IS MONEY YOUR PROBLEM?

From my experience money is THE number one cause of PROBLEMS in people’s lives.  That’s right, over and above everything else in life because most of those other things are caused by not having money.  For instance, people get divorced, have fights, can’t pay their bills, lose their houses and go to court over not having enough money or not managing it correctly.   Wouldn’t it be nice to be free of money problems and be able to do anything that you want to do?  I thought so!   Here are some helpful hints on how to handle your money, so that you don’t have to ever worry about money again!  Are you ready?  GREAT!!

 

1.       Understand how much you make and spend.

2.       Put together a plan on how to handle your debt.

a.       If you need help, The Debt Lady’s new book, Paper or Plastic, can help you with that.

3.       STOP concentrating on money all the time and concentrate on production!

4.       Produce, Produce, Produce

5.       Make more money

6.       Take a ride to the beach and look at a sunset

7.       Relax

8.       Smile

9.       Enjoy life

 

How does that sound?  Fantastic right!  Good, lets do it!

 

The Debt Lady says, “Take the problem of money out of your life, and a permanent smile will be painted on your face.”

Do you have to live within your means?

I was looking over a New York Times article about “living within your means” when it comes to credit and credit cards.  And I have to say that in some ways I totally disagree with this concept based on a few key points.  If you’re overextended on your credit cards then you need to do something about it, this is true, and it’s also true to “live within your means” but I have another viewpoint that you can look at that might be of some use to you: 

1.       If you’re stressed out about money every month, week, day, hour, minute or second, then LOOK at your income and expenses, I mean really look at them.  Find out how much you’re paying in interest per month, your true balances, not the minimum payments, and how much you spend on every other thing in your household.   Once you’ve done this, work out a plan to handle it.

2.       If you have “problems” because of money, then do the same as number 1.

3.       If you got a divorce, kicked the dog, or got foreclosed because of money, then do the same as number 1.

4.       If you ever yelled at a kid, wife, family member, friend, co-worker, or barista because of money DO NUMBER 1.

What I’m trying to say is that life is much easier to confront when you know exactly what it is that is creating the problems.  People have trouble confronting money, by confront I just mean LOOK!  And if you don’t know how to work out a plan, then ask for help!  I help people all the time work out plans so that they no longer have the problems listed in 1 through 4. 

Now, about the “live within your means” part of this whole thing, if you have a plan together and know exactly what you’re going to do to handle your finances, then instead of “living within your means” how about making more money so that your “means” get bigger and bigger and instead of “living within your means” and having your attention on that, how about making more money and living your life without worrying about it and flourish and prosper!

 

The Debt Lady says, “Live your life, love your people and stop kicking the dog!”

I got SUED now what do I do?

If you got served with a summons and complaint the first thing to do is, DON’T PANIC~~!   A summons means, COME to court, and a complaint means, this is why I am suing you!  I know those are pretty simple terms, but sometimes legal papers can be scary!  Why you ask, well let me tell you, its because attorneys use big words that people don’t understand to intimidate them!

 

There are 2 different types of law suits that you should be aware of, the first is you owe it and its legitimate and the second is somebody is trying to get money out of you and are grasping at straws to take advantage of you.  You have to realize that anybody and sue anybody for anything at any time.  Your dog could poop in your neighbor’s yard and he could sue you for it, believe it or not it’s the, American WAY!!!!” 

 

So, if you’re in a situation where you find yourself with court documents, the first thing to determine is, is it real? 

·         Do you owe a credit card company for a debt? 

·         Do you owe for back child support?

·         Did your car get repossessed and now you owe more money on it?

 

If you answered yes to any of these questions, then there are things you can do to handle the account. 

The first thing is to confirm that the amount of money that’s owing is accurate.  Sometimes companies will accelerate the amount owed on a law suit and if they do get the judgment against you, they can collect even more money.  Keep in mind that a judgment means that somebody decided on something, and that’s the extent of it. 

If you’ve determined that you owe the money, then call the law firm and try to work out a payment arrangement or settlement if you have the money to offer a lump sum.  Start out low, like 20 cents on the dollar to start, then move up from there and make sure you can pay the money if you have it.  If not then try to work out a payment arrangement.  If none of these things work, or the law firm just wont work with you, then prepare to go to court!  Now don’t Freak out! 

Going to court will NOT kill you, I promise!

 Bring all of the information that you have on any hardship, medical condition, unemployment or any other reason why you couldn’t pay the account so that you can show it to the judge.  Know how much money per month you want to pay and stick to that number.  By doing this, you are confronting your situation and not hiding from it!  You can always hire an attorney to do this for you but realize that the amount of money to pay the attorney may not be worth it!

If you decide to not do anything and let them get a judgment against you, then that is your prerogative also.  But I have to warn you that if you do nothing they can garnish your bank accounts or your job.  Garnishing simple means, taking something from you involuntarily.   They can also put a lien on your house, simply put means that if you sell your house down the road, the judgment will have to be paid as part of the sale. 

Now lets talk a little bit about that law suit where people are grasping at straws trying to get something out of you that they have no right to, or that you are not obligated to handle.  For instance, somebody decides to file a law suit against somebody else and finds your name on the internet where somebody thinks that you MIGHT be connected to them and you MIGHT have something to do with it.  Or your neighbor was tired of your dog pooping in their yard and decided to do something about it without simple communication! 

Then COMMUNICATE by every means imaginable!  If the plaintiff is a neighbor, go knock on the door and talk it out and get them to drop it.  If it’s a company, or someone you don’t know, call them immediately and find out what is going on and get it handled with them.  Get all the documentation that you need to refute it, read every word of the summons and complaint to know what they are suing you for and supply all of the documentation to them and tell them that you are not liable and give them proof.  It is best to talk first and don’t put anything in writing.  You can get an attorney, but realize that its going to cost you an arm and a leg!  You can do this yourself.  Unless you get stuck and cant come up with any other solutions, then hire an attorney, but first try to communicate and handle it that way.   You can also file an answer with the courts, you can look that up and get all the training that you need on the internet.  So, go to court, that way you can fight it.

 

Don’t allow attorneys to do whatever they want to you, communicate to get an arrangement, or fight it if it’s not owed or downright unethical!  Those law firms that put commercials on TV to get consumers to sue companies for no reason, are criminals trying to make a buck off of you.  If it is a legitimate thing, where somebody died because they took a drug or something like that then by all means, SUE, but if it’s an attorney office trying to make money off of you, then realize what it is and fight, fight, fight!

 

The Debt Lady says, “Put your dukes up and clobber them, if you don’t you’ll be the one lying on the ground!”

How CAN I STOP Collectors from harassing me?

Stop collectors from calling you, sound too good to be true?  Well believe it or not, it’s the easiest thing in the world to do.  There is a federal law that governs bills collectors called the Fair Debt Collection Practices Act (FDCPA) and if you know those laws, you can be more in control of the communication that you want or don’t want from bill collectors.  Now keep in mind that this law is for third party bill collectors, which means, not the original collector.  For instance, you owe money to Discover and Discover calls you, they don’t have to abide by the Federal Law, but some companies do!  So these tips are going to be for the bill collectors that are calling from Collection agencies, law firms, and anybody else that is not the ORIGINAL creditor, get it?  GOOD.  So here we go:

1.        If you get a 30 day demand letter from a collection agency, (You will know this by the letter that states you have 30 days to dispute the account) you can request proof of the debt.  But it must be within that 30 days, and if you do so, they can not collect the debt until they supply proof.   There are instances where collection agencies will charge additional fees that they can or cant charge, you need to be aware of how they came up with the money they say you owe, so that you are more in control.  Also, if they cant supply proof, then by law, they cant collect the debt and if they send you more demand letters or call you, they are actually breaking the law and you could file a law suit against them for harassment.  What a concept right?

2.       If the creditor is pounding on your phone at home, send them what is called a Cease and Desist order.  Which basically means for them to stop contacting you.  By law they have to, go figure right?  Make sure that you keep a copy of the letter just in case, to prove that it was sent, again, this is another way you can file a law suit against the company for harassment if they don’t comply.

3.       If the creditor is calling you at work, simply tell them not to call you and that you cant take personal calls at work, and just to follow up with them, send another cease and desist order.   This will get them off of your back.

4.       If you want to communicate with the creditors to work something out with them, do it on your terms, not on theirs, make sure that you know what you’re going to offer and if you don’t get what you want, ask for a supervisor and their supervisor and their supervisor, until you have reached a person that will help you.

By following these simple rules, not including the many other rules that you can find at the FTC.gov website under the FDCPA, you will be more in control of the creditor traffic and be able to do what you intend to do to handle your debt and not be pushed into something that you don’t want to do!

 

The Debt Lady says, “Know the laws, be in control and win the game!”

How CAN I STOP Collectors from harassing me?

Stop collectors from calling you, sound too good to be true?  Well believe it or not, it’s the easiest thing in the world to do.  There is a federal law that governs bills collectors called the Fair Debt Collection Practices Act (FDCPA) and if you know those laws, you can be more in control of the communication that you want or don’t want from bill collectors.  Now keep in mind that this law is for third party bill collectors, which means, not the original collector.  For instance, you owe money to Discover and Discover calls you, they don’t have to abide by the Federal Law, but some companies do!  So these tips are going to be for the bill collectors that are calling from Collection agencies, law firms, and anybody else that is not the ORIGINAL creditor, get it?  GOOD.  So here we go:

1.        If you get a 30 day demand letter from a collection agency, (You will know this by the letter that states you have 30 days to dispute the account) you can request proof of the debt.  But it must be within that 30 days, and if you do so, they can not collect the debt until they supply proof.   There are instances where collection agencies will charge additional fees that they can or cant charge, you need to be aware of how they came up with the money they say you owe, so that you are more in control.  Also, if they cant supply proof, then by law, they cant collect the debt and if they send you more demand letters or call you, they are actually breaking the law and you could file a law suit against them for harassment.  What a concept right?

2.       If the creditor is pounding on your phone at home, send them what is called a Cease and Desist order.  Which basically means for them to stop contacting you.  By law they have to, go figure right?  Make sure that you keep a copy of the letter just in case, to prove that it was sent, again, this is another way you can file a law suit against the company for harassment if they don’t comply.

3.       If the creditor is calling you at work, simply tell them not to call you and that you cant take personal calls at work, and just to follow up with them, send another cease and desist order.   This will get them off of your back.

4.       If you want to communicate with the creditors to work something out with them, do it on your terms, not on theirs, make sure that you know what you’re going to offer and if you don’t get what you want, ask for a supervisor and their supervisor and their supervisor, until you have reached a person that will help you.

By following these simple rules, not including the many other rules that you can find at the FTC.gov website under the FDCPA, you will be more in control of the creditor traffic and be able to do what you intend to do to handle your debt and not be pushed into something that you don’t want to do!

 

The Debt Lady says, “Know the laws, be in control and win the game!”

IRS Makes you Pay Money when you Save Money

If you pay less than the full amount of any debt the IRS makes you pay tax on that money.  An example would be if you owed $1,000 to Chase on a credit card and you settled with them for $400.  The IRS considers that $600 as income to you and you will have to pay tax on that money. 

 

How does that make any sense at all you ask?  Well I ask the same question because it isn’t money that you actually received being what INCOME would be defined as.  Money that was actually received for something or in exchange for something is what is considered income.  So where does the IRS get off in making you pay tax on that money that you save?  Because they can!  So at the end of the day you got a settlement with a creditor, that they agreed to, and now you have to pay tax on that money that you saved. 

 

Really creepy, I say! 

 

If you are in a situation where you have saved money and have a 1099C form from a creditor, find out a few things that could help you so that you may not have to pay that tax. 

 

Did you settle that account because you didn’t have the money to pay?

 

Are you in a financial situation that is not optimum and are having problems making ends meet?

 

If you answered YES to either of these questions, then you may be eligible for a tax break on those pesky taxes.  You would normally claim 33% of the saved amount as income, but if you can prove financial insolvency then you may owe nothing. Find out by going to the IRS.gov website and looking at form 982.  This form determines if you are financial insolvent or not. 

 

If you don’t do your own taxes then I would recommend you get with your tax professional and ask him that question.  You never know what could happen.  But remember, I am not a tax attorney or tax professional and you should always consult one when you have a question, I’m just letting you know that there may be a way to not pay those taxes.  On the other hand, if you have the money and DON’T have a financial hardship, then by all means, pay your taxes on the money you saved.

 

The Debt Lady says, “If you know you have options, then why would you do anything else?”

 

Never Worry About Money Again!

By Jerri Simpson

Do you ever worry about money? Do you worry about what could happen if you buy this or don’t pay that, worry about how much it’s going to cost, or maybe even where it’s going to come from? You’re not alone. So many Americans today are consumed with money worries to the point that they seldom take the time to really enjoy their lives. It’s like constantly looking over your shoulder every minute of the day, worrying about whether your car is going to be stolen or when your cell phone is going to be plucked out of your hand by some hoodlum. It’s exhausting!

Can you imagine what it would be like NOT to worry about money? In some ways, having complete control over your finances is akin to having complete control over your life. But how do you do that? It actually quite simple: Just by knowing where your money is going puts you in better control.

Having a budget is the key to regaining control over your finances. I’ve heard people say that sticking to a budget restricts their financial freedom. This couldn’t be further from the truth. A good budget should include everything that involves your money. It’s your ticket to being able to go anywhere or do anything that you want, without worrying about the cost, or negative consequences to your bills.

If you knew exactly how much you were making, where your money was going and how much you needed for extracurricular activities, then you would never have to worry about overspending or overdraft charges. You could even plan for additional expenses by setting money aside in savings and paying cash when you’re ready instead of outrageous credit card interest.

The richest man in the world could walk into a store and buy anything he wanted without having to think about money. But would he be happy? Well it’s the age-old question: Does money buy happiness? Not even close. Of course you have to make and have money in order to survive in our modern world. But is that what makes people happy? I think not.

Happiness comes from within, from knowing who you are, following your goals and dreams and being the best person you can be. Happiness is putting your attention on the beautiful things in life — a happy family, a short trip to another city, sitting down and talking over dinner or just spending time with your best friends. It doesn’t have to cost a lot of money to have a good time, to have great friendships, a loving family, or even a smile on your face and a spring in your step.

So learn what you need to know, handle what you need to handle, do a budget, and live your life to its fullest. Breathe in the ocean air or the smell of freshly mowed grass, watch the children playing in the yard, and go out and enjoy life. The only thing you should worry about is absolutely NOTHING!

The Debt Lady Says, “Play your cards right and you might have a flush!”

DON'T ALLOW YOURSELF TO GET GARNISHED!

Have you had your bank account or wages garnished?  Did you find yourself out of money, out of time and out of groceries?  If so, you’re not alone.  People get garnished every day.  Why?  Because they don’t confront and handle the problem that they got themselves into.  Bill collectors can be obnoxious creeps that don’t let you get a word in and threaten you with all sorts of things.  This puts people into a position of not wanting to communicate with them and puts them in a worse situation.  Here are a few tips to help you handle those situations so that your money isn’t taken from you:

1.       If you communicate with the creditors you will have more luck handling them so that you won’t get garnished. 

2.       Make arrangements, and keep to them.  Make sure if you get a payment arrangement from a collection agency that you get it in writing.  DON’T take their word for it, bill collectors lie. 

3.       Offer settlements to law firms for less than the full amount, they might just take it.

4.       When you’re supposed to go to court, go to court.  Plead your case and try to get a payment arrangement from the judge, it could be a much better payment arrangement than the one the creditor offered you.

5.       CONFRONT, CONFRONT, CONFRONT!  Look at the paperwork, appear in court, pick up the phone and call.  Go on line and get more understanding on the process and you will be more educated to handle the situation.

6.       Be tough and fight for what you want, don’t back down.

By following these simple steps you can make a difference in your life and not be caught off guard by a garnishment.  I hope I have your agreement!

 

The Debt Lady says, “Keep the money you earn and don’t let anybody take it away from you!”