Credit cards are not necessarily bad and even have important advantages, but you must handle them responsibly to ensure that you do not run into problems. When you use a credit card, you take home something now that you will pay for in the future. Credit cards offer not only convenience and can be useful in emergencies when you encounter unexpected events (such as car repairs); they also help you build a credit history. If you pay your bills on time and in full (avoid paying the minimum balance!), a positive credit history will help you in the future. You have to borrow to prove that you can borrow responsibly.
Your credit record shows how well you pay your bills. Credit records are kept by credit reporting agencies. They sell your credit information to banks and other lenders. By looking at your records, the person or company making a loan can decide whether they should lend you money. A positive credit history will be essential in getting a car loan or home mortgage in the future. Your credit score can even affect your chances of getting a job or renting an apartment. Many employers and housing providers now check your credit history.
If you have more expenses than income, you have a debt problem. Debt is like quicksand- it keeps pulling you down deeper unless you do something about it. It is so easy to get into debt, and it is much harder to get out. Answer the following questions to determine if you have a debt problem:
If you answered yes to any of these questions, you may have a debt problem.
There are options when you find yourself in debt. It will take time and commitment, but taking action now is far easier than watching your debts grow. The temptation to just ignore your bills and stop paying them can be strong. If you feel overwhelmed by debt and need help, consider working with a nonprofit debt counseling service, such as Consumer Credit Counseling Services.
Your salary or wages are just one of the things your employer may provide. Employee benefits can be worth hundreds- and possibly thousands- of dollars each year. These benefits might include:
Many companies have dedicated Human Resource (HR) personnel that can help you navigate your employee benefits. This should also be an important consideration before you agree to take a job.
Most of your taxes are taken out of your paycheck before you receive it. The largest amounts taken out are for federal and state income taxes. Smaller amounts are taken out for Social Security and Medicare taxes. This covers half of your future benefits as your employer pays the other half.
If you receive a large tax refund at the end of the year, you may want to adjust what is called your "withholding". Form W4, which your employer can provide, allows you to adjust your withholding claims. While reducing your withholding will not bring you the big year-end refund, you will have the use of that same money through the course of the year.
The Earned Income Tax Credit (EITC) can help low-income individuals or families reduce their taxes- and possibly get a refund. For more information, call the Internal Revenue Service at the toll-free number, 1-800- 829-1040.
So you may have accumulated some savings and want to think about ways to best invest in your future. Investing can make your money work harder for you. Before beginning to invest, remember that investments generally are meant to pay for your long-term needs- such as your education, a home, or even retirement. In contrast, savings accounts and emergency funds can be used for short-term goals. You should keep some money in a savings account or certificate of deposit (CD). A savings account gives you easy access to your money but does not pay as much interest as a CD, which requires a longer period of deposit to earn the higher rate of interest. Most investments have more risk (meaning that you could lose some of the money you put into them) than savings accounts. However, they also offer more opportunity to make money on your savings. , The longer you have an investment, the more the risks are reduced. You may want to consider some investments like these: