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Debt may keep some people from retiring

New Jersey residents approaching retirement may wonder when they will be able to retire in light of debt that remains unpaid. Credit card debt and student loans weigh in as two debts that some older individuals may still need to pay off. Some baby boomers may benefit from mapping out their finances before retirement. Today older Americans owe nearly $43 billion in unpaid student loans for themselves or their children. In 2005, this amount was $8 billion. One plan for reducing student loan debt … [Read more...]

Addressing credit card bills in New Jersey

New Jersey consumers carry an average debt of more than $62,000 each, an amount that is about $15,000 higher than the national average. Their per capita credit card debt is the second highest in the nation. With such high levels of consumer debt, it is no wonder that many people need to find ways to reduce their credit card payments and balances in order to find relief. There are several methods for reducing credit card debts which people can consider. First, if possible, the best way for … [Read more...]

Seeking verification of outstanding balances

Residents in New Jersey who owes credit card debt could be interested in the answers to questions posed by a consumer who was being pursued by a credit card issuer's collection agency recently. The debtor wanted to know whether consumers have the right to demand proof of the debt from them and what they can do if the collection agency refuses. According to Fair Debt Collection Practices Act, a debtor has every right to request a verification of debt. However, that request must be in writing … [Read more...]

Paying the minimum on credit card debt a bad idea

New Jersey residents may know that credit card debt may be difficult to pay off. This might result in a long-lasting debt that never seems to go away. Yet, paying off the bill slowly may make the difference between seeing the original amount double or even triple. A $50,000 credit card debt with 24 percent interest rate may take 42 years to pay. This might happen if the credit card holder only pays the minimum amount due each month. In this case, the final amount paid for charges totaling … [Read more...]

The treatment of debts on the death of the debtor

Debt is increasingly a part of life, in New Jersey and across the U.S., and so it is increasingly a part of death too. When a person dies, his or her estate is obliged to pay liabilities, including taxes and debts, before making distributions to heirs. Debts typically do not die with the debtor, therefore, and they usually must be paid. On the other hand, debts normally will not pass to heirs. If the decedent has a will, it will usually name an executor to manage the estate, handling … [Read more...]

Even small debts can reduce credit scores in New Jersey

If an outstanding balance is small enough, a creditor may not put much effort into tracking the individual who owes it down, but the organization may still end up reporting the debt to a credit agency. Unless someone is regularly tracking their credit score, these types of small debts may end up going unnoticed and unpaid until the individual applies for a car or home loan. While most people stay on top of credit card debt, unpaid lab bills from a doctor's visit or late fees from movie rentals … [Read more...]

Creditors and IRA funds

When a New Jersey resident cannot repay a credit card debt, could a creditor garnish funds from that person's Individual Retirement Account? The answer to that question depends on whether or not the individual in question is actively withdrawing the funds. If funds from an IRA have been withdrawn and placed into the owner's savings or checking account, the money could be garnished if the creditor wins a judgement to seize a bank account. However, funds in IRAs and other retirement accounts are … [Read more...]

Studies differ on average amount of debt

New Jersey residents may be interested in hearing the results of several new studies on the amount of credit card debt people carry. According to a survey conducted by one financial services website, the average American household carries around $7,000 in credit card debt. However, for people who consistently have a balance on their credit card, the average amount is $15,000. This study analyzed statistics compiled by the government. A study carried out by another company found slightly … [Read more...]

The effects of credit card debt

While credit cards can be a great financial tool for New Jersey residents when used properly, there can be side effects to using them. The biggest side effect to using a credit card is the inflationary side effect. Although the rate of inflation has been 2 percent over the past few years, items that are charged on a credit card have the equivalent of 13 percent inflation. That is a level that hasn't been seen since the 1970s. This can lead to a general fear about the future, as a borrower is … [Read more...]

Large education loans linked to higher credit card debt

It is undeniable that having a college or advanced degree brings many advantages and opportunities, not the least of which is the promise of higher overall earning potential. But in an economy with an extremely tight job market and an ever-growing gap between the degree haves and have-nots, those who had to borrow large amounts of money to obtain those degrees are facing more and more financial challenges. One of those challenges, according to a recent report by the Pew Research Center, is that … [Read more...]

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