The Real Reason All of These Companies Are Failing
August 4, 2008 by Erik Folgate
Filed under Credit and Debt
Bear Stearns: See Ya Later
IndyMac Bank: It was nice knowing you
And now, WCI Communities: Hasta La Vista, Baby.
Okay, that last one was cheesy, but you know it made you chuckle a little bit. It feels like a bank or major corporation is going belly up every day. The question is, Why? Why are so many major corporations struggling lately? Many of the companies going bankrupt have something to do with the decline in the subprime mortgage market and the housing market itself. However, this is not the root of the problem. The media will shove this down your throat. It’s the economy. It’s George Bush. It’s the war. Pick your scape goat.
Are Your Finances Spinning Out Of Control?
July 24, 2008 by Erik Folgate
Filed under Credit and Debt, Spending and Saving
If your finances are heading in the wrong direction, you should be able to tell. Free Money Finance has five signs that you’re living beyond your means. The first step to becoming financially fit is recognizing that you need to change your financial habits. If you’re oblivious to the fact that you need financial help, then read those five signs. If more than one of them applies to you, then you need help.
The good news is that you’re never too far gone to change your financial position. The bad news is that it takes hard work and sacrifice to change your financial situation. You will need to:
Congress Approves Bail Out For Homeowners, Fannie Mae, and Freddie Mac
July 24, 2008 by Erik Folgate
Filed under Consumer News, Credit and Debt, Economic Policy, Economy, Politics, Real Estate
Here is the article from the AP, via Yahoo Finance about the House sailing through a bill to bail out homeowners and the Fannie Mae/Freddie Mac institutions.
I love how Yahoo Finance titles it a “rescue” when it should be called a “bail out”. Rescue makes it sound like Congress is doing such a great, noble thing. I know that I sound negative about this, and for some families, it will help them out. There were some families who were truly tricked into a mortgage that they didn’t understand. There were others that knew exactly what they were doing, but the power of greed took over and they moved up in house by taking advantage of creative financing. Then, there’s the mortgage lenders who knew exactly what they were doing the whole time. They’ve been in the business for a long time. They knew these people couldn’t afford the houses they were financing, but they still extended the credit.
25 Reasons To Get Out of Debt Today
July 22, 2008 by Erik Folgate
Filed under Credit and Debt, Money Management
Some of you will go through your entire life being in debt. You’ll always pick up a car loan, always carry credit card debt, and you’ll always move up in house. My challenge to you is stop the debt cycle in your life. Stop the cycle of always being in debt. If you need some convincing, here are 50 reasons why you should get out of debt as quickly as possible.
Exposing The Universal Default Provision In Credit Cards
July 8, 2008 by Erik Folgate
Filed under Credit and Debt, Scam Alert, Spending and Saving
Some of you don’t like the fact that I don’t like credit cards. One of my regular readers criticized me for putting too much blame on credit cards. He thinks that the lack of personal responsibility is what causes people to misuse credit cards, not the credit card itself. I agree that personal responsibility is the key to sound money management, but credit cards are a horrible financial product. The universal default provision, which many of you are familiar with, is the best reason why it is such a horrible product.
What is the universal default provision?
More Reasons To Cut Up Your Credit Cards
July 3, 2008 by Erik Folgate
Filed under Credit and Debt, Economy, Spending and Saving
The economy is slow, inflation is rising, and the price of everything seems to be higher. What will you do about it? Use your credit card to supplement the difference? I don’t think that’s the answer. The opposite is the answer. Trash your credit cards today, and you will be free from their bondage.
I’ve written about the advantages of using cash over credit cards, even when you never carry a balance on your credit cards. Here are a few more reasons that support my stance on using cash over credit. Donna Rosato from Money Magazine wrote an article in this month’s issue titled, “Life Without Plastic”. Here are some studies she refers to that support the notion that we spend more when we use plastic.
Kids And Money: Teaching Your Kids Not To Borrow Money
June 28, 2008 by Erik Folgate
Filed under Credit and Debt, Kids and Money
For those of you that like to borrow money to the point that it comes out of your eyeballs, you might not want to listen to this advice. But, for those of you that are fed up with owing money to everyone for everything, and you don’t want to put your kids through the same agony that you’ve gone through, this is the article for you. The problem is that our nation is indoctrinated to think that borrowing money for everything is a way of life. Swiping the credit card has been woven into the fabric of our society, and now children are learning how to borrow at a very young age. So, the cycle will continue unless parents start teaching their children something different. Don’t count on the schools to do this for you. Most of them don’t even have a personal finance cirriculum, and if they do, it’s probably sponsored by a credit card company. Here are some tips for how to teach your children not to borrow money.
Never Co-Sign A Car Loan For Anyone
June 20, 2008 by Erik Folgate
Filed under Consumer News, Credit and Debt, Taxes
Recently, I was listening to the Dave Ramsey Show, and there was one story that struck a chord with me. I love to hear all of the different stories people have to tell. They range anywhere from a mom that stole her son’s identity to success stories about people paying of $60,000 in two years. This particular story was a man who called in to tell about how he helped a friend from church get a loan on a car by co-signing for the loan. He never thought that a really close friend from church would stop paying the payments, so he went ahead and signed on the dotted line. About a year later, he realized that she hadn’t been paying the payment, and the car was repossessed. Now, the bank is going after him for the money still owed on the loan. It’s a common story told on Dave Ramsey, and it’s a life lesson that is usually learned the hard way.
How To Deal With Various Types of Debt Collectors
June 17, 2008 by Erik Folgate
Filed under Consumer News, Credit and Debt
Hopefully, you don’t have any credit accounts that are in default. But, some of you may have recently seen the light about changing your finances, and now you’re trying to clean up your past. Part of that cleaning up may involve dealing with bill collectors. Bill collectors have one of the worst jobs in the world. It is their job to collect money from people that don’t have any money. Collectors have made a very bad name for themselves in the past few decades, because they have been known for their harsh collection practices. In fact, their treatment of customers was so bad, that it spawned a federal act to be drafted called the Fair Debt Collection Practices Act. This act gave more rights to the consumer and restricted collection agencies from certain practices. It basically stopped collection agencies from acting like monsters and gave consumers a legal argument against the way bill collectors treated them. If you are not familiar with this act, please click on the link above and read about your rights as a consumer and the rules and regulations that collectors must follow in order to fairly collect the debt you owe.
The Month of May Was Favorable to Discount Retailers
June 5, 2008 by Erik Folgate
Filed under Consumer News, Credit and Debt, Economy
Retailers Such as Costco and Wal-Mart posted higher than expected earnings for the month of May. All of the major media outlets are referring to this as a result of the first wave of economic stimulus payments rolling out in May. But, take notice at what types of stores did well. It was discount retailers that did well, not mall retailers. The article I referenced to on Yahoo Finance indicated that the Gap and American Eagle had worse earnings than expected due to the stimulus payments.
