses. Whenever possible, make extra payments and get that debt off your back as soon as you can.
Once you have paid off a car, drive it until it just cannot be repaired anymore. Take good care of it, keep the body and interior in good repair and do not let needed engine work go ignored. Yes, all that costs but not nearly as much as a new car.
If you have paid off a house, rejoice and stay there as long as you can. Tired of the way it looks? Home remodeling is a lot cheaper than buying a new one.
As far as other forms of credit, avoid them. I do think it is good to keep 1 credit card for use in absolute emergencies. Your 12-year-old's desire to get a new, $100 pair of sneakers is not an emergency, nor is you desire to go to that football game next weekend. Also, credit cards are good to use when traveling. No one in their right mind wants to carry a few $1000 in cash around but, and this is especially important, pay off the entire balance when the next bill comes due, and never, ever be late with a credit card payment. I used to work selling credit card offers and they sounded great. No interest for a year is great, but, if you are late for one payment, the full interest late, along with late fees kick in and you suddenly are way behind. Also, when that interest free period ends, if you have a balance, you will immediately start paying those big interest rates and it becomes very hard to catch up. That is how credit card companies can make those great offers. They count on people falling behind because then they start making their money. Do not get caught in that game. If you must use your card, make sure you pay off the entire balance when due, even if it means skipping a Friday night dinner out or two.
About the only debt I can think of that you may have trouble avoiding is hospital and doctor debt. If you develop a serious illness, you have no options and most insurance will not cover everything, unless you pay a great deal for that policy. If you run up deep medical debts, work out a payment schedule that you can afford. Most hospitals and doctors are actually pretty good about working with you.
Again, I know this is all old news to you, but this is the best advice I know, Stay out of debt and if you cannot, pay off all of your debts as soon as possible. Being debt free is liberating. You will be absolutely amazed at how much stress you shed when you find yourself free of debt.
Debt is crippling. When you start paying interest on money you owe, you are immediately losing. Even at low interest rates, when you carry a debt for years, you are costing yourself a lot of money. Of course, some things almost always have to be paid off over time. Few of us can pay cash for a car or house. If you are that fortunate, consider yourself blessed and take advantage of your good fortune. If you are like most of us, use your head. Do not buy that really cool sports car when a nice, sturdy sedan will suffice and do not buy more home than you need. Very few need a huge house on a large lot. Buy what you can afford and be happy, very happy, when you pay it off. Get the best deal you can and make sure, even if you have to eat Ramen Noodles a few nights, that you never miss a payment. Do not even be late on payments, penalties are unnecessary expenses. Whenever possible, make extra payments and get that debt off your back as soon as you can.
Once you have paid off a car, drive it until it just cannot be repaired anymore. Take good care of it, keep the body and interior in good repair and do not let needed engine work go ignored. Yes, all that costs but not nearly as much as a new car.
If you have paid off a house, rejoice and stay there as long as you can. Tired of the way it looks? Home remodeling is a lot cheaper than buying a new one.
As far as other forms of credit, avoid them. I do think it is good to keep 1 credit card for use in absolute emergencies. Your 12-year-old's desire to get a new, $100 pair of sneakers is not an emergency, nor is you desire to go to that football game next weekend. Also, credit cards are good to use when traveling. No one in their right mind wants to carry a few $1000 in cash around but, and this is especially important, pay off the entire balance when the next bill comes due, and never, ever be late with a credit card payment. I used to work selling credit card offers and they sounded great. No interest for a year is great, but, if you are late for one payment, the full interest late, along with late fees kick in and you suddenly are way behind. Also, when that interest free period ends, if you have a balance, you will immediately start paying those big interest rates and it becomes very hard to catch up. That is how credit card companies can make those great offers. They count on people falling behind because then they start making their money. Do not get caught in that game. If you must use your card, make sure you pay off the entire balance when due, even if it means skipping a Friday night dinner out or two.
About the only debt I can think of that you may have trouble avoiding is hospital and doctor debt. If you develop a serious illness, you have no options and most insurance will not cover everything, unless you pay a great deal for that policy. If you run up deep medical debts, work out a payment schedule that you can afford. Most hospitals and doctors are actually pretty good about working with you.
Again, I know this is all old news to you, but this is the best advice I know, Stay out of debt and if you cannot, pay off all of your debts as soon as possible. Being debt free is liberating. You will be absolutely amazed at how much stress you shed when you find yourself free of debt.
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