Debt

No more Starbucks - we can't afford it

Barbara Bartlein Nov 11th 2009 @ 4:00PM EST Filed Under: Budgets, Debt, Health, Wealth

Every morning my husband and I drive through Starbucks and get a latte. Great way to start the day. I can sip a Venti most of the morning.

After looking at our budget, however, we found it was time to evaluate this little habit. Our daily stop was costing close to $8 per day or almost $250 per month. When the economy was great and my business was booming, I rarely gave the money a thought. In fact, I thought I "deserved" this little luxury because I worked so hard.

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Frugal consumers push companies to embrace new age of thrift

David Schepp Nov 11th 2009 @ 2:00PM EST Filed Under: Bargains, Budgets, Debt, Food, Home, Saving Money, Shopping, Career, Recession, Recession Diaries, Economizer

Consumers are notoriously fickle in their allegiances and interests -- remember those food-assembly kitchens that were all the rage a few years ago? But the recession has sobered buying habits, and increasingly, more companies are viewing Americans' recent conversion to thrift as a long-term trend, not simply flash-in-the-pan fascination.

In an attempt to cash-in on this new sensibility, businesses are keen on promoting their products as a good deal. That's why, for example, Clorox Co. isn't raising prices on its improved trash can liners and Campbell Soup Co. has reduced the promotional price of its V8 brand vegetable juice by 17%, according to the Wall Street Journal (subscription required).

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We shouldn't be talking about deficit reduction with 10.2% unemployment

Bob Cesca Nov 9th 2009 @ 5:00PM EST Filed Under: Debt, Recession

There's a potential disconnect between the Obama administration, the unemployment rate and the deficit, and I hope there's some sort of resolution or else you and I could be looking at high unemployment for some time to come -- not to mention a backslide on the greenshoots and economic growth we're beginning to see.

The unemployment rate jumped to 10.2% last month, the first time unemployment has breached 10% since 1983. While monthly job losses are significantly declining since early this year, 10.2% is still a scary threshold.

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Bank of Mom & Dad's Money Coach: The truth about debt

Farnoosh Torabi Nov 6th 2009 @ 6:15PM EST Filed Under: Credit, Debt, Kids and Money, Saving Money, Health, Bankruptcy, Video, Credit cards

My task each week on SOAPnet's Bank of Mom and Dad is to provide young women with solid advice that will improve their messy financial lives. In return I've received quite the education on some of the reasons we, as a society and particularly women, overspend and compile debt.

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Ask the Dolans: Can my credit card company change the terms on account I have closed?

Ken and Daria Dolan Nov 6th 2009 @ 10:00AM EST Filed Under: Credit, Debt, The Dolans, Video, Credit cards

Ken and Daria Dolan, America's first family of personal finance, answer your questions every Friday.

Click here to ask Ken and Daria your question

Credit card companies are on a tear, raising rates, slashing credit lines, increasing minimum payments and closing accounts in advance of the new credit card legislation that will restrict their more outrageous behavior. Today, Ken and Daria Dolan of Dolans.com help a WalletPop reader decide if she has any recourse against her credit card company's latest trick.

Dear Ken and Daria,

We got a letter from our credit card saying they were changing the terms on our card. We still have a balance on the card, but we opted out and closed the account. They STILL upped the minimum payment required on our balance. Can they do that?

You'll find simple, proven solutions for managing your credit card debt at Dolans.com.

Recession tales: Saving vs. spending a tough battle

Lita Epstein Nov 5th 2009 @ 9:00AM EST Filed Under: Borrowing, Credit, Debt, Saving Money, Recession, Credit cards

There's no doubt that the current downturn has changed people's spending habits.

Since the peak in housing wealth, homeowners lost more than $5 trillion in equity and 15 million homeowners own homes that are now underwater (worth less than they owe). Unemployment is hovering near 10% with no clear signs of falling.

Homeowners' previous piggy bank -- home equity -- is no longer available for spending. Even if people still hold a job, many are worried that their jobs are at risk and won't spend except for necessities.

People, afraid for their future also changed their savings habits. In the first quarter of 2008, before the recession took hold people saved about 1% of disposable income. By the second quarter of 2009 the savings rate soared to 5% of disposable income. But now that we appear to be near the end of the recession the savings rate dropped back to slightly above 3% in the third quarter of 2009, as people see the end of the recession in sight.

While economists now don't believe this recession will be as deep as the Great Depression, its depth and length will certainly change people's spending and savings habits for a long time to come.

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Recession tales: Forget housing as an ATM

Ann Brenoff Nov 2nd 2009 @ 3:00PM EST Filed Under: Debt, Home, Real Estate, Recession

Will the American Dream of home ownership go the way of the myth that our streets were paved in gold?

Home ownership has long been a milestone rung on the ladder of success. Much as we use birthdays to measure our personal progress toward life goals, buying a home of your own has been the way we announce to the world that we have arrived.

Throwing in tax incentives like mortgage interest and property tax deductions just sweetened the pot. If you wanted to keep up with the Joneses, you added a bigger deck whether you needed one or not.

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Credit card addiction: How to spot the warning signs and break the habit

Gina Roberts-Grey Nov 2nd 2009 @ 6:00AM EST Filed Under: Credit, Debt, Recession Diaries, Credit Reports, Economizer, Credit cards

With more than $40,000 in credit card debt and more than 20 credit cards to her name, Diana Ryan didn't think she had a problem -- even though her husband had no idea just how many pieces of plastic she had tucked in her wallet. "It sounds cliche," Ryan says, "but I thought I could stop at any time."

But the lure of special offers and other card deals was much stronger than Ryan's willpower. "I couldn't say no when a cashier asked if I wanted to open a new card to get an instant in-store savings or receive a new promotion," she says.

Ryan represents a growing number of Americans who've passed the point of merely overspending and have entered into the realm of addiction. And, in doing so, they're maxing out a record number of credit cards.

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Credit card issuers in support of debt repayment program

Gina Roberts-Grey Oct 31st 2009 @ 9:00AM EST Filed Under: Debt, Credit cards

The actions of credit card issuers have come under close scrutiny of late. In attempt to gain some positive press, 10 of the major credit card companies have announced changes in debt management plans allowing consumers the chance to lower payments and qualify for enhanced benefits in recognized credit counseling services programs.

This new tiered system qualifies consumers for special benefits they might not otherwise be able to tap into. Among the highlights: lower interest rates, waived late fees and minimum payments. The goal is to help consumers pay off their high-interest credit cards.

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Walletpop round-up: Worst credit cards

Martha C. White Oct 29th 2009 @ 6:45PM EST Filed Under: Credit, Debt, Economizer, Credit cards

Break out the rotten tomatoes. This is Walletpop's roundup of the priciest, sneakiest and just plain lousiest credit-card deals out there. Trust us, there are a lot of cards floating around the bottom of the barrel, so it took a lot of effort to find the ones you probably want to avoid at all costs.

Interest rate: If your credit isn't stellar, you can be looking at paying 20% or more for the privilege of whipping out the plastic. (Even if you have great credit, some cards will be oh-so-happy to sock you with a rate of 15% or so.) For real sticker shock, we checked out co-branded store cards, which typically have higher rates. Case in point: The Gap Visa card has rates that start at 18.24%. That could tack quite a bit onto the price of that pair of khakis. We also looked into the Best Buy Reward Zone MasterCard, issued by HSBC, but they won't even give users information about interest rates until they actually apply! Thanks, HSBC; you've forced us to leave it to our imagination, and what we're imagining is pretty scary.

Annual fee: To be fair, several American Express cards made our best list, but we've got a worstie here, too. With a whopping $5,000 initiation fee plus a $2,500 annual fee, the American Express Centurion Card wins this one, hands down. Luckily, this card is issued by invitation only, so you'll probably never be faced with the agonizing decision of whether or not to drop the price of a cheap used car every single year for the privilege of using this card. For that reason, we're nominating a second worstie in this category: the Visa Black Card issued by Barclays. It's got an annual fee of "only" $495 and an APR of 13.24% -- a higher rate by several percentage points than our best pick.

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The for-profit college student loan nightmare

Zac Bissonnette Oct 29th 2009 @ 2:30PM EST Filed Under: College, Debt, Student Loans

Over at Washington Monthly, Stephen Burd takes an extended look at one of the biggest -- and least reported on -- financial crises facing young people: unethical for-profit college foisting massive debt loads on their students. These debt loads often carry exorbitant interest rates and lack any consumer protections whatsoever.

The stories Burd tells are egregious: Slick, misleading advertising luring prospective ~~suckers~~ students into meetings with admissions officers -- glorified salespeople straight out of Glengarry Glen Ross. The admissions people then lie to students about the benefits of the program, and sign them up for high-interest student loans without explaining the terms.

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How to avoid 'pulling a Gosselin' with family finances

Gina Roberts-Grey Oct 28th 2009 @ 8:00AM EST Filed Under: Debt, Relationships, Celebs & Money

On Monday, Jon Gosselin said he returned $230,000 in funds to a joint account shared with his estranged wife, and reality show co-star, Kate Gosselin.

He did so because earlier this month, a Pennsylvania judge ordered Jon to return these funds, even as he continues to criticize Kate for not being forced to return money she allegedly withdrew from the couple's account.

While Gosselin has a fighting chance of quickly coming up with that much coin (through media appearances and sponsorships), most regular Janes and Joes in the midst of a divorce aren't usually able to pony up large chucks of cash all at once.

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