Oprah talks about America’s Debt Diet

Posted by
March 3, 2006
 

“My lovely wife keeps shopping for apparel and many other things for the home that I do not think we need. No surprise then that we are in debt. What can I do to try to stop her from spending so much money on stuff that we don’t really need and instead save it?” Jeff writes.

This is a tough situation and a very common one in the United States as we have pointed out in our previous articles on debt trap. Did you get a chance to watch Oprah’s episode on the debt trap in America? Interestingly enough she called it “America’s Debt Diet.” In this special TV program, three families with huge debts were given advice on how to solve the problem. In all cases, the wives were bigger spenders. Not that this is the case for most other couples who face credit problems, but if one partner has bad personal finance habits, the whole family suffers.

So what can you do to handle your current situation?

    Talk to your wife nicely and have meeting to evaluate your financial situation. Start by estimating your net worth (total value of all your assets), your income, expenses, and debt. Try to analyze if they are out of sync.
    Try to work out a step-wise approach to reducing your debt by paying off a fixed amount each month and cutting your expenses by eliminating unnecessary expenses.
    Develop a list of financial goals. This may include saving money for a vacation, retirement planning, and college funds for your kids, etc. If she shares the dream, she may be willing to change her habits.
    If you are in serious debt you need to act quickly. Try to get financial advice from a reputable company like Ameriprise (the new name for American Express Financial Advisors) rather than all those crooks that advertise on television. They use misleading names (like credit counseling services) and basically want to victimize highly vulnerable people like you.

Useful articles: Retirement planning for baby boomers – Set retirement goals – Basics of retirement planning – How to secure a nest egg?

Personal finance

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