Teach your kids

Don’t let your kids make your money mistakes. Talk to them about money. It's one of the major facts of life.

Friend of mine once told me, "They don't teach us how to stay married, how to raise kids, or how to take care of our money." I had to agree, but I can only help my child with the money part. I know my limitations.
More Debt Management

FICO scores

Insurance companies use FICO scores to help them determine rates. This is absurd. This basically says those who have more debt are better drivers.

There has been little backlash against the practice because seven out of 10 people live paycheck to paycheck and have an average of $9,000 in credit card debt spread over nine separate loans/cards. I gladly will pay a little more for insurance before I go into debt.
More Debt Management

Clean credit report

You need a clean credit report, not a high FICO score.

Some people freakout and think if they have a low score they will never get to borrow money again.

Walk in with a clean credit report, no debt, money in the bank and say, "Do you want my business or not?"

If they say no, go somewhere else. Besides, with your new debt-free mindset why on earth are you borrowing money anyway?
More Debt Management

Pay off the house

If you can't fathom paying off the house you are living in you are living in too big of a house.

Pay off the house. No mortgage. It can be done, but not enough people do it.

Be weird with us. Don't have debt at all. Think about it and come on over. We have room in our club.
More Debt Management

Vacation is over

Vacation is over. Now the bills are arriving. Was it worth it? If yes, how about next month, and the month after that, and the next . . . plus interest.

Once you go on a paid-for vacation you will never use credit for one again. Folks, you can't rent fun. Save up or don't go.

And if you have debt other than your mortgage you should not be on vacation in the first place.
More Debt Management

Three car rules of thumb

Three rules of thumb to remember about cars:

1. Unless you're completely debt-free and have a net worth of $1,000,000 don't buy new cars.

2. The first 25,000 miles equals $10,000 in depreciation. The next 75,000 equals another $10,000.

3. When deciding whether to repair a car add the cost of the repair to the amount you'd get for the car (even if salvaged). If you can't sell it for that amount, don't repair.
More Debt Management

A mortgage

I don’t know the exact amount but I do know my next house will cost less than the amount of cash I have to spend on it.

You don't have to have a mortgage. They aren't a fact of life.

Too many people enter retirement still paying on a house. This is crazy. It isn't an investment, it's a place to live. If you happen to make money on it someday, great, but don't rely on where you live to always appreciate in value.
More Debt Management