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COVID Financial Struggles

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
October 26, 2020 8:03 am

COVID Financial Struggles

MoneyWise / Rob West and Steve Moore

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October 26, 2020 8:03 am

As the pandemic drags on, the economy is actually improving. But there are still millions unemployed, or losing work hours and overtime, and dealing with anxiety about their finances. On the next MoneyWise Live, hosts Rob West and Steve Moore talk with Neile Simon of Christian Credit Counselors about a plan to relieve the stress. We’re overcoming COVID financial struggles on the next MoneyWise Live at 4pm Eastern/3pm Central on Moody Radio.

Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore

Jeremiah 2911 readings for I know the plans I have for you clears the Lord, plans to prosper you and not to harm you, plans to give you hope and a future. Good to know as the pandemic drags on the economy is improving, but millions are still on work hours overtime and bonuses from West talks with kneeling assignment of Christian credit counselors about a plan to remove some of the stress that your calls on anything at 800-525-7000 800-525-7000 nine Steve Moore coming covert financial struggles. That's nice right here on money wisely partnerships a Christian, credit counselors and she joins us now from the front lines of the financial battle.

Many Americans continue to face with this pandemic lots exactly right Steve, she's right there in the trenches, along with the Christian credit counseling team and nearly were thrilled to have you back on the program. Thank you so much for having me on the shower. It's a privilege to be here speaking of the front lines. What you give us an update. What are you hearing from folks calling into Christian credit counselors these days. This pandemic I think has impacted all of us somewhere experiencing more expenses with the changes that are going on now with more people working from home, kids, kids being at home as well. Taking online classes have some parents who are having to cut back their hours which means a loss of income because they really need to focus and help their children through this transition.

You also see higher grocery bills going on here anymore because you're at home. The utility bills are going up. We've also seen that the federal unemployment was cut in half and then for some people, or some states eliminated altogether. Or maybe you have credit cards that were on promotions and those promotions are expiring and so the payments are more than doubling. So what's happening is a lot of people are experiencing a loss of income, higher expenses or a change in their budget and they haven't really accounted for and but there feeling it in their pocketbook or in their bank accounts and with things the way they are. There's a lot of uncertainty right so we really need to be focused and come up with a plan to prevent it from being a crisis was exactly right merely for folks listening to the program today and resonating with what you're describing. Perhaps seeing themselves in some of these scenarios you're outlining how can you help these folks find peace in the midst of these trials. I think the most important thing is to be open, honest and transparent with people right. A lot of times it's difficult when you are struggling with your finances or maybe you have overspent right so it's humbling to say, can I need some help. Or maybe there's a little shaman that okay I was in a good steward with my resources, but the important thing is that we are all human right and were here together to support one another as like-minded Christians and find ways to get out from underneath the stress and the strain that that can bring on so I would say reach out to your support system you took moneywise who has trusted resources continue to go to church.

I know a lot of churches are meeting in person, but you can certainly attend online have conversations with your friends with your family. Even with your kids about what's going on, and so that you're all working towards a common goal to get out of debt or to stay out of debt and really work within the means that you have. Well, I think also seeking out a godly counselor can be key in terms of helping you make some progress in the right direction, but with your values in mind. Why do you think it's so important to have a counselor who shares your values and is also trained in biblical finances. Yeah, I believe that it Christian credit counselors, we feel it's very important to be working with a Christian counselor because were like-minded. We have the same foundation where we want to share biblical principles around your finances, think often a lot of us get caught up in the worldly views of wanting to look drive a nice car have the nice house and just providing our children with what they need and want.

And a lot of times were not able to afford that.

So what do we do we put it on credit or reported on credit cards and then later find that you were were overextended. Brave men were not and then we don't have that peace in our lives right well we come back just around the corner. Here were going to talk about what you can do. What are some practical steps you can take and what about a debt management program is that the right solutions that are much more as we return. This is moneywise live his run was longed for taking your calls later at 800-525-7000. The financial wealth you leave behind could be the best thing that ever happened to your loved ones or the worst in splitting hairs, giving your money and things to your children without ruining their lives. Ron blue explains why it's important to make these decisions now, instead of forcing your heirs to do would later splitting heirs will foster a real appreciation for the precious resources that God has entrusted to you, and it's available. Click the start button moneywise you have money in a retirement account for just a general investing. You know, the stock market sometimes is possible to enjoy both profit and peace of mind and investing no matter what's happening. You can see a short video webinar on sound mind investing got bored since 1990 sound mind investing assault offer was for living well sound mind investing.O RG politics can be a grubby guy. People scoring points of one another, just to be on top of the heap to be in control now like that sometimes people want to win no matter what the cost is what you like that brought Jesus was listening to some in arguing about which one of them was the greatest. Obviously this is not a new problem and he signaled the greatest among you will be the servant of all. That sounds a bit screwy until you ask yourself who's the most influential person in my life is someone who loved me when I was taught to love kid for me when nobody else would, who covered for me who might be liquid who spoke up for me when I wasn't there to defend myself.

My Jesus has a point.

Mighty great.

This isn't so much about winning maybe out rightness is something that grows quietly and surely in the hearts of the people around us company.

Do you feel like your hands are tied with debt, preventing you from serving God. If you have credit card debt. Christian credit counselors can help through our debt management program we can get you out of credit card debt. About 80% faster while honoring your debt info.

For more information on how Christian credit counselors can help visit Christian credit Christian credit or call 800-557-1985, 800-557-1985 listed what it was talking really silent director of future partnerships that Christian credit counselors as we consider review talk about how the covert financial struggles that lots of people are facing and how the good folks at Christian credit counselors can help you with that Billy just before the break we were talking about those who find themselves in a situation where there overextended, perhaps because of the pandemic.

Or maybe just living the lifestyle beyond their means. Maybe they've gotten caught up in the comparison drops it, whatever it is there's a spiritual side and spiritual implications to being overextended talk to us about what you see in their jazz of the overextension really becomes bondage that is hard to break and was important understand is that credit card companies are designed to keep people in that cycle of making payments with very little progress because it's where they make their money so we at Christian credit counselors really teach people to spend less than they make work on creating saving buckets in different areas of their lives so that they're not just going out and buying whatever it is that they want, but they're showing some discipline saving up for it and then buying it when they can afford it and being a good steward with their resources. Not only that, but we need when you practice those principles. You really began to experience peace and and are able to live more generously, and it feels good to build your self-esteem as well that searcher nearly borrowed. Let's talk about the practical side of where we go from here somebody listening today is saying no I'm in trouble.

What are some of their next steps. As we talked about earlier expenses have changed. For all of us. So it's I think really key for everybody to get on a budget whether he if you don't have a budget create one or make some edits to the one that you currently have. Based on the changes I would say evaluate what your needs and what your wants are. During this time. If your income has shifted.

It's very important that your intentional about your spending so that you're not over spending and then again relying on the credit cards. I always encourage people to do to have these financial conversations with their family, not only their spouses but with their children to once the parents have discussed and can't understand what needs to be done. Bring the kids involved so that everybody is participating in collaborating terms and working towards the common goal that the family wants to have around finances and down. Be bold and open about your financial situation and lien on resources like Christian credit counselors like moneywise like their budget coaches and really seek out the resources that you need in order to keep you on track and keep you encouraged. Also, contact your lenders.

Some lenders are still providing some great experience. So find out what your options are so that you can make a good educated decision around them.

Really those are interesting double points.

You just went through you know so many husbands and wives themselves have trouble talking about these things about sharing these things with their children. I can imagine some people might push back on that thinking they don't want to burden the kids thinking that maybe this is something children don't need to know about at all.

Any thoughts in that regard.

Why think you don't have to have full disclosure with the children but if you're trying to cut back in terms of eating out right and to be at home maybe do meal planning. Get the kids involved with cooking write and say that that were working on being more intentional with their spending and and saving more, and so finding ways just to have them participate. Maybe not know all the financial numbers specifically but just have them be a part of what the goals are for the family in terms of cutting back on costs and expenses. The idea of getting the kids involved in working together because were teaching biblical principles of managing money at the same time that they can carry on into their adult lives are nearly what about the debt management program. How can you tell if that's the right solution for you. Some of the indicators I would say if some of you are staying up late in your you're worrying about your finances in your debt. If your relationships are suffering or you feel distracted at work. Maybe even having feelings of hopelessness, right, or maybe you're doubting God's provisions and in its preventing you from being as generous as you'd like to be think those are some really good indicators that it's that it's time to just reach out and have a conversation and figure out what your options are and if you can get some help. If this is a new concept for some folks this idea of using the debt management program like the one offered by Christian credit counselors. Can you give us just a quick overview of how it works. Short so the way Christian credit counselors can benefit you is that we have relationships already in place with the creditors where we have pre-negotiated interest rates, terms and conditions so through our program and service were able to lower your payments and your interest rates and then we consolidate all of the debt into one monthly payment and we snowballed the debt so what that looks like for you is that throughout the program you're in a continue to make monthly payments to each and every creditor on the plan. Those payments will just be made through us with the lower terms and and once an account gets paid off. That payment is then applied towards another account to help people pay out the debt faster so.

Through this process of lowering the APR's and snowballing the debt were able to get you out of chat about 80% faster versus if you were just making minimum monthly payments now on the program you are honoring your debt in full. We are not a settlement company and were not providing a consolidation loan.

The way our program works as we set you up on a monthly draft from your checking account. We pull the funds and then we electronically disperse payment to the creditors.

Seven days later. So the next steps would be to figure out how we could help you. So what we offer is a free consultation which will consist of working you up a comparison estimate outlining what you're paying now versus what you could be spending with us so will have the new APR's. The cost savings interest savings estimated time to repay and also what our monthly service fee is and in part of the free consultation will also be working to create a budget with you. Once we do those two things we send you all the information so that you can think about it pray about it.

Share the program with your spouse and make a good decision. So our goal is really just to educate you and expose you to the resources and allow you to make a decision well I love that it's trusted godly counselors. People who know the Council of Scripture to be on the journey with you. So no reason not to see whether this is the right solution for you, merely in terms of looking at where we go from here.

You talked about confronting the issues you know. So often we find yourself in this position where the bills are melting. We don't know how they are to be paid the credit card that seems to be rising, not falling, we tend to just run away from it. Perhaps not even open envelopes anymore. Why is it so important to confront these issues out on God a great point because a lot of times people are fearful or they're scared or they don't have the resources to get an action because they don't have the money to pay the bills. So what's really important understand is that it's not gonna go away and it's only going to get worse if you just ignore it or stick your head in the sand. I think it's really powerful for you to be able to tackle your problems head on lean on trusted resources and get into the solution and God's word. I love it nearly always great to be with us. Thanks for stopping by taking so much God bless that to Chuck about its Christian credit or toll-free 800-557-1985. Really Simon from Christian credit counselors always enjoy your blessing will be back with more your phone calls to 800-525-7000 800-5257 four will be right back after this morning and life run on the same truck.

Unfortunately, sometimes it seems like your money is heading in a different direction from your goal, and never enough three keys to financial contentment. Author Ron blue helps you to break down all your financial options to a basic floor and then shows you how to keep it all chugging along at the right direction on the same truck never enough three keys to financial contentment available when you click the store button moneywise here is your personal savior point, we preachers.we are new creations in Christ.

When the person as long as we think, like the old person in his heart he blinks so however we relationships right now about the things that were going through right now is a direct result of what we think we just keep coming back to be reminded of this. I'm not going you been listening to a quick word that we experience now Galatian the online experience working with this January 2021. Would you like your life to be used with joy. Would you like to interject a little dimension in even the most ordinary day, author Randy Alcorn says you can when you discover the treasure principle and a concise powerpack style is newly revised and updated book offers us except when finding the pleasure and eternal rewards of the treasure principle what you discover. Wife will never look the same treasure principle is available when you store button moneywise was God's direction life together your phone call so here's the number 805 five 7000. We have 12345 we have almost 5 full lines available for you so well, five lines, no waiting, call right now 800-525-7000. Anything financial is fair game as Chicago, Illinois. Susan, thanks for calling in today. What's on your mind every day I enjoy my job so I really don't plan on retiring income property in California you proximately my brother closer to his family and property that we sell this property at this time to dissipate.

Susan, do you mean in the way of proceeds or you don't know what to dissipate in terms of how you could convert that into some of the something that generates return capital property, property, property, like work. She works long term capital gain that you would have real estate and the rates vary were between zero and 20% depending upon your income so you would just have to understand what is the true game on the property, which is basically the selling price minus your original cost basis plus certain improvements and expenses related to selling it to generate a gain on that if you voted for more than a year. It's a long-term gain and depending upon your income, it would be 20% or less, probably about 15 or 20% mark.

So, the key would just be to make sure that you set that aside no way to avoid that would be to either give the property away before you sell it so you could move it into a donor advised fund and get the full value of it that you could then give away to ministry in charity of the second option would be was called the 1031 exchange, which is where you roll the proceeds within a certain window of time into a like property that is also an investment property in them. Essentially, you deferred the capital gains by pushing it forward. But if you do want to go and realize the the of the value of it because either you don't want to get into the business of being the out-of-state landlord with somebody who's not a relative were now your marketing it in your having to keep up with the maintenance and are they taking care of it and what if they move out of the middle of the night and will then want to know that I would say you go ahead and sell it. Just recognize that you gotta pay some tax on it so you set that aside so it doesn't catch you by surprise, and then it's a matter of saying how do we want to repurpose these assets in light of our goals and our values meeting. Let's look at our priority here.

Whether it's giving or paying down debt door, you know, just saving for the future and if if it's long-term savings. How do we want to redeploy this and not income generating or to seek a return, probably through stock and bond portfolio which would be much more passive and so only more liquid throwing a lot at your Susan is all that make sense capital over here that you sell the property, you pay that in the year that the property is sold so that would be a part one of the schedules on your tax return. If you sold this your for your 2020 tax return that you would file prior to the filing deadline next year so I think at this point, you know I like the idea again because of the transition here. You're an out-of-state landlord, so to speak, you know. Realizing this, the proceeds of this property and then redirecting those. After some prayerful consideration and review of your goals and priorities that if you need an investment professional to help you would get plenty of certified kingdom advisors there in Chicago.

I'd interview two or three of them to find one that's a good fit for you could really deploy these assets, an investment strategy that makes sense with your goals and objectives you and your husband together. Of course, and can really take an active role in managing this for you but if you have other questions along the way Susan don't hesitate to call and thanks for being a faithful listener. Thank you very much Susan wish you and your husband the very best about an email or maybe even to the first one we have is from Bart in Newport Beach, California. He says hello improve my credit score. Do I need to pay someone yeah you know you will find plenty of folks that tell you that they can charge a fee improve your credit score, but I wouldn't ever do that is really nothing that you can't do yourself and frankly there's a sum of fraud and some scams out there involving credit score improvement. So here's what you want to focus on the bottom line is you being in on time payer every month in managing your credit but responsibly is the key. So 35% of your credit scores made up by your repayment history and that it goes down from there.

Another big factor is what's called credit utilization will try to keep those balances below 30% of the available credit that's been extended to you beyond that you want to look at the types of credit that you have the number of inquiries you have. Bottom line is if you follow biblical principles managing money wisely keeping your debt under control or paid off, and paying on a timely basis that score even with some derogatory history meeting a bankruptcy of the pastoral charge for a late payment as those get older and older Bart.

They will become less significant as it relates to your score the newest information always impacts you the most. Just put everything on and if you have an email question. A short question by way of email address is questions at 21 questions at 21 you're listening to moneywise live what you are you more hundred 55 7000. How should we as Christians think about what if we could invest our money in a way that aligns with what we believe that Eventide we believe it is possible to love God and love our neighbor in the very practice of investing is not investments for performance better world so you can invest for the future with a sense of wholeness and purpose. We call this investing makes the world rejoice. More information is available. Christian healthcare ministries enables believers to show love for one another by sharing each other's health costs through CHN's voluntary health cost-sharing programs members uplift each other spiritually and financially. CHN was an eligible option under the affordable care act and a Better Business Bureau accredited charity interested. Learn more by calling 800-791-6225 or online at CH ministries.more 1990s major radio for pastoral care.

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Here's a great deal more about our money than most of us imagine Jesus is more about our sessions and about anything else, including both heaven and hell in managing God's money. Author Randy L breaks it all down, simple, easy to follow format that makes it the perfect reference to your interested in gaining a solid biblical understanding of money, possessions and eternity managing God's money is available is to confirm an equally veritable Supreme Court would be the president's third Supreme Court Justice fast-moving wall bar has forced evacuations for 60,000 people in Southern California is powerful winds across the state the power to be cooked to hundreds of thousands to prevent utility equipment from sparking new places, smoky bar in Orange County broke out just before 7 AM local time and quickly threatened neighborhoods in Irvine is not clear what started the fire sales of new homes fell by 3 1/2% in September, the Commerce Department says despite the modest decrease. Sales of the homes are up 32.1% from a year earlier job losses on Wall Street that I off 650 points abounds are down 189 and the S&P fell 64 this is SRM news.

Thinking about what is waiting. So let's say hi to me that she's calling from Independence, Missouri well and thank you for calling today. How can we help hello my call. I really appreciate it.

I am in the process of refinancing my home with $30,000 cash out on waiting on the final closing this week and so my question is I have about 20, $21,000 in credit card debt and what I had planned on doing was paying off about $10,000 of that, and then utilizing the rest to make improvements to the home. What you think.

Well, couple of things. One, it sounds like you're very close to closing so that the mortgages already kind of right near the finish line so I'm not you suggest we do anything different there, although if you're extending the term.

I have a slight concern about that and would want to encourage you to perhaps pay more than just the minimum payment so we don't inadvertently drag this thing out a lot longer just ask how many years did you have left on your existing mortgage and what is the term of the new well house for five years so I had 25 years left on the mortgage and it's a 30 year refi so you just think in terms of need and I realize you may not have the luxury to do this, but if you did you think in terms of trying to send one extra payment the year you'd probably get close to taking that 30 years down the 25 years. So if you become a given that mode perhaps we can recapture some of this time that were extending through the refi. Second thing is what led to the 20 to 21,000 credit card that you have. Was it unexpected expenses.

Do you have a budget that doesn't balance and so your using the credit cards to fund part of your lifestyle or what's the result of well I bought a house that was in really good financial shape. But then when I bought the house I ended up needing to replace several things I didn't have the cash so I used credit cards to do that got got it so you living on a budget right now spending plan the balances and do you regularly see the end of the month. You have a little bit left over. Yes okay. Great. Cannot contribute 12% to my 401(k). Okay, great.

And what about the idea of just paying off the credit cards in full and then dropping the renovations down to let's say nine or 10,000 but taking what you would have been sending to the credit cards moving forward and using that to try to replenish this perhaps reserve account that would allow you to do the additional 10,000 renovations over time that and I was trying to decide whether or not that would be a good option.

Okay, that would be my preference.

Just because I think it would get out from under that interest me benefits of attractive interest rate of 12 or 13%, as opposed to the typical 1718% still a lot of money going out the door to interest and so getting a guaranteed return equal to that is something I really like. So going ahead and eradicating all of that debt being out from under it, but then not allowing that money to slip through your hands and the other expenses. Discretionary spending but you being purposeful about redirecting that to a reserve account that could be specifically for additional renovations over time.

I really like that option.

The other option I guess if there were some things like repairs that really needed to be done sooner rather than later. You could took the room take the remaining amount 10,000 use Christian credit counselors put on a credit counseling program which doesn't affect your credit score per sale that will be noted that you are in a credit counseling program on your report, but again that doesn't factor into the score and that account would be closed. But you'd be able to get the interest rate lowered and paid off 80% faster so I consider one of those two options. My preference would probably be to go and pay it off in full and then I think the key for the renovations is if you're planning to stay there than do the things you're going to enjoy and make sure you find somebody as reputable as you give your bid in writing before you proceed with any of that. If you're planning to move in the near term.

I probably get some advice on what things to renovate that are going to return the most value to you upon the sale, but apart from that, it sounds like you're headed in the right direction. I like the fact that your debt is headed down at least on that high interest consumer data thank you very much from Independence, Missouri. Let's stay in Missouri Rolla, Missouri and Robert what's click and how can we help Robert you Willis. We just cigarette. A large credit card $350,000 with a credit card bill I sold off the property.

This thing down to about 40,000. The problem that I have is that I lost my job and I've been utilizing you a flyer that should pay 3% your be good for 0% interest per year. Morning out of Salt Lake from an outfit called take charge of her and sent them all the information on the credit card you sent me a letter back big trouble about you trying to go to the local credit card people and see if it would help me in the process of downsizing my home much smaller home. Basically I have a little bit of rental income insurance is far 75 expansion insurance.

She started her supplemental life and so I don't have a lot of you have a little money save dollars smart enough to shake some news on the minimum credit card wondering if you were Guy could go change. Like when you call. Consolidate your first get all your accounts so credit score goes in the toilet. I have maintain at least a 750 credit score are sometimes up to show some things like before the payment is concerned about your credit scores.

I am getting out of debt. You mentioned you have some small rental income.

Robert do you have Social Security covenant as well. It's a thousand miles.

Okay. All right.

Well, you know that there's obviously limited options here I would connect with our friends. A Christian credit they're not going to consolidate in the form of a new loan with they try to do is get the interest rates don't get you on a monthly payment problem is without work, without a steady income beyond Social Security and the rental income, which is all spoken for between the insurance payments. The minimum credit card payments under the house apart from that, you know there's not much income there obviously so I'd say we either need to look for some part-time work to try to get that going again or if you're already covering the minimums. Perhaps you could just now redirect that through Christian credit counselors at a lower interest rate, which would get these debts paid off much sooner. So at this point out. That's where I go next just to have them look over your situation again that I could do with a new loan by putting everything together there to just try to keep you where you are close those accounts and get the interest rates down. Get your monthly payment. Hopefully that fits within the limited income that you have and get you on solid footing here moving forward. Christian credit is a place to go if you have other questions after you talk to them Robert's job and paying off all that you have moneywise live with West. Do you know if you have enough money house.

Do you know how much is enough. If not, one blue can help with this book.

Master your money a step-by-step plan for experiencing financial contentment and how to save and invest wisely create a long-term financial plan and how to get out of debt. Find all master your money by Ron blue available when you click the start button moneywise live to work here to help you understand how to share your faith in the eyes of a layman is also designed to be living as a Christian you know that almost 2/3 of very grown-up virus of message for God to change the way they live their people all around you would love to hear about the one true God loves him so much he gave his only son, so that if they believe in him will not have eternal life. Think about two out of every three people around you right writing the salvation through Jesus, God has you in perfect position to share the love of Christ and who knows the rapture could happen at any time and you sure don't want anyone to be left that's what you need to start moving everyone now. Every day posted. There is nothing more exciting than knowing God is using you to move people closer to join is not America.

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Many people are experiencing financial challenges such as credit card debt downsizing that in jobs saving more than half of all the courses are the result of financial pressures at home, your money counts biblical financial expert Howard shows that the Bible is a veritable managing your finances will discover the profound relationship, your money counts is available when you click the start button moneywise live, I am Britney thank you so much for holding when you've been there for a little bit but what you question today taking my call about consolidate all that and maybe we been working on picking up her maybe take extra money out against the Humpty.

I see plenty of options here Britney, let me ask you a few questions. What is the value of the home roughly we've done work simply padded so I don't not exactly pray, but I would say probably 20 to 30,000 more than what we okay see you have 20 or 30 in equity, that's helpful. You mentioned that you want to do some improvements have you gone through a list of the things you want to do. Do you know roughly what you need to spend to accomplish those projects that a lot don't need to do. Yeah, probably about right done that you mention some debt other than the mortgage. Tell me about that what you a couple car loan validated credit card and took it off like our collateral and that about 26,000 try to get a feel for the equity that you have in the house.

What percentage of the home's value is that so do give me just roughly what you think the house is worth 72,000 okay. Somewhere between 70 and 90,000 got okay now here's here's the bottom line, you know, I think one of the challenges is we want to not treat the symptom, but we want to really always tackle the underlying issue when it comes to dealing with her finances because we have to start with this idea that God owns it all. Where the steward or the manager of it, which puts us in a really important position in terms of managing God's money, and he's given us principles to follow when it comes to that management and one of these ideas beyond God owns it all is that we need to live within God's provision that we need to accept what God has provided and we need to live well within that doesn't mean we can't try to pray for an increase or you work hard and try to get higher paying job, or whatever it might be but whatever that provision is that we know comes from the Lord.

We need to live within it, and that is only done with the spending plan which means you need to have a budget you got have a written account of everything coming in and going out, including those well call discretionary expenses that are you not get to get a bill in the mail for the spending that just happens.

That tends to be the budget buster.

But you also need to have the things that are nonrecurring in terms of they happened a couple of times a year, maybe a quarterly insurance payment or once your homeowners association or something like that. And when you get all that in one place. Then we got a balance that budget would just make sure Giddings and there make sure all of our expenses are in there.

Make sure were saving for the future and make sure at least paying the minimums on all the debts that we have and then we really need to have some sort of margin left over that we can allocate to our priorities. If you don't have an emergency fund. That's the first thing to tackle starting if you have credit card debt with $1500 is your goal for that emergency savings and then beyond that with every dollar that's available. Britney we need to direct that to paying off this debt. The problem is when I hear you know it we consolidated once using our cars collateral and we paid off some credit cards and now working to try to do it again but this time really use the house as collateral. My concern is that were treating the symptom which is overspending and were really not ever solving the underlying issue which is I've got a live within my means that I can't do that without a budget so I really wouldn't think about trying to tap the equity in your house, especially since with the $72,000 home and I'm glad that you have more than you've got about 30% plus in equity, but I don't want to see that go toward paying off the debts if it's only going to come back a few months later year or two later because were to continue to overspend beyond her means. So I want you to really not even think about paying off the debt with the home unless you demonstrated for at least six months that you can live on a budget meet your obligations and have some margin that you could send toward additional debt reduction or to rebuild your emergency savings over time.

So that's really step one. If you did that, then at that time, I might consider refinancing with a cash out and tell me about the interest rate that you have on the current mortgage right now and not allowed time to live alone that could be done without refinancing. It's really more important that he's on the deed to the house than anything, but you will do have good credit scores now yeah okay you you certainly could get if you do, you certainly could get that the interest rate down below 3%. Right now the challenges I'd really rather you not extend the term on it so I know probably have matched the term with the current number of years you have remaining on the mortgage and again I'm really not want you to pull any money out for the debt repayment right now until you can demonstrate you can live on a budget consistently with regard to the renovations I'd probably wait on those until you get this consumer debt paid off. So at this point, I'd sit tight really focusing on the budget and if you need some help with that contact one of our money was coaches you'll find those folks up your path forward from here. I hope that's helpful to you. If you have other questions along the way. Give us a call back very much and wish you the best as you go forward. Thanks Chicago Tina, your concern about your mom's credit. Thank you very much and I am her guardian and power of attorney and she does have quite a bit of asset that pays for her living stuff, but with everything going on in the world right now. Your input about freezing her credit, she downed many credits and I just don't want anybody feeling her identity. Laura anything like that, causing chaos is a good idea Tina. But it's not going to protect her against necessarily identity theft what it's going to present is somebody from accessing her credit report which is good to protect against scammers attempts to open fraudulent accounts so if somebody were able to get her information through a breach of some kind where or by stealing her identity through some means when they try to use that information to open a fraudulent account in her name. They would not be able to do so because when they tried to pull the credit history in the attempt to open the account they wouldn't be able to provide the pin number and that's gonna stop them in their tracks.

That doesn't mean that they haven't already assumed her identity.

So bottom line. There is, yes, it's one tool in your toolbelt you still need to take precautions to safeguard your and her financial information moving forward by using just good common practices. Don't click links in emails to fall into phishing schemes and will be careful what information you give over the phone when somebody contacts you don't use a public Wi-Fi to transact business change passwords regularly. All those things but going back to the freeze. Still a good thing to do and I basically had contact each of the three bureaus. This is now free is a result of a change in the wall last year. Tell them you want to put a credit freeze in place in Equifax, Experian and Trans Union and then with that four digit pin number anytime she or anybody else fraudulently tries to access that report they would have to have the pin number in order to do that make sense to you very question, my brother and he has got financial troubles numerous times and bank stuff like that and he does have, I think the ability to try to get another credit card or something and thinking off on his feet, protect him from himself to be able to freeze the credit so he couldn't open up another were still getting card offers for him and it's like you laugh at the credit scores zero and yet people are now writing about yes you have the is guardian. You have the ability to make those decisions up as power of attorney is that right yeah yeah that's why he's now starting to join me on Facebook like now now now now don't do that and you know it's hard to control his access because he does have access to the Internet and I just don't want them to get in trouble again. Yeah yeah so again as long as you have the legal right to do so. Yeah, putting one of these freezes in place again would prevent anybody from being able to open an account in his name. Without that pin number because they would be able to access the credit reporting with no credit report. No lender is going to extend credit so that would be a safeguard. Assuming you have that the right to put that in place on his behalf. And it sounds like you certainly do so hopefully that's helpful to really appreciate your called Tina, thank you very much Rob. Susan is on the line, but I'm afraid were just not going to have enough time to get her a question I with her permission and asking for her. She has five grandchildren received an inheritance from her dad. She wants to open the college fund of four of the five grandchildren.

What's the best way to do that. What you think. Yes is a great idea and I think a 529 is good to be the way to go. You can open one of the name of each of the children. You can contribute up to 15,000 years of plenty per 529 because that would be per child and that amount would grow over time there will be investments inside of it is always a juice for qualified educational expenses you will pay any tax. All the games, which is great and if there's money left over in any of the accounts you could transfer it to another beneficiary to find the best 529 for you Susan to open for your grandkids go to saving for you run a quick calculator and it'll give you a recommendation, whether using in-state plan for another Susan. You sound like a very generous person.

May God bless you as you go forward with your grandchildren's investments. You've been listening to moneywise live a partnership between Moody radio and moneywise media. Thanks for joining us will see you again tomorrow

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