There is so much contradictory information about finances that it can get very confusing, very fast. What about a budget? John Maxwell says “ A budget is people telling their money where to go instead of wondering where it went”.
You need a written plan to know where your money is going. It’s that simple. If you don’t know where it’s going, how do you expect to get a handle on your finances? A budget does not have to be complicated. Write down all of your financial commits into categories and then put money aside out of every paycheck to meet that obligation.
What about using Debt Management Companies? Bad idea. This is not the same as debt consolidation. They charge a fee for taking over the payment of your various loans and they have worked out lower interest rates and payments for you. The down side is that mortgage companies view this almost the same as if you had filed a Chapter 13 bankruptcy. They are a lot of rip off artists in this industry and you must be extra careful.
Do you know that most of us focus on our health and our money after it’s gone! People tend to say that things will work out in retirement even though they are not saving. Hey, don’t expect Ed McMahon to show up at your door with a big check!
If things get bad enough I’ll just declare bankruptcy you say. Everyone seems to be doing this. Declaring bankruptcy is not the answer and will be something you will regret for the rest of your life. It is one of the top stressors in life and will be on your record for life. I have a young friend who declared bankruptcy and he has been passed over for good jobs due to this.
This is not the time to deal with options to not declaring bankruptcy but be advised that alternatives do exist.
More coming up!
Jacques
CreatingWealthThatLasts
3 comments:
I feel for your young friend, Jacques, it must be very difficult for him ..
It is so important to educate children & young people, in this day and age - to save up & then buy .. the "I want it now age" is over .. & should never have begun.
Thanks for your enlightenment on budgeting - Hilary
Thanks for the sharing with us about finance. It is so important for the younger people to learn this. Just like any habits, it is better if we can learn it while we are young.
Thanks.
Giovanna Garcia
Imperfect Action is better than No Action
It was sad for my young friend and he realizes the mistake that he made!
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