[April 17, 2020] Hello, my name is Laurie and this is my very ﬁrst blog post! A few facts about me before we get started:
- I am a middle aged woman
- I am married but also have experience as a divorcee and a single woman.
- I am radically inclusive
- I have children, grandchildren, step children, step grandchildren and those I call children. However, they are all addressed as my kiddos - no distinction between biological children and non-biological children when referenced.
- I have a strong New England accent but that won’t matter here ?
- I probably think I’m funnier than I actually am.
- I am a survivor of domestic violence.
This list could go on and on, but I have information I’d like to share - what I consider important information. My hope is you think so as well. And there is no better time than now. Did you know April is Financial Literacy Month?
So let’s get started!
Today I’d like to discuss debt. And how to begin to overcome it.
For the ﬁrst time in my adult life, I am debt free. Debt free for me means no credit card debt. It does not mean no car loan or mortgage. That would be ﬁnancial paradise and we are not there...yet.
I wish I had taken step-by-step notes about my ﬁnancial transformation along the way, but I didn’t. So I will do my best to share some signiﬁcant points that were life changing.
I have always been extremely conscientious of timely bill paying yet am aware that the ability to do so is a privilege not everyone has due to unearned disadvantages. Some of my suggestions may not be for everyone or attainable at this time. Which brings me to my ﬁrst point: many ﬁnancial advisors or programs are cookie cutter steps that just don’t work for everyone. Keep that in mind as you move forward.
My passion for ﬁnancial health grew when I began presenting the Allstate Foundation’s Purple Purse ﬁnancial empowerment curriculum to people who had experienced ﬁnancial abuse. Allstate has developed an informative 5 module training focused on those victimized by domestic violence. For women who are victims of domestic violence, 98% experience ﬁnancial abuse. It is one very signiﬁcant barrier to making positive change. Financial abuse has no boundaries and presents itself in many ways. Financial abuse is experienced by those who are not allowed to have an income at all to those who are the only income earners. It was here, amongst those who had experienced both ends of the spectrum and all points in between that I quickly realized people who are in ﬁnancial turmoil do not like to look at their credit reports.
1st must do: GET YOUR CREDIT REPORT! It’s free through creditkarma.com and it’s also free to monitor credit activity. If you are anxious about retrieving your credit score, ask for support from a friend, relative or advocate. Getting the report is the ONLY way to begin. (For some, it may be necessary to review your children’s credit reports also, as they are often victims of ﬁnancial abuse). Reminder: do this safely. That may mean doing so on a library computer. The point is: safety plan around this step if necessary.
Once you have retrieved your credit report, review all accounts to ensure there is no fraudulent activity. Do not be too concerned if balances are a bit off from your records; sometimes credit cards and loan originators report balances quarterly, monthly, etc., causing a lag in balance updates. If there are any accounts open that you have not approved, or fraudulent activity you notice, contact creditor and credit karma as soon as possible. If there is incorrect information, you may need to contact the reporting credit bureaus. Credit Karma reports Transunion and Equifax. The third credit reporting agency is Experian.
Keep in mind as you review your report, legal assistance may be necessary, especially when fraudulent activity is caused by an abuser. Research free legal services in your state for support.
A few more tips: if at all possible do not close any accounts! Your credit score will plummet. I learned this the hard way many years ago! Silly me thought it would help my score. Quite the opposite dear younger me! So, unless you cannot stop using those charge cards, or you fear fraudulent activity, leave them open.
So if you’ve pulled that report...good for you! Now what to do? That depends... let’s begin - but ﬁrst, time for a full disclosure. I am not a ﬁnancial expert. I am sharing what little I know and what has worked for myself and my husband and some of my children... I am not responsible for your ﬁnancial health or your credit score. You have authority over your decisions. However, if you have positive results after you’ve followed a few of my tips, I’ll take some kudos!
Now looking at the report, you may be experiencing one of many scenarios. Let’s review a few.
- You may have a very low credit score with delinquent bills. Some years old. You could consider bankruptcy. Or, start calling companies to make payment arrangements. Negotiate. Only agree to what you know you can do. One at a time. Do a bit of research on the impact this could have on your taxes. I won’t go into detail here but know loan and credit debt forgiveness may need to be reported to the IRS!
- You may have a decent credit score but lots of bills...with lots of payments. Most ﬁnancial advisors would say to pay off bills with the highest monthly percentage fee. If you can, awesome! Go for it. For many however, tackling bills with the lowest balance ﬁrst is much more manageable. Pay the minimum on all other bills and pay off or down as much as possible on the lowest balance until it’s paid off. Move on to the next lowest balance.
Easy Peasy, right? Not so much, however, working with each debtor is imperative. Think about ﬁnancial advisors...but use caution. Scams exist!
- You may have a great credit score with minimal debt, however, if that’s the case you probably wouldn’t be reading this. But, for the slim chance you are in this category and reading this blog, I hope you can pass this information along.
My hope in writing this blog is to assist you in beginning to take control of your ﬁnancial health rather than your ﬁnances controlling you. There is so much more involved in ﬁnancial recovery, however, this is the ﬁrst step for many. The ﬁrst step toward a road of positive change. Remember, each person’s unique experience impacts their decisions and this is no different...the point is, taking that ﬁrst step, whatever you decide that is for you, must happen to regain control that is rightfully yours. You deserve it.
- Laurie, SOAR Member
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