Globe Staff

The number of single-family homes placed under agreement to be sold in Massachusetts was down 10 percent in August from the same month a year ago, the fourth straight month of year-to-year declines, but was up slightly from this past July, according to a release from the Massachusetts Association of Realtors.

There were 4,117 new pending sales of single-family homes in the state in August, down from 4,570 in August 2009. Newly pending sales rose 1.7 percent from this past July.

Condominium sales in Massachusetts fell 19 percent in August from the same month last year. There were 1,435 units placed under agreement last month, down from 1,770 in August 2009. The number fell 2.1 percent from the previous month.

The numbers reflect the “post-tax credit” period, said Eric Berman, spokesman for the association. “Everyone was rushing top get the deals in place before April 30,” when the $8,000 federal tax credit for first-time home buyers ran out.

The results follow a 26 percent drop in home sales in Massachusetts in July from the same month a year earlier, according to figures from the Warren Group. The number of Massachusetts home sales in July reached a 20-year low for the month, and a similar drop occurred across the country.

The August numbers from the association are based on newly signed purchase and sale agreements, and are compiled from the Multiple Listings Service. They do not include transactions that are not listed on MLS.

WASHINGTON—Private employers hired more workers over the past three month than first thought, lifting hopes for the weak economy. But the unemployment rate rose in August for the first time in four months as more people entered the market looking for work.

Companies added a net total of 67,000 new jobs last month and both July and June’s private-sector job figures were upwardly revised, the Labor Department said Friday.

By Justin Harelik • Bankrate.com

Dear Bankruptcy Adviser,
I am filing Chapter 7. I have a car loan for a vehicle that is worth less than $15,000, and I have one year remaining with a balance of less than $5,000. My attorney recommends I not reaffirm. Do you agree, or is it better for me to reaffirm this debt?
– Stitch

Dear Stitch,
Your attorney gives sound advice. I am not a fan of reaffirming a car loan after you file bankruptcy. If you are able to continue making payments on the vehicle without a reaffirmation agreement, you will eventually get the title to the car in about a year.

A reaffirmation agreement is a legal, enforceable contract, filed with the bankruptcy court, which states your promise to repay all or a portion of a debt that may otherwise have been subject to discharge in your bankruptcy case. The bankruptcy wipes out your legal liability to pay on the car. When you sign a reaffirmation agreement, you are re-establishing that liability.

This does not mean that you can keep the car, not make payments and receive the car title. That would be too easy. The reaffirmation agreement re-establishes liability otherwise eliminated in the bankruptcy. And failing to make payments means the car will be repossessed, sold and you will be liable for any remaining balance. This is exactly what happens when you don’t file bankruptcy, have a car repossessed, get sued and must pay the remaining balance.

Unfortunately, the majority — about 65 percent — of car lenders make a reaffirmation agreement mandatory as a condition of keeping the car. This means that you will not be able to choose whether you want to sign the reaffirmation agreement. Failing to complete the reaffirmation will allow the lender to repossess the car after your bankruptcy is over. If that does happen, you will not be liable for the remaining balance because you did not reaffirm the loan.

Benefits of the reaffirmation: I don’t think there are many benefits to signing a reaffirmation. However, there are a few.

• The future payments will be reported on your credit reports. After the bankruptcy, you will show current monthly payments on the car and this will help to re-establish good credit post-bankruptcy discharge.
• The lender will send you a monthly billing statement or payment coupons. Many lenders will not do this unless you reaffirm the loan.
• You will get some warnings from the lender when you fall behind on payments. Some lenders are very aggressive. If you fail to sign a reaffirmation agreement and fall behind on the payments after your case is over, the lender will repossess the car quickly. You would not be liable for the difference owed after the car is sold.

When does a reaffirmation on a car loan make sense?

• Low balance. You probably would be safe enough to file the reaffirmation because you only have approximately 12 payments left. It is more likely than not that you will be able to complete the payments and receive the car title.
• Low payment. A low monthly payment usually means you will be able to afford making the payment after signing the reaffirmation. There still is a risk, especially if you were to lose your job. But even with unemployment, you might be able to afford a payment that is less than $200 per month.
• No other car available. That means you cannot come up with $2,000 to buy a reliable used car. I would still only recommend reaffirming the loan when the car has a low payment and low balance.
• Co-signer exposure. Someone used his or her credit to help you get a car loan. You don’t want to hurt the co-signer’s credit. Even if the payment is difficult, most people don’t want the lender suing a person who was willing to help you get the car — especially when that person is a mom, dad, sister or brother.

When does a reaffirmation not make sense?

• High balance and high interest rate. You can and will be able to find another car after bankruptcy. Car lenders are desperate and car loans are available for people who have recently filed bankruptcy. Don’t become too emotionally attached to your car such that you cannot see when it is best to surrender the car and find something new.
• You are unemployed. Unless the payment is very low, you just don’t want to take any liability after your bankruptcy is over. Yes, I know you will need a car to find a job and go on interviews, but that process could take a while and you could end up with a post-bankruptcy filing, post-reaffirmation repossession. That would compound a difficult situation.
• The value of the car is much less than what you owe. While most people owe more on their car than it is worth, you ought to see how far upside down you actually are. If the value of the car is less than 50 percent of what you owe, a reaffirmation might not make sense.

I hope you can avoid the risk of reaffirming the car and simply continue to make payments. While your credit score may not see the benefit of the future payments, you will avoid additional risks such as repossession and a lawsuit after your bankruptcy case is closed.

Get weekly advice on slashing debt and debt consolidation tips! Subscribe to Credit Card News.

Ask the adviser

To ask a question of the Bankruptcy Adviser, go to the “Ask the Experts” page, and select “Bankruptcy” as the topic. Read more Bankruptcy Adviser columns and more stories about debt management.

Bankrate’s content, including the guidance of its advice-and-expert columns and this web site, is intended only to assist you with financial decisions. The content is broad in scope and does not consider your personal financial situation.  Bankrate recommends that you seek the advice of advisers who are fully aware of your individual circumstances before making any final decisions or implementing any financial strategy.  Please remember that your use of this web site is governed by Bankrate’s Terms of Use.

July 22, 2010

From Reuters – MSN.Com

WASHINGTON (Reuters) – New claims for state unemployment aid unexpectedly rose last week, heightening fears the U.S. economic recovery is stalling.

Initial claims for state unemployment benefits increased 13,000 to a seasonally adjusted 472,000, the Labor Department said on Thursday.

Analysts polled by Reuters had expected claims to slip to 452,000 from the previously reported 457,000, which was revised slightly up to 459,000 in Thursday’s report.

While layoffs have slowed sharply from early last year, businesses remain skeptical of the strength of the recovery and are holding back on hiring, keeping claims for unemployment benefits at uncomfortably lofty levels.

High unemployment is a sore point for President Barack Obama, whose approval ratings have plummeted.

The economy’s failure to create sufficient employment to absorb the more than 8 million Americans who lost their jobs during the recession could hurt the Democratic Party in the November mid-term elections.

“It’s looking more and more like the job market is treading water. Layoffs are down from 2009, but hiring hasn’t really picked up and this is disappointing,” said Stephen Bronars, a senior economist at Welch Consulting in Washington.

“There is a lot of uncertainty on the hiring side that’s causing things to remain sluggish. In order for the recovery to give people confidence it needs to cut across different sectors of the economy.”

U.S. stock index futures extended losses on the data, while Treasury debt prices added to gains. The U.S. dollar fell versus the yen.

The claims data has no implications for the June employment report due on Friday as it falls outside the survey period.

Nonfarm payrolls likely fell 110,000 last month, the first decline this year, as the bulk of May’s 411,000 temporary census jobs ended, according to a Reuters survey. Employment increased 431,000 in May.

However, there is a risk payrolls could show a steeper decline after an independent report on Wednesday showed private employers added only 13,000 jobs last month.

Separately, the number of planned layoffs at U.S. companies rose slightly last month, but the level remained close to a four-year low, global outplacement consultancy Challenger, Gray & Christmas said.

Employers announced 39,358 planned job cuts in June, up 1.4 percent from 38,810 in May. Announced layoffs touched a four-year low in April at 38,326.

In the Labor Department report, the four-week moving average of new jobless claims, considered a better measure of underlying labor market trends, rose 3,250 to 466,500 — the highest level since early March.

“What we are seeing here is a sideways move in the labor markets. I don’t think we are seeing renewed deterioration. We are getting regular reminders that we are not ready for any significant job creation,” said Kevin Flanagan, chief fixed income strategist at Morgan Stanley Smith Barney in Purchase, New York.

The number of people still receiving benefits after an initial week of aid increased 43,000 to 4.62 million in the week ended June 19, the Labor Department said. The level was above market expectations for 4.54 million.

The insured unemployment rate, which measures the percentage of the insured labor force that is jobless, was unchanged for a third week at 3.6 percent in the week ended June 19. (Reporting by Lucia Mutikani; Additional reporting by John Parry in New York; Editing by Andrea Ricci)

By BAO ONG

Unemployment, home foreclosures, rising debt. These problems set the stage for scams last year.

The financial crisis spurred scam artists to target people with misleading “free” trials, job-hunting scams and other ruses. And financial experts say it’s not over. In 2010, consumers should remain vigilant about where they spend their dollars.

People facing financial woes — especially those who lost their jobs — became the most common victims last year, says Stephen Cox, president and chief executive of the Council of Better Business Bureaus, which recently identified the top 10 scams of 2009.

You can see the complete list at bbb.org/us/bbb-news. Look for “BBB Lists Top 10 Scams and Rip-Offs of 2009.”

Scams that targeted job hunters, including bogus job offers that required a fee upfront, were among the top scams, according to the BBB.

In some cases, job seekers were told the prospective “employer” had to check their credit report. Instead, unwitting applicants were signed up for credit-monitoring services that were charged to their credit cards monthly.

Debt-assistance scams also were popular. In some instances, consumers paid in advance to have a company negotiate with their lenders to lower their debt, only to find out that scammers took the money and ran, according to the BBB.

Ploys also zeroed in on consumers and small-business owners wanting to get a piece of the federal stimulus money. Internet scams set up transactions that claimed to help people receive government grants. But first, individuals had to submit personal information, such as credit-card and bank-account numbers.

The Better Business Bureaus aren’t regulatory agencies but consumers can file complaints to them. Here are some safety tips:

• Be wary of advertisements for jobs that you can do from home or do in just a few hours per week — and still make a lot of money.
• Read the fine print, especially for free-trial offers.
• Never wire money to an unknown source.
• Beware of any checks claiming to be lottery winnings or eligibility for a government grant.
• Ensure that all terms are in writing and never take a business’ word alone.

Write to Bao Ong at bao.ong@dowjones.com

By KAREN BLUMENTHAL

Still mulling over your New Year’s financial resolutions?

David Laibson, a Harvard University economics professor, has one for you—one that many of us may wish we’d made last year.

“Promise that you’ll never try to time the market again,” he suggests, a not-too-subtle gibe at the many investors who sold their stock in the depths of the downturn early this year and then missed the huge rally that followed.

That’s not the only thing many of us could afford to improve. We would also like to save more, earn more and spend more wisely in 2010. But despite the fresh promise of a new year and a new decade, tackling all our goals at once can be overwhelming.

So to help you accomplish your many New Year’s ambitions, here’s a year’s worth of personal-finance aspirations, timed to major holidays to raise your chances of success:

• New Year’s Day: Save more.

“Saving more” is the top goal on people’s resolution list this year, according to a recent survey commissioned by Putnam Investments, which found that respondents put thriftiness ahead of those two perennials “losing weight” and “exercising more.”

But while dieting and exercise require discipline, effort and sweat, savings can easily be put on autopilot. Between bowl games and parties this weekend, take a few minutes to set up an automatic deduction from either your paycheck or your checking account to an online or a bank savings account. Or increase your contribution to your 401(k) by one percentage point. If the money isn’t in your paycheck or your checking account, chances are you won’t miss it.

In the same vein, commit at least half of any raise you receive this year to savings as well. That should be even easier to do, since you haven’t had that money in the first place.

June Schroeder, a financial planner with Liberty Financial Group in Elm Grove, Wis., offers another easy trick: Put any rebate checks and coupon discounts into your savings as well. A cousin of hers was religious about this. If the cash register tape said he had saved $5, he committed that to his savings. Over more than two decades, those savings and investment returns alone added up to more than $10,000, she says.

Ms. Schroeder is less rigid about her own contributions, but her rebate savings and money earned from recycling helps pay for vacations each year.

• Martin Luther King’s Birthday: Get educated.

In honor of the thoughtful civil-rights leader, take an hour or two over the long weekend to study up on one financial issue that you’ve ignored. Look up the expenses embedded in the mutual funds in your 401(k). Calculate how much your debt is costing you. Figure out what’s actually covered by your insurance policies—and what isn’t.

Real financial literacy means paying attention to how banks, lenders and investment firms make money off of us. “Failing to really focus is rolling the dice—and the house tends to win,” says Adam Levin, co-founder and chairman of Credit.com, a credit-information Web site. Reflective and forward-thinking consumers understand what they’ve signed up for.

• Presidents Day: Prepare for new credit-card rules.

Here’s a quickie, since your company may not give you this day off. In late February, the second phase of the Credit Card Act will kick in. To be well-prepared, look at your February credit-card bills to memorize your due dates, which, by law, will be the same each month. Paying your bills on time is the most important factor in your creditworthiness, and now should be even easier to accomplish.

While you’ve got the bills in front of you, note your credit limits; issuers won’t be able to ding you with extra fees if you charge more than this amount, but you may have your card rejected at the store if you ignore your limit. Also take a look at your interest rate: If it’s variable, it will climb when interest rates go up.

Finally, expect new billing statements by summer with far more information, including how much interest you have paid year-to-date.

• Your birthday: Get your annual credit report.

Whenever your birthday falls, take advantage of the once-a-year freebie and check your credit report for accuracy and to help avoid identity theft. The credit bureaus will also try to sell you a credit score and may offer a discount. If you want an idea of what your score is, buy the FICO score, developed by Fair Isaac Corp., and avoid signing up for a monitoring service, which isn’t worth the cost.

• Memorial Day: Finally, have “that” conversation.

While remembering those who made the ultimate sacrifice, consider your own mortality as well. Talk to your adult children or your parents—or both—about your or their estate, philanthropic goals and other wishes. If your children are still at home, start a conversation about money and investing. If you haven’t prepared a will or drawn up papers for a health-care proxy or power of attorney, now is the time to do so. Too often, we avoid these issues until it’s too late.

• July Fourth: Declare your financial independence.

Now that the first half of the year is over, review your portfolio to be sure you’re still properly diversified in a comfortable mix of stocks, fixed income and cash. If you were too busy to rebalance your holdings in January, do it now.

In addition, don’t be scared to pull some holdings off the table, says Tom Ruggie, of Ruggie Wealth Management in Tavares, Fla. If one of your companies’ prospects have changed or the stock has rallied, it may be time to move on, or to at least sell part of the holdings.

If you don’t feel confident making these decisions, find a financial adviser to help you. Check references and meet with at least a couple to be sure your goals, expectations and investment strategies mesh well—and that their fees are reasonable.

• Labor Day: Tame the monthly bills.

While relaxing from all your hard work, Colleen Schon, a senior vice president at Raymond James & Associates in Auburn Hills, Mich., suggests you review your biggest monthly expenses to see if you can find some meaningful savings. Can you cut the cellphone bill? Combine cable, phone and Internet services in a lower monthly rate? Refinance the mortgage? Remember to redirect at least part of any realized savings into a college or retirement account.

• Thanksgiving: Don’t let gift cards go to waste.

While waiting for the pies and turkey to cook, round up all your unused gift cards from your various drawers and glove compartments. Then take them with you to the mall for yourself or gifts for others, swap them with family members or donate them to a charity. Some cards may assess fees after a year without use even under the new rules. Either way, though, it’s silly to lend money to retailers.

• Christmas: Reflect on what’s most valuable to you.

Amid all the shopping, decisions about charitable donations and year-end chaos, we can lose sight of what we truly value. When I reflect back on this year, my best-spent dollars went to a night of theater with my parents, sporting events with my husband and a grand vacation with our college-age daughters—all far better than fancy cars or designer labels.

It’s worth taking some time each year to muse about your spending and financial priorities. The choices are free, and the payoff is priceless.

Write to Karen Blumenthal at familymoney@wsj.com

MIAMI — Home prices rose for the sixth straight month in November, fueled by tax credits for homebuyers.

The Standard & Poor’s/Case-Shiller 20-city home price index released Tuesday inched up 0.2 percent to a seasonally adjusted reading of 145.49. The index was off 5.3 percent from November last year, nearly matching analysts’ estimates that it would fall by 5.1 percent.

The index is now up more than 3 percent from its bottom in May, but still 30 percent below its peak in May 2006.

Rising prices are important to the economic recovery because they make homeowners feel wealthier and lead them to spend more money. Consumer confidence rose for the third straight month in January, reaching its highest level in more than a year, the Conference Board said Tuesday.

Price increases also help restore home equity for the one-in-four homeowners who currently owe more on their mortgages than their homes are worth.

In a research note, Deutsche Bank analyst Joseph LaVorgna wrote that current price trends could lead to a $1 trillion year-over-year increase in homeowner equity by the first quarter of this year.

Karl Case, a co-creator of the index, pointed to signs of stability that were in stark contrast to rapidly falling prices a year ago. “Flat is good,” he said.

Phoenix and San Francisco posted the highest month-to-month gains, on a seasonally adjusted basis, while New York and Chicago had the largest declines.

The tax credit for first-time homebuyers had been scheduled to end Nov. 30, but Congress extended the deadline through April, and expanded the program to include a tax credit for current homeowners.

“A lot of people are thinking now is the time to buy because they are going to get a great bargain or a steal,” said Bill Wilkerson, a real estate agent with ZIP Realty in Phoenix. “I’m looking forward to a very active springtime.”

Prices increased for the seventh straight month in San Francisco, where sales in the $500,000 to $750,000 were strong. Buyers took advantage of the tax credits and low interest rates, said Chuck Colliver, president of Century 21 Alliance in Daly City, Calif.

“Those people who have been thinking about buying a house this year are probably going to put it on the front burner” because of the low rates, Colliver said.

In Las Vegas, prices edged up 0.1 percent, the first month-to-month increase since January 2007. Still, prices are down 56 percent in Las Vegas since peaking in April 2006.

The list of cities with price increases, on a seasonally adjusted basis, also included Los Angeles, San Diego, Denver, Boston and Charlotte, N.C.

While prices have risen steadily on a national basis, some economists predict they will dip again early this year because of high unemployment and foreclosures.

“Until we get job growth, we won’t get complete healing of the housing market,” said Jeff Humphreys, an economist with the University of Georgia.

Data for December and January could show price declines due to a lull in buyer activity after the tax credit was extended, Humphreys said.

UBS analyst David Goldberg estimates that prices could drop another 3 to 5 percent before unemployment levels out, possibly in the second half of this year.

“We’re probably in the latter stages of seeing home price declines,” Goldberg said.

Home prices fell for the third straight month in Tampa, Fla., where sales of distressed properties comprise about half of total sales, said Cathleen Smith, a regional vice president with Coldwell Banker.

Prices also dropped in Washington — which had posted seven straight monthly increases — Miami and Detroit.

The Case-Shiller indexes measure home price increases and decreases relative to prices in January 2000. The base reading is 100; so a reading of 150 would mean that home prices increased 50 percent since the beginning of the index.

From The Boston Herald

By Amy Hoak / Marketwatch.com
Friday, November 20, 2009

Mortgage giant Fannie Mae has decided to let thousands of Americans who lose homes to foreclosure rent their properties back.

“This new program helps eliminate some of the uncertainty of foreclosure, keeps families and tenants in their homes during a transitional period and helps to stabilize neighborhoods and communities,” Fannie Mae’s Jay Ryan said in unveiling a new “Deed for Lease Program” earlier this month.

The initiative aims to help homeowners who either don’t qualify for or haven’t been able to negotiate loan modifications. (Those are deals where lenders unilaterally cut homeowners’ monthly mortgage bills to prevent foreclosure.)

Under the Deed for Lease Program, homeowners facing foreclosure can voluntarily sign their property deeds back to their banks. In exchange, lenders will lease the houses back to former borrowers at market-rate rents for up to a year.

Rental arrangements beyond one year are also possible but not guaranteed.

However, the program only applies to borrowers or tenants facing the loss of primary residences. Second homes don’t qualify.

Consumers seeking Deed for Lease deals must also:

be no more than 11 payments behind;

have made at least three payments since getting or modifying mortgages;

receive releases from any second mortgages or other subordinate liens;

prove that market-rate rents don’t exceed 31 percent of applicants’ gross incomes.

Additionally, the plan only covers mortgages controlled by Fannie Mae.

Fortunately, millions of homeowners have Fannie Mae loans without even knowing it.

That’s because the firm buys up thousands of mortgages each year from lenders that no longer technically own the loans, but keep collecting mortgage payments on Fannie’s behalf.

To see if you have such a mortgage, go to FannieMae.com.

Dean Baker of the Center for Economic and Policy Research calls the Deed for Lease Program a “very big step” toward helping people who face foreclosure.

Why some people cut up their credit cards and live a cash-only lifestyle

Since then it’s been cash and debit cards only for Brough, 50, who has no debt of any kind.

How does she do it? She buys secondhand furniture and electronics, gets her husband’s medicines from Canada at cut rates, has a $10,000 emergency fund and thinks long and hard before she opens up her wallet.

“When you use cash you think about what your needs are because you’re paying a big chunk of money at once,” she said.

This concept is probably a foreign one to many Americans who are addicted to buying almost everything on credit. But believe it or not, it is possible to survive and thrive without depending on credit cards. In fact, Brough is part of a small but growing debt-free movement, some joining because of personal or economic hardships, and others just looking to simplify their lives.

It’s all about economic empowerment. “Times are tough and people want to take control of their finances,” says Denis Cauvier, a financial psychologist and co-author of “The ABCs of Making Money.”

“When people look at what’s happening, all the ups and down of the stock market, housing prices, people getting laid off, they get a sense they are out of control,” Cauvier says.

As a result, “we’re seeing a huge rise in the use of cash and debit cards,” he says. “It’s a positive way of gaining self control.”

While there are no hard numbers on how many people are giving up the credit-card lifestyle, more consumers have been trying to reel in their debt levels.

Consumer credit has been falling at record levels after years of climbing. In April, credit card borrowing fell at an annual rate of 7.5 percent, and revolving credit, mainly credit card debt, decreased 11 percent, according to the Federal Reserve.

JD Roth, who writes the “Get Rich Slowly” blog, says more of his readers want to move in the debt-free direction. “It’s this whole movement back to basics,” he says.

However, he adds, “Our culture is so accustomed to getting what they want right now and using debt to do that, it may not be realistic for every individual.”

Indeed, going debt-free is no cakewalk.

“We have to always plan ahead now and make sure we have the cash,” says Jeff Pelletier, who stopped using credit cards after a series of unfortunate financial events. He lost his job nine months ago producing training videos for a St. Louis company, lost his house to foreclosure,   ended up $50,000 in debt and filed for personal bankruptcy late last year.

Without credit cards, he has been unable to make major purchases. “We’re sort of living hand to mouth,” says Pelletier, who relocated to Boise, Idaho, for a job with a general contractor and is renting a home with his wife and two sons.

“The thing that hit me the hardest was that plastic has no emotion to it. Whip it out, use it, done,” he says. “Cash is harder to part with.”

The couple also has had to be creative. It’s a bit easier today to do things like rent a car or buy things online without a revolving credit card, say experts, because you can use a debit card instead.

But Pelletier still sometimes has to find alternative payment methods.

“My wife is going to see a dying friend in Texas, and we had a friend put it on her credit card and we gave her the cash,” he says.

Brough, of Cary, does use her debit card for some online purchases, but she’s more likely to use sites such as Craigslist that allow her to meet sellers in person and pay them cash.

Her daughter recently wanted a new, lime green Dell Inspiron laptop, and Brough went on Craigslist and found one for $1,000 slightly used. “I offered him $500 cash, and he took it,” she says.

Ironically, one drawback of living debt-free is that it can hurt your credit score, which could affect your interest rates if you ever want to borrow again, says Howard Dvorkin, founder of Consolidated Credit Counseling Services Inc. and author of “Credit Hell – How to Dig Out of Debt.”

“A lack of a credit history is sometimes as bad as having a bad credit history,” he says.

But even if you stop using credit right now it will take eight years before you have no credit history, he said. In any case, he added, the positive impact of being debt free on overall economic health generally outweighs any negatives.

“I don’t see a need to have a credit rating,” says Jay Craig, 44, of Seattle, who has been cash-only since 2003. “I used to have a house, a couple of car payments and some credit cards, but over time and through a series of events I got back to where I was before I got married and started a business — cash-based and stress-free.”

Craig, who is divorced and lives on a boat, didn’t even have a bank account until earlier this month and has been using a Western Union debit card for any shopping needs.

While he’s never been big on debt, he does miss having a credit card for emergencies.

“I still have a little bit of debt from my business and from a few hours in the hospital — I have no health insurance, which is stupid — but I should be free of all that by the end of the year,” he says. “And without debt or credit, I can live very well on under $40,000 a year.”

Craig admits it would be harder if he had a wife and kids.

Indeed, as life and responsibilities change, some debt-free zealots wonder if they’ll be able to keep it up.

Brough’s post-owing lifestyle is going well right now, but she said paying for her kids’ college education may send her back to the debt till.

She’s hoping her kids can get scholarships and she’s launching a nutritional products business that may help handle some of the costs. There may also be a need for more family budget cuts and jobs for the kids to cover some of the tuition costs.

“But worse comes to worse, if they need a college loan, the debt will be in their name,” she says.

]]> http://eramolaw.com/blog/?feed=rss2&p=94 0