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Too many people only have one way of dealing with debt: ignoring it and hoping it’ll go away on its own.
Sorry, folks, but that debt isn’t going to magically disappear. In fact, it’ll only get worse the longer you ignore it. It’s time to face the facts: deal with your debt now, or watch it swallow you (and your credit rating) whole.
You’ll never get out of debt without a clear, comprehensive strategy on dealing with your debt. The good news? Read more…
In fact, some consumers behind in payments to credit card companies have found themselves subjected to increased interest rates or a cut in their line of credit which often adds to their mounting financial problems.
A new study shows that individuals and households so severely burdened by financial woes that they are considering filing for bankruptcy may first want to consider seeking help from a credit counselor.
According to the National Bankruptcy Research Center together with the Management International Financial Education Foundation, research shows that consumers who used pre-bankruptcy counseling demonstrated improvement in their credit report in as little as two years.
In fact, the second phase of the groups’ study on the value of credit and bankruptcy counseling reveals that recipients of counseling had fewer delinquent accounts and kept accounts current longer than those who did not receive pre-filing or credit counseling.
With job losses continuing to mount, more personal bankruptcies are likely to emerge.
The Miami Herald reports that personal bankruptcies continue to increase in South Florida where filings in April were up over 50 percent from the same time a year ago.
According to the news source, personal bankruptcies are on the rise partly because more people are losing their jobs. Read more…
In fact, a number of consumers who received tax refunds from the government had tagged much of the money to pay off credit card debt and other outstanding bills instead of making a big purchase.
This type of prudent financial management is wise – especially as the recession lingers on and job worries continue.
A report released last week shows that Americans are making some headway with debt management.
The Federal Reserve’s first quarter report on the flow of funds in accounts held by businesses, the government and families showed that household debt contracted for the second consecutive quarter.
In a breakdown of household debt, the Fed reported that home mortgage debt was flat and consumer credit contracted at an annual rate of 3.5 percent.
Consumers keeping a more watchful eye on their borrowing may be doing so because they have seen their wealth decline.
According to the same Fed report, household net worth – which is defined as the difference between the value of assets and liabilities – is said to be $50.4 trillion as of March 31, 2009. Read more…
That’s because the Congressional Budget Office has announced that the federal budget deficit grew by nearly $1 trillion over the past fiscal year, to a new high of $1.4 trillion. The new figures are due to a combination of falling revenues, which declined by 17 percent, and higher spending, which increased by 18 percent.
The federal deficit now stands at about 25 percent of the gross domestic product, which is the highest level recorded since the end of World War II.
The latest figures present a sharp contrast with a nationwide trend of consumers paying down their debts by substantial margins, with the latest government report showing that credit card debt plunged at a 13.1 percent annual rate in August. Read more…
On Friday, President Obama renewed his push for a Consumer Financial Protection Agency that would aim to crack down on a number of objectionable practices that have made it tougher for people to put their debt problems behind them.
A previous report in the Los Angeles Times notes that the proposed agency would have oversight over financial products ranging from payday loans to credit cards to mortgages, and that it would have the power to impose large fines and bring charges against those who violate guidelines for such products.
The proposal has run into opposition from groups like the U.S. Read more…
That’s because Thursday, October 15 marks the deadline for people who requested six-month extensions for filing their federal taxes back in April. According to the IRS website, as many as 10 million Americans are thought to have requested such extensions. Some exemptions will still remain for military personnel who are serving in combat zones around the world or for people living in areas recently affected by natural disasters.
The IRS noted that people will be able to take advantage of the e-file and Free File programs up until the 15th for their 2008 taxes. Read more…
A recent report on the Baltimore Sun’s “Consuming Interests” blog notes that one card company recently contacted the author asking if there was a way they could get them to use their card more often, claiming they wanted to be the “primary one you turn to when making purchases.”
The article may be a sign that instead of simply closing down inactive accounts, slashing credit limits and imposing new terms that make continuing an account unfavorable for a consumer, creditors are feeling a financial pinch from people simply using their cards far less often. Read more…
This week, the Department of Labor reported that 514,000 Americans filed for first time unemployment benefits last week. While still high, the figure is 10,000 lower than the 524,000 recorded last week and appears to be part of an emerging trend towards fewer job losses.
At the beginning of the week, the National Association of Business Economists announced that the recession is already over, even though it remains to be seen how strong any ensuing recovery will be. The NABE survey involved 44 economists, 80 percent of whom believe that the recession has now passed.
Still, economists have widely predicted that the nation’s unemployment rate will rise to above 10 percent by next year before leveling back off in 2011. Read more…
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