Coffee heat rising

Short- and Long-Term Consequences of Debt to Consider

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Debt isn’t inherently negative. The option to pay using a credit card or take out a loan can enable consumers to make big-ticket purchases they otherwise couldn’t afford outright. But debt can also become a personal finance problem, as many Americans can attest. CNBC reports that nearly half (43 percent) of U.S. consumers have carried a credit card balance for two years or more. And the average American household with credit card debt owes nearly $17,000. These statistics illustrate how commonplace debt is—and also how challenging it can be to eliminate in a timely manner.

When you consider the short- and long-term consequences of debt, the importance of figuring out how to pay down debt becomes apparent. Here are just four side effects of living with significant debt.

 Negative Emotions

The impact of debt can extend beyond financial health alone. One study of nearly 34,000 participants published in Clinical Psychology Review found “people who are in debt are three times more likely to have a mental health issue” than those who are not.

Many people find debt to be a stressful state—and understandably so. It can be tough to relax when you’re trying to figure out how you’re going to come up with your next credit card payment. Money-related worries can easily interfere with sleep and work. Debt can even put a strain on interpersonal relationships, often because consumers with debt feel a sense of shame.

Debt denial occurs when people try to distance themselves from negative feelings by ignoring their financial reality. As difficult as it is, it’s important to face debt head on to alleviate the root cause of these negative emotions.

 Collection Notices

After a few months of nonpayment, creditors will turn your debts over to collection agencies. Representatives from these companies will reach out, often repeatedly, to solicit repayment. Receiving these notices can be stressful. And though the only way to stop them once and for all is to eliminate debt, consumers should be aware of their rights. As the Consumer Financial Protection Bureau outlines, debt collectors may not:

  • Contact you before 8 a.m. or after 9 p.m.
  • Contact you at work if you tell them this is not allowed.
  • Harass you or anyone you know.
  • Contact you if they know you have an attorney representing you.

If paying your debt in full seems unlikely at this point, there are options to explore. Creditors and debt collection agencies alike would rather receive something than nothing at all. For this reason, debt settlement can be an effective strategy for consumers already receiving notices.

Here’s how partnering with a debt settlement organization works: Consumers pay into a dedicated account each month. When their balance reaches a certain threshold, trained negotiators reach out to creditors, attempting to settle credit card debt for less than the original balance. While this does not stop collection notices—as you cease repaying debts for a period of time—it can ultimately zero out balances if a settlement is reached.

The key is making sure you enroll in a reputable program if this is the route you choose to pursue. Say, through online research, you find Freedom Debt Relief to be an industry leader in successful debt settlement. It’s still your responsibility then to look up Freedom Debt Relief reviews to see what real clients are saying about their experience. 

Poor Credit

Sustained revolving debt, like credit card debt, can damage your credit score. Why? Well, the amount you owe accounts for approximately 30 percent of your FICO score. 

Reduced Savings

Last but not least, carrying debt tends to diminish the amount you can contribute toward savings. The less you have stashed away in your emergency, savings and retirement accounts, the more precarious your overall financial situation becomes, especially if you ever lose your primary source of income.

These short- and long-term consequences of debt illustrate why it’s so important to work toward actively eliminating debt for your own financial well-being.

Skip the Coffee and Invest in These 3 Affordable Ways Instead

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There are many people who look at investing as something beyond their reach and only affordable for the wealthy who have the disposable income to buy hundreds of thousands of shares in a company. The truth is that investing is for everyone and the sooner you start, the quicker you can grow your wealth and prepare yourself for your financial future.

You don’t even have to deplete your savings to begin your investment journey. Just put aside the money you would spend on your morning latte or other small items that you can do without to start your investment portfolio. If you are looking to invest with little to spend, consider some of the low-cost investment options listed below.

DRPs

Image via Flickr by marcoverch

A small investment option for investors just starting out are dividend reinvestment plans, often referred to as DRPs or DRIPs. These stocks allow investors to directly obtain stocks from a company without the added expense of using the services of a broker. Most of these options only require you to purchase one share of stock to get a piece of the action.

There are many benefits with opting for a DRP, such as the ability to invest a specified dollar amount on an ongoing monthly basis. This allows you to be able to invest in the market during both its ups and downs which will provide you with a more representative return over the life of the stock. DRPs also provide dividend reinvesting which means the dividends you make will be reinvested, giving you a larger portion of stock.

Individual Stocks

The advent of discount brokerages online has allowed armchair investors the ability to invest in individual stock purchases themselves with as little as $5 to $10 fee per trade. This leaves you a large portion of the money you have to invest to be put into the stock itself instead of them being spent on brokerage fees. With these services, investors also have the option of being able to purchase fractions of large shares in up to 70 companies traded publicly. If you want to invest in major companies like Virgin American, you can spend as little as $10 towards the purchase of fractional stock.

Penny Stocks

A great investment opportunity for those looking to trade for less than $5 per share is to invest in penny stocks. Penny stocks represent smaller companies that are trying to establish themselves on the open market. Since the companies are just starting out, the investment is considered a more volatile one with the risk of considerable drops in share prices overnight. Though when proper research is done and investors learn the knack for trading them, they can also result in an incredibly high profit.

When choosing penny stocks, you will be making your trades from one of four tiers that these stocks fall into.

  • Tier 1 – Shares trade at $5 a share or slightly higher.
  • Tier 2 – Shares trade for less than a dollar a share.
  • Tier 3 – Shares are less than a penny.
  • Tier 4 – Prices are triple zero rates for a share.

Take advantage of investing early even if you don’t have much in the bank by considering one of the low-cost investing options listed above.

4 Stocks That Surprised Investors

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The stock market’s only constant is its unpredictability. You can’t always count on stocks to do what you expect them to do, which is exactly what makes it so fascinating. Let’s take a closer look at some of the stocks that have made unexpected moves in recent years. Whether they suddenly shot up without warning or unexpectedly dropped in value, the following stocks sent shockwaves through the market and those who keep tabs on it daily.

Axon Enterprise

Image via Flickr by Elvert Barnes

Axon Enterprise (AAXN) used a risky promotion to give their company a boost. Instead of continuing their focus on selling TASERs, Axon switched to body cameras along with cloud storage solutions for the data produced by the cameras. To get things rolling, they offered free body cameras to every U.S. police officer for a year. The promotion tanked their stock to $21, but the risk paid off. After the year-long free trial, orders began to pour in for more cameras and AAXN stock rose to over $40.

Kush Bottles

It’s no surprise that marijuana stocks have been performing well in recent years. With the legalization of marijuana becoming a hot topic in just about every state, and the widespread development of dispensaries, it’s only natural that these stocks continue to rise.

But Kush Bottles (KSHB) is an outlier in a field of hot stocks. Kush Bottles rose more than 120 percent on the market over the course of the year in 2017 and reported revenue of $10.6 million for the second quarter of 2018 alone. Even more surprising is the source of the company’s revenue, which isn’t actually directly tied to marijuana sales. Instead, Kush Bottles specializes in wholesale supplies for dispensaries, including vaporizers and child-resistant containers.

Citigroup

The recession hit the large banks hard, but Citigroup (C) really reached a low point during this financial crisis. In April 2009, the company’s price fell to 97 cents per share. It seemed as though Citigroup was on the brink of shutting down altogether, and few investors thought they’d recover from such a hard hit. But over the last decade, the company was able to recover due to a massive government stimulus. The unthinkable has happened — Citigroup now trades at over $60 and continues to rise.

Zynga

Not all stock surprises have a happy ending. In the case of Zynga (ZNGA), a high earnings forecast that didn’t pan out resulted in a major drop in the company’s stock price. In the second quarter of 2012, Zynga’s price dropped over 40 percent in a single day in after-hours trading. By missing the mark on its financial forecast by such a wide margin, Zynga became a cautionary tale of the stock market.

Though the stock market can certainly produce some great results, there will always be unexpected ups and downs to keep investors on their toes. These companies are great examples of the ways in which certain companies can produce incredibly surprising results when it comes to their stock market values and dramatic changes in performance over a short period of time.

On Being a Woman in America

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From Facebook friend Beth Riley, up pops the post below, with quote from a book by someone named Jackson Katz.

On reading it, I first thought…yup. Then reflected that it’s a damn good thing we don’t live in Saudi Arabia, where I grew up. That government just murdered…uhm, “executed”…a woman for the dastardly crime of asking to drive a car.

All extreme fundamentalist movements — be they fundamentalist Christian, fundamentalist Islam, fundamentalist Buddhist, fundamentalist Hindu, fundament-anything — aim to hold women down. This impulse seems to stem from a trend in human nature to try to control and even imprison females, for reasons that may have made sense when we roamed the ice sheets chasing mammoths but that don’t seem to do so in an advanced civilization.

In America, folks who subscribe to such thinking tend to identify as “conservatives.” But these extremists are not conservatives; they’re radicals. They take a radical attitude toward women, toward foreigners, toward God, toward our nation. People who think they can tell women what they can and cannot do with their bodies are people who think woman’s place is as a slave: to a man, or to a culture, or to a misguided religion.

From Beth’s post:

I draw a line down the middle of a chalkboard, sketching a male symbol on one side and a female symbol on the other.

Then I ask just the men: What steps do you guys take, on a daily basis, to prevent yourselves from being sexually assaulted? At first there is a kind of awkward silence as the men try to figure out if they’ve been asked a trick question. The silence gives way to a smattering of nervous laughter.

Occasionally, a young guy will raise his hand and say, “I stay out of prison.” This is typically followed by another moment of laughter, before someone finally raises his hand and soberly states, “Nothing. I don’t think about it.”

Then I ask the women the same question. What steps do you take on a daily basis to prevent yourselves from being sexually assaulted? Women throughout the audience immediately start raising their hands. As the men sit in stunned silence, the women recount safety precautions they take as part of their daily routine.

• Hold my keys as a potential weapon.
• Look in the back seat of the car before getting in.
• Carry a cell phone.
• Don’t go jogging at night.
• Lock all the windows when I sleep, even on hot summer nights.
• Be careful not to drink too much.
• Don’t put my drink down and come back to it; make sure I see it being poured.
• Own a big dog.
• Carry Mace or pepper spray.
• Have an unlisted phone number.
• Have a man’s voice on my answering machine.
• Park in well-lit areas.
• Don’t use parking garages.
• Don’t get on elevators with only one man, or with a group of men.
• Vary my route home from work.
• Watch what I wear.
• Don’t use highway rest areas.
• Use a home alarm system.
• Don’t wear headphones when jogging.
• Avoid forests or wooded areas, even in the daytime.
• Don’t take a first-floor apartment.
• Go out in groups.
• Own a firearm.
• Meet men on first dates in public places.
• Make sure to have a car or cab fare.
• Don’t make eye contact with men on the street.
• Make assertive eye contact with men on the street.

― Jackson Katz, The Macho Paradox: Why Some Men Hurt Women and How All Men Can Help

To that I say: Yup. All of the above.

I wonder how many men are aware of all the strategies and subterfuges the women in their daily lives take to protect themselves. To me they’re so much a part of ordinary life, I wouldn’t bother to mention them to a male partner or friend, any more than I would mention that I drink a glass of water or a cup of coffee in the morning. So…why would he be aware of all that, unless he’s an exceptionally close observer?

Here’s another one:

•  Never live in a place that doesn’t have a garage with a door that closes. When you get home, never unlock or get out of your car until you’ve closed the door and you’re sure it’s really shut. Look around you in the garage before unlocking your car door and stepping out.

Oh, what the heck, as long as we’re in that vein:

• Watch your rear-view mirror as you’re driving home. If someone follows you into your neighborhood, be aware; if the person follows you onto your street, keep driving past your house and drive out of the neighborhood. If he continues to follow you, drive to the nearest fire station, police station, or emergency room and lean on the horn.
• Never, ever leave your garage door hanging open. As you’re leaving the house, stop the car and wait until the door is completely shut, to ensure that nothing gets in its way and causes it to come open again as you’re driving away. And it should go without saying: never leave the garage open when you’re in the house.
• Never walk across a parking lot habituated by panhandlers and potential purse-snatchers.
• Do not carry a purse: wear clothes with pockets and drop a couple of credit cards in them.
• Install motion-sensitive lights along all four exterior walls of your house, up near the eaves where it’s hard to reach them to unscrew the bulb.
• Place battery-operated “screamer’ alarms on all sliding doors and windows, and on the sliding screens for Arcadia doors.
• Equip a room in your home with a solid-core door and a hardened dead bolt. Keep a weapon hidden in the room, and also hang a house dress on the back of the door, to use if you have to dart in there at night when you’re not fully clothed. No, you do not want to reward the cops with an impromptu strip show!
• Have a phone in every room, including the bathrooms, not only for your convenience but so you can grab a phone quickly to call 911.
• Equip every exterior hinged door with a heavy-duty security screen, and fit each one with a hardened deadbolt. Remember to close them and lock them whenever you’re not walking in and out.
• When driving at night or through a sketchy district, if you see a red light ahead, slow down to give it a chance to turn green so you don’t have to stop your vehicle.
• Avoid driving through high-crime neighborhoods and areas known to be infested with drug gangs.
• Drive a substantial distance to avoid having to shop in grocery stores whose parking lots are unsafe.
• If you have a carport or garage with an entry to the attic in its ceiling, padlock the thing.

Can most or all of this be replaced by an expensive security service and an alarm system? Well…some of it. But a) I hate alarms; b) I hate the monthly gouge an alarm service charges for something that might be needed once in my lifetime, at most; c) you’re at risk everywhere, not just in your house; and d) in my book self-reliance trumps relying on someone you don’t know and who cares about you only because you pay for the privilege.

Do I also hate living like I’m the one in prison, not the bad guy? You bet. But as things stand now, I don’t see many alternatives.

There, but for…

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…the grace of God!

Ever have one of those experiences when nothing happens to you and that causes you to think thank You, God?

This is different from a close call. In a close call, something does happen to you. An event almost does you in, but you manage either to dodge out of the way or to survive without permanent injury. This is a close call:

I’m about 21. I’m driving through the cotton fields on a two-lane road, headed from a suburb into downtown Phoenix, there to start my day as a receptionist for a law firm. As usual, I’m flying low: around 50 to 60 mph. Two lanes. Country road. In a new 1967 Ford Fairlane that was a certifiable lemon.

As I’m tooling along listening to the radio (The mornin’ sun is risin’/Like a red rubber ballll…), some guy in a pickup pulls off a dirt side road, right in front of me. I’m gonna hit him. My mother told me to watch out for country boys on side roads! Why didn’t I listen?

I slam on the brakes.

The damn car LEAPS into the air (no exaggeration!) and lands in the middle of the oncoming lane.

And yes, there is an oncoming car in the oncoming lane. The driver looks panicked.

At that moment, everything shifts into slow motion. I seem to have half an hour to think about this and contemplate my choices. I can…

• jerk the car back into my lane. But the guy who pulled out in front of me is now right beside me, driver-side door to passenger-side door. If I move into the right lane, I will hit him. The recoil may push us both into the oncoming car…

• stay where I am and head-on the third driver. Not an option….

• at around 50 mph, pull off onto the left-hand shoulder, a strip of dirt that borders an irrigation canal. This may cause my car to roll and I could find myself upside down in the irrigation ditch. But maybe not…

I choose option c) as the least disastrous. Miraculously, the ground is hard enough to support my car’s laboring tires, and miraculously, the car does not spin out of control. The guy in the oncoming car whistles past me. The guy in the pickup proceeds on down the road.

That is a close call because an element of choice occurred after the event began. You’re not saved just by the grace of God, but by a combination of your own volition and God’s grace.

A true thank-You-God moment may be influenced by choices you made before the event occurs, but your escape has nothing to do with choices you make during and after the event.

Example: One of my clients was an economist who had a career as an international banker. He traveled a lot in his business. One day he was flying into a large South American city, where he was to meet with another banking executive about some high-end business matter. Somewhere along the line, his plane was held up, so they were running several hours late coming to their destination.

As they circled around to come in for a landing, he looked out the window and noticed smoke coming out of a large high-rise. Of interest, but he didn’t think much about it.

Once he got into town, though, he discovered the smoking building housed his guy’s office. The fire had broken out a few hours before. And, like many buildings in many third-world countries, it was inadequately designed for fire safety: it had few or no usable fire escapes. The guy had been trapped in his upper-floor office, and he died.

Now there you have a thank You-God moment. It was pure, raw luck that my client hadn’t been in the office when the fire started: “a few hours before” was right when the two men had scheduled their meeting. Nothing that either person did could have changed the outcome. The only reason my client survived was that by random chance he happened to get on a plane that was delayed.

I always figure I’ve had a thank You-God moment when I come across a major car wreck, because….if I’d been there 15 minutes or half-an-hour earlier, that could’ve been me in one of those cars. Indeed, I thought I was enjoying one such this very morning when I came across a three-block long back-up at the intersection of two of the busiest arterials in the central city.

The cops had shut both roads down about a quarter-mile in each direction from the wreck. People were winding their way through residential neighborhoods in order to get on their way. Luckily, I contrived to turn left out of a tiny residential lane onto Arterial East-West and continue on my way to the veterinarian’s.

As it turns out, this also wasn’t a true tY-G moment, because no one was killed or even hurt seriously. The only reason the cops were making SUCH a BFD about it was that one of their SUVs was involved. Some guy had sideswiped the cop (?? how hard is it to notice a gigantic white tank with blue stripes all around it and a pair of red bubble-gum machines on top???) and caused the police vehicle to roll.

This happened at 7:00 this morning. I left my house at 10:44, so it was about 10:50 or so by the time I reached the scene of the drama. They had that intersection shut down in four directions for almost four hours!

Forgodsake, they clear out fatalities faster than that.

I surely have had plenty of real tY-G moments, when I and my fellow homicidal drivers missed a monstrously fatal disaster by a matter of minutes. Or even seconds.

How about yourself? Got any good thank You-God stories?

Doggy Ups and Downs

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Each day, Cassie has her ups and her downs. And it seems that each down gets deeper. She’s in a bad way every morning, but then seems to revive a bit around noon.

Today I noticed she wasn’t in her normal nest. Or anywhere else. Thinking I’d accidentally left her outside, I went running around calling her: no response. Finally I found her in the clothes closet, squirreled away in a corner.

This is not a good sign. In all the ten years this dog has lived here, she has never gone into that closet. Maybe once or twice to sniff at a shoe, but really: she doesn’t go in there.

The other not-good sign: she flat refused to eat this morning. I managed to coax a few bites down her by mixing some of the food with water to make a kind of soup. But she wouldn’t even take all of that. Either she’s having a difficult time swallowing or just doesn’t feel like being bothered. My money’s on the latter: my guess is she simply doesn’t want to eat any more.

If you’re going to let Nature take its course, you’ve gotta listen to Nature and understand what She’s telling you. Today She definitely was trying to say something…

The vet’s office called to say he wanted me to come pick up some Temaril tablets to try to deal with the refusal to eat issue. Why, I don’t know. Temaril is a cough suppressant. She’s stopped coughing, and he knows it.

I am now flat broke, budgetwise: $5 left to live on for the rest of the month. I transferred a hundred bucks over from emergency savings to get through the next week…hope I won’t have to spend much of it, but am basically out of food except for what’s in the freezer and what’s growing in the backyard.

At any rate, the UPs: Along about noon, the dog seems to revive. This is becoming a pattern. But every day, the morning “down” seems worse than the previous day’s. Really, today I thought she might not be alive by the time I got back from the vet’s — it’s an hour of driving, round trip. So I pull the car into the garage, climb out, and hear Cassie barking on the other side of the door!

She hasn’t barked in days.

Fling wide the gates…and lo! There’s Cassie standing there bright-eyed and wagging, looking normal as apple pie.

WTF?

The garage door is open. Ruby is still in the car — I’d taken her with me because I thought there was such a high chance Cassie would pass while I was out fighting traffic, and frankly, I do not want Ruby to decide to eat the remains.

She is a dog, you know…

So Cassie walks outside, Ruby being locked in the vehicle and so unable to make her escape to Yuma. Cassie strolls around, sniffs, pees, acts pretty damn normal. I get the mail, we stroll back inside as though this were just another day in Paradise.

Right away, while she still is acting like she’s going to live, I mix up some more dog food swill, causing her to get about half the remainder of this morning’s dog food down, along with about a third to half a cup of water.

Vet called just a minute ago. I pointed out that Temaril was for a cough and she’s stopped coughing. He said it contains a steroid to reduce inflammation, and can sometimes make an ailing dog feel better. Before I left the Funny Farm, I’d given her one of the remaining half-tablets from the previous bottle. He says it can act pretty fast, and that might explain her apparent revival. He also speculated that she may just feel bad when she wakes from a night of snoozing and it could take several hours for her to begin to feel better.

I reminded him that she’s 12 years old. He said…yeah…but made no further comment on her superannuation. He did remark, though, that Corgis are unusually tenacious dogs, and so one shouldn’t give up on her too soon.

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