Why Ignorance Isn't Always Bliss

Do you know how much debt you're in? If your answer is no, you're not alone. Many women are unaware of exactly how much they owe. If you're juggling credit card payments, loan payments and personal expenses, it's easy to lose sight of your overall debt. But this ignorance is anything but bliss: not knowing how much you owe puts you at risk of having too much debt.

Here are a few easy tips that may help you take control of your financial future:

1) Keep a Record: Record your current living expenses for a month. Look for ways to reduce expenses so you can pay back your debt. WISER's website has an excellent fact sheet with helpful tips on how to keep track of your spending.

2) Calculate Your Monthly Income: Add up your total income—all of the money you receive in salary, other payments and benefits and any earnings on investments each year. Divide your annual income by 12 to calculate your monthly income. Subtract all of your regular monthly bills and the other monthly expenses that you found by keeping track of your spending. This will tell you what money you have left for emergencies, like car repairs. By knowing your monthly income, you can find ways to curb your monthly spending and to reduce your overall debt.

3) Order a Free Credit Report: All US Citizens are eligible for one free credit report from each credit agency per year. Experts suggest looking at credit reports from all three agencies to get an overall picture, because your credit report may vary from one company to another. To receive a free credit report,visit www.annualcreditreport.com or call 1-877-322-8228.

4) Reduce Your Credit Card Debt: Try to use lower interest credit cards or cards with no annual fee. You can get a list of credit cards, interest rates and fees by sending $5 to RAM Research’s CardTrak, P.O. Box 1916, Frederick, MD 21702, or for free on the Internet at www.cardweb.com. See also www.cardtrack.com. The Institute of Consumer Financial Education can also help you reduce your credit card debt. Visit www.icfe.info, write P.O. Box 34070, San Diego, CA 92163 or call 619-232-8811.

5) Pay Right Away: An easy way to stay aware of your spending and to minimize your debt is to pay your bills in a timely fashion. By paying on time, you're not accruing additional charges through late fees and you may able to reduce your interest charges. If you cannot pay the full amount, pay as much as you can each month.