San Diego, CA. What is worse than losing your
job? The bills just keep coming in even after any available unemployment
benefits have been exhausted. Money is becoming very tight for an
alarmingly high number of American families as the economic downturn
accelerated after the September 11th attack on America. That aside, many
money shortages among American families, are due in part to poor spending
decisions made in the past which has left have little or no savings. Panic
oriented, credit based, spending decisions are usually unwise even though
they are made under desperate situations.
Dealing with creditors and getting out from under a mountain of debt are
two situations many Americans are finding themselves in for the first
time. Taking action early and not delaying communications with creditors
or others involved is essential for survival and long term financial
recovery. Establishing a written plan of action for both household
spending and debt reduction is crucial to financial survival and recovery.
Take positive steps in order to reduce the negative impact of adjusting to
a lower income life-style. Developing new spending priorities and
techniques to make less income go farther is an acquired
skill. Achieving greater value for your spendable dollars, especially in
household and grocery spending (because that is where 30 cents of every
take-home dollar of income goes) makes coupon and rebate use even more
essential than ever.
Working directly with creditors, will help you avoid making the same
mistakes again. Letting credit and debt counselors do the work with
creditors for you can be less stressful, but it also may be expensive due
to fraud and scams. Many so-called debt management agencies are fronts for
lawyers who just try to sell people on filing for bankruptcy. If you
select a credit counseling agency, make certain they are an accredited,
nonprofit agency with a long successful track record of helping consumers.
The three basic ground rules when dealing with creditors are: be honest,
be humble and be in touch. Take the first step by contacting all
creditors, preferably ahead of time if you know an income reduction is
pending. Explain what's happening and lay the groundwork for a temporary
reduction of payments. Have your plan ready. Tell how much you can afford
to pay and how often you can pay it. Then be ready to negotiate.
Getting out of debt (and rebuilding credit) is a somewhat slower, step by
step process. Avoid more borrowing just to pay someone else off. Sometimes
a consolidation loan improves cash flow, but ultimately it is added debt
and that may have a negative impact on credit files, especially if paying
off new charges in addition to a consolidation loan. What your credit
files might say about you in future years is your responsibility. Taking
positive action with all creditors early usually stops negative reports
from being sent to credit reporting agencies.
For information about
monthly budgeting guidelines, and
warning labels for your charge cards, visit the ICFE's Web page at:
If you would like a printed copy, please send $1 to the
ICFE and ask for: "Money Helps"
The information packet includes:
1) "15 Tips to improve spending Practices";
2) "How to set up
and implement a spending-plan";
(plus a budget worksheet)
for personal and/or family finances;
3) "Dealing with
4) "Steps to
take to reduce indebtedness";
5) "How to
spend smarter for household and grocery items," and a
Profile" which helps people identify dangerous spending habits.
Money Helps" is available on the Internet free or by sending
send $1 AND a self-addressed, stamped (60 cents) # 10 envelope (SASE) to:
ICFE Money Helps
PO Box 34070
San Diego, CA 92163-4070
About the ICFE:
The Institute of Consumer Financial Education (ICFE),
founded in 1982 by the late Loren Dunton - creator of the "certified
financial planner” (CFP) designation - is dedicated to helping consumers
of all ages to improve their spending, increase savings and use credit
more wisely. The years between 1984 and 2000, the ICFE was also known as
the National Center for Financial Education (NCFE).
The ICFE is a nonprofit consumer education organization that has helped millions of people through its education programs and Resources. Over
one million "Credit
/ Debit Card Warning
Labels” and "Credit
/ Debit Card Sleeves” are in circulation world wide.
The ICFE's on-line help for consumers who spend too much
was featured in PARADE Magazine (June 9th, 2002) in the Intelligence
Report section. The money helps and tips are from the "Money
Instruction Book," a course in personal finance, which was completely
revised and updated in 2002 and is positioned to become among the premier
programs in the new bankruptcy and debtor education initiatives.
The ICFE's "Do-It-Yourself Credit File Correction
Guide," now in its Twelfth Printing, is in use by thousands of consumer credit and debt
counselors in addition to tens of thousands of consumers. It received a
"buy” rating in July, August and November from nationally syndicated
financial columnist, Humberto Cruz in his column, "The Savings Game".
BottomLine Personal newsletter gave the Guide a "Send For” rating in
September 2001. The ICFE and our do-it-yourself approach to credit file
correction was featured on NBC Nightly News on 04-30-02. The Spanish
edition of the Guide premiered in January 2002. Syndicated columnist,
Robert Heady also gave the ICFE Guide a "buy” rating.
The ICFE Web site at: www.financial-education-icfe.org helps consumers with
mending spending, learn about the
proper use of credit, budget and expense guidelines, how to set up and implement a
spending-plan and also access financial education courses and videos and how to
teach children about money. Other ICFE services include a
free eNews, and an
on-line resource center of financial education
learning tools, including videos, books and personal finance courses.
Consumers may learn more on the Internet about the "Do-It-Yourself
Credit File Correction Guide" here, or fill out our request
form, indicating your areas of interest.
For more information contact Paul S. Richard ICFE Executive Director at 619-239-1401.