Week 13 Homework

This lesson is titled ‘The Great Misunderstanding’, and focuses on dealing with your finances from a Christian perspective.

The homework for this week is:

  1. Read Chapters 4 and 20 in Financial Peace Revisited.
  2. Check out the inspirational stories at the FPU Member Resource Center.
  3. Tell someone else you know about FPU and what it has done for you. Remember, you can always loan out your materials and we have scholarships available for all of our classes.

Remember, you have a lifetime membership for your family and can attend at any time at no cost. If you ever need a refresher, feel free to stop by a class for one week or the entire course.

Lastly, we have some additional reading on this subject, if you are interested.

Fed Plans To Revise Credit Card Rules

Finally, some good news out of Washington! It looks like the rules on credit cards are going to be revised to make them more consumer friendly!

An exerpt:

The new rules would require companies to tell customers 45 days before terms of a credit card contract are changed, compared with 15 days now. And the rules would expand the list of changes requiring advance notice to include those involving penalty interest rates, which often range above 30 percent. Today, most consumers learn only after opening their monthly bills that they have been penalized with significantly higher interest rates because of paying late, going over their credit limits or falling behind with another lender.

Also:

Companies would also be required to spell out that low rates on balances transferred from another credit card apply only to that balance, not to new purchases. And it would require companies to apply payments to the debt carrying the highest interest rate. Many companies now apply payments to the least costly debt, thus forcing customers to pay more in interest.

These measures will definitely help people in getting out of debt. Still, it is shocking that consumers can be treated so badly by an industry without any public scorn. These changes still don’t make credit cards a good method of payment, but they at least start to even the playing field.

05-2007 Class Schedule

Folks,

The final schedule for the Financial Peace Class is:

05/13/2007 — Super Savers

05/20/2007– Cash Flow Planning

No class on 05/27/2007 for Memorial Day.

06/03/2007 — Relating With Money

06/10/2007 — Buying Only Big, Big Bargains

06/17/2007 — Dumping Debt

06/24/2007 — Understanding Investments

07/01/2007 — Understanding Insurance

07/08/2007 — Retirement and College Planning

07/15/2007 — Buyer Beware

07/22/2007 — Real Estate and Mortgages

07/29/2007 — Careers and Extra Jobs

08/05/2007 — Collection Practices and Credit Bureaus

08/12/2007 — The Great Misunderstanding

Debit Cards, Rewards, and Security

No Credit Needed pointed me towards visaextras.com, a free points/rewards system for users of debit cards. There are a lot of people who are so blinded by the prospect of rebates and rewards that they wouldn’t dream of using anything but plastic. While I would disagree with them, at least using a debit card links your spending to your income in a very direct way.

MSN Money has a related article on rewards and security for debit cards. The most important thing to understand here is that DEBIT CARDS HAVE THE EXACT SAME FRAUD AND LOSS PROTECTION AS CREDIT CARDS. Check

Debt Sinks Worlds Oldest Business

Think using debt to fund your small business is a good idea? I have a great counter-example for you, Koko Gumi. Koko Gumi (a Japanese construction firm) was the worlds oldest continuously operating company, and had been in business 1,400 years. Yes, they have been a family business since the 7th Century and are having to shut their doors. Why? Debt, of course.

You see, in the 1980’s, the company borrowed heavily to invest in the inflated Japanese real estate market. It was an opportunity too good to miss, they thought. The bubble burst, and they were in hock up to their eyes. Then, demand for their services diminished (they are specialists in building and restoring Buddhist Temples) and they couldn’t keep afloat.

The 1-2 punch of debt and hard times is too much for almost any business or family. You can’t predict when hard times will come, but you can influence how hard they will hit you. By preparing with a generous emergency fund and keeping out of debt you can make sure that your head stays above water, no matter what.
If you are interested in learning more, Business Week has all the sad details.