How to use an inheritance: Pay off debt or invest?

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Question: Any ideas on how we should use an inheritance? My husband and I recently inherited $50,000 and we can’t seem to agree on whether we should invest all of it or pay off debt of about $18,000 and invest the rest.   Answer: On the surface, it seems the answer to your question should be straight forward, so here is my short answer: In general, if your costs to borrow money are higher than what you can safely earn on the same amount, … Read More

financial valentines

Ways to Avoid Relationship Debt

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It’s tricky. How do you draw the line so you can protect your finances from relationship debt without creating a confrontational situation? Start by being aware of what it is and how it can creep into your life. Relationship debt is the situation when one person in a relationship becomes liable for the debts incurred by an ex-partner. I’m raising the issue for discussion because I have started to see more relation debt fallout … Read More

can i deduct student loan interest

Is my student loan interest deductible?

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Question: ” Is my student loan interest deductible?” Answer: Assuming you meet certain requirements, you may be able to claim all or part of the student loan interest that you’ve incurred during the year. Generally, a qualified education loan is a debt you incur to pay qualified higher education (undergraduate and graduate) expenses for yourself, your spouse, or a dependent at an eligible educational institution in a program that leads to a degree. The IRS … Read More

Afraid a Loan Could Ruin Your Relationship?

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Since the financial crisis in 2008, banks have really tightened their lending standards. It’s more difficult to borrow money — even for those with strong credit histories. But what do you do if you or someone close to you needs a loan? Many people are turning to friends and family to borrow funds. The Virginia Society of CPAs has put together the following tips to to take to prevent a loan from  damaging a … Read More

Credit Reports Why You Need to Review Your Report

Why and How to Review Your Credit Report

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I understand that staying up to date on your finances can be a challenge. Fortunately, though, you have access to your own personal credit report free of charge. This can be a great way to monitor and protect your financial identity while saving you money over the long run. Yet I still find many people aren’t doing it. Read on to learn the basics on why and how you should take advantage of this … Read More

A parent's dilemma credit cards in college

College students and credit cards: A parent’s dilemma?

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Question: Our son is in his first semester of college and so far we have skirted the issue of getting him a credit card. Are we making a mistake by not letting him have his own card? Answer:  Sending kids off to college isn’t easy. Even though you think it’s time for your child to experience life on their own, you know they’ll still depend on you for some financial support and one of … Read More

familycreditrepair

Repairing Bad Credit: Yes,You Can

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In some cases, bad credit is a result of irresponsible money management. But it often occurs because of unexpected financial hardship. One day you might have all of your bills current, and the next you could become disabled or lose your job. And if you fall behind on your debts, it will wreak havoc on your credit rating. Credit repair agencies claim that they can remove bad entries from your credit report. But did … Read More

Is an escrow account required?

Is an escrow account required?

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Question:  Can my mortgage lender require me to have an escrow account? Answer:  Generally, your mortgage lender can require you to have an escrow account if you borrow more than 80 percent of the value for the property you financed. The percentage you borrow against the valuation of the property is known as the loan-to-value ratio. Each month, in addition to your mortgage payment, the lender collects a prorated amount to be held in … Read More

spouse with bad credit

What you need to know before marrying someone with bad credit

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Question: I’m marrying someone with bad credit. How will it impact my credit? Answer:  Even if you’ve had spotless credit, you may be turned down for credit cards or loans that you apply for together if your spouse has had serious problems. It’s a good idea to deal with this issue now rather than wait until after you’re married to discuss it. Attitudes toward spending money, along with credit and debt problems, often lead … Read More