My lawyer says they are not and a good accountant would agree. Is that true?
You owe no taxes on your forgiven debt.
Good thing to or that would be really backwards and would hurt the person you just helped.
Check out my Personal Finance blog for more finance information. http://personal-financial-advising.blogspot.com/
My boyfriend has a pattern of overspending and living paycheck to paycheck. At the beginning of our relationship, I let it go. And then I got really worried about what this could mean for our future. And, now I’m just resigned that we’ll never be that kind of couple who invests together. Is my boyfriend’s irresponsiblity with personal finances something I should be concerned with?
If you want to have a future with him, yes you should be concerned with it. He would be compromising both your futures. It would be difficult to make the major purchases that you’d like to in your life (like get a mortgage together), and you will not be able to get through the rough times well (like if one of you gets laid off for awhile).
I would sit down with him and set up a budget. Have him work on paying off any debts while not being able to exceed an allowance (cash allowance only…take away all other access to money — except for an emergency card that he can’t use unless his car is in a ditch or something).
My husband owns a very small pest control company. We do not get paid on a regular basis and the amount always varies depending on how many jobs he has that week. We are trying to get on a budget and I am not sure what to do. We’ve been on a budget before back when he worked for a company and got paid a certain amount each week. I do not know how to account for the variations.
Take out a sheet of paper and write down each and every expense that you have. Next, put them in order of importance. I recommend starting with food, shelter, utilities, and clothing. From there move into debts and finally at the end of the list, unfortunately, should be entertainment.
As money comes in pay the items in the order you listed them. For instance, at the beginning of the month you will need to pay the rent/mortgage. Once that is paid for use whatever money is left over to pay the next item on the list.
Each time you are paid just start where your last income left off and go down your list. It is a great idea to set aside a little money each time you are paid to build an emergency fund of one to two thousand dollars to help you through any slow times you may see in the future.
Should you want more information regarding budgeting or emergency funds you can check out cash-in-full.com. It is a blog focused on personal finance.
I hope this helps. Best of luck!
will our personal debt be dissolved or just moved along with the new currency and world gov etc.?
It has already happened, which is why the recovery is taking so long. This is a "balance sheet" recession.
http://www.voxeu.org/index.php?q=node/3065
http://delong.typepad.com/sdj/2010/08/first-draft-of-september-8-principles-of-economics-lecture-financial-markets-and-depression-economics.html
So we’ve seen what happens:
A. People abandon their homes because they can’t afford the mortgages.
B. People renege on their other debts: credit cards, etc.
etc. Those who have jobs pay off the debt they can,
http://blogs.wsj.com/economics/2010/07/08/consumer-borrowing-dropped-again-in-may/
but most of the decline in outstanding personal debt has been defaults:
http://www.federalreserve.gov/releases/g19/current/default.htm
http://www.housingwire.com/2011/01/19/household-debt-decreased-in-2010-due-in-part-to-default
and it has been this was since the recession began:
http://www.reuters.com/article/2008/07/23/idUS160626+23-Jul-2008+BW20080723
Of course, this has hurt the small banks (those that didn’t get federal rescue money) a great deal:
How The Bailouts Hurt Small Banks and Benefited Big Finance.
And the result is nasty (and self defeating) for all
http://krugman.blogs.nytimes.com/2009/01/30/damnification/
I’m looking for an amateur finances program that I could use to get my boyfriend and my money/spending organized. Nothing too complicated and free preferably. My finances are fairly simple but he travels a lot for business and has to keep track on expenses. Any suggestions would be helpful keeping in mind that I’m not financially savvy.
Thanks!
For tracking your spending and overall money management, mint.com is a good site. As someone else mentioned, you can link your accounts and it will keep track of what you spend and even attempt to automatically categorize it for you so you know how much you spent on gas, groceries, dining, etc.
For learning about your finances and getting some help planning them, I’ve actually started a site called Finavigation (http://finavigation.com). The site is free and includes a feature that analyzes your finances, gives you some pointers on things you can improve on, prioritizes your savings goals for you, and shows you the most efficient way to pay down your debts. It also has a blog with financial lessons so you can learn about the basics of personal finance and how to get ahead financially.
Good luck and I hope you find something that works for you!
Help! What does this phrase mean: "A fat lot of good the investment and money management books will do you"?
The text is about people with debts. Thanks!
it means that investment and money management books are worthless
I was planning on switching careers back to money management. But this mortgage mess has me contemplating filing BK.
Do anything you can to avoid bankruptcy, imho. See if you can negotiate your debts down, work a short sale on your home or whatever. Get yourself on a written budget as quickly as possible. Spend every dollar on paper on purpose before it comes into your home. That made the biggest difference for us with our finances.
Now about the financial services industry/money management. Yep, that will affect you big time. Companies are going to run a credit check not only to assess your responsibility level and to see if you’re a risk financially to them…but also if bonding is required, you won’t be able to be bonded or get clearances you might need if your credit isn’t where it needs to be.
When someone is dealing with other folks’ money & they’re in a hardship position…that’s when a person might be most tempted to short cut or flat out steal. They’re more susceptible to temptation and the manipulation of others if they’re under financial stress.
Now that’s not to say YOU would do something illegal or unethical. We’ve been in dire straights financially before & took the high road…but statistically someone in a tough financial situation is going to be more likely to succumb & companies don’t want to take that risk.
Pay off your mortgage early with 9 Year Mortgage! http://bit.ly/9yrmortgage – Pay off your debts and your mortgage in about nine years. No need for debt settlement, credit counseling, or a home equity loan. http://www.youtube.com/watch?v=kXfBcWbzo-w
Duration : 0:3:27
HI,
I’m a trader in financial markets. This is my first work. After about 2.5 years of struggle I’ve finally become a profitable trader. Along the way I’ve accumulated debts, I’ve been less than honest to the people I’ve owed. I suppose some of you will understand how a person behaves when things get really ugly.
Since I’ve never really had a time in my life where I’ve had a fixed income (salary) run a home. Now at this stage in my life I’m still not matured enough to do sound financial planning. When I say financial planning I do not mean how to diversify my savings portfolio but basic financial planning of everyday things and managing a persons lifestyle. I’ll be grateful if you can suggest any resources a book, a website, an article which will educate me about managing my finances.
The first thing you need to do is figure out how much money you need to spend.
You _need_ food, shelter, clothing, utilities, anything your boss requires you to have for work and transportation. Everything else is a "want" and not a "need".
Add those things together. If that’s less than you earn, you’re good so far. If it’s not, then you need to see about less expensive "needs"–maybe you sell your current car, and use the money from that to get something cheaper to operate (gas, insurance, car payments, etc.). Basically, if you’re not living in a cardboard box and dumpster diving for your meals, you’ve got some wiggle room.
That stuff gets paid first. If you can set it up, see about having the money taken directly from your checking account. That way, you don’t run the risk of spending money on stuff you don’t need, and then can’t pay the electricity bill.
Take 10% of what you earn, and put it into savings. The standard rule of thumb is to have enough to live three to six months.
Still less than your earnings? Good. Now if you’ve got debt (especially credit card or student loan debt), get them paid off as quickly as you can. You’re paying ungodly amounts in interest–get rid of that debt, and you’ll be amazed at how it frees up your finances. Some people end up spending half of what they earn just to make the minimum payments on those debts, and can’t figure out why they never have any money.
I managed to clear up my credit card debt by paying off the one with the lowest balance first. Then, I could use the money I had been paying on that, and roll it into the payment on the next lowest balance, and so on. By the end, I was cutting huge swathes out of the last card’s balance each month, paying the same amount I had been paying on five or six cards.
If you’ve got more than one credit card, I’d look at getting rid of all but one (or maybe all of them). If you’re thinking, "But what about emergencies?", that’s one of the things that 10% going into savings is for. That way, when the car needs tires, or (like me) you have a several thousand dollar bill to fix a backed up sewer line, you can pay cash, and avoid the credit card interest.
If your job has a retirement account you can put money into, put in every dime you can afford to. Once the emergency fund is set up and you’ve got three to six months living expenses, you can invest that money too.
Once you’ve done all that, then you can spend on "wants". Wants (to me at least) are strictly a cash business. If I don’t have the money in the checking account to pay for it, I save up until I do.
That’s how I did it. When I became unemployed in 2009, I was able to get by on unemployment because I didn’t have any debt, and I became really ruthless about cutting what I didn’t need to spend. When I finally got back to work last year, I also didn’t have a hole to climb out of, so while I’m not making as much as I did before, I am making enough to pay my bills, and even have a little extra "wants" money.
Is it hard for you to pay your bills in a timely manner each month? Do you feel like you are drowning in a sea of debt and you just can’t get out? If you have credit issues then you should try to get some help for them. If you try to consolidate your loan you will have just the solution you need to get out of the ocean of debt that plagues you. You can find the perfect solution when you get better at managing money and consolidate your debt.
Taking care of your finance situation can seem daunting, but getting the right debt consolidation help is not as hard it seems. You might be able to take care of your personal loan issues as well as any other financial burdens you may have when you merge all your debts into one loan at a better interest rate and only pay off one creditor per month.
You may find that credit card companies charge as high as 20% interest, while debt consolidators can save you on this high rate. You might be able to get different kinds of loans with much better rates. If your credit card debt is what is sinking you deeper into a fix than debt consolidation is a good option.
When your interest rate is lowered, you will have more money to spend and you will also have a better-balanced budget. You can repair your credit history when you take this road and you can be free of hassling creditors.
Check out these handy tips to help you overcome your debt and financial issues as quickly as possible.
Even if you ignore your credit problems, they won’t go away so this is not the best option in terms of handing your problems. It doesn’t matter how long you ignore them for they will still be there.
Make sure you write down all of your monthly expense and try to eliminate things that are not crucial. Is it possible to eliminate some items from your life?
Writing down the exact number of your monthly bills can help put them in clearer perspective for you and help you to make better choices.
Each loan is composed of two pieces, the principal amount and the interest. You want to may as much off as you can each month to avoid higher interest rates. When you only pay off the minimum each month you will get increasingly higher interest rates that will keep you in debt longer. When you consolidate your debt you can have lower and lower rates and your principal will go down.
It is hard to save when you have debt issues in your life, but attempt to put a bit aside each month. If you do this, you might lower your risk of going into further debt.
Stay away from borrowing money as soon as you have restored your credit. You don’t want to sink back into debt again and having a good credit rating is key for the future. As tempting as it can be to take on more debt, stay away at all costs.
Jack Blacksmith
http://www.articlesbase.com/finance-articles/managing-money-is-key-115142.html
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