Fru-Gal Column April 28

The other day a friend told me that she was filing for bankruptcy. She is an intelligent educated women and I asked how did this happen. She explained that she really was never taught about money. She was never taught how to balance a checkbook from her family or how to save. I am sure many people say that it is common sense to know this. It isn’t. Teaching your children about money is an essential part of parenting. Both of my children have checkbooks and have text messages sent to their phone with balances. They know how much money they have. They also know not to spend money they don’t have. Sometimes something happens that is not in your control like losing your job, a medical emergency or you simply over spent on things you didn’t need. You do have options, whether it’s settling your debt yourself, getting professional credit counseling or even filing for bankruptcy. Now is the time to get started in erasing your debt. Prioritize payments if you cannot pay all your bills every month; be aware of what you need to pay and what may wait a month. Paying your living expenses first for example your utilities, rent, mortgage and food. Pay any secured loans next. Car payments are vital if you need a car to get to work. Pay credit cards, medical bills and student loans next. Your credit will be hurt, but you will have a roof over your head. Call your credit card companies and request a reduction of the amount you owe including late fees. Also ask to lower your interest rate. Tell them that you don’t have enough money to make payments at the current rate. When your last resort is bankruptcy use this as a rebuilding a better financial life. You have two approaches: Chapter 7 erases most debt entirely, while Chapter 13 allows you to pay off debts over time. Both services require a lawyer who specializes in bankruptcy, most will agree to a free consultation. If you have any questions go to bundle.com, type “ask a debt expert” to join a forum and get free advice from qualified credit counselors at the National Foundation for Credit Counseling. During tough financial times it is also important to pay yourself. Have an emergency savings account. This account will help ensure that you don’t borrow from your retirement nest egg or take out additional loans that would push you into debt. A general rule of thumb is to have enough money set aside equal to at least two months of living expenses. If your employment outlook is especially uncertain, consider setting aside enough to cover six or more months of living expenses. If your employer matches a portion of your payroll contributions to a tax-advantaged retirement savings plan, not participating means you are giving up free money. Start small. By saving at least $25 a week from your paycheck, your savings account will grow and you should be motivated to save more. If you pay off a debt that you have been paying for awhile put that payment right into savings. If you never had it to start with you won’t miss it. If you are getting a tax refund, deposit that money into a savings account. I guarantee that even though it may be uncomfortable at first you will be happy with the end results.

Break the debt cycle in a couple of easy steps:

• Stop using your credit cards
• Set up a spending plan and stick to it
• Set up an emergency fund
• Talk about your finances with your partner and pay bills together
• Just use cash – no credit cards
• Don’t buy on impulse. Institute a 24-hour waiting period before purchasing items outside your budget.

• Write down your financial goals. Take small steps toward them every day.
• Sign up for online banking to automatically pay bills.

Request a Financial Planning Resource Kit from Certified Financial Planner Board of Standards, Inc. http://www.cfp.net/learn/requestkit.asp

The Federal Government’s central web site about managing your money is www.MyMoney.gov
. Learn tips from the FDIC and other government agencies including suggestions for dealing with job loss, mortgage problems and other financial concerns during difficult times.
You may also find additional information from the U.S. government on money management by calling toll-free 1-800-FEDINFO.

Jump Start Coalition for Personal Financial Literacy offers personal financial education materials aimed at grades K-12. www.jumpstartcoalition.org

Try a new tool on the free money-management site mint.com, calculates how much you’ll need to set aside for a specific dream.

The Consumer Federation of America offers several financial publications, including 66 Ways to Save Money. www.consumerfed.org

Investors of all ages can link to “Investing Basics.” It is sponsored by the Alliance for Investor Education. www.investoreducation.org

The Bureau of the Public Debt’s Web site features pages on savings bonds, a savings bond calculator, and instructions for buying bonds online. www.savingsbonds.gov

View “Knee Deep in Dept” and “Fiscal Fitness: Choosing a Credit Counselor”. www.ftc.gov/credit

The Federal Citizen Information Center’s site contains text versions of hundreds of consumer publications. See the “Money” section for a list of brochures on money management and retirement planning. www.pueblo.gsa.gov

Visit Women and Company website which is a financial community created for women. www.womenandco.com

According to America Saves, saving $2 a day by buying coffee rather than a cappuccino or latte would, over a year, allow you to completely fund a $500 emergency fund. www.americasaves.org

More useful information:

To stop the majority of unwanted phone calls from businesses, sign up with the National Do Not Call Registry. Register both land lines and cellphones at (888)382-1222 or online at https://www.donotcall.gov. (To register by phone, you must call from the number that you are registering)

Save $3 by mail with purchase of one bottle of Captain Morgan Original Spice Rum rebate http://social.taylorstrategy.com/smpr/fb_tabs/cap_morgan/links/cap_morgan_coupon.pdf
Free Energizer Max Batteries after Worklife rewards. Use your Worklife rewards card to get 100% back in rewards at Office Depot.
Purchase two packs of AAA or AA batteries for $11.49 at Staples and get your purchase price back in Staples Rewards.

Buy one six inch sandwich; get another six inch sandwich of equal or lesser price for free at Subway from opening to 9am, until April 29. Try a breakfast sandwich and grab a sub for lunch. No coupon required. http://www.subwayfreshbuzz.com/menu/breakfast/

Visit a Public Garden for free on May 6: National Public Gardens Day. Download a free voucher for two free admissions to a participating botanical garden, arboretum, or park. www.BHG.com/freegarden