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Here Are Some Legal Issues You Have to Deal With Long Before You Need Them

July 10, 2021 By Justin Weinger Leave a Comment

By the time you realize you need a lawyer, it is often too late. It might be difficult to find a good lawyer at the last minute. That is why people with means often have a family lawyer on retainer at all times. No one calls an attorney without good reason, they are much like first responders. They are the people you hope you will never have to work with. When you do end up encountering them, it is often a desperate situation where you feel hopeless and afraid. You are definitely not coming at it from a position of strength.

The better way to deal with life’s stickier issues is in advance. Like insurance, you never want to use it. But you also never want to be without it. When the worst happens, you just want to know that you are covered. Even so, there are some situations that aren’t amenable to prior preparation. You just have to hang on tight and hope for the best. Here are a few situations where you can do a little better:

Foreclosure

You do not buy a house or rent an apartment expecting foreclosure in your future. But you are also not setting yourself up for success if you don’t have a plan for what happens if you lose your job and find that you can’t make your payment. You need to know answers to questions like, how does foreclosure work. No one saw the pandemic coming. People who thought they were rent stable found themselves on the wrong end of foreclosure notices.

You can start by educating yourself on the options you have if you one day find yourself in arrears. The first thing you should know is that you actually have options. The second thing you should know is that for best results, those options should go through a law firm with experience in such matters. This is not the moment to play Yellow Pages roulette. You need to know who to call before the first notices start arriving. If you have the kind of health insurance that supplements your income when you suffer injury, that can get you by with most of your bills. When those supplemental checks come, don’t breathe a sigh of relief. Move to the next phase and speak to an attorney about what happens next.

A Living Will

There are good reasons why you need a will even if you’re broke. One of those reasons is that there is more than one kind of will. It is not just a way to legally arrange for who gets your goldfish after you pass. It is also a way of letting people know what your wishes are in the event you find yourself in the need of hard medical choices that you are not able to make at the time.

All hospitals ask you if you have a living will. Unfortunately, this usually comes less than an hour before they give you the gas. If something goes wrong on the operating table, you need to be clear about DNR directives, organ donation, and the like. You do not want your distraught family to have to make a snap judgement in the moment when they are at their emotional worst. That is why you should have a living will or advanced directive made while you are at your emotional best.

Prenuptial Agreement

A prenuptial agreement, commonly known as a prenup, is a legal contract created by two individuals before marriage. It outlines the division of assets, debts, and financial responsibilities in the event of divorce or separation. Prenups can address issues such as property rights, spousal support, and inheritance, helping to clarify expectations and protect both parties’ interests.

Everyone knows that money problems can ruin a marriage. What you might not know is that money can also ruin a divorce. If you have a lot of money or are planning to have a lot of money, you might want to have a serious, adult conversation about what happens to that money, taxes, and assets if something happens to the marriage. It is not a strictly negative thing. You don’t want to leave important matters like the care of your children to the vagaries of a judge who is operating on little sleep and a bad burrito for lunch. Make amicable arrangements while both parties are still amicable.

Filed Under: Financial Truths

Help Your College Student By Adding Them as an Authorized User to Your Credit Card

October 22, 2018 By MelissaB 1 Comment

I got my first credit card when I was in college.  At first I was responsible, but then I began to charge more than I could afford on my meager student salary.  I still remember the first purchase I made on my credit card that I knew I could not pay off immediately—a $37 tennis racket because my friend and I wanted to play tennis that summer.

Unfortunately, that lead to a habit of over charging because I had very little income coming in.  My experience is not unique.  Approximately 90% of undergraduate and graduate students who have credit cards carry a balance each month (Debt.org).

Boost a Student's Credit Score
Boost Student’s Credit Score

If you’d like to help your teen or college student develop a responsible credit pattern as well as a good credit score, the secret may not be to get him his own credit card, but instead to make him an authorized user on your account.

As an authorized user, she’ll be able to use your card.  You can either pay what she charges or have her pay what she charges.  In addition, you’ll be able to keep an eye on her purchases and make sure she is using her privileges responsibly.  This can get her into the habit of responsible credit card use so she can avoid debt in the future when she has her own card.

A Few Caveats

Before you pursue putting your child on your account as an authorized user, you’ll want to cover a few bases:

Have a Strong Credit Score

If you add your child as an authorized user to your account, she will “inherit” your credit score.  If you have a high credit score (generally 700 or above), you will be giving your child quite a gift.  With a high credit score, when she finishes college, she’ll more easily be able to rent an apartment and get her own credit card later in life.

If your credit score is low, you’ll be saddling her with an obstacle to overcome.  It’s better for her to have no credit score than to inherit your low credit score.

Choose a Card that Reports Authorized Users to the Credit Bureaus

Not all credit cards report authorized users to the credit bureaus, which means your child won’t get your credit score.  In general, the major credit cards do, while credit unions may not.  To be sure before you add your child, confirm with the credit card company that they will report authorized users.

Only Do This With Responsible Children

Since you are ultimately required to pay any expenses put on your credit card by your child, only put a child who is financially responsible on your card as an authorized user.  If your child has been irresponsible financially in the past, there is no use in tempting him with your line of credit.

See If There Is a Fee for Authorized Users

Finally, keep in mind that some credit cards charge a fee to add an authorized user.  You’ll want to verify this is not the case for your particular card before you add your child.

If you’d like to help your child develop financial maturity and secure a good credit score, consider adding him as an authorized user.

Have you added a child as an authorized user or were you added as one?  If so, what was your experience?  Would you recommend doing this?

 

Filed Under: credit cards, Credit Score Tagged With: credit, Credit Score, student credit

Do We Inflict Peer Pressure On Ourselves?

January 15, 2014 By MelissaB 10 Comments

When my husband and I got married, we were flat broke.  Broke.  We bought the cheapest wedding bands that we could find, and my diamond is small.  However, that was my preference.  I wanted to stay within budget, and I personally like smaller diamonds rather than the big rocks that some women wear.  (All I could think was that when I had babies, I’d accidentally scratch them with a big ring.)

Still, there have been times that I’ve been in the presence of a group of women, each with a huge rock on her hand, and I’ve been a bit embarrassed by my small diamond.  I’ve wondered what other people thought of us and our financial situation.

Peer Pressure Doesn’t End in High School

In high school, peer pressure is at its peak.  If you want to be popular, you have to follow what the other kids are doing.  I didn’t cave to peer pressure often.  Instead, I had a few close friends, and I followed the path that was important to me.  I was relieved when I graduated because I thought the peer pressure would finally be done.

In college, I found that the peer pressure did relent.  People would respect your choice if you didn’t do what they were doing.

However, as I got older, I began to realize that there are societal norms that you’re expected to maintain.  This becomes the “keeping up with the Jones'” phenomenon.

The Pressure Becomes Internalized

Self Inflicted Peer PressureMy husband and I are digging our way out of serious debt.  We are scrimping and saving, knowing that in a few short years we will be out of debt and can start fresh.  We can have all of our money be our own once we’re out of debt.

Meanwhile, we drive a 10 year old minivan with over 125,000 miles on it.  I wear my small diamond ring, which I don’t ever plan to replace with a bigger version.  We rent an apartment instead of owning a home.

No one is pressuring me to spend money that we don’t have.  No one is passing judgment on us (at least not to us directly).  But it’s hard not to look at other people’s lives and see the “stuff” that they have.  The nice cars.  The nice home with brand new furniture and a manicured lawn.

No one is telling me I’m failing, but I feel it sometimes.  I feel that I’m not living up to society’s standards.  I can see how easy it is to want to keep up with the Jones’, even if you can’t afford it.  I can see how easy it is to pull out the plastic just this once because you’ve been scrimping and saving and just want to be like other people once in a while.

For the people who can afford it, there is no danger in this.  For the people who can’t afford it, there’s just debt and heartache.  You might then be just like those you want to be like.

Me, I’ll keep resisting the peer pressure, even though now it’s mostly pressure I put on myself.

Filed Under: Consumerism, ShareMe

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