Posts tagged 'Credit card debt'
Consumer confidence is up – and most likely your urge to shop. There is a school of thought that suggests as follows: If you see an expensive item which immediately becomes a need – a burning passion you just can’t live without – walk away. If the desire continues unabated for at least five days and you can afford it, go back to the store. If the item is still there, your lust increases on seeing it again, and they have it in your size, congratulations. If it’s not there, or they are out of your size, consider yourself saved by karma. That way, you avoid acting on impulse and can know with certainty that you really want it.
May 26th, 2009
Researcher Kent Monroe has developed a test to tell if you are a shopaholic. The new test includes six statements, for which individuals answer on a 7-point scale from strongly disagree to strongly agree:
1. My closet has unopened shopping bags in it.
2. Others might consider me a “shopaholic.”
3. Much of my life centers on buying things.
4. I buy things I don’t need.
5. I buy things I did not plan to buy.
6. I consider myself an impulse purchaser.
Respondents who score 25 or higher are considered compulsive buyers. Monroe administrated his test to 550 staff members and found nine percent (men and women) qualified as shopaholics. LiveScience.com reports that previous studies have shown that between two percent and eight percent of the population are shopaholics.
March 16th, 2009
Cinderella stomped her foot. Where was her fairy godmother when she needed her? Marrying the prince had not turned out happily ever after and she had become quite short tempered. The monotony of palace life was bound to get on anyone’s nerves. She knew her shopping habit was out of control. Since it was her job to be the belle of the ball, and Manolo’s are so pretty, she had always been able to rationalize her purchases. Lately though she had begun to feel embarrassed. She had taken to putting her purchases into plain brown bags so the prince – and town people – couldn’t monitor her spending.
She knew she was overspending and if she didn’t start cutting back on expenses she would have to go back to work. Unfortunately, due to her limited skill set and education, that meant a return to the scullery.
She needed her fairy godmother to wave her magic wand and fix it all. After all, that woman could do anything. Then reality hit. Her fairy godmother had been cut in the last round of palace lay-offs. She was going to have to go it alone.
Rather than panic, she decided to do some homework and some financial planning. To begin she re-read some of the post from So Many Shoes – especially the ones on credit cards, interest rates and debt. She also turned to No Regrets for savings ideas. She vowed to get her financial life under control and to check back more often.
January 28th, 2009
Barbie thought she had it all. Ken had come to senses, left Midge, and wouldn’t stop calling. She had a lovely town home, a corvette, her pilot’s license, a fabulous body and a wardrobe which put the Bratz to shame.
Unfortunately, much of this had been purchased with debt. Her mortgage, car lease, student loans and credit card bills were killing her. Then the bottom fell out of the stock market. It was time to get things under control. Marrying Ken was not the answer – they had been on and off again for years and who knew if she could trust him. She was loaded with debt. Where to start?
First, she needed to get those credit cards under control by not using them anymore. No more shopping, gym memberships or expensive dinners out. (Besides, people had been complaining she looked too thin for years.)
Once she stopped spending more, it was time to pay down her credit cards. She called the credit card company to set up a payment plan and to reduce her interest rates. If they didn’t go for it, she decided she would call a reputable credit counselor for assistance.
Then she looked for ways to consolidate her loans. For example, she grouped her student loans into a student consolidation loan allowing her to combine her multiple loans and pay a fixed interest rate to just one company. She also combined her credit card balances onto one single card (with a lower rate than her current card).
She also reviewed her budget and determined ways to increase her income. She had many skills and talents: over the years she had taught, practiced medicine, served in the military, hell she had even been President of the United States.
Once she had her plan she felt better. She picked up the phone and called G.I. Joe and the girls. Rather than a night on the town, why didn’t they all come over for pot-luck and movie?
January 23rd, 2009
Recent statistics show that the Botox treatment industry has generated over $1 billion per year in revenue. When an industry hits that threshold, it’s a viable, on-going market. Although the recent market downturn may put a slight wrinkle in sales, younger and younger women are now trying the procedure. A growing number are getting Botox the moment they graduate from high school.
This is an example of really bad money management – not to mention a totally unnecessary cosmetic procedure. At upwards of 300 dollars per appointment, you would be much better off paying down your credit card or other debts or saving or investing. Even if you are completely debt free, and can truly afford it, there is plenty of time to freeze your face.
If you put the $300 in your savings account instead and earned 4% interest, in five years you would have roughly $1,460 dollars ($300 x 4 times a year – usually you need three to four injections per year). If you waited five years to start Botox, and saved the money each year, you would have saved approximately $6,700. What could you do with $6,700?
January 16th, 2009
Per yesterday’s post, sung to the twelve days of Christmas…
On the twelfth day of Christmas proper spending meant to me:
Twelve affordable gifts purchased
Eleven charities helped
Ten happy friends
Nine happy family
No unpaid bills
Nothing for myself
No more gifts to buy
Nothing for my pets
No forgotten friends
Lot’s of happy calls
Plenty of good-will
and a debt free hol-i-day…
December 3rd, 2008
Sung to the twelve nights of Christmas
On the twelfth day of Christmas over-spending meant to me:
Twelve new credit card applications
Eleven outstanding bills
Ten gifts I couldn’t afford
Nine things for myself
Eight things for my family
Seven things for my friends
Six different interest rates
Five more gifts to buy…
Four thank you calls
Three thank you notes
Two forgotten friends
and a debt filled hol-i-day…
December 3rd, 2008
The best gift you could give yourself this holiday season is to get though December without incurring additional debt. Believe it or not, your friends love you for you – not for the gifts you give them. If they don’t, get new friends.
Not paying your credit card bill in full every month is one of the worst things you can do for your finances, except in emergencies. Unless you can pay your bill in full every month, use a debit card instead of a credit card. If you are unable to pay your bill in full when you receive it, pay off as much of it as you possibly can. Do not use the card again until you have completely paid your bill and have a zero balance. The reason you want to pay as much as you can possibly can is the more you pay now, the lower your outstanding balance (what you owe the credit card company) and the less interest you will owe on the balance. Remember, interest is calculated on the amount outstanding. If you pay only the minimum required, you will pay the credit card company a lot of interest.
There are lots of ways to give without spending a fortune: Many websites and magazines have gift lists in various price ranges – use the range that you can comfortably afford. Diets aside, don’t over look home baking. Fattening deserts are always a crowd pleaser. Parties are good too. Arrange a pot-luck so everyone shares the cost and each others company. A heartfelt phone call wishing them a happy holiday and letting them know you are thinking about them is often better than any gift. Last but not least, since today is global AIDS awareness day, don’t forget charities. Making a donation in a friends name is a great way to honor them – and to help others in need at the same time.
December 1st, 2008
Pleather? Polyvinyl chloride? How’s a girl to shop in a recession?
That depends: Is your credit card debt higher than your hemline? Use this time to take a break, stop shopping, clean out your closet and pay down your debt. Unpaid credit card bills are the single worse thing you can do to your finances.
But, if your credit card debt is higher than the heels on your ballet flats, Fake it! No, not with illegal cheap knock-offs – nothing screams non-chic like an obviously fake bag. Hot for a trendy item? Indulge with GUESS, Zara, H&M, Bebe and ABS. Those stores are expert at copying / “interpreting” designer looks and retailing them for a fraction of the price; so if you love a trend, go to one of them and get the knock off.
Look for designers second lines and visit some stores you may not have been to in awhile (if ever). Vera Wang has hooked up with Kohl’s; Lela Rose is with Payless. Premium jeans Chip & Pepper and Ralph Lauren are at JCPenney; Cynthia Rowley is at Avon. Sarah Jessica Parker, Amanda Bynes and Venus Williams are with Steve & Barry’s. Todd Oldham is teaming up with Old Navy. Madonna’s at H&M. Top Shop is opening in New York. And, have you been to Target lately?
Whatever your style, remember going into debt for fashion is never chic.
October 28th, 2008