question: Even though I have nothing, I still feel like I’m not achieving my financial goals car payment or student loan. The real question is, is my husband a spender and I a saver?
answer: Think of your financial life like a road trip where you need a GPS. Enter your coordinates (financial goals) and GPS (budget) will guide you to your destination. Would you like to travel to a place you’ve never been before without guidance? Without a financial plan, you may find yourself wandering, worrying, and frustrated that you won’t be able to reach your financial goals. Add relationships to the mix and travel becomes even more difficult (think of the spendthrift backseat driver who always wants to take detours).
Yes, you may be financially purposeless. You don’t have a plan and you and your husband are opposites when it comes to money. So what should I do? Decide on a financial date. This is not a budget meeting. Instead, this is “Let’s plan for the future where money is involved.” conversation. Please raise any concerns you may have at this initial meeting. Think about how you feel. Don’t criticize or blame. share. listen. talk.
Once you start, it will become a habit to go on dates on the same day and at the same time. Set one or two goals for your next meeting. You don’t want to overwhelm the spendthrift. For example, you can start with an emergency fund. Is that where you want to be? If not, plan how to save the recommended 3-6 months of living expenses (following the GPS analogy). Do you have debt? Make a plan to pay it back.
Read: Rules to make it easier to talk about money with your partner
question: When is a debt consolidation loan available?
answer: Debt consolidation loans can be good as long as the terms, including interest rates, don’t expand your debt to the point where you end up paying more interest. They also worry that people will use such loans to wipe out credit card debt and then pay off the debt again once their cards are depleted. As a result, they end up with new credit card debt and even consolidation loans. I’ve seen this happen many times.
Read: Are you suffering from continuous debt repayment disorder?
Related article: 4 reasons why credit balance transfers are bad
question: What is a healthy amount for a credit card for someone with an annual income of $80,000?
answer: How much credit you have available depends on your situation. Why have a credit card with a $20,000 limit if you can’t pay it off on time? With that income and a good credit score, you can probably get a lot of credit. But is it necessary? So, it’s not a question of your income, but how much money you can handle at once without becoming one of the millions of consumers who go into credit card debt every month.
Read: Credit card and auto loan delinquencies on the rise
question: I’m 58 years old and plan to retire in 9 years. I can’t even receive a pension. How can I be sure I have enough savings in my 401(k) to meet my retirement needs?
answer: Knowing whether you have enough saved for retirement can be very difficult. The key to knowing this is to predict your life expectancy. But creating a budget for when you quit your job can give you a better idea of your retirement needs.
Look at all the income you get from Social Security as well as cash savings and retirement investments. AARP is also a great resource and has great features. retirement allowance calculator It will help you decide if you have enough savings.
Read: Retirement planning is a guessing game you need to get right
question: I’m 52 years old, and due to circumstances when I quit my job to care for an ill parent, I had to use all of my retirement savings. Now I have very few bills and no savings for retirement. How do I start a rebuild?
answer: What a wonderful thing you did to help your parents. Caregiving is one of the main reasons many people don’t have enough savings for retirement, especially if you’ve had to quit your job. Do everything you can to get back to saving for retirement. If your company has a workplace retirement account, contribute to it. You may also need to readjust your retirement plans, such as working longer than planned.
question: In the post article titled “Moody’s downgraded 10 local banks and warned major Wall Street firms.” My husband and I have an account with one of the largest lenders. Should we be worried about this bank’s negative outlook?
answer: If your funds are held in an institution insured by the FDIC and the amount is less than or equal to the insured amount, there is no need to worry.
Read: Is your money safe? Here’s what deposit insurance covers.
question: I was carrying a pretty heavy burden. My father passed away in June. He left my mother in a pretty dire financial situation. It turns out she has $60,000 in credit card debt and has mortgaged her house to pay off her previous debts. There’s not much capital there, maybe $20,000 left. She is currently receiving social security checks and will have to downsize to a smaller, low maintenance place (no yard, no upkeep, etc.). Something like a small senior efficiency apartment will suffice.
She makes a minimum payment of $1,500 a month on her credit card. All told, she will receive about $4,500 a month from her pension and Social Security. She is 72 years old and will not be able to pay off her credit cards in her lifetime. What would be the best course of action? In addition to the small emergency fund she had, she has about $14,000 left in the bank after selling things around her house. Oh, and her car is reaching the end of its life, so she needs a reliable used car. She is completely overwhelmed.
answer: It’s really unfortunate that we have to deal with an issue that clearly should have been addressed a long time ago. We recommend making an appointment with a nonprofit credit counseling agency. Talk to a budget expert who can help you plan for moms. And that plan could include her filing for either Chapter 7 or Chapter 13 bankruptcy protection. I have advised several seniors in this situation to file for bankruptcy to free up much-needed funds for living expenses.
I spent several years of my career covering bankruptcy cases. And this is what I know. For most people, this is not an easy decision. I’ve never seen anyone slack off after a bankruptcy hearing because they were overjoyed that their debts were cancelled. I have seen people feel shamed and devastated when they ultimately felt that filing for bankruptcy protection was their last resort. But bankruptcy exists to help people like your mom. The National Foundation for Credit Counseling has information on finding an agent.visit its website Or call us at 800-388-2227.
