Michigan families find themselves in credit card debt for a variety of reasons. Impulse buying, unexpected emergencies and overspending on vacation are just a few of the reasons that a family may begin developing credit card debt. Dual incomes no longer shelter families from credit card debt due to rising college tuition costs, health insurance expenses and recession repercussions. Recently, a certified financial planner evaluated four dual-income families and their financial strategies.
A personal trainer from Ann Arbor, Michigan, has avoided credit card debt by simply not using credit cards, but for many people it is either too late for that option, or their current financial situation does not allow it. In fact, three of the four families evaluated have made personal choices to simply not step into credit card debt. They have avoided the trap of credit cards by living simply, developing budgets and taking second jobs. This type of planning has come from personal convictions and upbringing. However, a freelance writer from Minnesota has experienced credit card debt and its negative side at a very real level.
After divorcing her first husband, the mother of two made choices that caused her to begin accumulating credit card debt. She eventually opted to file for bankruptcy and then lost her home. During this period of her life, she and her daughters were without health insurance. This experience motivated her to get control of her finances and begin rebuilding her wealth.
Results from a recent study show that 6 out of 10 Americans believe they need dual incomes in order to live comfortably. While a dual-income family in Michigan may not be protected from the risk of debt, there are a variety of measures to help with out-of-control spending and credit card debt. Individuals who need true debt relief may benefit from the protection that a bankruptcy can provide.
Source: The Week, 4 dual-income families reveal their budgets, Jane Bianchi, Nov. 6, 2013