Money Monday

Our household has been swept up in a quarter-life crisis. We procrastinate less and organize more. We appear adult-like most of the time these days and it can be a little scary! Then again, I guess it's about time. This weekend Adam and I (both wheelers) under took the daunting task of organizing our finances together. We have all sorts of dreams...cars, houses, an upcoming move closer to our families, and maybe a Wii (ok so we aren't COMPLETELY grown up yet!). We also have all sorts of debt...student loans, credit cards, and Adam's recently acquired new-to-him car payment. As people with disabilities, our financial situation is unique so before we began our work today I did some research on advice, resources, and information that might be tailored to us. Maybe I missed my mark with keywords, but google failed me! I couldn't find much at all. With that in mind, I thought I'd share a few tips that helped us today.

[Caption: Mission 1 Tackle our credit card debt.]

Reading some general tips on managing credit cards, one piece of advice kept coming up over and over again: Stay out of debt/ Don't use credit cards. Well-that's enlightening for some but probably not the people that read these articles! We really haven't done too badly in using our credit cards. We've avoided food and clothing purchases, but car repairs and flights home have been a weakness. With our current interest rates, minimum payments barely put a dent in our balances. Today's goal was to do something about that and here's what we did:

1. Make a list of all your credit cards, their current balances, your credit limit, and your interest rate. You can get this information through the automated system of most companies by calling the number on the back of the card. Call this first to get the information so you're prepared when you call back to speak to a live person (if you are lucky!).

2. Consider your needs for each card. A lower interest is always better because then you'll be paying less back to the credit card company for their service of loaning you the money. For me, it's also important to keep a card with a high available balance just in case there's a really costly emergency with absolutely no alternative at the time. Think about what changes would make it easier to resolve your debt. Have you made several payments on time to a card with a fairly low rate but would like a higher available balance? Would you like a lower interest rate? Would it be helpful to move the due date of your payment to a different day of the month? These questions are all extremely relevant to us!

3. Adam and I discovered that 5 out of our 6 combined credit cards had interest rates of almost 30%! That's extremely high-think of it as paying an extra 1/3 for every single thing you buy. So we reviewed how many payments we'd made on time, how long we'd been customers, etc. and called all of our credit card companies. Here's how we did:

 

Adam went first and didn't do so well. 2 of his companies agreed to send him a letter after they did a "periodic review" to determine if he was eligible for a reduction. The third company refused so he's looking into other options (perhaps to be featured on a future Money Monday).

 

One of my companies was closed on Sunday, but I was able to negotiate with the other from 31% to 10.9%! A HUGE success and definitely worth the call!

As you make your calls, remember that you are a CUSTOMER and try to empower yourself before calling. It always helps to be friendly, but it's important to be assertive as well. If it's true (and it almost always is), mention that you've received several other offers from companies in the mail and you'll have to consider another option if you can't reach a more reasonable agreement. Keep in mind that the individual employees that you talk to are often only allowed so many of these changes a time period so unfortunately it's to their benefit sometimes NOT to help you. I think this is where a little charm goes a long way!

4. Keep up with your changes. Document everything carefully and take note if your reduced interest rate or increased balance has any requirements attached. Many times a company will offer a much lower rate until you break the "terms". If you are even a day late on ONE payment, the rate shoots back up! If you can afford it, automatic payments set up through your bank can help avoid this!

5. My last tip is from Adam. He's not a big fan of chatting on the phone with credit card representatives so he gathered all his preliminary information through chatting on the company's website. Several make this option available and it helped him get many questions answered before he made the call.

I hope this is helpful to someone and if you'd like to see any other money matters on another Monday covered, let me know. Until next time, I'll be teaching Bailey (my service dog) to do this...on stilts.

[Photo caption: Three service dogs standing to retrieve money from ATM's.]

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