Farnoosh Torabi is the author of “You’re So Money: Live Rich, Even When You’re Not” and can routinely be seen on MSNBC, NBC’s Today Show, CNN, the Fox Business Network, and Geezeo.
She’s ready and willing to answer your questions about your finances. Check out some of the more recent questions and her response.
What happens when you fall on tough times, and then you try to get back on your feet? What should be your first steps?
Farnoosh says “Start by figuring out a basic budget: how much you need for food, shelter, and other essentials. Then map out a plan to cover these expenses and any debt. You can check your credit report for free at FreeCreditReport.com.”
Do you need/want to buy a new car? What about 30k car by late 0ct. ‘09. How much should you have ready to put towards a down-payment?
Farnoosh says “I wouldn’t buy that car. That’s a lot of money to spend on something that declines in value and costs money to own” She adds “Why do you want a car that costs $30K? You could use that same money as a down payment on a house in many areas of the country while the market is really inexpensive. That’s a better long term investment in my opinion.”
What if you have a high-balance credit card which just increased their interest rates. Since credit cards seem to be opening with lower limits, you would probably have to take out a few of them to get the balance down. Does Farnoosh think that all of these inquiries and new accounts will take your credit score down very far? She says “Yes, opening multiple credit cards and moving balances back and forth will lower your credit card. I would minimize doing this unless you can lock in a low rate and commit to paying off the debt instead of incurring more.”
Here’s a goal from someone – Move To Sweden! They say “we have bills and are trying to move to Sweden by the end of the year. I am the only one working (hubby diligently looking) and trying to do all I can to lump the bills into one payment (via debt mgment) and payoff the smaller stuff. Is this a reasonable goal when only one of us is working? Also, we have a huge car payment that was fine in California where I made a lot more money, but now in the mid-west it is sort of killing us and we are stuck with it. The company does not refi (my bad credit) and we owe quite a bit still…I just feel totally stressed. Any suggestions? I see no light at the end of the tunnel.”
What does Farnoosh suggest? “Have you tried selling the car? Since I don’t known the exact figures on your income or debt I can’t say for sure if your goal to move to Sweden is realistic. But, that shouldn’t keep you from trying. It sounds like you’ve combined your bills and are paying them the best you can. Continue to do this and save a little every week. Eventually, you can make that move. Just don’t let tunnel vision toward a move keep you from enjoying life in the Midwest the best you can.”
Sometimes past problems can haunt you later if you aren’t willing to take care of them right away. A user at 25yrs old says that she has never opened a credit card in her life, but as of now, she has terrible credit. She continues “though I do not have major outstanding balances, I have a few well, maybe several un-paid bills that I have acquired. Mainly just final bills that as a young adult I let sit on my credit and now that I’m trying to help out my mom and get my life back together, I have these small [things] that are now haunting my future. What would be the best way to take care of these? Should I just start contacting the agencies and get them paid off little by little? Please advise?? I need the help.
Farnoosh helps, saying “Make a list of every single bill you owe. You can choose to pay the ones with the highest interest first, or, pay the ones with the lowest balance. Paying the higher interest debts first saves more money but paying smaller balances can feel pretty good to get off your plate. Your choice. The important thing is to address this debt now and not let it grow. Remember: you can still build good credit by paying your car loan and utilities on time.”
And ther you have it, you had questions, you got the answers, and now we have shared them with you. Remember if you too have an a question, you can ask Farnoosh, or any of our other experts here at Geezeo.
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Tags: Credit card, Fox Business Network, FreeCreditReport.com, Geezeo, home, Money Management, NBC, Personal finance
