Trying using these helpful tips for financial planning: 

* Define and prioritize your financial goals. These goals may include: saving to send your children to college, buying a new car, saving for a down payment on a house, going on vacation, saving for the holidays, or planning for retirement. 

* Break down each financial goal into manageable short, medium and long term goals, e.g. less than one year, one to three years, and five years and more. 

* Educate yourself! Read books, magazines or on-line information about investing. With much less effort than you might think you can make more informed decisions that will help you craft and execute your plan.

Benchmark your progress on a monthly, quarterly, or semi-annually basis to determine if your action plan is meeting your established goals. Involve the whole family! Establish goals for your children now so that they will begin to learn the value of money, and that it doesn’t grow on trees. The most important thing is to do something and start now!

• Unplug electronic devices and chargers. Modern devices use electricity even when turned off. An easy alternative is to plug as many devices as possible into a surge protector, which is easy to turn off when you leave for the day.
• Fill up your refrigerator. More food in the fridge keeps the air inside cool when its opened.
• Cook in the microwave or outside. Microwaves use less energy than most stoves and using the grill will keep the inside temperature from warming up.
• Replace your air conditioner filters. Dirty filters force the unit to work harder because the airflow is restricted.
• Cover your water heater in an insulated blanket. Older models loose heat forcing the unit to work in overdrive. Water heater insulation can be found at most home improvement stores.

We have all heard the saying, "if it sounds too good to be true, then it probably is." There is some truth to this statement. As consumers we are overwhelmed with ads, gimmicks and infomercials. Determining the good companies from the bad can be nearly impossible!

The same is true with debt settlement companies. If you are considering hiring a third party to help you manage your debt, then you're probably already past your financial breaking point. It is very important you do not let your emotions make your decisions for you; you must stay logical and rational. Otherwise, you may become the victim in a story that starts out with it sounded too good to be true...

There are many types of programs available and there is not a one size fit all program. If you are considering signing with a debt settlement program, be open and honest with your consultant about your financial situation. If it's an honest company, they will help give you an honest consultation to help you figure out what will benefit you the most. If you're not comfortable with the program or the company, or if this is just not the right time for you, don't rush and keep researching.

Have you ever thought of making a game out of saving money with your family?  “How much did you save today” could be the dinner table conversation with a reward of “good job” from spouses, children, brothers, and sisters.

Do your children receive an allowance?  Do your teenagers have part-time jobs?  Get the children involved in saving.  By earning an allowance a child learns the value of his work.  By learning to save money he learns to be thrifty and to save for that one big thing he so desperately wants.

Mom, did you plan your weekly menu in advance and use coupons when you shopped today?  How much did you save?

Dad, did you wash the car instead of driving to the car wash?  Did you get your children to help?  How much did you save?  I bet you got wet and had a good time.

Son, how about washing the dog in the backyard instead of taking him to the groomers?  How much would that save?  Remember outside, not the bathroom, your Mom will ground you.

Daughter, could you bake those cookies for your lunches next week instead of Mom buying them?  Remember a little flour, vanilla, eggs, etc. will go a long way and make many more dozens than you could purchase for the same price.  How much did you save?

Everybody in a family can help save money and it’s much more fun when the family does it together.

The year 2009 begins with very real financial issues for our consideration: the economy, unemployment percentages approaching double digits, and sharp downturns for real estate and stock investments.  And yet, it’s still important to make easy to follow financial resolutions which could improve your financial situation. 

Your financial resolutions should be life long commitments, not just the punch line of a joke at the New Year’s Eve Party. DSUSA is committed to helping you learn how to improve your financial situation. In doing so, we will impart a series of resolutions over the next few months.

Financial Resolution #1 – How To Save Money

If you have the ability to enroll in a 401 (k) plan at your place of employment, do it at your earliest opportunity.  Despite the weak economy, investing for your retirement on a tax-sheltered basis is one of the best investments you can make for your financial future.  Most companies allow for open enrollment during a specific time period and you may qualify for matching funds.  Contact your employer’s Human Resources representative for more information.

Gas Prices and the Mortgage Crisis

As summer school is a shortened, intensive term, we are combining the topics of Gas Prices and the Mortgage Crisis into one last class.

These issues are great fodder in this, an election year, because more Americans are faced with the very real dilemma of how to get to work and/or are losing their homes.

In the movie, “My Fellow Americans”, Jack Lemmon and Jim Garner play two former chief executives who are thrown together and on the road.  When a scandal brewing in the White house threatens to implicate them both, Lemmon and Garner head out of town and into “real” America where they learn a lot about the country that elected them.  In a poignant scene, the executives share food with a family who appear to be on vacation, having a simple picnic along the roadside.  The family is honored to be sharing a meal with the duo and volunteer to take them in their over-packed and crowded station wagon to the nearest town.

Conversations ensue and one of the executives starts complaining about Americans who aren’t doing their part to shore up the economy.  The mother of the family asks her husband to pull the car over and asks the former executives to get out of the car immediately.  Offended and perplexed, the Lemmon character asks why and learns that they have not just been riding in the family’s car, they have been guests in their home.

How are you getting to work these days?  Are you carpooling or taking mass transportation?  Have you traded in the gas-guzzling SUV for a smaller and more gas-efficient automobile or hybrid?  Have you been able to keep up with your mortgage or are you one of the many who are anxiously awaiting the sale of your home to downsize into some more affordable?

These are humbling and life-altering times and much can be learned from those who’ve gone before us during like economies.

School’s out for summer!

Recession vs. Depression

President Truman once said, "When your neighbor loses his job it's a recession, when you lose your job it's a depression."

A recession is defined as a period of two or more successive quarters where there is a decline in our gross domestic product or GDP.  If you'll remember from our last class, the GDP is defind as the total of market value of all goods and services produced within a country during a period of time, such as a quarter or a year.

A depression is a long-term recession or a very severe recession.

Recession cycles are thought to be a normal part of living in a world of inexact balances between supply and demand.  What turns a usually mild and short recession or "ordinary" business cycle into a great depression is a subject of debate and concern.

If you gathered five economists together and asked them if we are in a recession vs. depression, you would most likely get five different answers.  But if you gathered five people together who had lived through The Great Depression (1929-1939), you would get five dramatic answers.

The Great Depression was the largest and most important economic depression in world history, and it is used in the 21st century on how far a modern economy could possible fall.  Originating in United States, historians most often use the stock market crash on October 29, 1929 (Black Tuesday) as the starting date of The Great Depression.

International trade declined sharply, as did personal incomes, tax revenues, prices, and profits.  The depression ended at different times in different countries, but end of the depression in the U.S. is associated with the onset of the war economy of World War II, beginning around 1939.

Want to learn more?  Pick up a copy of John Steinbeck's novel, "The Grapes of Wrath", about the desperation faced by American farmers in the 1930s or talk to your grandparents or great-grandparents.

Class dismissed.

Welcome to Class!

The U.S. Economy – everything that is produced by all people and all companies in the U.S. – is measured by a statistic called the Gross Domestic Product or GDP.

The Gross Domestic Product is measured by two different means; real GDP and current dollar GDP.  The Bureau of Economic Analysis or BEA measures the real GDP quarterly and it is calculated by the following information:

• Imports and income from U.S. companies and people outside the country are not included,
• The effects of inflation are taken out, and
• Only the final product is counted.  In other words, if a U.S. company produces two items (like shoes and shoelaces), only the value of the higher produced item is counted (the shoe).

Current dollar GDP, a higher measurement, is that which leaves inflation into its estimate.

The GDP is important to the U.S. Economy for three reasons:

• to determine if the U.S. Economy is growing more quickly or slowly than the previous quarter or the same quarter the year before,
• to compare the size of economies throughout the world, and
• to compare the relative growth rate of economies throughout the world.

The Federal Reserve (Fed) uses GDP growth as one of its indicators when it determines if the economy needs to be stimulated or retrained.  If the GDP increases too rapidly, the Fed may raise interest rates to stem inflation.

Also, investors review GDP growth to determine if their asset allocation needs to be adjusted, comparing country GDP growth rates to determine best investment opportunities.  If you have money invested in the stock market, such an adjustment would help you determine whether you should invest in one type of fund vs. another.

The bell just rang and you are free for the day!

Next up:  Recession vs. Depressions, Gas Prices, and the Mortgage Crisis.

It may seem like a long time ago when you were last sitting in your high school economy class ... hoping against hope the teacher wouldn't call on you to discuss recent trends of the Gross Domestic Product.

Chances are that regardless of when you last sat in that class, and you well may be wishing you had paid more attention; the U.S. economy has changed significantly within the last year, and words like "recession" and "mortgage crisis" and "economic slump" are now fully ensconced in our our day-to-day consciousness.

Even if you still don't fully understand the total implications of a recession, no doubt you have at least been affected by rising gas prices, which is a contributing factor.

Over the next few weeks, we will continue to discuss the U.S. economy and how it affects you, and what you can do to survive the wild ride.

Facing your financial fears begins with taking an inventory of your financial health. 

• To whom do you owe a debt?
• What made you create the debt?
• Where were you financially when the debt was created -- did it solve the problem or add to it -- and where are you now?
• When will you pay off the debt?

Why, you may ask, does any of this information make a difference or how does it directly effect your current financial health?

Because when we stop being busy and focus on a situation, we get clarity in our lives, we gain perspective, and we can better focus on the task at hand .... how you resolve your debt. 

It's hard to believe that anyone these days is too busy to face their financial fears, especially when news headlines cite mortgage woes, foreclosures, and massive credit card debit.

Our public motto used to be "word hard, play harder", but these days its harder and harder to avoid the obvious - we have to face our worst financial fears because they could become reality.

Earlier this month we asked you to do a little free association and set goals for your future which is important in the fulfillment of a happy, satisfied life.  However, you need a contingency bail out if the bottom falls out.  Your parents can't help you any more and you can't count on that guaranteed bonus at the end of the year.  Stop being too busy living the latte life and take an inventory of your financial who, what, where, and when.  Sometimes facing our fears is the first step to financial freedom.

The first step in setting up a financial plan is making a budget and sticking to it.  That means writing down everything you spend, and formulating a budget which will eventually allow you to do the things you dream about.

The second step in setting up a financial plan is formulating long-term financial goals.  If that presents a bigger challenge than you are ready to tackle right now; break them down into a number of short term goals.  What can you achieve in the next six months or within two years?

The third step in setting up a financial plan is to educate yourself by reading books, taking classes, or meeting with a financial planner.

The fourth step in setting up a financial plan is to review your progress on a regular basis.  For instance, at the end of the month, did you stick to your budget and did you have extra money to put into savings?  Did you start a 401K plan?

By setting up smaller goals, you will eventually realize bigger dreams!

Mapping out a sound financial future is easier than you think!

First, set out some goals but allow yourself to do some free association.  Imagine that anything is possible.

Your goals can include:  "I want to send my children to college" or "I want to save money for a vacation" or "I need to plan my retirement".

You can expand these goals to be more specific:  "I want to send my son to Georgetown" or "I want to save money for my vacation in Provence" or "I need to plan my retirement which I envision as living in a house on Lake Geneva".  Notice the words "need and want" ... and notice how just being more specific really opens you up to possibility that you can create your own destiny.

Sometimes just getting past an "I need" goal which could be "I need to pay off my credit cards so I can begin to take regular vacations" can lead you to an "I want" goal.

In our next blog, we'll talk about actually setting the goals.

Reality Check -- Life Without Credit Cards

We applaud you for making the commitment to get out of debt, but realize that the reality of living without a credit card can present challenges. 

In some circumstances, keeping at least one credit card is needed for emergencies when the water heater goes out, or you find that your child needs new books for classes and they didn’t think to tell you about it until the day before they need them.

Although self-control and sound judgment certainly must enter into your decision about whether to use your card or not, there are other ways to decrease your day-to-day expenses;

• By bringing your lunch to work each day instead of going out, you are saving money on gas too!
• Get a library card and start reading books instead of buying movies or adding premium channels to your cable system. 
• Start taking public transportation a couple of times a week or begin a carpool with co-workers.  Not only you are saving gas money; you are also allowing yourself some extra time to actually read that book!

The good news is there are several choices available to you and your spouse about the repayment of your shared debts, but the key to making it work is to stay in agreement with one another.  It may take several strategizing sessions to work this out, and you may even need to employ the assistance of a good financial planner, but it will be worth it in the long run.

First, stop accruing new debt by putting a freeze on your credit card spending.  While the two of you may agree to keep a card or two available for designated expenses, this isn’t the time to run up new debt or take out cash advances on your credit cards.  This is a great time to close out those department store cards with higher interest rates.  And never cut off your spouse without first letting them know of your plans to freeze the debt.

Recently, we wrote about speaking openly with your fiancé about your finances before you get married (see “Money Can’t Buy Me Love” posted on February 1, 2008).  As important as it is for a couple to understand about how they will jointly save funds for a future together and spend it on a well thought-out budget, it’s also vital to know where each individual stands if divorce becomes inevitable.

Over 70% of all marriages that end in divorce are due to financial problems, and divorcing couples are likely to have as much debt as they have property.  Just as you would divide assets, divorcing couples need to assign responsibility for the debt.

Sometimes it’s as easy to acknowledge that one individual assumes responsibility for that debt which was brought into the marriage.  However, if you and your spouse have been married for a long time, you have a shared credit history, and allocating responsibility for the fair division of debts is the key to the success of your individual financial futures.

If you are unable to afford to place your parent or elderly family member into an assisted living facility, perhaps you’ve thought of bringing them into your own home.  This arrangement can be quite costly, plus there is the additional burden of stress it upon all family members, which have agreed to this seemly “simple” arrangement.

First, do you have adequate space to accommodate the parent or elderly family member?  Has that space been remodeled to accommodate any physical handicaps?  Is the space located in a part of the home that is easily accessible should an emergency occur?  Will the parent or elderly family member be on their own for meals or will you supplement their care with home health care?  Is the home health care organization licensed or are you relying on the assistance of an independent agent?  Is the agent bonded?  Is the agent able to administered medicine or do you need to explore additional assistance from a medical provider?

If the cost of assisted living is huge, the cost of moving a parent or elderly family member into your home is overwhelming.

Regardless on which avenue you embark, it’s a commitment, which will affect the rest of your collective lives.  Be prepared and get information today.

The cost of placing a parent or elderly family member into an assisted living facility is a huge expense.  Once application fees and room deposits have been settled, an individual most usually enters into a contract with the organization who operates the facility, paying a substantial buy-in, which is not refundable.   So in essence, your elderly family member is purchasing the space into which they move cost them thousands of dollars.  Now add in monthly rent, meals and activities, and you have a better assessment of the true cost of assisted living.

Are you prepared for your financial future of your parent?

As the Baby Boom Generation enters its fifties and sixties, there is no more talked about subject than taking care of elderly family members.  While Boomers are ready to embrace a more active adult lifestyle, their parents are finding themselves having to deal with the reality of moving into assisted living and nursing homes.

Although some Boomers are financially set and can afford the luxury of moving a single parent into their homes, there are several considerations, which come to the immediate forefront of this delicate, delicate issue.

We've all heard about the stimulus package which is currently being implemented by Congress, and the big question being asked of all Americans is, "How will YOU spend your refund?"

We strongly encourage clients of Debt Settlement USA to pay themselves first, and coudn't recommend a better use for your stimulus refund and/or your tax refund than helping yourself to become debt free.

Our negotiators can negotiate great deals any time of year but during the tax season, many creditors will negotiate special 'tax time settlements'.   And, many credit card companies are hoping that their clients will use their stimulus refund to pay down their debt.

If you have funds saved to apply towards a settlement or anticipate receiving a refund of any kind, please contact your personal debt negotiator right away.

How did you learn to become financially responsible?  Was it something that was taught to you in school?  Was it something that was discussed often in your home, and did your parents take the time to nurture and instruct you in the fine art of handling money?  Or did you, like many, have to learn "the hard way" by running up debt on credit cards that you did not have sufficient funds to pay back in a timely manner?

Believe it or not -- it's never too early to start teaching your kids about money!  One of the first things young children understand is "I want".  So why not take the time to instruct your child that with "I want" comes the responsibility "I earn".

Being "financially healthy" means more than just being out of credit card debt.  Becoming debt free and staying debt free means learning how to manage and handle money on a day-to-day basis as well as saving for your future.