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Monday, March 1, 2010

Debt and Preparedness



I think I have a pretty firm handle on spending and debt and maybe that is why I don't bring it up too often, but the other day I received a phone call; "Good afternoon, I am wondering if you know a neighbor of yours Mr. So and So?". The caller then explains how they have been trying to get in touch with them and could I give them a message or can I give supply current contact information. After I ask what it pertains to I am told it is a personal nature. My response varies when I hang up to the mood I am in and no I do not give out information on my neighbors. This burns me up for two reasons, one is if it's personal why are you embarrassing them by calling their neighbors and two, why are my neighbors living the high life and I have collection agencies calling my house for them? I'm not sure if I have written about this before but it is becoming a common occurrence.
Outside of utilities and mortgage I have no debt. I went down that road with an ex-spouse who could shop you into oblivion and refuse to go back. Part of being prepared is also getting rid of unsecured debt(credit cards), and paying down or off your secured debt(mortgage). I don't know about you, but I don't think being prepared is about sustaining and providing for your unsecured debt. Are there emergencies? Sure! What do you consider an emergency though? You need your car, you need your house, medical, but how much of it is habit?
You need to budget. What you pay first is roof over your head, food in your stomach and utilities. By utilities I mean gas, electric and water, and by food I don't mean NY strip and lobster. Then pay yourself, I don't care if it's only $10 a month. Credit cards, should you work to pay off the one with the lowest total balance first? Only if it has the highest interest rate. The new credit card law is in effect and you can read this on an appropriately named site Creditcard.com. There is no cap to the interest rate and I was talking to a friend the other day, they carry a high balance on all cards, that she already received notice that her interest rates will go up and she wishes for a 35% interest rate now.
What if I cannot pay the minimum balance after mortgage and utilities? They have companies that can negotiate your payments for you, I have never used them but you can negotiate them for yourself. You can call or contact in writing the credit card company and tell them what you can afford to pay. Again, not having done this myself I don't know if it will keep creditors from calling the house.
If credit cards are a habit then the first step is to stop using them for anything but emergencies. A deal you can't pass up? I have yet to see that, okay except for one thing and that was land I should have bought, but I'm young enough yet and there will still be opportunities for that and as much as I would have loved the land I would have not loved the stress the added expense would have cost at the time.
Shop debit or cash for your groceries, entertainment and necessities. Plan ahead if you can. Know the car will need a new battery soon? House needs new windows? Kids need summer clothes (this is mine lol)? Start to put a little aside every payday.
If you shop solely with cash you will better keep track of your expenses.
Need to know how to prep on the cheap? There is more to come.

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Mississippi Preppers Network Est. Jan 17, 2009 All contributed articles owned and protected by their respective authors and protected by their copyright. Mississippi Preppers Network is a trademark protected by American Preppers Network Inc. All rights reserved. No content or articles may be reproduced without explicit written permission.