debt management sounds just about as exciting as watching the oven preheat that said managing your debt is important to keep your bills on track and your credit score happy if you have a hard time managing all of your accounts or making your minimum payment a debt management plan might be exactly what you need i'm abby from ask abby and this is everything you need to know about debt management plans in one minute a debt management plan is essentially non-profit debt consolidation that allows you to pay off unsecured debt in three to five years a financial coach like the ones on credit and debt will work with your creditors to stop late fees reduce your interest rates and lower your minimum payments rather than paying your accounts separately every month you pay one monthly payment to the credit counseling agency great news dmps are always no cost or low cost sometimes there's a 50 enrollment fee and sometimes there's a monthly admin fee which maxes out at 75 it all depends on what state you live in so ask up front in other great news a dmp won't directly impact your credit in fact getting your accounts paid on time will likely give it a boost spoiler alert you'll have to shred those credit cards while you're enrolled in the program but sometimes you can keep one open for emergencies debt management plans are relatively low risk and high reward to learn more about your options for debt management plans go to creditanddet.org and sign up to talk to a coach for free
debt management sounds just about as exciting as watching the oven preheat that said managing your debt is important to keep your bills on track and your credit score happy if you have a hard time managing all of your accounts or making your minimum payment a debt management plan might be exactly what you need i'm abby from ask abby and this is everything you need to know about debt management plans in one minute a debt management plan is essentially non-profit debt consolidation that allows you to pay off unsecured debt in three to five years a financial coach like the ones on credit and debt will work with your creditors to stop late fees reduce your interest rates and lower your minimum payments rather than paying your accounts separately every month you pay one monthly payment to the credit counseling agency great news dmps are always no cost or low cost sometimes there's a 50 enrollment fee and sometimes there's a monthly admin fee which maxes out at 75 it all depends on what state you live in so ask up front in other great news a dmp won't directly impact your credit in fact getting your accounts paid on time will likely give it a boost spoiler alert you'll have to shred those credit cards while you're enrolled in the program but sometimes you can keep one open for emergencies debt management plans are relatively low risk and high reward to learn more about your options for debt management plans go to creditanddet.org and sign up to talk to a coach for free
Welcome back Suze Orman is here with us on the
InvesDiva Movement where we are aiming to help at least one million moms and more and dads and aunts
and brothers and grandparents all the people who can benefit from taking control of their financial
future, there is nobody better to answer questions about debt and that is Suze Orman she is the
legend in retirement planning and in debt management actually financial advisor unlike me
she's an actual financial advisor. So Suze thank you so much for being on our show and taking
the time to actually educating our audience.
Let's do it girlfriend what
do you want to know next? So debt management in America and in any
other country I'm hearing is a big deal, now not being from America I was born and raised in
Iran I didn't grow up with much but debt wasn't a thing we wouldn't buy things that we didn't have
money for and then I went to Japan and Japanese people also like they they don't go into debt like
buying as as as long as I know um so it was a very new thing to me coming to America finding out that
people going into debt to go to college people go to bed to buy stuff on their credit card and
then people don't pay their credit card.
I'm like how does this even make sense so I personally
don't have experience with it so my first question for you Suze is, what is the biggest mistake
people are making right now when it comes to debt? First, before you understand what you
don't have which is debt you know meaning the money you don't have that's created
debt you have to understand what money is. And you have to understand that the goal
of money is to make you feel secure. Simple, that's it, nothing more needs to be
said. You also need to understand that money is the greatest teacher when it comes to teaching
you about who you are. Because money cannot do anything without you, you're the one who has to go
out and get a paycheck you're the one who decides do you invest that paycheck do you spend it do
you waste it what do you do with it? If you are walking down the street and you drop $20 it cannot
call out to you and go wait wait you drop me come back and get me. So money cannot do anything
without you.
So if your money isn't doing what you want it to do and you find that you are in a
total financial chaotic mess that is because you yourself are a chaotic mess, your money is just
a mirror and reflecting back to you who you are. So when you have debt you have debt
because when you feel less than you spend more than, when you yourself feel like
ugh I'm a nobody I don't have anything I'll never be anybody I've struggled my whole life
I deserve this and whatever you say to yourself that all of a sudden translates into you
buying something that you can't afford. When you feel less than you spend more than
and so when you look at debt the first thing you have to understand is, this is a statement
of how you feel about who you are this is your mirror that you're looking at.
That you hate to
look at, that you don't want to pay attention to, that you don't know how to get out of it, so why
did you create that debt, to begin with? because I can tell you easily how you get out of debt but
if you can't figure out why you got into debt, to begin with, you'll get out of debt and get
right back in it again. So you need to look at debt in a whole different way now anybody can
say oh pay the highest interest rate first, who cares about any of that truthfully.
What I want you to care about is yourself and what are you doing in your life to be an
obstacle in your path to financial freedom or financial independence? And normally it comes
down to the three internal obstacles to wealth fear, shame, and anger. Those are the three
emotions that cause you to spend more money than you know you should be spending to do all kinds of
things because you're angry I'm gonna get back at this person I'm gonna go buy a new car, I'm gonna
do this, I'm gonna do that oh you're at a store and you see a sale and the sales ending today
and you are afraid that you're going to miss out on this sale you buy something you
take it home and you never wear it again. Why is that because when you look at that item
that you bought it reminds you of the fear that you felt when you purchased it and this is all
going on subconsciously and all of a sudden your life stops working if you have debt you have to
go within to see why you are doing without that is why it is so important that you understand
who you are, that you understand why you do what you do with money? Not in terms of investments and
things like that but why do you buy something when you can't afford it? why do you have 50,000 pairs
of earrings? Suze Orman still only has one pair for the past 40 years, I don't need more than that
you can look at any book cover go back to Oprah 20 or 30 years every show I was ever on you'll never
see another pair of earrings besides this.
I don't have a purse, I don't because I don't carry a
purse and so like why do you need all that stuff really? So when it comes to debt the most
important thing for you to understand is when you have credit card debt you are paying
for your present-day desires but your costs will be your future day needs. There will be
things when you get older that you need but you can't pay for them or get them because you
paid for your desires when you were younger. So just think about what I said to you and it's
not the typical answer a financial advisor would give you. The typical answer would be oh well
there's good debt, there's bad debt pay that snowball method pay the… no, I don't care how
you get out of debt I care about you understanding why you got into debt to begin with? What are
you trying to fill up within yourself with the things that you are buying that are putting
you in debt? that is the question at hand.
That is so powerful and surprised
that people don't know that. oh, they don't know that. People in America don't know that and I'm so
glad that you bring it up and people don't know that even though you've been saying
this clearly for years and years and years. But it's about who you are it's about so you
can so it this really is this is a spiritual thing like money is spiritual and you have
to become the kind of person who's not, who is not in debt you have to become the
kind of person who earns a lot of money, and that really is the gist of it is that hey
don't be in debt.
I am okay I'm not going to be in debt is not gonna fix the problem, the
problem is you, which is something that you were actually talking about in our first interview
like fixing yourself fixing understanding who you are um really can be powerful when it
comes to fixing your money issues right? It's the only way to fix your money issues you
cannot if you have money issues, it's because you have issues because your money can't have
issues without you. So stop blaming your money for things that you're doing.
Think about it your
money I can rip up twenty dollar bills I could can't they can't scream they can't go
stop I hurt. You and your money are one. I mean this obviously makes sense but I
have a follow-up question, and that is college debt? because that is something that again
the society kind of looks like it again in America like you you just go into college that you have
to go to college and you pay like what do people do with this do we do they have to continue to do
this? if they already have college debt what to do because that's a question that I get asked a lot
and not having had college debt my only solution is that go make more money and but like just learn
how to make more money but what would you say? Well right now student loan debt, so you
have all different kinds of debt you have mortgage debt you have credit card debt you
have 401k debt and loans sometimes you have personal debt hopefully you don't have payday
loans but you have all different kinds of debt, and then you have student loan debt as well.
Out
of all of those debts that you can possibly have, student loan debt is the most dangerous
debt you can have bar none. Why? because all those other debts including IRS debt can
be discharged in bankruptcy, you could get rid of them if you needed to. Student loan
debt is the only debt that you cannot take through bankruptcy in 99.5 percent of the cases.
So it will follow you to your grave. So therefore student loan debt is the one debt that you really
really really need excuse me to pay attention to and to make sure that you are not in default, you
are not in deferment, you are not in forbearance that you are really dealing with it. Now you
haven't had to deal with your student loan debt if they're federal student loan debt over the
past year or so and that's going to come to an end in January because you have been really on
a moratorium granted by the federal government. Where you aren't being paid in charged
interest right now, and you haven't had to make any payments, oh shortly you will so
it is really important that you have a plan of how are you going to pay off your student
loan debt and that's a whole course into itself.
So I do want to have a question um about debt versus getting funded for something
that is going to generate you more money. Do you think there is a difference? Yeah so right now I've started up my I co-founded
a new company by the name of Securesave and you can all look at it at securesave.com and it's
the first employer-sponsored emergency savings plan for employees, first of its kind. Now I could
have funded it myself but I didn't fund it myself instead we went for seed funding and everything
and other investors invested in this idea in the hopes that they're going to make a lot of money
off of it. Right now that's debt so to speak but not debt that I'm personally responsible
for, I'm responsible for doing the best I could possibly do to make this company a serious success
so that they win big as well as I win big but most of all the employees of all the corporations in
the world win bigger, and so that's somehow using other people's money who are intelligent enough
or not to invest in you and your idea and you haven't forced them to do it that's their decision
if they want to do it or not great.
Debt when you're starting your own company you're taking out
credit card debt, you're taking out equity lines of credit, you're using up all the money that you
have, and if it doesn't work then what? then what? so if you have an idea that you want to start
and go on your own save the money and you want to invest just your money but save it that it was
extra money don't go into debt to fund a business, in my opinion. That's just my opinion. You
know there was that um curves I don't know if you remember this but it was this big fad of
a franchise of all these women opening up these these companies where women would go from machine
to machine to machine they were called curves and it took off like wildfire everybody was
making a fortune and all these women were doing it and then the whole thing went belly up and
then all these women had absolutely no money. So just be smart with what you're doing when it
comes to debt also know how to run a business, if you're taking money from yourself or for
somebody else it's not just base because you have a good idea and you just want to try this,
you have to do the research you have to do a profit and loss statement you have to know that
you can carry that business for one or two years like I expect that we have to carry secure save
although maybe not all the way through 2023 to even start making a profit, but we have the
money to do so.
So just be intelligent with your ideas and just because you can't find a way to
make a living doesn't mean you start a business. You start a business because you have a passion
and a desire and a great idea and a business plan and you know what it's going to cost
and you know all of those things. Then start something but I would really like to
see you start it with other people's money or a small business loan or something more than you
yourself going into debt and one last thing on this and part of the reason of that is there's a
lot of money power attracts money powerlessness repels it. Just like I said to you a few moments
ago that money can't do anything on its own people are the ones who buy your products, people are
the ones who hire you and give you a promotion, and or whatever it may be so when you're powerful
you attract people to you since people control money you attract money when you're powerless you
repel people. Since people control money you repel money when you are in debt debt is bondage and
it's the thing that all of you are most afraid of, so here you are you're in debt and it's now
rendered you powerless but yet you need to be powerful to attract customers and everything so
it's like this catch-22 that's my thoughts on it.
So good I think the way I went about it at least
was when I was broken almost in a welfare house was um self-education, educate yourself it
goes directly with what Suze Orman is saying, it gives you power knowledge gives you power
and you don't have to go in my opinion really and get a fancy college degree to get that power
to get that knowledge. Like literally knowledge is now a commodities readily available
for everybody on YouTube, self-educate and try to find your passion, in my opinion,
everybody needs to have their own business at this day and age I feel like just working
at corporate America is not going to cut it learn how to create multiple revenue streams
and the more power the more knowledge you gain the more you have to give to people and the more
willing people are to give you money to serve them and it goes round and ha and then hand in hand and
then instead of accumulating that debt you're now accumulating that compounding effect for
your money to grow and grow and grow and turn into a million-dollar family.
I'm gonna throw
this out there. And Suze you are like literally it, you talk about like how to become the person
to earn money and be out of debt and how to get out of debt you are the whole package. We
cannot thank you enough for your generosity to be on our show this tiny little show which we
are hoping is going to grow and you guys watching, you know what to do go ahead and smash that
like button share it with people who need to hear this they need to change themselves
in order to resolve their money issues and remember to always Make Your Money
Work For You. I'll see you next time.
