If you're able to somehow successfully negotiate your debt to zero and you thought you were in the clear. Think again!
The unexpected will always occur; however, if we prepare better for them, we won't have to react drastically.
Last week the Federal Reserve Bank released new data showing that consumer debt grew in November 2011 by the swiftest rate since November 2001.
As the Latin Proverb states, "A wise man learns by the mistakes of others, a fool by his own."
Congress passed a cut on the Social Security tax in 2010, effective January 1st of 2011. Most people didn't even recognize the increase in their take-home pay.
With the economy still on the sliding, we seem to be regaling ourselves more and more with sweets, purses, chocolate and wine. Actually there's an arguement that purses and shoes can be cost cutting!
Like the government, most people make enough money; and like the government, most people need to cut their spending. However, after trimming the obvious things, such as the stuff you don't really need or seldom use, you reach a point when you get wary and you don't know what else you can cut.
Last week we talked about being too frugal. Yes, it can happen. Most people, however, have the opposite problem: overspending. There's only two things you can do with your money after you pay your taxes: you either spend it or save it. In 2005 our savings rate was actually negative, which means we spent more than we took home after taxes. That means we went into debt.
