Jackie Veling Of Nerdwallet January 27, 2021 - 4:01 AM
If you have high-interest consumer debt, getting control of your money in the new year might sound overwhelming.
Most Americans say the COVID-19 outbreak has caused financial stress, according to a survey released in October by the National Endowment for Financial Education, with 30% listing debt as their top stressor.
Despite the pandemic, you can still pay down your debt with the right plan. Hereâs how.
CONFRONT YOUR DEBT
The first step is simple, but it can be the hardest: You have to face the problem.
Angela Moore, a Miami-based certified financial planner and founder of Modern Money Advisor, which offers virtual advising and education for consumers, says itâs common for her clients to know theyâre in debt but not know how much.
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Ideally, Schultz is looking for a three-bedroom, two-bathroom house listed under $500,000, but she s willing to be flexible on the details in order to keep the price down. We re very committed to not having housing [cost] any more than 35% of our income, Schultz says.
This year, the couple hopes to make around $200,000 combined, but Schultz says the income from her new business is unpredictable. Outside their retirement savings, Schultz and her husband have about six months worth of emergency living expenses saved up, as well as about $30,000 set aside for start-up business expenses and a house down payment. We want to have more predictable income and to build up some more cash savings so we don t have to touch the emergency fund or business savings when we buy, she says.
Credit card debt being used for gifts, hurting retirement
People are tacking on nearly $2,000 to credit card balances pay for holiday presents, a survey found
December 16, 2020 5 MINS
Holiday spending is down amid the pandemic, but people are taking on more credit card debt to buy gifts, and that could hurt long-term and retirement savings goals.
While credit card debt is up across the board, people who suffered job losses this year have disproportionately been covering expenses with credit, according to a report today from LendEDU.
On average, 51% of people who remain unemployed because of COVID-19 are taking on additional credit card debt to pay for holiday expenses, LendEDU reported. That compares with 48% of people who were laid off but have since found employment and 33% of all people surveyed. The report is based on a Dec. 1 survey of 1,000 U.S. adults conducted by research firm Pollfish.