Posted June 29, 2009
Question
I am drowning in credit card debt, getting a divorce, and my car was just repossessed. I had someone working to repair my credit for a year, unfortunately nothing changed. Do you have any advice for me?
Answer
The first step, according to FPA member Philip S. Weisberg, CFP®,
of Weisberg Financial Services, is to stop the bleeding. "Any
spending that is not necessary should not be done," he said. The
next thing to do is to look for more sources of income, including a
second job. In addition, you should focus on paying off the debt
that has the highest interest rate. As for the car, Weisberg
suggests you consider carefully whether you need that expense or
whether you could get by using public transportation. If you do
need a car, consider buying a used car.
Weisberg also noted that divorce in the state of your residence, New York, is a 50-50 thing. "If your future former spouse has any assets, you should receive half of them and you will have to give him half of yours," he said. Learn more about how to financially plan for a divorce.
As for your credit card problems, Weisberg suggests that "you are better off learning about this subject by reading and researching it yourself instead of trusting someone else. This is a life-long process so it is worth the time spent educating yourself." Learn more about repairing your credit.
You may want to consult a financial planner to help you create and manage your financial plan. Find a financial planner.
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