Posted 03/04/2010
How to Dig Out of Debt, Part 2
Paying only with cash changes your outlook
By Deborah Hoskins, JD, CFP
Have you lived without your credit cards for the last week? Has it seemed rather mid-20th century, or even un-American, to go “cash only” for all of your purchases?
If it feels odd, just remember that your ancestors lived this way for all of history; consumer debt is a recent luxury. You may also feel like a little kid again, carrying your weekly allowance around in your pocket for purchases. Trying anything new is bound to feel strange until it becomes a new habit. Read More >>
If it feels odd, just remember that your ancestors lived this way for all of history; consumer debt is a recent luxury. You may also feel like a little kid again, carrying your weekly allowance around in your pocket for purchases. Trying anything new is bound to feel strange until it becomes a new habit. Read More >>
Posted
How to Dig Out of Debt, Part 1
Overspending and income levels are not necessarily correlated
By Deborah Hoskins, JD, CFP
At the end of 2008, the total credit card debt of Americans exceeded $972 billion. For those households that had a credit card, the average outstanding credit card debt was $10,679. Uninsured medical expenses, lost jobs, and other emergencies no doubt contribute to many Americans falling behind. However, overspending—otherwise known as deliberately living beyond your means—is a significant cause as well. Read More >>
Posted 02/18/2010
Credit Card Rules Are Changing, Part 2
You’ll see the true cost of making minimum payments
By Deborah Hoskins, JD, CFP
The Credit CARD Act of 2009 will be the law of the land on February 22. It gives consumers greater protection from the abusive practices of credit card companies, as well as better education on responsible credit use. I know that the word responsible implies a values-laden judgment on credit usage. My goal, however, is not to chastise or shame, but to nudge you toward better financial planning practices. I define better as that which saves you money. Read More >>
Posted 02/12/2010
Credit Card Rules Are Changing, Part 1
Some new features are worth paying attention to
By Deborah Hoskins, JD, CFP
Have you noticed a flurry of mailings from your credit card account providers lately? Since the first of the year, I’ve received many letters that all start the same way: “Important Notice of Changes to Your Credit Card Account Ending in xxxx.” Almost all of them are notifying me of higher rates on any balances I might carry. Since I never carry balances, I just briefly scan the brochure and duly file it away without a second thought. Read More >>
Posted 12/29/2009
What Doesn’t Help Your Credit Score
Your FICO score is not a report card grade
By Deborah Hoskins, JD, CFP
One cardinal rule for financial health is to avoid accumulating credit card debt in the first place—it’s a clear sign that you’re not living within your means. Compounding matters, interest is not tax deductible, and rates are outrageous. So if you never carry a balance from month to month—but pay off your account balance diligently—you should have a great credit score, right? Wrong! Read More >>
Posted 12/22/2009
How to Boost Your FICO Score, Part 2
Watch those car dealerships!
By Deborah Hoskins, JD, CFP
Last week, I described the three major components of your credit score. Two minor ones are left. Next week, I’ll share the biggest misconception about FICO scores. Read More >>
Posted 12/18/2009
How to Boost Your FICO Score, Part 1
Knowledge truly is power
By Deborah Hoskins, JD, CFP
Fair Isaac Corporation uses a trade secret algorithm to construct your FICO score. However, the broad parameters of credit score construction are now known and consist of five components, with their approximate percentage contribution to the final FICO number. Read More >>
Posted 12/11/2009
How Your Credit Score Is Derived
The national median FICO score is about 720
By Deborah Hoskins, JD, CFP
Credit reports contain information on how much you owe, what kind of loans you have, your payment habits, and serious matters such as court judgments, collection agency efforts, and bankruptcies. Read More >>
Posted 12/04/2009
A Responsible Use of Credit
Are you getting the lowest rates available?
By Deborah Hoskins, JD, CFP
My next several blogs will cover the financially responsible use of credit. The year 2009 has clearly been one of financial uncertainty, both in the stock market and in the credit market. The days of abundant and cheap credit are gone. The easy underwriting standards of 2007 seem like distant history. More than $1 trillion of credit lines extended by banks have been eliminated in the last few months. Read More >>
