While I’m off spending some much-needed time with my family, here’s a transcript of a recent online discussion with readers. It covers personal- finance issues many people face.
Question: I keep seeing commercials for companies claiming to get you out of debt by reducing interest rates and providing low monthly payments. Do these companies really get you out of debt like they claim?
Answer: If you need help with your debts, go to www.debtadvice.org. So many people are in credit-card or debt trouble that lenders are not as willing to negotiate as they once were. Many of the companies you see advertising are trying to get you to sign up for a debt management plan and will charge you too much for that plan. If you need that kind of help, find a plan that doesn’t cost more than about $50 to set up and $25 in monthly fees.
Q: I am two (albeit very large) payments away from paying off my credit card. I had huge debt, and it’s almost gone. I have no savings, but soon I will have no debt and then the savings can begin. Now, my question. How long does a girl have to wait to buy a house? I’m tired of renting. Oh, and I’m getting married.
A: Wait. Save with your honey and soon enough you will have enough to buy a home.
Q: I would really appreciate your insight on a family situation my husband and I are facing. Last year, I bailed my parents out when they were approximately $1,000 in debt to one of those “payday advance” places. They are both on fixed incomes but also have terrible spending habits. My husband and I have tried to work with them to acquire new habits, but they are very resistant to change. My folks are once again in debt to the payday advance people, this time $2,000.
My parents have asked us to loan them the money to pay the debt off, with them to make regular payments to my husband and me instead. We have made this arrangement many times over the years. My parents never do pay us back. My husband feels we should just bail them out again. My thinking is: No, we shouldn’t.
Additionally, I am about to be unemployed for a period of at least four months.
A: You are the right one here. Do not bail them out again. You see, you’re right that they will never learn their lesson because you two keep bailing them out. They won’t change until they are forced. So what will it take? For them to fall completely on their faces financially. Plus, it really sounds like you can’t afford to help them. Tell them that you love them but that you can’t enable them any longer. Be there to support them, but not with your checkbook. Trust me, this will never end unless you end it right now.
Contact Michelle Singletary at singletarym@washpost.com or c/o The Washington Post, 1150 15th St. NW, Washington, D.C. 20071.
