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    • CDTV Launch! March 30, 2011
        Credit Dusters has just launched our interactive television show. The network is called CDTV and it will start out with a daily show about all things credit. You can go there now…tv.creditdusters.com.
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    • New VW and Other Purchases I Didn’t Make June 4, 2008
      It seems strange considering my profession.  I recently pulled a copy of my credit report through the credit watch service  I am a member of.  I needed to purchase a car so I wanted to see where my scores stood and shop for the best interest rate.  To my surprise I had purchased a brand new […]
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    • Loan Modification – The Best Chance for Success April 30, 2008
      This week we are discussing a painful, but important situation that a lot of American consumers are facing. It is so scary to think that you might lose your home, but we want you to know that there is hope. We want to be a resource to those folks because we have been there and […]
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    • Beauty in Simplicity Chapter IV – The Final Verse April 25, 2008
      My family lives in a small, rural town in Southern Indiana. We are surrounded by a soy bean field with hundreds of sprawling acres across the street and a large lake that adjoins our property in the back. Sounds nice, right? Why am I so discontented?What is it that continues to drive me toward always […]
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    • Beauty in Simplicity Chapter III – The Endless Road April 24, 2008
      I began writing about the subject as a result of my daughter and I going on a field trip to our county 4-H last week. All the modern day farmers talking about raising chickens, cows, rabbits, and living off the land made me yearn for a life like that. This is my journey…The truth is […]
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    • Beauty in Simplicity Chapter II – What’s in the Box? April 23, 2008
      In his book, Halftime, author and successful businessman Bob Buford comments on the purpose of money in the following manner: Mike Kiami is a strategic planning consultant. He is brilliant. He is intuitive. He is demanding. He slices through all the pretense and posturing, and hones in on the core. He does not believe in […]
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    • Beauty In Simplicity – Chapter 1 April 22, 2008
      “Stop this train, I want to get off!” – Vanilla Ice Yesterday I touched on the fact that I am soul searching for the simple life. My wife and I used to think the Amish had the answer. I now know, as I mentioned, that I do not have to buy a farm and work […]
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    • A Rabbit Meat Shortage, The American Consumer, and Something About The Simple Life April 21, 2008
      I went on a field trip with my 3rd grade daughter this past week to our county 4-H. I learned a lot about farm animals. It was quite amazing because I saw the farmer of today and even with all the modern technology, (like a $280K combine that has a stereo, GPS system, and two seats) it […]
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    • How To Not Blow Your Tax Refund April 2, 2008
      In my previous post I wrote about the importance of filing even when you owe. Today I am going to give some helpful tips on preparing for your refund. Whether you are getting $500.00 or $5000.00 it is human nature to spend your money two or three times before it even hits the bank. I would encourage […]
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    • How To Proactively Protect Your Identity March 26, 2008
      Freecreditdusters.com has a great article on ID Theft – Check it out
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Beauty In Simplicity – Chapter 1

“Stop this train, I want to get off!” – Vanilla Ice

Yesterday I touched on the fact that I am soul searching for the simple life. My wife and I used to think the Amish had the answer. I now know, as I mentioned, that I do not have to buy a farm and work the land in order to embrace a life of simplicity.

We all yearn in some way to get off the roller coaster. This life is going way too fast. The highs are way too high and the lows…well that’s for another post. It does help that Laura and I have our own company and we are able to set the pace, which we have, but it goes so much deeper than that. Anyone can set their own pace.

I am learning that there is a lot of work in achieving simplicity. You are going against the culture of working till late at night to get the car (Lexus SC430, anyone?), the big house (Is it on a golf course?), and all the latest trappings. I feel as if I have to daily reboot my hard drive so as not to get caught up in the emotions and desires of consumer America.

We have had friends “upgrade” to that life and we have watched them become isolated from what really matters. I am not anti-wealth. The question is and will always be in my mind, “What price am I willing to pay for it?”

Is it ever enough?

John D. Rockefeller was asked by a reporter when he was at the pinnacle of wealth and late in his years, “How much is enough?” and John D. in startling honesty said simply, “Just a little more.”

What else needs to be said?

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Time, not money is the key to a great Spring Break

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Time, not money is the key to a great Spring Break!

Back in the day there was a big movement of child experts who claimed that your kids require, “quality and not quantity.” If this has been your philosophy I have a question for you, “How is that working for you? ”

The cold, hard reality is that your family is just like anything else worthwhile. It takes both quality and quantity to be successful. This is the case with any endeavor from your career, to your hobby, and anything else.

 If you decide this spring to plant a garden, then you cannot simply till the soil, plant the seed, and wait for the harvest. A gardener knows that he must care for the little seedlings even though he cannot even see them. He realizes that in order for that seed to shoot roots down and have enough strength to break through the ground it is going to need a fertile, well-cared area.

Your children are no different. They require you to spend time with them. Do not make the mistake of feeling as if you have to go somewhere to have a great time. Love in any family is spelled  T – I – M – E!

Check out more Spring Break Tips: http://freecreditdusters.com/

Game of Life Better Than Blockbuster’s

springbreak08.gif Well, we played the Game of Life last night and as promised I will give you the highlights. It turned out better than I could have ever hoped. We all had a blast and learned a lot.

The amazing part about the game and reality is the unpredictability. You never know when you are going to lose your job, get sick, have a child, run into some money – the ups’ and downs of life itself are displayed in the form of pink and blue pegs driving plastic SUV’s (we have the new version).

It was interesting to me the reasons behind the choices the kids made. The game begins with a lot of decisions. Do you go to college and or not go to college? All of the kids wanted to start their career. I asked Emily why and she said she liked the picture. Sean, my 4 year old, wanted to get married immediately. The kids all squealed when we gave them $10K each, but quickly realized how fast the money changed hands.

Emily, my nine year old, pulled her salary card after picking a police woman. She was elated to find out she made $60k every time she passed a “Payday”, but was angry when she realized she would have to give her money away each time she landed on a taxes space.

The interesting part on a personal level was that I decided to take the college route. I actually never went to college so it was a surreal experience seeing myself taking the long route and watching everyone else get jobs, pass several payday’s , and even get married before I graduated.

Emily’s car rolled away and she did not have insurance so she had to pay $15k. When Emily got married she tried to put her husband in the back of the SUV instead of next to her. Lord, bless her future husband!

Seth, our seven year old, did something that surprised me. When it came time to buy a house he opted for the most expensive one. His career was a computer tech so he had more money than I did as I doctor (Isn’t that how life works?) Then his mom asked him if he wanted insurance on the house. At first he said no because the insurance was $45k. Then we explained to him that if he had a fire or flood then he would have to pay big money for the repairs or even lose his house altogether. He thought for a moment and elected to buy the cheaper house so he could “afford” the insurance.

The kids agreed that we all had a good time and even spoke later about what we learned. I look forward to many more trips around the game board because Life, like the game, is way too much fun to sit out!

The Game Of Life

springbreak08.gif The Game of Life has always been my family’s favorite board game. This is where you scratch your head and mouth the words, “Board game?”  Yes, I did say it. You know the pre-pixel version where the whole family gathers around the table and interacts with fun, laughter, and a little friendly competition. It is old school, but this is what my family will be doing on our first night of spring break.

 In the real game called Life, my wife and I have had many conversations about our kids (we have three) and their lack of understanding about money. We set up our nine-year-old daughter and our seven-year-old boy with their own savings accounts. The four-year-old is still too young. We are not frivolous spenders when it comes to our kids, but they still do not have a grasp of where money comes from and that it is not an infinite commodity.

We are really trying to get creative with our family nights and turn them into masked-over learning experiences as opposed to just another movie night. The movie night is the easy and lazy way of technically having family night.

Monday night we are going to eat dinner together with every electrical device unplugged. Yes, even my laptop…does it have an off button? Our first order of business is for each family member to tell their favorite part about the day. If you start this you will find that kids are just mini adults and they have a tendency to be very negative about their day. My daughter wants to start out about the latest gossip in her 3rd grade class. We gently, yet firmly, steer the conversation to positive stuff. Because none of my kids want to actually hear about my latest exploits starting a social networking site, I usually end up making some kind of story about the king of Persia calling me on a secret mission.

After we clear the table we get out the game for the night. Just like real life the Game of Life has a lot of twists and turns. We are hoping to share with our kids the value of family over the desire for pure worldly possessions.

It should be interesting. I will let you know tomorrow how it went.

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Good things come to those who are proactive!

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Today we received a phone call from one of our clients. Carla and her husband called to thank us for sending them to the credit watch service. They had signed up a few months ago, but had never checked her credit since then.She was surprised when she received an email from Trans Union alerting her that several new trade lines had been added to her credit report. Carla knew that she had not applied for anything. She logged onto to her True Credit services and saw that 3 new collections had been added from the same company.

The ironic part is that these were her husband’s medical bills and they had been added to her account. She had just spoken with the collection agency and set up payment arrangement to avoid it reporting on her account.  They had assured her that the collections accounts would not be reported to the credit bureau.

“Because I was signed up with the service it alerted me immediately that something was wrong on my credit. This allowed me to be an educated consumer and hold the collection agency accountable. If I had not had the service with True Credit I would have not known about these until I applied for a loan. By then it would have been too late.”

We are working with Carla to get those items removed permanently from her report. Carla did a great job and we were happy to hear from her. 

What To Do When Your Income Drops – Part I

What to do when your income drops.

A loss of income is traumatic, whether it is the breadwinner or a second income – a bad few months or even a year can destroy your family, your credit, and your finances. The good news is there are some steps that you can take to minimize an unexpected loss of revenue.

The very first step is to be honest. Be truthful with yourself and the place that you are in. Do not stick your head in the proverbial sand. You will survive and in fact you will be stronger because of it. I know when my wife and I were in the process of financial meltdown we both went through a time of freak out, but you cannot stay in that mode. You have to shake the dust off and put together a plan of action. This begins with honesty.

The next step is to communicate with your family. If you are married then sit down with your spouse. If you have children then call a Family Meeting. When it comes to your kids it is important to assure them that everything is going to be okay, but that the family is going through a rough spot.

I would recommend including them in some of the budgeting phase (we will go over that in a moment) so they can appreciate the fact that you are not going to be eating out anymore and that the Saturday shopping sprees are on hold for the next few months. I coached a lady who refused to let her two teenage kids know that they were going through a rough time. She attempted to maintain their lifestyle even though they we losing everything. She would get very angry at her kids every time they would ask for money.

On the flip side, I would not recommend hanging out all your dirty laundry to your kids. Especially if you feel like you can turn it around quickly. In other words, use good judgment. Above all, do it with kindness and love. Explain to them that stuff comes and goes, but that they will always be a family. Family can go through anything and be okay just as long as they are together.

Step 3 is take inventory of your financial situation. The first thing I would recommend is to take a look at your credit report. This will give you a snapshot of your debts and open credit lines. It will also let you know what your credit score is from all three credit bureaus. My wife and I recommend a service through Credit.com – it is only $14.95 and that includes all three credit bureaus with scores. It is a good deal. Once you have pulled your credit you need to analyze it. This is very easy with Credit.com – you can print it out and go over it.

The first thing you want to do is write out all of your monthly bills in the form of a budget. Now calculate your bring home income (after taxes). So, how bad is it? If you have a significant shortfall – which I am sure you do since you are reading an article on your income dropping then we go into the Action Plan phase.

 If your income gap is negative, you’ll have to start cutting expenses and get your payments reduced to balance your budget.Determine where to cut corners to balance your budget and reduce spending, you have to know exactly how much money you have coming in and going out. 

• Stop spending leaks. Leave credit cards at home and pay in cash. Using a credit card to maintain current living standard is incurring high interest debt and is adding to, not resolving, your problems.Change eating habits. We spend 14% of our income on food, and more than a third of that in restaurants, on fast food, and vending machine snacks. Eating at home or bringing your own homemade lunch or snacks is a lot cheaper.

• Conserve utilities. Turn off the lights and the television when not in use. Run the dishwasher, clothes washer, and dryer with full loads and less frequently. Lower house thermostats in winter and use fans instead of air conditioning in summer.

• Communicate. Agree with your family that every purchase over a certain amount will be brought to the family for discussion prior to purchase.

• Plan. Prepare for upcoming bills, such as an insurance payment due twice a year.

 • Make lists. Weigh the importance of each item on your shopping list. Reduce the number of shopping trips.

• Explore entertainment alternatives. Disconnect cable TV; play board games or visit the library. Walk more.

Take an inventory of your resources

How much does the family own? Take a few minutes to add up your family’s assets—the result just might boost your spirit. Add up the total value of all your belongings on Worksheet #2 (next page). Remember to calculate everything owned at current market prices, not the original price.

Cash—those things that either are or can be easily converted to cash. Remember: Cashing in certificates of deposit (CDs) before they mature results in an interest penalty.

Marketable assets—financial assets that can be cashed in or sold for their current market value. Prices will fluctuate with market conditions.

Other assets—real estate and personal property that can be sold but usually not as quickly as the assets above. Assets such as vehicles, furniture, and appliances usually depreciate in value, so they are worth less now than when you purchased them, even though they are still in good condition.

Non-marketable assets—assets that cannot be sold or are more difficult to turn into cash. Withdrawing money from your retirement plan, pension, or Individual Retirement Account (IRA) before age 59 1/2 usually involves a substantial penalty.

Use savings – If cash is required, use emergency savings or take out a loan if you can get one. This will depend on your individual circumstances, but there are some disadvantages either way. When you take money from your savings account it will no longer earn interest. If you take out a loan, you pay interest for the privilege of using someone else’s money.Check into a secured loan based upon money you have on deposit in a savings or a certificate of deposit account. You will pay interest on the loan, but the total cost might be less than the interest on another type of loan. If your family decides to withdraw money from a savings account, take money from a regular account first and leave any certificates of deposit untouched. You’ll lose interest and may have to pay a penalty on the certificates if you cash them in before they mature. If any case, think carefully about taking on any additional debt until you get back on your feet.

Should you use retirement savings? Don’t be tempted to start spending what you put away to use in retirement for everyday living expenses without some careful consideration of the long-term consequences.   And remember, under the tax rules, you must have your company deposit the money directly into your IRA rollover account at your new custodian—a bank, brokerage firm, or mutual fund.

If you take possession of the check—even for a few days—the company must withhold a sizable amount for income taxes.  But perhaps you truly need some of this retirement savings in order to meet some current bills. Prepare for this by rolling your 401(k) into an IRA invested in a money-market mutual fund or a bank money-market deposit account. Use this money only if your other savings run out.

You’ll pay taxes and penalties on the money withdrawn. But as soon as you find work, you can stop your withdrawals and protect any remaining IRA money left.  Some 401(k) plans let you borrow from retirement savings. There are rules about how much you can borrow, the interest you will pay, and the deadline for repaying the loan. For a short-term financial need this can be one way to borrow money quickly and without a lot of paperwork. 

Stay Tuned for Part II

The New Credit Face of FICO 08

Credit Hawk Blog has an excellent post as well as several resources about the new credit scoring system that is already out. Check it out: http://credithawk.blogspot.com/2008/03/new-face-of-fico-08.html

Thanks,

Matt Sullivan, CEO