Today it's a two for one blog special...but only because this is really important

Hey everyone,

I'm a believer of being proactive and not reactive about certain things such as health, education, and finances. The last one is the inspiration of today's blog.

I'm a HUGE believer in personal financial responsibility and I feel that people are not sufficiently prepared for their financial futures in their education (I hear you learned about this type of stuff in home ec back in the day.) Yet even though they are not receiving an education about how to handle credit and finances, they are very aware of how to spend and when they have spent more than they are getting in more and more debt. To me, this is like never telling a teenage boy what a condom is or how to use his penis and then being confused when he gets an STD or a baby...just because you don't explain it doesn't mean he's not going to use it. Same with finances and credit...they are going to happen and if you don't learn how to you it you will end up with a credit virus that infects your life.

So I'm watching a documentary that I think EVERYONE should see. Ok maybe not everyone... it should be anyone in one or more of these categories:

1. Going to college
2. Just gradauted from college
3. Have a credit card
4. Don't have a credit card yet but are considering getting one
5. Have a line of credit with ANYONE (including student loans, credit card, car payment...)
6. Have little, no, or bad-average credit
7. Find yourself saying/thinking "I never have any extra money."

If you're not one of those people then I'm not too worried about you cause you have your shit together. If you are in one of those categories you need to see this movie.

It's called "Maxed Out" and I think it would help a lot of people who don't understand the danger of bad credit or the preditory practices of consumer debt companies (credit card companies for all you non CNN people.) If you have Netflix then you can watch it instantly for free. It shows what the bad spending habits that people develop in their late teens through thirties can ruin your life later.

Still don't think it's important? Here's some facts:

• Forclosure rates are up 76% in the last year, according to the Associated Press
• According to the Federal Reserve, as of November 2007 Americans are the proud owners of $937,500,000,000 in credit card debt (in other words $3,091 for each person in the country right now) with an average increase of 1.2% a month.
• Additionally... we Americans have $1,567,900,000,000 in non-revovling debt (auto loans, mortgages, student loans, etc)-which breaks down to a nice $5,168.14 for everyone from my 110 great grand aunt to 3 minute old Tim Smith in BFE, Nebraska.
• As of 2005, the US Government has spent all the money in the Social Security Trust Fund, to pay the minimum payments on its debt. The same Trust Fund that is suppose to help pay Generation X and Y's retirement in 2050. (Info courtesy of The Fed)
• If you charge your share of the US debt, $3,090, on your Visa at 18% (the average in the US) and only make minimum payments of $50 it will take you 14.25 years to pay that off ... and that's assuming you don't charge anything else to the card. Yeah...

With stats like that, I think it's very important for everyone to understand the importance of being knowledge of credit and why it is important to have good credit starting TODAY. If not for you now but for you in 10-15 years and for your children in the future because shit happens.

In Short: Remember that credit doesn't not equal free money...it actually equals more expensive money. In some cases way more expensive. And don't think it's something that doesn't apply to you ro could never happen to you. Severe credit card debt is something that is like slowly gaining weight, it happens slow enough for you not to notice how bad it's gotten and a year down the road you're 30+ pounds heavier and can't get it off. Credit card debt, student loans, etc are the same way...just cause you didn't have to pay it right this second does not mean it is free.

Be informed. Be aware. Be proactive.