debt arbitration Debt Handling Solutions Sometimes debt can seem overwhelming. In those instances, or even before things get that far out of hand, get back to basics and try some of these debt handling solutions. BASICS – Lower insurance deductibles for your homeowners, renters and vehicles policies where appropriate and save money. Don’t take chances on bouncing checks; instead get covered with overdraft protection and pay about the same as what it would cost for one bounced check to cover our account for an entire year. Ask your banker about packaged account services. Many offer free savings and checking accounts with free overdraft protection and checks, free online bill paying and more. When you shop, check your receipts, even for groceries. Many times items ring up at incorrect prices. Sometimes store policy allows for no errors, meaning you get the items free if it wrings up wrong. So carry along a handheld calculator or pencil with small notepad to tally up your charges. REACH OUT- If you have medical debt, the first thing healthcare offices try to do is get you to charge the bills or refinance your home, etc. STOP. Before you take such a drastic step, check with legal counsel. There are often other steps to take first. For example, notify the billing parties and tell them you need to apply for financial aid. Many have forms to complete, and although they may be lengthy, remember they’re for free money to pay your bills. Reach out, take forms and fill them out. Then set up minimum payment arrangements for the remaining balances, even if it’s just $10 a month for 30 years. Healthcare bills are not like credit card debt and do not need to be reported to the credit bureau in the same manner. Also reach out with merchandise and return any recently purchased items that you can for a refund. Credit cards and mail order companies generally allow you 30 days to inspect your purchase. Return any you can for refunds. If purchases are beyond the 30 days and for various reasons don’t hold up to their end of the “bargain;” i.e. they broke already or never worked right to begin with, get on a letter writing campaign pronto. Write the place of purchase and copy the manufacturer, the distributor, the Better Business Bureau and your state Attorney General’s Office. State the reasons our product is faulty and that you want a refund. It’s often rewarding to get help with other entities like these. No need to go it alone! So before your debt gets out of hand, take charge and get back to basics. Put some of these debt handling solutions into practice and make the most out of what you have. Friends Who Owe You Money Can Quickly Become Former Friends It’s pretty much common sense, or at least it’s been said a thousand times before, don’t lend money to friends and family. What is often missed in that warning is that you should also not sell things to friends and family. Here are a couple of scenarios. Your friends are over for a Christmas tree decorating party. Two of the guys know that you sell pre-owned designer men’s suits on eBay. They ask you if you have any new stock because they could use a new sports coat. “Sure look in the hall closet, see if you like anything.” After five minutes both men return, one wearing a Hugo Boss suit coat and the other is sporting a Zegna blazer. It’s the holiday season, you’re all friends, and even though you know you could get at least $80 each on eBay for them, you only paid $4.99, so you tell them you’ll sell them for $10 each. What the heck, it’s gift giving season anyway. Then they announce their checkbook is in the car, so they’ll pay you Tuesday when they see you next. Fast forward three months to March and they still haven’t paid you. Or perhaps you know a friend is looking with his teenage son to buy a car for Junior. You have another friend who is a self-employed mechanic and is always picking up older cars and fixing them up. You mention to friend #2 that friend #1 wants to buy a car for his son. Mechanic friend was going to sell the car for $900, but since it’s a friend of yours, he tells you to tell them they can have it for $600. You disclose all that’s right with it as well as all that will soon need repair. Friend and son drive the car, say they want it and will come over with money on Tuesday. They arrive on Tuesday with only $300 and tell friend #2 that they will have the balance paid off in 30 days and hoped he’d understand. Four months later and lots of pulling teeth, friend #1 dribbles in an occasional $10 here and $20 here toward their $300 debt. Yet they’ve had the car for months. So what went wrong in the above cases? The friends (now former friends) never asked to borrow money (to give you the opportunity to not lend them cash, as you’ve been warned). The seller-friends were blind-sided with the sudden convenience of no money after the transaction had already taken place. Because it was a friend, "c'mon what's little leeway among friends, anyway?" the sellers felt cornered and awkward to rescind the offer after they had already agreed to it. The only real solution is to never, as in never ever, sell anything to family and friends unless you have cash in hand, at that moment. And don’t feel obligated to give them a deal of a lifetime. If you could get a fair price for the item elsewhere, offer it to your friend at that price too. If you don’t, you could be losing out on a whole lot more than income. Friendships and families are often severed because of transactions gone bad. Don’t let it happen to you. ARE YOU AN AVERAGE AMERICAN?If you find yourself drowning in credit card debt, take heart, you are not alone. Americans charge over one trillion dollars per year on Visa, Mastercard, Discover and American Express. All these purchases "on plastic" would be fine if we all paid our balances in full each month -- but that's not the reality. In the year 2000, the average American household with at least one credit card carried a balance of $8,123. Practicing Realistic Spending Get out of debt and stay out of debt, are words to live by for Editor Lisa Laskey and her family. "By the time I met the man who would become my future husband, I was in more debt than I could handle. After a few years together, my husband's thrifty ways and his parent's great financial modeling helped me learn the importance of living within our means and not planning to pay it off "next month." This may sound unexciting and not spontaneous to some, but it has gotten us through many lean years and insures that we will enjoy the extra income of the non-so-lean years."