School Loans, Car Loans, & Credit Card Debt – What Are You Doing to Help Your Child Live Debt Free?

Now that our children have returned to school from break, I ca not help but wonder if we are preparing them for the financial responsibilities they will be facing? I mean have you sat down with them and explained how credit cards work, school loans and budgeting? Are they at least enrolled in a personal finance class? We cannot continue to use silence when it comes to money while our children walk into our crazy financial world.

I had a very interesting conversation with my godson. He will be graduating from high school soon. He assured me that he was ready to take on the responsibility of purchasing a car. He felt this way because he has been working par-time at a fast food restaurant. When I asked him how much money he had saved his answer was simply, none.

We talked about the importance of saving money and some responsible things he could do with is earning. I went on to explain to him that having a job was a good step towards saving to buy a car outright. However, he was still lacking in responsibility for assuming that everyone else would gift him enough money to buy a car.

When it comes to loans that a person should contribute some of their own money. Giving someone the total amount they need removes them from having a true interest and feeling of ownership. Many homeowners walked away from their homes or that very reason. They had no money to lose, so they walked away from the home.

So our conversation ended with an agreement that he would cover insurance and gas with his income and save at least 10% for college expenses and I would send him cash towards the purchase of his vehicle as a graduation gift.

I guess buying a car is much more common then when I graduated from high school. However, I would rather teach graduates the importance of being responsible with their money then popular with their peers. What are we teaching them by buying the mandatory iphones, laptops, games systems, digital cameras, DVD players, and ipods? I think the message is pretty clear, “consume more, save less and use debt to consume everything you want. This has got to stop!

Pretty soon my godson will be off to college where he will be bombarded with credit card applications, cell phone companies and many other vendors enticing him to get into debt. Hopefully he will learn how to be responsible with money before he earns his college degree because my other gift was a few sessions of our Kids And Money Program known as K.A.M.P.

Give your child the gift of a debt-free lifestyle by joining our on-line financial community. Women Obtaining Wealth is an on-line financial community that offers its members support in the areas of finances, marketing, and personal development. You can hear more about this topic and many others on our Internet Talk Show every Sunday at 9:00pm EST we even have the chat room open so that you can type in your questions at http://www.blogtalkradio.com/womenobtainingwealth.com or call (646) 478-5836! If you missed any past shows, you can always listen them in the archives.

Consolidate Debt Loans – Credit Card Debt Consolidation Loan

The credit card system is the most easily available form of loan, as their authorization is based only on the credit history decided by the average monthly income, type of profession, proper bill payment patterns etc. of the person availing a credit card. But since the credit card system is the most unsecured form of loan, being completely dependent on the persons’ intention and promise to repay the loan, it also carries the highest rates of interest attached with it. This easy availability of credit cards also leads to the individual acquiring too many credit cards. The possession of too many credit cards has an adverse effect on the credit scores and rating of the individual. This poor credit rating leads to lending agencies charging these individuals a higher rate of interest on other types of loans like home loans etc.

Monthly Payment Higher then Monthly Income

The debtor is thus engaged in a vicious cycle which goes on increasing his debts and financial burden. Added to this is the fact that there is easy availability of credit made available due to a number of cards possessed by the individual. This leads to a tendency of over usage of credit cards to the purchase of objects that the debtor may require or wish to acquire, but may not have the immediate availability of income or financial means to do so.

The debtor on the other hand is not so adept at financial management, hence is not aware of the concept involved in the calculation of ratio of their debts to their average monthly income. This means that due to the over usage of easily available credit cards and the necessity of other loans like house loans etc., the debtor inadvertently finds himself in a completely skewed financial situation. In such a situation where the total payable loan amounts and minimum monthly payments combined are much higher than their average monthly income.

Delinquent Credit Card Accounts

This leads to irregular payments towards the outstanding credit card amounts and the loan installments. The debtor eventually ends up with a number of past due, over limit and sometimes delinquent credit card accounts. Credit card companies then apply late fee and over limit fee, in addition to that they also hike the interest rate that is normally charged on the credit card as a form of penalty. Not only does this increase the monthly payable amounts but also adversely and at time irreparably affects the credit ratings and scores of the individual. This is especially true in the cases of the individuals who end up with delinquent credit card accounts in the process.

The rates of interests that the debtor is forced to pay in such situations is in comparison much higher in all such cases compared to the rate of interests available on debt consolidation loans. Even unsecured debt consolidation loans which have a rate of interest slightly higher in comparison to the secured loans, prove to be more economical than the exorbitant interest rates charged by credit card companies. Hence both secured and unsecured types of debt consolidation loans are equally useful as means to consolidate credit card debts.

Taking Control Of Your Personal Finances – Credit Card Consolidation Programs Can Be A Huge Help

Many Americans are taking advantage of credit card consolidation programs. They’ve found out the benefits of seeking professional help to pay off the loans owed to creditors.

If your debts are piling up and you owe debts to more than one creditor then the Credit Card Consolidation program is right for you. The program is simple. You are given a loan to pay off the smaller loans.

Why is this a viable alternative to simply ignoring the company or filing bankruptcy?

#1- You’ll avoid the negative mark that bankruptcy can leave on your credit for seven years or more.
#2- Consolidation Experts will educate you on your rights and options.
#3- You’ll be able to finally pay off your loans

There are other options. Now that you know this, bankruptcy doesn’t have to be one of them. Debt Settlement programs are taking the load off of overwhelmed individuals who have accumulated an enormous amount of debt.

These companies are experienced in debt relief and can not only act as a third party but negotiate to lower your payments and the debt you owe by up to 50%. This is the best method to use when you feel you are running out of money to pay your lenders.

Take advantage of these programs now and let the experts work for you. The federal government has come up with laws to protect you and fully support these programs. You’ll no longer have to stress over unpaid loans or put off dealing with your debt. Now you can finally be in control.

Research for yourself by going online and finding out how these programs have helped millions of Americans get back on track and how you can be helped too.