No More!

A divorce is final and a wife who always left the finances up to her husband is now left to fend for herself financially.  A husband for thirty years suddenly passes away from a heart attack and his widow has no idea where to start to put her life back together financially because she always let him pay the bills and invest on their behalf.   Both of these women and both of these situations I know personally. Both of these situations happen too often and women are always on the losing end!  When I write it is usually to inform the reader about how to manage their money better so that in the future they will have wealth and not debt.  Rarely do I write about subjects that are intense in nature, but as Women's history month is upon us I feel that I need to address an important issue that is affecting 4 in 10 households in the United States. 

Women are the primary breadwinners in 4 out of 10 households in America which means it is more important than ever for women to know how to manage their finances. Not only for themselves, but also for the children they have or hope to have. Whether a woman is married or not she has to be in control of her money! Gone are the days where a husband or a father would handle the finances of a wife or daughter. Whenever this took place in the past, all it did was leave that women in a vulnerable position with her finances if that father or husband died. More commonly today women are finding themselves in a divorce and completely lost afterwards because they spent their entire marriage letting their husband control the bank account and other financial matters. 

Today all of that CHANGES!  No longer as women will we sit on the sideline and wish that our finances just fall into place.  We will take the necessary steps needed to control our own money and stop letting our money control us!  So what can we do? First, we decide what we want in life. What goals do we have for our household in the short term (6-12 months) the intermediate (1-3 years) and long-term (5-10 years). These goals which I like to call dreams are the fire to our match and they are going to get us to where we want to be financially. When my family was $48,000 in debt we created our own dreams and we wrote them down on a piece of paper and put it up on the refrigerator so that it could be seen each and every day. Believe it or not that sheet of paper full of our dreams kept us focused the 2 1/2 years it took to pay off all $48,000 because every time that we wanted to buy something we didn’t need we would look at that sheet and say we want that dream more!  After women figure out what they want in their life going forward it is now time to take your head out the sand and figure out if you are in debt and if you are how much debt you are in. The only way that you can begin to become debt-free is to know who you owe money to and how much you owe them. Only then can you take action to pay off that debt!

Getting a spending plan (budget) down on paper is essential because you have to know how much money is coming in and going out each month so that you can start to make the needed adjustments. If a woman finds herself living paycheck to paycheck each month she can start her financial recovery by looking at her spending plan and seeing what she can cut out. Cutting out unnecessary expenses leaves money available in each paycheck to start paying off debt. If after cutting out all that you can in unnecessary expenses you still find yourself struggling financially then it is time to find extra income to pay off debt. That may mean adding extra job or selling anything that you can for the extra money. When we were getting out of debt we sold everything that we could. If people wanted to buy it, we would sell it to them!  We also found out what we were good at which was tennis and basketball and started training kids in each sport for $25/ hour!  Do whatever it takes to find the extra money to pay off what you owe!

Why is it important for ALL women to be debt-free and use their money to work for them and not someone else? The reason is that women on average make $.77 for every $1 a man makes, so we can’t afford not to be in control of our money! Even with the income disadvantage women can still come out on top by controlling their finances.  The secret is to make it up in your mind that you deserve better and you are going to do whatever it takes to get to that better!  No more spending money on stuff you don’t need! No more staying in debt because society said “that is how it will always be!” No more not having an emergency fund!  No more letting someone else tell you what to do with your hard earned money!  Today is the day you say “NO MORE!” 

Silently Suffering

A couple of weeks ago I attended the NACA (National Association For Campus Activities) Conference in Nashville Tennessee.  NACA is where colleges and universities from all around the country come to one place to hire performances for their campus for the upcoming semester while at the same time attending beneficial educational workshops. The campus representatives who attend are mostly students accompanied by an advisor.  This was my first National NACA so 99% of the students and student affair professionals were meeting me for the first time.  Majority of the performances that are for hire at NACA are music acts, magic acts, comedy, lecturers, etc so what I have to offer is completely different and at first not easy to understand. That is why I wear a t-shirt that says “DEBT SUCKS” on it because that is what I am about, I am about showing students that they don’t have to die in debt like so many people before them. They actually can be different from their parents, grandparents, aunts, uncles, etc and get out of debt in a few years after graduation.   I did not start off my speaking career talking to college students but I actually started speaking to individuals who were in the average age range of 40-65yrs and the common sentence spoken at the end of my presentation no matter where I was at was “where were you when I was younger?”  It was said to me so much that I decided I need to go to where the people are younger and that is when I started speaking at colleges.  I went to NACA because it is the best way to get in front of a lot of universities and colleges in one place and when you are able to interact with close to 2500 people in a few days you are able to see a disturbing trend.

Students on a daily basis would walk past me, look at my shirt, and say DEBT does SUCK! Then I would speak to them one on one and quickly come to understand that their financial issues ran extremely deep and that they don’t even know where to start to get a handle of it.  A senior came up to me who was in $30,000 of debt which consisted of student loans, credit cards, and a car loan.  He said “we need you to come to our school, or better yet I just need your personal email because I need help.”  He went on to talk about he didn't know how he would pay off the debt after graduation and to make the situation more serious he had a baby on the way in June.  I met a young woman who wanted after graduation to work directly with young kids at risk and help them towards a more promising future, but she said that she would have to take a job that she didn't want to just to pay off the debt she had.  In her words “I will have to put off my dream for a few years until I can get a handle on my debt.” Another young lady stopped me in mid sentence and said “please don’t remind me of my debt.  I went to a different university before attending this one and racked up so much already.”  As she was speaking tears started to form in her eyes and I quickly told her it would be okay, but she shook her head and said “I don’t think so.”  I tried to help her in the two minutes we had to talk, but I could tell that she needed more and at this type of event that was not possible.

The examples go on and on, but the point of the stories above is that there are A LOT of students that are silently suffering because of debt and they need help, they need direction.  When I was in college which was not long ago no one cared about how much they owed because we all just said we will get to it after graduation, but these students don’t have the same care free option.  With tuition at some universities increasing as much as 40% since 2008 students are feeling the burden of debt before they graduate and to add insult to injury because of the 2008 recession the government has less money to give to universities for grants, etc.  When less money is coming in from the government then who makes up the difference in the money owed? That’s right, the student and their parents.  The good news is some universities are seeing the importance of financial literacy for their students and like the idea of someone who has been in massive debt, got out of it, and now is able to show others how to do the same. After NACA I recognized that I have to do a better job at explaining to Deans, Directors, Advisors, etc the importance of this information because there are students silently suffering and if they don’t go in the right direction they WILL BE graduates silently suffering who will be deep in debt living paycheck to paycheck and not the prosperous alumni that can give back to their alma mater.  My mission is to help as many college students as I can before they graduate so that they are able to live a life without debt.  A life without debt for these students will lead to a world that is changed for the better.

I HEAR THUNDER

The housing bubble that burst in 2008 has taken four years to recover.  Prices of homes that are selling are finally starting to rise again in most states.  Although that financial disaster has taken a turn for the better there is another storm that is moving in from the distance and that is student loan debt.  Student loan debt is sitting at $1 TRILLION dollars currently and with defaults at an all time high it is the next bubble that is ready to burst!  Just like the housing bubble not many people are paying attention to the warning signs and many don’t understand how dangerous the economy will get if this bubble burst.  Everyone will be affected if this bubble pops in fact no one will escape the aftermath.

First the borrowers who are not able to pay the current loans they have don’t have the luxury of filing bankruptcy like the homeowners did during the housing crisis.  These borrowers are going to get sued and their wages are going to be garnished making real life even more challenging.  Student loans never go away in fact they will take social security checks and tax refunds to pay off these loans.  Next the banks that lend the money to students are in the same predicament they were in with the housing bubble because a non paying student is the same as a non paying homeowner.  The banks are in the position again to be over leveraging themselves and putting their customers (account holders) in possible financial danger if these defaults continue to rise.  The $1 Trillion student loan debt is more than car loans and credit card debt combined so it presents a problem for these lending institutions.

Lastly, the universities are going to be hurt by this bubble and the sad part about it is that the universities think that if the bubble bursts they won’t be impacted.  The students who are borrowing money are getting federal loans which come from the government so what happens when those loans start to default?  The government takes a hit and stops putting out as many loans and grants for students to take advantage of for attending college.  As a result of this action on the part of the government universities have to find ways to make up the lost of those funds and also risk losing out on a potential Einstein because that Einstein can’t afford the high tuition.  As you can see a storm is upon us and we can hear the thunder, but are we going to let it reach us and we have no umbrella like the housing bubble or are we going to get inside and protect ourselves by doing our part to eliminate this debt.  You have been warned.

THIS OR THAT?

There are so many choices in life especially when it comes to finances.  These choices can lead to wealth or they can lead to a continuous cycle of just enough to get by.  One of those choices that everyone will make in their life at least if they don’t live in a major metro city like New York where transit rules is when to buy a car.  Not only when to buy a car, but how to pay for that car.  If you only look at car commercials you would think the only option a person had was to finance the car they wanted.  Why do these commercials only show how you can get a car payment or a lease?  Because that is where the car dealership or the bank can soak all the extra money out of you in the form of interest.  The car companies are clever with their commercials because they make the person watching the commercials feel that they NEED that car and that the car will raise their status in the world.  Unfortunately it actually does the opposite.

After looking at a few of these car commercials, I have seen monthly payments of $399, $569, even one that was $749.  Who would pay $749 a month for a piece of scrap metal?  That is the rate of a two bedroom apartment in the south and you can actually live in an apartment!  I use to be part of the car loan crowd in 2007 when my husband and I signed our names to a $20,000 car loan for a Chrysler 300.  The car company appealed to our desire to impress others.  As a result of this vanity my husband and I landed on the wrong side of “this or that”.  We chose this (car loan) and missed out on that (paying off a college loan fast).  See we also had a $25,000 college loan as part of our debt and if we were smart instead throwing our money away each month in the form of a car payment ($400) we could have been paying that student loan off.  It got to a point when I looked in the driveway at that car all I could see was a missed opportunity to be debt free!  Just like us whenever you choose a car payment you are missing out on a brighter future financially because you are spending money that could be used for something more valuable like investing.  For example take our $400 car payment that we paid on for two years.  If we would have invested that same amount over the same period in a mutual fund that has a 10% return on investment then our family would have over $10,000.  If we would have stayed on the loan company’s five year schedule and invested that same amount we would have saved over $30,000!  When I seen these numbers I decided to pay off the Chrysler and to only pay cash for used cars in the future.  I also found out that millionaires only drive used cars and let others take the depreciation hit by buying new.  

We now only drive paid for cars and as a result money that used to go to car payments is now going to saving for the future.  If you have a car payment you have to ask yourself “this or that” and realize what you are missing out on.  Do you have a car payment and there’s no extra money to save for retirement, for college education, or insurance then it is time to say do I want “This” a car payment on something that goes down in value everyday or “That” a financial future where there is no struggle and your family has generational wealth?

Don’t Leave Home Without It!

This blog post was going to be on a completely different subject until my daughter decided to enter this world three weeks ahead of schedule.  All the events that led up to her coming early got me to thinking about personal health insurance and how important it is to have for every individual no matter what age.  The reason that I recommend health insurance for everyone is that one of the most common reasons for bankruptcy is overwhelming medical bills.  Overwhelming can span from a few thousand dollars to tens of thousands of dollars and when people don’t have health insurance they are on the hook legally for every cent.  This second pregnancy with my daughter was filled with extra doctor visits, multiple sonograms, and a maternity emergency room visit two days before she was born. 

Today I received the benefit statements from all of the extra visits excluding the ER visits and they totaled close to $600 and these were all office visits in the last month!  Thank goodness for health insurance because I did not have to pay a dime.  I have yet to receive the bill for the ER visit and her birth, but I know because of the insurance that I don’t have to pay the entire bill, but maybe a tenth of it.  If I didn’t have health insurance her birth alone would cost me at least $10,000!  That type of money you can’t come up with overnight and the hospital expects to be paid as soon as possible for any service and when people don’t pay up the hospital ends up suing and winning.  Eventually the person will end up filing for bankruptcy because they can’t pay.  As far as health insurance goes the age group that goes without it the most are the younger generations ages 18-35 mainly because young people think they have a long time before chronic illnesses hit their body.  They would rather save the monthly insurance premium and use the money elsewhere.  That is a big mistake!  If you can’t afford health insurance currently as a young person it is time to re-evaluate your priorities.  If you have a cell phone, or home internet, cable, etc you may want to cut one of those services off or all of them off and pick out some health insurance because it is to dangerous financially not to have insurance on board. 

In the past two years I have known four people under the age of 32 who have had either a stroke, heart attack, or cancer and I don’t know what their insurance coverage was at the time, but if they didn’t have it they could easily be in the bankruptcy stage by now.  For example the cost of treating a heart attack is $40,000 and that does not include the treatment that it will take such as more doctor visits and extra medication that will follow for the rest of that person’s life.  The cost of treating cancer is even more so there is no reason to take the chance of not having health insurance.  Remember DON’T LEAVE HOME WITHOUT IT!

If you don’t have insurance what are you risking financially by not having it?

WHO DO YOU THINK YOU ARE?

When attempting to get out of debt you have to take actions you have never taken before and go places you have never been.  Sacrifice is the key word in becoming DEBT FREE and for many that is a brand new concept because before sacrificing to win financially sounded like punishment and abuse.  On the journey to getting out of debt I hit the problem of debt from all possible angles.  Of course our family found new ways to bring in additional income, but the most beneficial changes came from cutting back on certain items and services.  One area that I cut back on was clothing for not only me, but for the entire family.  I use to be the person who wore only name brand clothes and shoes and the same was true for my husband as well.  We had been dressing this way ever since we were in college.  That all changed once I was on unemployment and $48K in debt.

At that point shopping at Goodwill and consignment shops became a new hobby.  I could no longer justify spending $20+ on a pair of jeans or $40 on a pair of shoes because we didn’t have the funds to cover it.  For those of you who don’t know what Goodwill is it is a store that sells used clothes donated by others and the proceeds go to career training for individuals in need as well as other services.  Before I started shopping there I use to look down my nose at Goodwill and you wouldn’t catch me dead in there.  That all changed one day when I went to one of the local stores and seen multiple BMW’s and other luxury cars in the parking lot.  Before going in I said to myself the drivers in these cars must be here to donate clothing, but once I was inside I seen a couple of the ladies actually buying for themselves!  At that moment I realized that these women are just continuing the spending habits they had before they owned the luxury cars and there was no shame to them to be shopping at Goodwill.  This store was allowing them to save money in their clothing budget so they could spend in more important areas like college funds, retirement, and vacations.  Right then and there I said to myself “WHO DO YOU THINK YOU ARE?”  “These wealthy individuals don’t think they are so much better that they can’t shop in Goodwill why do you think you are?”  From that point on I have been finding great deals at Goodwill and consignment sales and tell you the truth it is those clothes that I get the most repeat compliments on. 

I attend consignment sales mostly for my son’s clothing and shoes because if you have kids you know that they don’t care if they drag their shoe until it is a hole at the toe.  They don’t care about crawling in the dirt until the jeans they are wearing are no longer recognizable.  That is exactly why their clothing shouldn’t cost you a lot of money.  I hate to see parents spend $100 on a pair of sneakers when they could just spend $8 or less at a consignment sale and put the rest in a 529 college fund.  Kids are not hard to impress in fact every time I bring home clothes or shoes from a consignment sale my son always says “mommy you got me some new shoes, thank you mommy!” They don’t care where the shoes come from as long as they light up and they can play outside in them.  We as adults are trying to impress other adults when we buy our kids expensive clothing and all we are doing is depleting our own bank accounts for the future.  When I was employed in my first pregnancy five years ago I bought all of my son’s items brand new. Brand new changing table, crib, stroller, car seat all of it was coming out of my bank account at full price.  I know I spent thousands of dollars before he was even born.  I am now eight months pregnant again, but this time I bought the stroller, car seats, changing table, diaper bag, bath tub, etc, from church consignment sales and saved thousands!  The point of all this rambling is that you don’t have to care what people say if they see you shopping at Goodwill or consignment sales because they may be laughing, but if they saw your bank account the laughing would surely stop!  I actually brag about the deals that I get now because I want people to know that there are more important things in life than clothes.  So the next time you find yourself sticking up your nose at Goodwill and consignment sales while at the same time in debt do what I did and say to yourself “WHO DO YOU THINK YOU ARE?”

Have you ever saved money by buying used clothes?

Let’s Celebrate!

April is more than a month where we get to play practical jokes on unsuspected victims, it is also designated as Financial Literacy Month!  During Financial Literacy Month there are events taking place daily that attempt to educate the public about money management.  The goal is to help both young and old realize that Financial Literacy is nothing to be afraid of, but instead embraced and conquered.  I know that your own financial life can be overwhelming at times, but hopefully I can give you a few starting points that you can implement during the last thirteen days of April.  April is just the beginning, the idea is to keep going until you master your own financial life!

Steps:

1.    List your short (3-6 months), intermediate (3-5 yrs), and long term (10-15 yrs) goals for your life on a sheet of paper and put it on your refrigerator.

2.    Open a savings account and start saving a certain amount each paycheck. Even if it is $10 just save something!

3.    Write down all your debts both small and large. (Face the fear of knowing the total)

4.    Determine how much money you have coming in (paycheck) versus how much money is going out (bills). Write it all down on a piece of paper.

5.    From that piece of paper (budget) determine which are needs and which are wants.  Determine what can be cut back or cut out.

6.    Once you figure out in your budget where you can save money start adding that extra money to your smallest debt and pay it off fast! Then repeat with the next smallest debt until all debts are eliminated.

7.    Find an accountability partner.  Someone who will encourage you to keep going when times get tough and remind you of those goals you have on your refrigerator.

I know that personal money management can be overwhelming.  It can feel like you are trying to eat an entire elephant all at once. Just remember to take one piece at a time and eventually that elephant will be completely gone.  That is why I put seven steps instead of thirteen for these last thirteen days so you can take your time and get it done by or before April 30^th.  The steps are simple all you have to do is say to yourself “I am ready to make a change for the better in my financial life” and the rest will take care of itself.  Don’t give up; complete the journey because in the end all of the financial strife that use to be a part of your life will just look like a bad dream and all that will be left is financial success!

Will you take the first step TODAY?

When Will We Ever Learn?

I am sure you have heard the definition of insanity, but in case you have not the gist of it is “doing the same thing over and over again and expecting a different outcome”.  Between the years of 2000 and 2008 America was flying high above the rest of the world and everyone was prospering, at least it appeared that way.  The prosperity that majority of Americans were displaying was actually an illusion.  The reason is simple and complex at the same time.  During this time there was a housing boom and everyone who could breathe or spell their name was able to qualify for a mortgage.  Credit was flowing freely from banks and individuals as well as companies could borrow to the max.  If people had equity in their home they would cash it out to buy cars, go on trips, pay for college, start businesses, etc.  All majority of Americans did for these eight years was spend money they didn’t have and live the illusion of the “good life”.  Want to know what Americans didn’t do in those eight years?  SAVE!!!  During the same period there were times when the savings rate was in the negative meaning that people were spending more money than they were bringing home in income.  Everyone thought this illusion of prosperity would continue, that their home values would continue to rise, and that banks would continue to lend, but then 2008 arrived and the magician revealed that the past few years was all a trick and the unfortunate treat was upon us.

In 2008 the economy collapsed and a snowball of catastrophes hit America from all sides.  The “why” behind the collapse is complex, but a broad overview would be this: Banks were like the Americans giving out more money than they had on hand and dealing in risky business practices.  Banks gave mortgages to people who eventually would not be able to afford them.  Homeowners mortgage rates started to rise and as an added insult companies were laying off people left and right and so there was no income to go to paying for the mortgages that these banks were so carelessly handing out earlier in the decade.  The banks being so heavily invested in these mortgages started dropping like flies, the most famous one being Lehman Brothers.  I still remember the night I was looking at CNBC watching the employees coming to empty out their offices, such a sad sight.  Americans were losing their jobs, homes, cars, retirement savings, and families.  As a result of all this loss behavior started to change.  People went from spending all they had to saving everything they could. In fact the savings rate was at an all time high of 4.2% (of disposable income) in December 2009 and it appeared that Americans had learned their lesson and had turned away from habits of the past.  You can say that the insanity had disappeared, but not so fast as of February 2012 the savings rate is back in decline (3.7%) and Americans are heading right back to the habit of spending more than they bring home in income.

  

I am sure you are asking the question why would people go back into this insanity?  Why would people go back to car loans, buying expensive shoes, going on trips, taking out home equity loans, etc?  The only answer that I can come up with is that people are starting to feel safe again, because the economy is improving and jobs are coming back, but that does not mean that you should run right back to the edge of the cliff with your finances.  We all have to learn our lesson from how we felt in 2008.  That uncertainty made us change our habits and we have to resist the urge to go back.  When the economy went off a cliff in 2008 a month later I was laid off by Pfizer and my family was in $48,000 worth of DEBT.  We had to change our behavior towards our finances or become a casualty of the economy and another statistic.  That is exactly what we did, we stopped borrowing money and paid off everything.  We also built up an eight month emergency fund of expenses because we are determined to never let the American economy affect our personal economy again.  If the economy ever decides to take a nose dive again we will be ready this time.  Insanity is NO LONGER welcomed at our home!

Have your finances become a victim of insanity?

IN CASE OF AN EMERGENCY, BREAK GLASS!

Most individuals do not know what to do if an emergency came into their life.  They tend to break the glass and use whatever is inside?  Usually what is inside is a credit card or a bank loan because the individual is not ready when life happens.  The problem with this tactic is that it leads to an endless cycle of debt that keeps the person from achieving generational wealth.  The main reason that someone would have to turn to debt to cover an emergency is because they were not prepared in the first place.  An emergency fund is essential in building wealth because it turns potential catastrophe into an inconvenience and it erases stress from the situation. 

I always advise clients to have at least an emergency fund of $1000 if they are trying to get out of debt and four to six months emergency fund if they are out of debt.  Once I make this request I usually get the following request, “How am I going to find $1000 to put into an emergency fund?”  Once I have this push back I have to point out to the individual that it is not going to be simple and they will have to sacrifice to get this emergency fund fully funded.  If they are serious about getting out of debt they soon realize that life as they know it has to change temporarily in order to get ahead.  I must admit that it is a fair question that they put before me about the “HOW” and so I make sure I give them various money finding options to get them started.

Journey to $1000:

   1. Sell everything and anything: I am actually about to list a living room set on Craigslist for $1500 and if it sells I would have my emergency fund with one sell if I was in debt.  Also most households have more televisions than people living there.  SELL THEM! You get the picture sell, sell, sell.

   2.Cut off some services: house phones are ancient so if you have a cell phone cut the house phone off and add the savings to your quest for $1000.  Cable TV is also not a necessity when you are getting out of debt so cancel that service and save over $100 a month.  Haven’t been to the gym in the month? Get rid of the membership!

   3.Don’t eat out at all.  I am talking about all restaurants big and small.  No McDonalds, Burger King, Wendy’s, etc.

   4.The shopping mall and retail store are not your friends if you are in debt.  Wear the clothes and shoes you already have in your closet and don’t buy new items!

    5.Have multiple yard sales.  It is unusually warm right now so why not get an early start on selling some items out of your home.  If this weekend is too soon start getting out the items that you would like to sell and put them all together so that they are ready to sell in the summer months.

These five suggestions are just scratching the surface of what an individual can do to get the emergency fund fully funded over the next couple of months, but in order for this to be possible the person has to be sick and tired of being sick and tired and is ready for a change.  It won’t be easy, but I promise it will be worth it!

How would you come up with a quick $1000?

Till next Wednesday!

WHAT NOW?

It has finally arrived. Not the latest gadget that you bought from Amazon, but your student loan bill.  When that loan statement arrives it is usually the first time that a recent graduate sees exactly how much was borrowed in their name for that college degree. Depending on what university they attended that overall number could be overwhelming.  Even though the number may be overwhelming a lot of these adults just shrug their shoulders and say “I will pay it over the term” which could be a decade or two and then they go out and buy a new car.  I want to change that way of thinking and say why not pay that student loan off as fast as you can.  When my husband and I found out he had a $25,000 loan it was indeed overwhelming because it was as if someone had hit me in the face with a brick!  I thought he went to college on a four year basketball scholarship, but come to find out one year was not paid for and it cost him $25,000! Did I mention that was only for ONE year!  We had to come together with a plan to pay the loan off as soon as possible, because it was no way that we were waiting until 2030 for this weight to be from around our neck!  So what are some of the steps that we took that you can take to pay off student loan debt for good!

First you have to find the extra money to pay off the loan faster, but this is usually where people get stuck and eventually get frustrated because they feel they are living paycheck to paycheck already.  If you have a new career you now have much more money coming in than you did while in college, but where most people fail is that they start spending that new money on an expensive apartment, a new car, dinners out, etc and all of a sudden there is a struggle to pay their student loans.  Here’s an idea, how about living on the same amount of money you did in college? You don’t have to get the best apartment in town, you can drive a paid for used car with no car payments, and the ramen noodles you ate in your dorm room still taste the same so cut back on eating out.  Want to find even more extra money?  Cut off the cable and watch your favorite shows on Hulu.  Reduce the minutes on your cell phone plan and cut off your home phone because neither is needed if you are tens of thousands of dollars in student loan debt!  Next look around your home and see what you can sell.  We sold everything we could from clothes to electronics.  We had multiple yard sales and visited the local pawn shop frequently.  We stopped buying new clothes in fact we didn’t see the inside of a shopping mall for the two years we were getting out of debt.  We saved on clothes by wearing the ones we had longer and shopping consignment and thrift stores.  Last, but not least the fastest way to pay off student loans is to get a part time job because let’s face it you just graduated which means you are still in your twenties and have the energy of a bull! The extra income will lighten the burden and bring you closer to being DEBT FREE!

There are so many other ways to find extra money for paying off student loan debt, but this post would go on forever.  Just remember that all of these sacrifices are temporary and if you are committed to paying the student loan debt off it will take no time to become student loan DEBT FREE!  These ideas will free up hundreds of dollars a month and that extra money should be thrown at the student loan and nothing else.  Trust me it works my husband and I paid off that $25,000 student loan and a $20,000 car loan in 2 ½ years! You can do it too!

What are some of the things you did to pay down student loan debt?

Till next Wednesday!

How Much?!

How much?  If you listen carefully you can hear that being said all over the United States by unsuspecting college graduates who had no idea the true cost of the college degree they just obtained and guess what now the loan has come due.  Why would these adults know the amount of loans that were taken out on their behalf, because more than likely their parents had them sign up for the debt when they were eighteen.  What eighteen year old has the life experience to even understand what debt even is, but four years later all of sudden they are in a crash course with reality.  Imagine coming out of school with a student loan debt of 40, 50, or even $100,000!  Go one step further and imagine having that amount of debt with an entry level salary or even worse no career at all!  This is a dilemma that graduates find themselves in today.  The sad part is that it did not have to be this way and all it took to change this outcome was preparation on the part of the parents and the kids themselves.

Parents have eighteen years to prepare for their children to go to college for free.  The opportunities are endless for a free education.  Starting with investing into an Educational Savings Account or a 529 Plan and letting the money compound for eighteen years will definitely have your child going to college debt free.  Next start applying for college scholarships immediately.  Don’t believe the lie that only athletes and insanely smart kids get scholarships.  Also don’t wait until junior or senior year in high school to start searching because there are scholarships for kids as young as thirteen or even younger as seen on this website: www.finaid.org .  Last, but not least every able teenager can work for their collegiate dreams.  They can wash cars, mow grass, have yard sales, get a job, deliver newspapers, etc.  They can work in high school and college to insure that they come out a debt free graduate.  Both parents and kids should realize that the college they choose should match the money they have saved.  A child doesn’t have to go to an Ivy League institution to have a great career.  For example I went to South Carolina State University and although I was on a tennis scholarship I knew that it cost $7,000 a year for tuition and boarding.  During the same time Wake Forest which is a private university had a tuition and boarding of over $25,000 a year!  There is no way that a diploma from Wake Forest is worth FOUR TIMES more than a diploma from South Carolina State University.  I promise the opportunities are out there if you make the right choices and as a result of those choices a DEBT FREE education will be waiting for you!

Have you ever had a “how much” moment with student loan debt?

What Are You Waiting For?

The first session of my Adult Money Management Class was completed last night.  It was filled with individuals who were ready to make a change when it came to their finances.  They each came ready to digest the material and start to apply it to their lives.  Over the years I’ve come to realize when it comes to managing your finances individuals tend to go at it alone because they fear what people will think of them.  They don’t want to be embarrassed in front of others because the financial mistakes that they have made up until now will be out for everyone to see.  The ones that finally say “I’ve had enough” come to realize that they are not in the minority when it comes to financial issues, but where they are in the minority is when it comes to those that will seek help. It takes courage to say I am going to make a change in my financial life and having that type of courage will overtake any type of fear and it will definitely get you through the journey to become DEBT FREE!  

It does not matter what your age is when you decide to get your financial house in order as long as you do it! In the class last night the ages ranged from twenty six to eighty years old and each person said that they came away with some information that will help their household financially.  I was once where they are today and even though there was a time when I did not want anyone to know the amount of my debt I am now able to stand before others and tell my story without shame as I did last night at the beginning of class.  I know it helps when you are not alone in this journey to be DEBT FREE!  

SO WHAT ARE YOU WAITING FOR?