Posts Tagged: ‘credit card debt’

Why Credit Card Debt is Bad for Your Health

February 21, 2018 Posted by kingcade

The economy is improving and with that comes consumer confidence, increased spending and rising credit card debt.  But while household income has grown over the past decade, so has the cost of living.  This has caused many consumers to access lines of credit and utilize more credit cards.  Credit card debt hit its highest point ever in 2017, surpassing $1 trillion, according to the Federal Reserve.

Close to 2 in 5 consumers who have been in credit card debt say it has affected their overall happiness, according to a recent study by NerdWallet. One-third said it negatively affected their standard of living, and 1 in 5 said it negatively impacted their health. Still, the average American has about three credit cards and a total balance of $6,375, up nearly 3% from last year, according to Experian’s annual study on the state of credit and debt in America.

There are steps you can take to deal with credit card debt with rising interest rates.  Don’t let your debt cost you another sleepless night. Sit down with an experienced Miami bankruptcy attorney to discuss your options in greater detail.  The consultation is free, the relief is real. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Related Resources:
 https://www.usatoday.com/story/money/personalfinance/budget-and-spending/2018/02/19/why-credit-card-debt-can-bad-your-health/341044002/

Top 10 Reasons People File for Bankruptcy

February 17, 2018 Posted by kingcade

While it is commonly assumed that people who file for bankruptcy cannot resist the temptation of using credit cards or are self-proclaimed shopaholics, most people go bankrupt for other reasons.  Here are the most common reasons people file for bankruptcy.

  1. Medical debt. Medical expenses account for approximately 62 percent of personal bankruptcy filings in the U.S., according to a recent Harvard University study.  And interestingly enough, the study revealed that 72 percent of those who filed for bankruptcy due to their medical bills had some form of health insurance.
  2. Reduced income. Companies are cutting back on expenses and for many employees that means pay cuts. Less income, combined with an unexpected expense can end in bankruptcy.
  3. Job loss. The sudden loss of a job can quickly deplete ones savings.  Approximately 62% of Americans have less than $1,000 in savings and 21% live month-to-month.
  4. Credit card debt. This is not always the result of irresponsible spending, but can accumulate due to an unexpected medical expense, illness or job loss.
  5. Divorce. This can mean a significant loss of income and assets for both partners. It can also mean taking on a portion of your partner’s debt if you co-signed on a loan during the marriage.
  6. Unexpected expenses. Emergencies can happen to any one of us, whether your vehicle breaks down, you suffer a debilitating illness or a catastrophic storm damages your home—these events can deplete savings quickly.
  7. Student loans. Even though these are difficult to discharge in bankruptcy, statistics show that student loans account for at least one percent of all U.S. bankruptcy filings, which translates to approximately 15,000 bankruptcies a year.
  8. Utility payments. For many homeowners, the rising costs of utilities- such as heating, air conditioning and electricity- can quickly add up and pave the way to bankruptcy.
  9. Foreclosure. A number of people file for bankruptcy in an effort to save their homes from foreclosure.
  10. Money mismanagement. Money management has become more difficult, thanks in part to inflation.  A combination of poor spending habits and incorrect budgeting can quickly spiral into debt.

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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

New Study Reveals- 24 Percent of Americans have more Credit Card Debt than Savings

February 8, 2018 Posted by kingcade

The new statistic comes from a 2017 Bankrate study, which also revealed only 52% of Americans have emergency savings that exceed their outstanding credit card balances.  Meanwhile, the average U.S. household owes $7,136 in credit card debt and an estimated 57% have less than $1,000 in the bank.

There are ways to break the cycle of debt and boost savings simultaneously.  It starts by creating a budget. Without a budget, you will have no idea where your money is going each month and where you can cut corners.  Downsizing your living space can free up several hundred dollars a month.  But keep in mind, cutting back on leisure purchases, eating out and clothing can do the same.

Taking on a side-job to earn extra income is another way to pay down debt and boost savings.  Of the 44 million Americans who currently have a second job for supplemental income, more than one-third bring home upwards of $500 a month as a result.

Getting out of the debt cycle begins with creating a realistic budget and getting a grasp on your current financial situation.  There are specific ways you can deal with high interest credit card debt.   If you are struggling with insurmountable debt, whether it is credit card debt, medical debt or student loan debt, consider sitting down with an experienced Miami bankruptcy attorney for a free consultation who can assess your financial situation in more detail and let you know if bankruptcy is right for you.

Click here to read more on this story.

As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

The Negative Effects Store Credit Cards Can Have on Your Credit Score

January 5, 2018 Posted by kingcade

Getting a deal on holiday purchases can end up costing you more in the New Year- a lot more, in fact.  The reality of a cheerful sales clerk asking, “Would you like to save 20 percent on your purchases today by opening a store credit card?” Sounds tempting, right?  But these cards can ultimately hurt your credit score.   Store credit cards can have a large impact on your credit usage, which is a big factor in credit scores.   Applying for these cards requires an inquiry on your credit report and reduces the average age of your credit accounts.

Store credit cards have significantly higher APR’s and it is easy to fall into debt. The credit limits on these cards are typically 10 percent compared to other cards.  How much of your credit limit you use has a substantial impact on your credit score.  The one factor that matters more is paying on time. Credit experts advise staying below 30 percent of the limit on any card. Consumers with the highest credit scores use less than 10 percent.

When you apply for a store credit card, the card issuer will pull one of your credit reports.  This helps qualify you, but it can cause a temporary dip in your score. On top of potentially hurting your credit scores, retail cards have usability issues. These cards are good only at one store or retail chain.  They are typically accompanied by high interest rates and severe penalties if a payment is missed.  These cards also have less security features.

If you shop at a particular store often, it might be worth opening a store card to access ongoing discounts, presales and insider benefits.  But avoid making this decision lightly and in the checkout line.

Click here to read more on this story.

If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Life after Bankruptcy: 5 Things You Need to Do After Bankruptcy

January 2, 2018 Posted by kingcade

If you recently filed for bankruptcy, you are likely experiencing a sense of relief from having your debts discharged and getting a fresh start financially.  These tips for “life after bankruptcy” will help you avoid future debt problems and improve your credit score once your case is finalized.

Collect and preserve all paperwork from your case. Your bankruptcy attorney should provide you with a copy of your bankruptcy petition (i.e. – 40-50 pages of detailed financial information – including the facts about the debts and assets involved in your case.)  You should also have a notice of bankruptcy filing directly from the court, which shows the deadlines that affected your case.  Finally, you should have a copy of your discharge order entered by the bankruptcy judge. This is important as some lenders require to see a copy of the bankruptcy papers before lending you new credit.

Check your credit reports regularly. You can obtain your credit report for FREE from each of the three main credit bureaus once a year.  It is important to see what creditors are saying about you.  Especially after a bankruptcy, you want to make sure that all of the discharged debt is being reported to the credit bureaus with a zero balance so it does not count against you as outstanding debt.  You also want to make sure the account is not transferred to a new collection agency who falsely pursues you for the discharged debt.

Start a budget and review it regularly. Creating and sticking to a budget is the key to staying on track financially.  It is also a great way to manage your income and expenses and see where every dollar is going.  Just like in the Means Test that compared your income and expenses over a six-month period to standards set by the Census Bureau and the IRS. The concept was to identify those who actually had the means to pay their debts, but who were living an extravagant lifestyle financed on credit cards and other debt.  It’s an urban myth that people who file for bankruptcy live lavishly and are financially irresponsible. Statistics monitored since 2005 show that a very small percentage fit into this category.  Most bankruptcies are caused by an unforeseen illness or medical expense,  job loss, or even a divorce.

Start an emergency fund.  When establishing a budget for yourself, make sure you put aside a portion of your income for savings.  Having an emergency fund will help you avoid incurring unplanned debt or taking out cash advances to cover unexpected costs like a car repair or appliance repair.

Think about new credit.  A great way to rebuild your credit after filing for bankruptcy is to obtain a secured credit card.  You can open this card by depositing money into an account as security.  Your credit limit is the amount you deposited into the account.

If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Related Resources:

http://blog.credit.com/2014/12/5-things-to-do-after-bankruptcy-103308/

https://www.legalzoom.com/articles/life-after-bankruptcy-get-back-on-your-feet-after-filing-chapter-7