Financial Myths…

Here is a listing of 10 urban legends. This actually came from the MSN Money website and I am stunned that people would actually believe any of these, but I have seen people try to convince each other of some pretty outrageous things before.

� Myth No. 1: You can float a check longer if you write in red ink. The theory is that a bank’s equipment can’t scan red ink, so it takes longer to process the check.
� Myth No. 2: You don’t have to pay income tax — it’s illegal. Only foreign income is subject to Uncle Sam’s cut, the story runs, and there’s a form you can file to exempt yourself. But no one will tell you about it.
� Myth No. 3: I’m under 18, so I can’t be held accountable for a debt. (Variation: Credit-card debts are wiped out when you turn 19.) Spring-breakers love to use this one to justify running up a cruise or resort-hotel bill on their credit cards.
� Myth No. 4: My hotel key card has my credit-card information. The ramification is that you’d better clutch it tightly or a con will decode it and rack up a big bill.
� Myth No. 5: Boycotting a few gasoline brands brings gas prices down. Poor Exxon and Mobil. They often show up as the bad guys in a mass e-mail urging Americans to avoid their pumps on a particular day.
� Myth No. 6: It’s better if you don’t sign the back of your credit card. Some well-meaning pigeon decided one day this would protect him from identify theft.
� Myth No. 7: You can make a pile of dough by helping a foreigner solve his money problems. “Hello, my name is unpronounceable, and I need to get money out of my country. Will you let me use your bank account?” is the gist of this e-mail plea.
� Myth No. 8: You can now opt out of having credit bureaus give your information to anyone who asks. Just call (888) 567-8688 and give them the Social Security numbers of everyone in the household in a single call, says the message. But hurry — you only have 60 days to take advantage of this ability.
� Myth No. 9: You can buy your way out of points on a speeding ticket. If you pay a bit more than your fine actually is, the state will send you a refund check for the difference.
� Myth No. 10: Hotel Bibles often have $100 bills tucked into them. Heard the one that Gideons leave $100 bills in their hotel Bibles to reward folks who turn to the Good Book?

Okay, bottom line. If you wrote the color of the ink does not matter. A check is a check. You have to pay income tax if you had an income. If you incurred the debt it is your responsibility. Boycotting gas doesn�t accomplish much. There is not a lot of difference between a signed credit card and an unsigned credit card. By now everyone should know that if give money to people from Nigeria to get their money out of the country, the only one that is going to be out is you. Basically, if it sounds too good or too far fetched to be true, it probably is.

The Debt Diet-Step 5:Part 1

You are the one making the decisions when it comes to where your money is spent. Putting things down on paper will make it easier to tell what direction you need to go. A spending plan will get you headed down the road to debt freedom. See what the experts have to say about developing a spending plan.

A new spending plan should be developed for each month, detailing your estimated monthly expenditures. It should be completed 15 days before the month starts. By following this timeline, if you have a shortfall�more money going out than coming in�you will have time to cut expenses or generate additional income.

To free up as much money as possible for debt repayment, create a bare-minimum spending plan using Glinda Bridgforth’s spending plan worksheet. This exercise will show you the minimum amount of money you need to get by during a given month.

Here’s what to do using Glinda Bridgforth’s spending plan worksheet:
1. Take a look at your calendar and note any special events that may cost money.
2. Complete your spending plan by making the best estimate of your upcoming bills and other needs for the month. Tweak the payments in all categories to determine the minimum amounts that can be spent without creating a sense of deprivation.
3. Don’t forget to include an amount for your savings cushion so you have a resource available for emergencies.
4. Calculate your cash flow. What is the amount left over after you subtract the total expenses from the net income you will have for the month?
5. Include the “Murphy’s law factor,” which means anything that can go wrong will. Add an extra 10 percent to the spending plan once it’s done. That figure is realistically what you’re going to spend if something goes wrong (like car problems, plumbing, falling and getting hurt, etc.)
6. Apply remaining cash to your debts.

This spending plan is road map to financial success. Follow it and you will eventually get to your destination.

The Debt Diet-Step 4

In this step, you will have to commit to not spending. This is one of the hardest steps for most people. They have become accustomed to a certain lifestyle and having certain things and this will have to change. Read what the experts have to say about step 4:

The quickest way to get yourself back on the right path is to stop spending. Use these suggestions to help cut back so you can move forward!
� Don’t carry credit cards in your purse (only debit/ATM)
� Write checks, pay cash
� Turn down credit line increases
� Create specific funds for special occasions, like holiday presents, vacations, anniversaries, etc.
� Tell friends what you’re trying to do to rally support
� Don’t run up bills you can’t pay in full at the end of the month
� Pay credit card bills on time to avoid late fees
� Make no more than one ATM visit a week
� Don’t be seduced by credit card offers such as airline miles

The faster you are able to adjust your lifestyle, just that much sooner will you find yourself on the road to debt freedom.