Taking Stock of Your Finances

Taking Stock of Your Finances
How you begin to take stock of your finances

Compare your monthly spending to your monthly income
Prepare yourself for a shock. Most people underestimates the amount that they actually spend relative to what they earn.
By doing this comparison, you may quickly realize that you’re using credit to finance a lifestyle you can’t afford, and you’re spending your way to the poorhouse.
Is that’s the case, you must reduce your spending to meet your financial obligations, and you may need to do a lot more than that depending on the seriousness of your financial situation.

Order copies of your credit histories of credit reporting agencies
Your credit history is a warts and all portrait of how you manage your money: to whom you owe money, how much you owe, whether you pay your debts on time, whether you are over your credit limits, and so on.
Being charge higher interest rates on credit cards and loans is a direct consequence of having a lot of negative information in your credit history.

There are many things beyond your control – like bad luck and rising prices may be partly to blame for your debt. However also there is chances you’re at least partly responsible as well. For example, you may:

*Pay too little attention to your finances. You forget to pay your bills on time; you don’t pay attention to the balance in your checking account so you bounce checks a lot; and /or you have a lot of credit accounts.

*Maintain high balances on your credit cards. As a consequence, you can afford to pay only the minimum due on the card you pay a lot in interest on your credit cards.

*Have little (or nothing) in savings so you have to use credit to pay every unexpected expense.

*Mismanage your finances because you don’t know how to manage them correctly.

There as a survey done, showed that 41 percent of consumers blamed their bankruptcy on poor money management skills; 34 percent attributed it to lost income; an 14 percent cited an increase in medical costs.

Compulsive spending is an addiction just like alcoholism and you can’t beat it on your own. You will always have debt problems if you can’t control your spending.
Taking Stock of Your Finances

Debit Card advantages and disadvantages

Debit Card advantages and disadvantages
Debit cards are not charge cards or credit cards. Like charge cards they don’t offer you a line of credit.

Unlike charge cards they deduct your purchases directly from your checking account.

They function very like ATM cards personal checks. You can spend only what you’ve got in your account.

Advantages
Debit cards are very convenient. If you have one, you don’t have to carry checks or a large amount of cash. Also, merchants who will not accept a personal checque may accept them.

Disadvantages
Yes unlike credit cards, debit cards are not covered by federal regulations that protect consumers in disputes with merchants.

Also, many banks charge fees for the use of a debit card, though others don’t.

Shop around among banks and other financial institutions for the best deal.

Be sure to ask whether there’s monthly, annual, or per use charge for the card, and whether there’s any additional penalty for using the card at another institution’s ATM.

With debit card, you can’t stop payment on a purchase you are disputing the way you can with a check or a credit card payment.

A debit card does not help you establish a credit rating.

Finally, depending on the state you live and how quickly you report the loss or stolen debit card cab result in your checking account balance being used up, plus your overdraft protection amount too.
Debit Card advantages and disadvantages

Why a credit report is important?

Why a credit report is important?
Your credit report doesn’t come into play just when you want to borrow money. A bad credit report may affect wheat you pay for insurance, whether you can rent the apartment of your choice, or whether you’ll be hired for certain jobs.

A particularly finance conscious romantic prospect might even nix you for a bad credit history.

Your credit score can cost you thousands of dollars and deny your opportunities you never knew you missed. Clearly, what you don’t know can hurt you.

*Say you signed for dating service. Now, what if all the information available to your prospective dates is given to them by people you’ve dated in the past? What if the quality of the date you get in the future is directly tied to what all the people you’ve dumped (or been dumped by say about you?

*Say you’re applying for a job. Your salary, job title, and the size of your office will be tied directly to what’s on your resume. But what you didn’t wrote your resume – your last employers did, and what if they mixed up your personal file with the file of that person who was fired for sexual harassment? Can you imagine walking in the job interview without any idea what you former boss may have reported or whether it was correct?

Meeting your life partner, landing a great job of these situation are ones in which you have a great deal of personal interest in a successful outcome. Kind of like getting a good mortgage rate so you can afford or keep that dream home.
Why a credit report is important?