- Scarred by Debt
by Natalie Daly
Times are tough, but you don’t have to let your debt mark you forever. If you’re among the 79% of undergrads who have credit cards, you’re part of a group carrying record-high credit balances. The average balance grew to $3,173 and 21% have balances of between $3,000 to $7,000. And this isn’t even including the more than $25,000 amassed in student debt!1 Is this really the way you pictured starting your life?
Proud and in Debt
According to researchers at Ohio State University, young adults feel empowered by their credit card and education debts. Seriously?! You feel empowered? “The more credit card and college loan debt 18- to 27-year-olds had, the more they felt like they were in control of their lives. Ironically, this is the generation that is expected to deal with an increasingly growing 14 trillion dollar national debt.”2
Don’t let your debt scar you. Get out now and stay out of debt. That’s the only way to really get ahead and make the most of all of your hard-earned cash. Here are some tips to help you avoid digging yourself into debt:
- Add it up. It might make you a little queasy, but you’re better off knowing where you stand. Get all of your bills together and do the math.
- Less cards = more control. Did you know that half of college undergrads had 4 or more credit cards?3 It’s time to get rid of that card you opened for a free T-shirt on the first day of class and keep it manageable. Have you heard of debt stacking? It’s a great way to gear down your debt. Take a look:
- Check your credit. Did you know you can get your credit report for free once a year? Visit AnnualCreditReport.com (877-322-8228). You might have a “don’t ask, don’t tell” policy on your debt balance but your credit score is the number one thing banks, creditors — and future employers — look at, so you’d better know what’s up.
- Develop a budget. Ugh. The B-word. Budgets are boring, right? Maybe, but for some, this can be a major wake-up call. If you seem to run short at the end of the month and can’t figure out where the money goes, this is a great way to discover less than stellar trends in your spending habits.
- Learn from your mistakes. “Nearly one in five 18- to 24-year-olds is in ‘debt hardship,’”4 so even if you’re in over your head right now, you can make a couple of strategic changes and get back in the black. As soon as you learn from your mistakes, you can start taking a step in the right direction … and that’s money in that bank!
* The examples are for illustrative purposes only. The Debt Stacking concept assumes that: (1) you make consistent payments on all of your debts, (2) when you pay off the first debt in your plan, you add the payment you were making toward that debt to your existing payment on the next debt in your plan (therefore you make the same total monthly payment each month toward your debts) (3) you continue this process until you have eliminated all of the debts in your plan. In the example above, when the retail card is paid off, the $220 is applied to credit card 2, accelerating its payment to $573. After credit card 2 is paid off, the $573 is applied to the car loan for a total payment of $1,124. The process is then continued until all debts are paid off. Note that the total payment per month remains constant.
Tags: budget, credit, credit cards, debt, debt stacking, education, money, spending, student, undergrads
Posted in Primerica, Tips |
The holidays are upon us and many families are digging deep to find the cash for gifts and travel costs. According to a recent survey, the average U.S. household plans to spend an average of $683 on holiday related shopping, a slight drop from last year.1 With unemployment close to 10%, and many more families unsure about their financial future for 2010, finding ways of enjoying the season without busting the budget are more important than ever.2
Primerica presents three easy ways to make your money go farther this Christmas.
- Shop Smart. Both traditional retailers and online merchants often run sales or offer incentives like free shipping to encourage consumers to buy. Just shopping around a bit could help you save big.
- Stick to Your Budget. Decide ahead of time how much you want to spend on each person or gift and stick to it.
- Try a “Stay” Cation. Airfare for a family can really stress a budget – especially when the economy is slow. Even gas and other travel expenses could be a big strain on a family’s finances. Consider staying close to home this year. Start a new family tradition like watching a special holiday movie together, going caroling in your neighborhood or taking cookies and homemade crafts to a local senior center.
A few small changes can make a big difference and if you’re smart about your spending, you can still satisfy those wish lists – without breaking the bank!
Tags: budget, holiday spending, staycation, unemployment
Posted in Primerica, Tips |
Economic woes and an increase in consumer prices have made sticking to a budget even more difficult for families across North America. People who were already struggling financially under the burden of debt and poor savings may be feeling the pressure even more intensely now.
Primerica presents six tips to help you have more and spend less.
1. Cut energy use.
Simply sealing a home properly can help you eliminate 25% of your heating and cooling costs.1 Many utility service providers provide free or discounted energy audits. If this option isn’t available, you can always go the professional route, or do a self‑check using the steps found at Energy Stat.
Another way to prevent leaks is to add insulation, use caulk, spray foam and weather stripping to seal leaks around windows and doors, and in attics and basements. Plug devices with standby power, like TVs and stereos, into a power strip so they can be turned off all at once.
2. Spend less on groceries.
With the cost of virtually everything at the grocery store going up, this is one budget area you can’t afford to ignore. Coupon clipping can help you keep more money in your pocket (a household of four that uses them strategically can save 25% a year), but this is only effective if you use them for items you already use or need.2
Warehouse clubs can be a good source of cost effective purchases, but you have to weigh the benefits against potential negatives: the tendency to eat more because the food is going bad, and the potential for impulse shopping (many stores put electronics and other goodies out front). Did you know that you can save up to $1,200 annually just by cutting half of your unplanned purchases?3 It’s all about making a list – and sticking to it!
3. Trim entertainment costs.
When eating out, skip the drinks, and instead of ordering two entrees, order one appetizer and split a meal. Or dine out during breakfast or lunch, when the entrees are typically cheaper. Movie tickets now top $10, so hit the matinees instead for discounted admission. Join the local theater’s loyalty club for freebies, get discount tickets in the local Entertainment Book, or head to the drive‑in, where tickets are usually cheaper.
4. Improve gas mileage.
The easiest way to spend less on gas is to simply use less of it. Consolidate errands into one trip, or walk to the grocery store instead of driving. Speeding or braking sharply and frequent lane changes cuts fuel economy by 35%.4
5. Shave car insurance.
Most insurers will shave prices for anti‑lock brakes, having an accident‑free record, taking a defensive driving course, or using the same insurer for both auto and home coverage – adding up to as much as 25% off a your premium.5 Shopping around for competitive quotes is a great way to potentially save.
6. Boost your income.
Costs are rising across the board and a few extra dollars each month can go a long way to relieving the financial pressure of a weak economy and higher expenses.
Business opportunities, such as Primerica’s part‑ or full‑time opportunity, are great ways to do something enjoyable while padding the bank account.*
While you can’t control rising costs, changing a few habits can help you hold onto more of your cash!
Tags: budget, car insurance, gas mileage, Primerica, recession, save energy, save money, spend less, Tips
Posted in Primerica, Tips |
