Due to the recent state of our economy, many people have been confronted with an unpredictable loss of income as companies are forced to restructure their workforce. Layoffs, downsizing and foreclosure seem to be constantly in the news. Companies are also cutting back on overtime, which can cause a profound reduction in income while salaried individuals are asked to take on more tasks and work more hours. It is wise to start thinking about “what if” alternatives and plan for possible unemployment, a reduction in pay, loss of overtime or a potential pay freeze. If you are married you should have a plan if either of you becomes unemployed.

Following are some tips to help you prepare if you think you may be facing a pay cut or reduction in income.

• The most important item on your agenda should be an updated budget.  If you are like most consumers, your monthly income never goes far enough. After paying for the house and groceries, it seems there is little leftover for things that matter most. The reality is it may not be your salary that is to blame; it might be a pattern of poor spending choices.
• It has long been recommended that people set aside the equivalent of three to six months of income to carry them through a crisis. Review your current monthly expenditures i.e. food, gas, needs, mortgage, auto loans/leases, insurance, etc. and reconfirm that your savings can sustain you for this period of time. If not, you must put aside extra funds from your current cash flow to build up your savings.
• Plan to pay off any 401(k) loans that are outstanding. If you lose your job you will be required to pay back any 401(k) loans rather quickly, possibly within just a few weeks. If you do not repay these loans, the government considers these funds an early withdrawal and will require you to pay taxes and penalties on the funds.
• Review employment benefits, including medical, dental coverage and life insurance. Take care of necessary annual checkups and examinations while you’re still covered. Married couples who are both employed should look into moving the entire family to one spouse’s plan. You may be able to reduce your expenses by reevaluating telephone plans, eliminating a cell phone, or eliminating a home maintenance service. Any of these funds could be deposited into your savings account.

DMCC offers free budget counseling sessions for anyone who is interested in getting their finances organized; even if you are not facing a reduction in income or unemployment. Establishing a budget is the first and most important step when confronted with an income reduction.  This is a necessary tool in formulating a strategy to stay ahead of your finances.

Our certified credit counselors will help figure out what you can do to maximize your income and put some funds away for savings.  DMCC can also help you answer questions that you may be facing about repaying your debts on a lower income.

Jessica Stokes is the Education and Research Coordinator at Debt Management Credit Counseling Corp. (DMCC) a 501 (c)(3) nonprofit charity committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with debt. DMCC is approved by HUD to offer housing counseling and by the U.S. Department of Justice to provide bankruptcy counseling and education. DMCC is located at 700 W. Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441. To speak to a certified credit counselor, call 866-618-DEBT (3328), email contact@dmcconline.org or visit www.dmcconline.org.

Step 1: Open a browser and go to www.annualcreditreport.com.

Step 2: Select your state using the drop down menu and click “Request Report”.

Step 3: Complete the online form and click “Continue”.

Step 4: Click on the check box next to TransUnion (you may also choose Experian or Equifax, but their reports do not include full account numbers).

Note: You are entitled to one free credit report per credit reporting company per year. That means you may go back and get reports from the other two credit bureaus at any time during the year.

Step 5: You will be transferred to the credit reporting company’s site where you have to create an account.

Step 6: The credit reporting company will need to confirm that you are who you say you are. It will ask you questions related to your account numbers, address history, or employer history.

Note: You typically will only have to answer one open ended question like “Of the four following cities, type the name of a company that you worked that was based in one.”

Step 7: In addition to your free credit report, you will be offered to see your credit score for a small fee (under $10). Click “No Thanks” to see just the free credit report.

Step 8: Your free credit report now appears. Print it out or save it to a file on your computer.

Note: If you disagree with any part of it, there is a link for you to learn about how to correct inaccuracies.

Step 9: Click “Logout” when finished.

STEPS TO OBTAIN FREE CREDIT REPORT THROUGH THE MAIL OR PHONE

If you would like to obtain your credit reports by U.S. P.S. you must go to www.annualcreditreport.com and download the request form. Print and complete the form. Mail the requested information to:

Annual Credit Report Request Service
P.O. Box 105281
Atlanta, GA 30348-5281

Your reports will be mailed to you within 15 days. Please allow 2-3 weeks for delivery.

To request your credit report by phone call 1.877.322.8228. You will go through a simple verification process over the phone.

After being enrolled in DMCC’s Debt Management Program (DMP), you qualify for a Credit Score Analysis.

What is a Credit Score Analysis?

Your credit score is a direct result of what is listed on your credit reports. Therefore, changes to your reports, could have positive or negative consequences. DMCC has the ability to simulate changes to your reports. After 6 months on our DMP, DMCC will show you what you need to do to improve your score. Contact DMCC and learn how you could get a free analysis.

DMCC is a 501 (c)3 is a charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with their debt.  Education is provided free of charge to consumers as well as personal counseling to identify the best options for the repayment of any unsecured debt. To speak to a certified credit counselor, call 1-954-418-1466, email contact@dmcconline.org.

DMCC is located at 700 West Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441.

1. You do not have any savings.

2. You make minimum payments on your credit cards.

3. You use credit cards for things you used to buy with cash, such as groceries.

4. You use increasing amounts of your total income to pay off debts.

5. You have more than two or three major credit cards.

6. After you pay your credit card bill, you increase your balance by the same amount (or more) the following month.

7. You are at or near your credit limit on your credit cards.

8. You count on the float in order to pay your bills, writing a check hoping that you’ll be able to cover it by the time it clears your bank.

9. You are unsure of the total amount you owe on all your debts.

10. You take out cash advances on your credit card to pay other bills.

11. You have tried to make a purchase with your credit card and been declined.

12. You have been denied credit.

13. You bounce checks.

14. You get calls from collectors.

15. You lie to your spouse or other family member about your spending, hide credit card statements or constantly argue with family members about your finances.

If you realize that you are in over your head, the sooner you act, the easier it will be to get out from under the burden of debt. Beware of companies that promise to fix your credit. There is no easy fix, but it is possible to turn your finances around if you work at it.

Here are some other warning signs that you might be piling up too much debt:

• You cannot pay off the bill in full each month. Even before you get to the stage where you’re only paying the minimum, there are warning signs. If you rarely see your credit card balance drop to zero, you need to start rethinking your spending/saving plan.

• You are charging because you haven’t got the money. If you are making purchases with your credit card because you can’t afford to pay cash for it, that’s a strong sign you are in financial trouble.

• You are near or at the limit with your credit cards. You have spent yourself into a corner, and the credit you need for everyday life is used up.

• You are suffering physically. Your brain is recognizing that your spending patterns are in conflict with your income and your anxiety level increases.

• You are running up unsecured lines of credit. Many institutions offer lines of credit or overdraft protection on checking or savings accounts. If you are utilizing these services on your accounts month to month, then you have a problem. Because these services usually have a cost associated with them, they can be costly every time they are used.

DMCC is a 501 (c)3 is a charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with their debt.  Education is provided free of charge to consumers as well as personal counseling to identify the best options for the repayment of any unsecured debt. To speak to a certified credit counselor, call 1-954-418-1466, email contact@dmcconline.org.

DMCC is located at 700 West Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441.

There are, however many differences in these two types of debt. Students often do not understand the long term effect of this toxic debt. Of note: Student loans cannot be discharged in bankruptcy. There is no statute of limitations on the repayment of these student loan obligations. As long as you owe, you owe. Repayment begins six months after graduation or the student leaving the educational facility. Loans that are awarded based on financial need are low-interest loans sponsored by the federal government. The government subsidizes these loans, so no interest accrues until you begin repayment after you graduate or leave school. There are other loan options available that are not need-based. If you need to borrow money to attend college, be sure your federal loan options are exhausted before considering private loans. On some private loans, interest accrues while students are in school.

Rethink college and the finances of your degree. Pay as you go, get a job. Save before you get there (students and parents). Live like a college student. Get college credits while in high or attend community colleges for general education. Do a budget. Live at home. Apply for scholarships. Minimize your college expenses.

If you must borrow for your education, follow these tips.

1. Ignore your available loan limits and borrow as little as possible.

2. Pay a little each month on each loan while you are in college so you know this is not free money.

3. Be certain to notify all lenders of your new address and contact information after graduation or when you move.

3. Keep track of all your loans. Students may graduate with three to four types of loans and with a loan for each semester they are in school. Set up a spread sheet that lists the following categories: lender’s name, website, payment address and phone number for the lender, type of loan (Federal, Perkins, Stafford, private, etc.), loan amount, interest rate and any fees, date interest begins to accrue, loan term, deadlines for repayment and any payments made.

4. Know that even if you are granted forbearance, an economic hardship deferment or an alternate repayment schedule your interest on the loans continue to accrue.

5. Payments must be made on each loan in a timely manner unless they are consolidated.

6. Cut your expenses. There are five categories of expenses while in college for the average student. Tuition and fees are set by the institution. Maximize your credit hours for the tuition paid. Twelve plus hours cost the same tuition as 15 or 18 hours. Room and board are the costs that are most controlled. Live like a college student not your professor or your parents.

Books and supplies also have some student control functions. Frequently these options may also include a timing and preplanning component. New texts may cost $230 while renting the same may be only $110.

You must plan ahead. Personal expenses include cell phones, computers, internet, clothes, etc. These also may be controlled by the student and the “wants versus needs” analysis should apply.

Transportation is the final category. Limits on where and how you travel may save you years of future debt.

Think before you borrow. Plan after you do. Pay off your loans as soon as you can once you graduate.

Nonprofit agency presents free Webinars to tell consumers the truth about debt settlement and loan modification advertisements.

DEERFIELD BEACH, Fla., May 13 /PRNewswire-USNewswire/ –Debt Management Credit Counseling Corp., a nonprofit organization (“DMCC”), today announced that it will be presenting free Webinars to inform consumers of the truth behind certain debt relief advertisements. The free Webinars will focus on helping consumers identify the misinformation being given by marketers of debt settlement and loan modification programs. Consumers attending the Webinars will learn the truth about these programs and be provided information about other debt relief options. Webinars will be presented Wednesday, June 3rd at 1:00 p.m. and 6:00 p.m. EDT, and Saturday, June 6th at 11:00 a.m. EDT.

With today’s economic conditions, many consumers are finding it difficult to pay their monthly credit card bills and home mortgage. Often overwhelmed and desperately seeking help, consumers turn to the debt relief solution that is advertised the most without knowing if it is the best choice for their personal situation. Not surprisingly, the companies that advertise most often generally charge the highest fees. Consumers responding to these advertisements are not always presented the truth about the programs or other viable options that may be better for them, such as creditor hardship programs, debt management plans, and bankruptcy.

“Be wary of companies providing debt services that do not conduct a complete assessment of your budget, risk tolerance, and short- and long-term goals. They are typically commissioned to place you in the program they are selling rather than assessing multiple options and matching your needs to the best available,” stated Bonnie L. Canty, an attorney whose firm provides consumer advocacy services.

Counselors from DMCC will be presenting the Webinars and attendees will have the opportunity to ask questions.

About DMCC

DMCC is a 501(c)(3) charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers overextended with debt. Education is provided free to consumers via seminars, workshops, financial literacy programs, and a vast array of online and printed materials. Counseling is provided free to consumers to identify the best options for the repayment of their debt.

http://www.dmcccorp.org

CONTACT: Jessica Stokes of DMCC, Jessica@dmcconline.org

Stated in an article on www.animallaw.info, the Uniform Trust Act of 2000 does not allow you to will property to an animal per se, but it allows you to set up a trust for the continuing care of your pet. The Act itself is an example of the increased recognition of animal interests.

As of right now, there are roughly thirty-one states that now recognize pet trusts. These trusts allow for the owner to name a pet as a beneficiary and to name a trustee to take care of the pet.

Make plans for your pet.

According to an article written by Eileen Ambrose of The Baltimore Sun, it is important that people make plans for what will happen to their pet. And whether they end up creating a pet trust, setting money aside in a will for care or use some other means, the issues owners face will be similar. For instance, pet owners need to find a caretaker and someone to manage the money left behind for the pet’s benefit. Usually the same person handles both roles. Look for someone who is responsible, capable of handling money and likes animals.Other suggestions in the article encourage you to:

• Name one or two backups in case the trustee cannot fulfill the job.

• Make sure there is enough money to cover pet expenses.

• Write a care plan, basically a memo detailing the veterinarian’s name.

• Include in the care plan the pet’s routine, medications, likes and dislikes.

Drafting a Trust

You will want to include specific information in the trust.

• The name and address of a trustee and an alternate trustee.

• The name and address of the caregiver and an alternate caregiver. (It may be beneficial to name the same person as the trustee and the caregiver)

• Detailed information on the identity of your pet. (microchip or papers)

• The standard living and care you wish for your pet.

• A detailed description of the property that will fund the trust.

• Information on how the remainder of the trust should be distributed once your pet dies.

• Instructions on the final disposition of your pet’s body.

According to an article by Richard Willing of USA Today, the average amount left to pets is about $25,000. It was also stated in the article that according to a 2000 survey by the American Pet Products Manufacturers Association that Americans own roughly 68 million dogs and 73 million cats. The impulse to protect them after one’s demise has always been strong and, for some, overwhelming.

DMCC is a 501 (c)3 is a charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with their debt.  Education is provided free of charge to consumers as well as personal counseling to identify the best options for the repayment of any unsecured debt. To speak to a certified credit counselor, call 1-954-418-1466, email contact@dmcconline.org.

DMCC is located at 700 West Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441.

Many consumers are now able to choose both local and long distance phone service providers. These companies offer many optional services such as voicemail, call waiting, caller ID, paging and wireless services. Review your telephone usage. Ask yourself the following questions so you can compare services and prices.

• Where do I call most often?

• What time of day or day of week do I call?

• Do I need voice mail or will an answering machine be sufficient?

• How often do I use call waiting and/or caller ID?

• If you are renting, are you paying for inside line repair coverage? (This is your landlord’s responsibility.)

Find out how each company prices its services. Is there minimum use, time of day or distance requirements, flat monthly fees, or special plans? If you have a cellular phone with free nights and long distance, you may not need any long distance service for your home telephone.

Most importantly, get your information in writing and do not be pressured into an immediate decision.

Slamming

This is the illegal act of switching your long distance, local toll or local telephone company without your permission. You may not know it has happened until you find a different company name on your bill or your phone charges are much higher than normal.

If you have been slammed:

1. Ask your local phone company to switch you back to your original company at no charge.

2. Tell the original company you are switching back, and ask to be enrolled in your previous calling plan.

3. Contact the company that slammed you, whose name and number is on the bill, to exercise your rights not to pay those charges.

Cramming

This is when companies add charges to your telephone bill for optional services you never agreed to, such as voicemail or “club memberships.” You may not notice these monthly charges because they are relatively small, ($5 to $30), and look like your regular phone charges.

To avoid being a victim:

1. Look at your telephone bill carefully every month, especially the detail pages.

2. Read the fine print on contest entry forms and coupons. You could be agreeing to switch your phone service or buy optional services.

3. Consider putting a “block” on changes to your phone service. If your telephone service provider offers a blocking service, the company must notify you before a change is made.

DMCC is a 501 (c)3 is a charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with their debt.  Education is provided free of charge to consumers as well as personal counseling to identify the best options for the repayment of any unsecured debt. To speak to a certified credit counselor, call 1-954-418-1466, email contact@dmcconline.org.

DMCC is located at 700 West Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441.

What is available?

The Federal government provides any or all of the following financial aid programs to undergraduate* college students:

Grants: Money that you do not have to pay back.

Loans: Money borrowed that you must repay with interest. Student loans usually have low interest rates that cannot be higher than a certain number.

Work-Study Programs: A student holds a job and his/her pay goes directly toward paying for tuition or other school expenses, such as books, etc.

* Undergraduate students are those studying to attain their bachelor’s degree.

How do I get financial aid?

Once you know what financial aid is available at your particular college or university, you must complete a Free Application for Federal Student Aid (FAFSA) to determine if you are eligible for financial aid. You can fill out a FAFSA for free at the official FAFSA website, www.fafsa.ed.gov. Beware of websites that will charge you up to $80 to fill out a FAFSA. Filling out a FAFSA should never cost you anything.

In order to receive aid from Federal Student Aid programs you must meet the following criteria:

• Be a citizen or eligible non-citizen of the United States with a valid Social Security number.

• Have a high school diploma or a General Education Development (GED) certificate or pass an approved “ability to benefit” test.

• Enroll in an eligible program as a regular student seeking a degree or certificate.

• Register or have registered for Selective Service, if you are a male between the ages of 18-25.*

• Have a result of “eligible” or “partially eligible” on the Drug Conviction question (question 31) of the FAFSA form.

* An applicant can check “Yes” on Box #29 of the FAFSA form, and the Department of Education will furnish Selective Service with the registration information.

The amount of money that you are eligible for also depends on your dependency status. If you are considered dependent, you must report your parent’s income and assets as well as your own, and therefore may receive less money because there will be a higher Expected Family Contribution Number. If you are an independent, you must report only your income and assets (and those of your spouse, if you are married), and this may allow you to qualify for more money.  In order to be considered independent, you must meet at least one of the following criteria:

• Be at least 24 years of age.• Be a veteran of the U.S. Armed Forces.

• Be married.

• Be enrolled in a graduate or professional education program.

• Have children that are your legal dependants.

• Be an orphan or ward of the court or were until age 18.

If you do not meet any of the above criteria, but feel that your extraordinary circumstances should allow you to qualify for independent status, speak with a financial aid advisor at your school. He or she can change your status if your case is truly worthwhile.

Grants

Grants are given based on need. To determine your eligibility, the United States Department of Education uses a formula to calculate your Expected Family Contribution. This number is calculated by taking into account your family’s income and other financial obligations. If you are an independent, only your income will be considered (and your spouse’s if you are married). If your eligibility changes during the academic year, you may lose the grant. You do not ever have to pay grants back.

Loans

While borrowing money to pay for a college education can be seen as a good investment, it should not be taken lightly. Student loan payments can put people in financial hot water if not managed properly.There are two main types of student loans:

1. Subsidized: this is a loan for which you will not be charged interest until you begin the repayment of the loan. You will also be exempt from interest charges during an authorized period of deferment, such as returning to school for a graduate degree. Subsidized loans are given based on financial need.

2. Unsubsidized: You will be charged interest on this loan from the moment the loan is given to you until it is paid in full. It is not awarded on the basis of need.

Although law dictates that student loan interest rates can never be higher than 8.25%, you must still be careful not to let the interest accumulate. If you do not pay interest charges as they accrue, they will be capitalized, which means that the interest will be added to the principal amount of your loan and additional interest charges will be based upon the new total amount. If your interest is capitalized, it will increase the amount of money you will have to repay. If instead you pay the interest as it accumulates, you will repay less in the long run. Please refer to Chart 1 for an example of how interest charges can capitalize.

When do I pay?

Most student loans provide a 6-month grace period after you graduate, leave school, or drop below half-time enrollment before you must start paying back your loan. If you have a subsidized loan, you will not be charged interest during this grace period. If by any chance, you cannot pay your student loan, you should contact your lender to find out about deferments, forbearances, and discharges.

A deferment allows you to postpone payments on your loan for a limited time and under special circumstances. You must keep making payments to your lender until your deferment is approved. If you have a subsidized loan, you will not be charge interest during a deferment. If you have an unsubsidized loan, you will be charged interest.

A forbearance allows you to temporarily postpone payments on your loan if you are unable to pay but do not qualify for a deferment. With forbearance, payments can be postponed or reduced. Be careful, as you will be charged interest during this time, no matter what type of loan you have.

A discharge eliminates your obligation to pay back the loan. It is only given under extreme circumstances. Student loans are not usually discharged by bankruptcy.

Federal Work-Study Program

A Federal work-study program allows students with financial need to work in order to pay for their education. The work-study program has a specific list of available jobs, and you will be paid at least the minimum wage, depending on the job that you are doing. You cannot, however, earn more money than your total Federal Work-Study award. There are also restrictions on how many hours a week you can work based on your class schedule and academic progress.

Any or all of these financial aid alternatives may be available to you to help pay for your education. Remember, spending on education may be the most important investment you will ever make. Go ahead and invest in yourself!

DMCC is a 501 (c)3 is a charitable organization committed to educating consumers on financial issues and providing personal assistance to consumers who have become overextended with their debt.  Education is provided free of charge to consumers as well as personal counseling to identify the best options for the repayment of any unsecured debt. To speak to a certified credit counselor, call 1-954-418-1466, email contact@dmcconline.org.

DMCC is located at 700 West Hillsboro Blvd., Building 1, Suite 105, Deerfield Beach, FL 33441.

“Hey Dad!”, my son screamed from our front door, “I did it, I was accepted to Boston University.”. My momentary exhilaration was overshadowed by the financial realities of college, especially private college. A quick calculation of my costs for 4 years of tuition, and expenses came to roughly $250,000, a very intimidating figure. Overwhelmed I thought, how could I possibly afford to send him to college? Fortunately, there are various options available to finance this academic endeavor.

Federal programs are the single, largest source of school loan consolidation. The first step in applying for this type of aid is going on the Free Application for Federal Student Aid (FAFSA) website, at http://www.fafsa.ed.gov/, and fill out a comprehensive questionnaire. It generally takes around 7 days to process, at which point you will receive a Data Release Number, and Estimated Financial Contribution. It is important to find out if the school you will be attending participates in the federal student aid programs, most do.

There are several federal programs available for student aid, assuming school participation. The Federal Stafford Loans, are available to both undergraduate and graduate students. First-year undergraduates are eligible for loans up to $2,625. Amounts increase for subsequent years of study, with higher amounts for graduate students. The interest rate is variable, but never exceeds 8.25 percent. The Federal PLUS Loans are unsubsidized loans made to parents; the interest rate is variable, but never exceeds 9 percent. Federal Work Study provides jobs to undergraduate and graduate students, allowing them to earn money to pay education expenses. These are the major federal sources of loan money for college.

Private education loans are also available from a variety of sources to provide supplemental funding when other financial aid does not cover costs. These loans are not sponsored by government agencies, and are offered by banks or other financial institutions. Sallie Mae is a unique loan that consists of a comprehensive package of both private and federal loans.

After accumulating 4 years of undergraduate education loans, it is best to consider a School Loan Consolidation Program. Very simply, you can elect to combine all your outstanding loans into one student consolidated loan, which may create more favorable terms and simplify repayment, benefiting both the borrower, and the lending agency. Major benefits include the convenience of lower monthly payments, a single fixed rate, and one payment per month. There is a minor downside, however, students who do not consolidate their Stafford loans will have a 6-month grace period after graduation to begin making payments. Students who consolidate must begin making payments within 60 days of their consolidation. Both parents and students are eligible to consolidate student loans. The school loan consolidation program streamlines repayment by eliminating different terms, repayment schedules, and lenders.

Will I be able to afford my son’s college education? Careful financial planning, and research should make this endeavor a reality. While it is true that college tuitions continue to rise, there is more financial aid available to compensate for the increases. Ultimately, a good education is your best investment.