Debt and Senior Citizens

We are in a consumer driven world. There are so many things all around us that make our lives easier and, in a way, influence us to think that we must have them. There are always things that we want which we simply can not afford. As banks and credit card companies mushroom out of control, we are bargraed with opportunities to accept so-called help from these financial institutions just so we can buy more merchandise we want but do not need.

The best part is that you do not even have to go to ask for the credit that you want. They will be at your beck and call offering credit cards, store credit cards (from those stores you wanted to purchase from anyway), merchandise cards (you're given hundreds of dollars in credit to purchase from the company's specific catalog), and leasing arrangements that allow you to pay over time.

The only problem with buying on credit is paying it off. Using an analogy, it is easier to step into quicksand than it is to get out. There is not always a branch lying around attached to a willing helper. Credit may be no problem if your current job earns enough money to repay your debts completely each month. It simply becomes part of your overall expenses. What happens, though, when your debt overextends your pay check?

Unfortunately, retired senior citizens are more susceptible to this pitfall. In prior years, they worked and earned a certain amount of money, but upon retirement are saddled with little more than Social Security – definitely a blow to the pocket book. Their income is not as flexible as it once was. There are solutions, however, from which seniors can benefit. Some are even geared specifically toward them.

As a senior citizen, you can request the help of a professional. Financial advisers are available to help tackle your problems. Asking for the aid of one such professional can save you a great deal of anxiety, credit ruin and, more importantly, stress. Your financial advisor can act as a mediator between you and creditors to develop "payoff amounts" that will not leave you destitute – and usually at a fraction of your current payments. If you feel that you're drowning financially, you should not wait until the water is over your head. Contact a financial advisor now for assistance.

Before meeting with an advisor, there are steps you should take to be best prepared for the discussion. Grab a notebook and pen to list all your creditors. List them in order of importance, starting with your mortgage (or rent or community fees, etc.) and ending with small payments like store credit cards. List their amounts as well. If you owe $ 50,000 on your home then list $ 50,000 and your current monthly payment. For example:

ABC Mortgage Company $ 50,000 (debt), $ 775 (monthly payment)

Listing the information this way will show your credit advisor that you are serious about getting your debt in order. It also is incredibly useful for the adviser in contacting your creditors since your financial advisor can then, at a glance, see what you owe and to what. A sample short list follows below.

It is important that you have a clear comprehension of your financial situation. The best solution to debt is to not get into any that you can not handle. However if you have already reached that "destination," especially as a retired senior, then utilizing a financial advisor is certainly a great option to help rid yourself of the burden.

And now, the sample I promised:

John Smith

Total Monthly Income: $ 1200

DEBTS / MONTHLY PAYMENTS

ABC Mortgage $ 50,000 (debt), $ 750 (monthly payment)

Car Payment $ 20,000 (debt), $ 450 (monthly payment)

Credit Bank # 1 $ 3,000 (debt), $ 25 (monthly payment)

Credit Bank # 2 $ 1,200 (debt), $ 15 (monthly payment)

Store Credit Card # 1 $ 5,000 (debt), $ 75 (monthly payment)

House Phone $ 50 (monthly payment)

Cell Phone $ 55 (monthly payment)

Total Debt $ 79,200

Total Monthly Payments $ 1,400

As you can see from this example, this person is losing $ 200 every month ($ 1400 monthly payments minus $ 1200 income). A financial advisor can usually negotiate with the credit card companies. They may even suggest that this person discontinue either their home phone or cell phone, for example, as most can probably get along with just one or the other.

Source by David Cunningham

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