I just want to say that this video helped me tremendously. My credit went from 648 to 812 as of today!! It was a lot of work but I'm over the moon! Thank you for all that useful knowledge, Chelsea. I'm so grateful.
A friend of mine had really bad credit when he moved to the U.S., despite he had a decent paying job. Why? Because he never owed anything in his lifetime. So the US-banks thought: No credit-history = bad credit history. He had to make small depts just to pay them in time to get a good credit. For a German this seems crazy.
I have a credit card for that reason. I made a toltal 5 purchases and currently I owe approx. 40$ or less that I plan to pay off this month. What I owed on it never exceeded 50$ But yea, you need to spend money just to prove you have money. You can't get good credit without someone making money off you.
I agree. It's one of the most idiotic aspects of American life. There's this myth out there that you have to carry a balance on your credit card from month to month to build credit. TOTAL BULLSHIT. Pay your credit card in full each month and you'll see your score grow.
+Maggie Doughty no it's not, I've had no credit history for a couple years of my adult life and they seem a bit surprised but once they see the amount of money in my account I guess they kind see why I don't have a credit history, I'm not broke enough to have thought to get one.
@@maggiebookworm Actually, not quite true. Many banks will issue credit to those with no proven credit history good or bad (mainly secured cards) but not want to deal with those who have bad credit events. Of course, you wait 7 (10 years in a chapter 7 bankruptcy) and stay away from credit, then you're back on the same terms as the one with no credit.
I just recently found this channel and after watching this video, I am pretty much living exactly what you have! I am just about to be 21 now, Ive been living on my own since 17, and of course I got the "You're 18, heres a credit card!!" card. Maxed it out and tossed it aside, and avoided it as hard as I could. Racked up so many parking tickets and late fees, and have cringe worthy credit because of it. This year Id say was my "growing up" year, and I am down to $100 left on my credit card, and just paid off a $900 car registration (on time, woohoo!) from all of my stupidity last year, while budgeting enough to keep myself afloat. Learned through the debt collection calls and looming letters in the mail that yeah, it actually DOES matter. Thank you for making these videos, Im glad Im not alone!!
While these videos can be very motivational, what I think is missing, is more technical advice and tools. I would love to see a video that visually demonstrates how one can create a budget for example, and how to adjust that depending on how much money you make. Like create a system based on a 40K income as the default, and then show how to adjust that to go higher or lower, depending on your income. I make about 13K a year....sadly, yet I manage to afford a car payment, insurance, and a phone, yet I struggle with savings, and I squander my unspent money into material items. Because my income is so low, it almost feels fruitless to save it, which is hurting my ability to succeed in life. Goals like getting a better job and moving out seem so distant and unattainable.
+Spider I really like Elizabeth Warren's 50-30-20 plan. It gives you a way to allocate your take home pay without micromanaging every dollar. 50% to needs (housing, insurance, transportation, etc.), 30% wants (eating out, entertainment, cable tv, e.g.) and 20% to savings and paying down debt. You can adjust the proportions to save more and spend less on wants, but you should always keep needs under 50%. Her book is called "All Your Worth," but there are other books/plans that lay out a similar strategy.
that's what their books are for, Chelsea had written a few books, as has most of the other gals on this channel, and they really delve into the nitty gritty, and how to prioritize. I've read Erin Lowry's book broke millennial and I highly recommend it.
Thank you so much for this ... nothing is better than acknowledging the problem and picking up the phone. Your right ...tomorrow I am going to start a payment plan with the debt collection agency that I owe to my school :(. I am so ashamed right now but being honest about it the first step to getting better. Thank you so much !!!! LOVE FROM WASHINGTON, DC!!! -Lucia
Most of the videos you make are great and really help me understand the ins and out of how to keep your finances in check. But there really aimed a people who have a full-time job and is getting a steady pay check. I'm just at the end of school and trying to prepare myself for life after that. This year I've started to earn recklessness amounts of money compared to what I've ever had before (For a student) and I've notice that I really have a problem using my money correctly when I only earning like $500 a month. Normally I spend most my money on games and other non-useful stuff because its really not enough money to invest or use to make more money. Any advice on good ways to handle your money when your only earning a small mount and not having to look after yourself yet. Thanks
+King Mckay If I understand your situation correctly (a) you are a full time student, (b) your expenses are being supported without you having to work (possibly by a student loan), (c) you have some kind of job that pays about $500 a month, and (d) you're looking for ways to prepare yourself for the transition to full time employment after school. At this point I wouldn't worry about investing, but rather saving. Is your living situation going to stay the same after graduation? Do you have a job lined up for after graduation? When will you have to start paying your debts? Even if you only save $100 a month till graduation and you graduate in the spring that's still about $700 to tide you over while you get set up. You may have to move back home for a while, but you won't have to beg for help or immediately start putting things on a credit card. And if you save up more you might have enough for first and last month's rent or be able to afford to go through a low paying internship or take a vacation. The theme of all these videos so far has been to plan for expenses not be surprised by them and it sounds like your in a great position to start planning for the costs of getting established. Worry about investing when you finally have something to invest.
William Nash Thanks, I will take this advice to heart. I will try save around $200 to $300 and month to at least give me enough savings to be able of move away if there are job opportunities out of town. Again thanks for the insight really helpful.
Thank you! You guys have helped me take proper steps in money, particularly my score. I did the same as you years ago and I just got into a good range. It really feels good to have that taken care of.
I have an "emergency" card just incase but have never used it (ive had it for 10 years but in the UK I get by fine with my bank card and cash and much prefer paying for my stuff outright :-)
+Sam Asher I use my credit card for everything because it helps me build up good credit history, which happens as long as you pay if off every month obviously. plus rewards stuff, most credit cards give you at least .5% cash back or something of that nature. Plus it's much easier to keep track of purchases and see where that money is going!
Wish I'd know at 18 what I now know at 38! Also - rehab credit cards?? Not heard of them in Australia but they sound like a goid idea done the right way.
You say you should save money while paying off debts, but I'm already struggling to pay the minimum off student loans and credit cards so after that, rent, food, utilities etc, i don't have extra money for savings. not everyone has a high paying job...
pobalex I work in retail and manage. if moving back home is an option consider it. try meal planning or prepping for the week to avoid over buying at the grocery store or eating out. there are ways to work with what you have. the first step though is to change your mindset from "I can't" to "what can I do to fix this". May it be picking up a part time job or something. it is tough. 80% of my monthly income goes to loans and insurance and the 20% goes to food and other necessities. it's just a big game you have to play and it sucks. but having a defeatist attitude or a negative outlook on it is the number one reason why things never change, in my opinion if my parents had that attitude when i was growing up we would still be in a one bedroom apartment on WIC.but because both grow up in the projects/in poverty they decided when they started their family they would do anything they possibly could to give my sister and i a better life than they did. it all starts with a mindset change.
then get another part time job, hustle work yourself out of debt. deliver pizza if you have to. Most people only save enough for emergencies so a minimum of 1000, maybe more if you really need to probably no more than 5k until you are totally out of debt (except a mortgage), then dump everything onto those debts. either use a debt snowball, where you pay the minimum on every debt but the smallest and throw as much money as possible at that one, and go up the list (psychologically most effective and easiest to stick to). Or the debt avalanche where you also pay the minimum on everything except the highest interest rate debt and dump all your money on that one, and then you pay the next highest and so on, which is mathematically the fastest way to pay debt but can be harder to maintain for most people because you feel like you are making no progress for a long time. If I were you I'd be looking at reducing your bills as much as possible, look at your housing and make sure it is the absolute bare bones cheapest housing that meets your needs, roommates if you don't already, and then go through your other expenses to see if you can wiggle them down, even an extra 20$ from cheaper car insurance can make a difference in the long run. get the cheapest insurance possible, make a good grocery budget and stick to it and don't eat out, make your own food at home eat oatmeal, rice and beans, spaghetti and marinara, meals that cost less than $1 per meal should be the bulk of your meals with very minimal eating out. (don't totally deprive yourself, just pick and choose and don't be afraid to just drink that water with lemon instead of a cocktail)
Also if your student loans are killing you, you can renegotiate your payments for a smaller minimum payment pretty easily until you are out of debt. But I hate to say it, getting more money might be your best solution here, and you should look into either getting a better job or getting a side job to help ease the burden. Plus if you're working constantly, it's a lot harder to spend too much.
Could you please make a video about financial planning for a pet? You hear it is a lot of money but how much should I be saving up to be a responsible pet owner?
She talks about it in a few of her other video's, she did it the long hard way which is the safest and most foolproof. Pay off your debts, check your credit history to see if anything is wrong that you can report and get fixed, make sure to pay at least the minimum on all your debts and don't make any stupid decisions involving debt.
Wow did you read the story of my life and do exactly the same thing hahaha! I can laugh about it now because I have good finances but I can't tell you what I was thinking at the time.
What about government student loans? Should I pay those off first or credit card/line of credit debt? Also, is it better to save for a while and make lump-sum payments or make minimum payments each month? Thank you so much for your advice! xx
+priya1992 make minimum payments WHILE saving up to make larger lump sum payments. You definitely don't want to skip out on payments for months at a time, even if your intention is to pay a big chunk at the end of it.
+priya1992 You HAVE TO make at least the minimum payments on all of your debts, so your credit cards and your student loans. However, I would start paying more than the minimum on your credit cards because that likely has the highest interest rate. Usually you want to pay off debts in order of decreasing interest rate, i.e. start off with your credit card that has 20% interest and work your way down to those student loans with 7%.
you can tackle it 2 ways... First is working out how much you can put towards your debts day that's $100 a week you pay the min on all cards and the rest you pay off the highest interest one. once that highest interest one is finally done you move to the next highest continuing to pay the min payment on the others. don't do any savings and cut back and sell what you can to get there quicker. the other option is the same process however it suggests to pay off the smaller debts first because it builds your confidence ie do you have unpaid small fines etc you can pay them first. both options work well but the principle is your knocking off one at a time
Samuel Rowan You should get a free credit report and on these reports will have the phone number on who to contact. I got mine from the free annual one. I would watch a lot of videos first just to make sure if you need to pay, dispute or let it run out.
Flippzfor Profit Check out creditkarma.com! I've been using that since I was 18 and it's helped know exactly what I had and what could help improve my score overall! Never had any issues with it and it's free :)
I have an outrageous medical bill that I'm never going to pay. I would never be able to pay it. I don't think medical bills hurt your credit though...? I'm not sure though.
+Shaynnanigans Medical bills definitely DO hurt your credit. They're one of the worst, actually. What you should do is talk to the provider to whom you owe the money and set up some sort of payment plan. Even if it's just $15/mo or something otherwise tiny, at least your account will remain active and current and show that you're making an effort to pay it off. Do not ignore medical bills, as much as they suck and as unfair as it seems for our health to be able to send us into financial ruin while living in an advanced country.
I will never understand credit score. Why do you need to loan and get in debt, just to prove that you can pay up? I think it's better for people to prove they can save up, than find ways to scrape by. Also, credit cards should be banned. They are evil.
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Chelsea, is it bad that I want to hear your entire life story? It sounds really inspiring as a whole. :)
I just want to say that this video helped me tremendously. My credit went from 648 to 812 as of today!! It was a lot of work but I'm over the moon! Thank you for all that useful knowledge, Chelsea. I'm so grateful.
A friend of mine had really bad credit when he moved to the U.S., despite he had a decent paying job. Why? Because he never owed anything in his lifetime. So the US-banks thought: No credit-history = bad credit history. He had to make small depts just to pay them in time to get a good credit. For a German this seems crazy.
+jbZahl Yep, no credit history is worse than bad credit history in the US and Canada.
I have a credit card for that reason. I made a toltal 5 purchases and currently I owe approx. 40$ or less that I plan to pay off this month. What I owed on it never exceeded 50$ But yea, you need to spend money just to prove you have money. You can't get good credit without someone making money off you.
I agree. It's one of the most idiotic aspects of American life.
There's this myth out there that you have to carry a balance on your credit card from month to month to build credit. TOTAL BULLSHIT. Pay your credit card in full each month and you'll see your score grow.
+Maggie Doughty no it's not, I've had no credit history for a couple years of my adult life and they seem a bit surprised but once they see the amount of money in my account I guess they kind see why I don't have a credit history, I'm not broke enough to have thought to get one.
@@maggiebookworm Actually, not quite true. Many banks will issue credit to those with no proven credit history good or bad (mainly secured cards) but not want to deal with those who have bad credit events. Of course, you wait 7 (10 years in a chapter 7 bankruptcy) and stay away from credit, then you're back on the same terms as the one with no credit.
I just recently found this channel and after watching this video, I am pretty much living exactly what you have! I am just about to be 21 now, Ive been living on my own since 17, and of course I got the "You're 18, heres a credit card!!" card. Maxed it out and tossed it aside, and avoided it as hard as I could.
Racked up so many parking tickets and late fees, and have cringe worthy credit because of it. This year Id say was my "growing up" year, and I am down to $100 left on my credit card, and just paid off a $900 car registration (on time, woohoo!) from all of my stupidity last year, while budgeting enough to keep myself afloat. Learned through the debt collection calls and looming letters in the mail that yeah, it actually DOES matter. Thank you for making these videos, Im glad Im not alone!!
While these videos can be very motivational, what I think is missing, is more technical advice and tools. I would love to see a video that visually demonstrates how one can create a budget for example, and how to adjust that depending on how much money you make. Like create a system based on a 40K income as the default, and then show how to adjust that to go higher or lower, depending on your income.
I make about 13K a year....sadly, yet I manage to afford a car payment, insurance, and a phone, yet I struggle with savings, and I squander my unspent money into material items. Because my income is so low, it almost feels fruitless to save it, which is hurting my ability to succeed in life. Goals like getting a better job and moving out seem so distant and unattainable.
+Spider I really like Elizabeth Warren's 50-30-20 plan. It gives you a way to allocate your take home pay without micromanaging every dollar. 50% to needs (housing, insurance, transportation, etc.), 30% wants (eating out, entertainment, cable tv, e.g.) and 20% to savings and paying down debt. You can adjust the proportions to save more and spend less on wants, but you should always keep needs under 50%. Her book is called "All Your Worth," but there are other books/plans that lay out a similar strategy.
that's what their books are for, Chelsea had written a few books, as has most of the other gals on this channel, and they really delve into the nitty gritty, and how to prioritize. I've read Erin Lowry's book broke millennial and I highly recommend it.
Is there a video on what you did to repair your credit?
Thank you so much for this ... nothing is better than acknowledging the problem and picking up the phone. Your right ...tomorrow I am going to start a payment plan with the debt collection agency that I owe to my school :(. I am so ashamed right now but being honest about it the first step to getting better. Thank you so much !!!! LOVE FROM WASHINGTON, DC!!! -Lucia
ok but seriously thank you so much for this channel
Thank you for talking about this!
Most of the videos you make are great and really help me understand the ins and out of how to keep your finances in check. But there really aimed a people who have a full-time job and is getting a steady pay check. I'm just at the end of school and trying to prepare myself for life after that. This year I've started to earn recklessness amounts of money compared to what I've ever had before (For a student) and I've notice that I really have a problem using my money correctly when I only earning like $500 a month.
Normally I spend most my money on games and other non-useful stuff because its really not enough money to invest or use to make more money.
Any advice on good ways to handle your money when your only earning a small mount and not having to look after yourself yet. Thanks
+King Mckay If I understand your situation correctly (a) you are a full time student, (b) your expenses are being supported without you having to work (possibly by a student loan), (c) you have some kind of job that pays about $500 a month, and (d) you're looking for ways to prepare yourself for the transition to full time employment after school.
At this point I wouldn't worry about investing, but rather saving. Is your living situation going to stay the same after graduation? Do you have a job lined up for after graduation? When will you have to start paying your debts? Even if you only save $100 a month till graduation and you graduate in the spring that's still about $700 to tide you over while you get set up. You may have to move back home for a while, but you won't have to beg for help or immediately start putting things on a credit card.
And if you save up more you might have enough for first and last month's rent or be able to afford to go through a low paying internship or take a vacation.
The theme of all these videos so far has been to plan for expenses not be surprised by them and it sounds like your in a great position to start planning for the costs of getting established. Worry about investing when you finally have something to invest.
William Nash Thanks, I will take this advice to heart. I will try save around $200 to $300 and month to at least give me enough savings to be able of move away if there are job opportunities out of town.
Again thanks for the insight really helpful.
+King Mckay You might be interested in www.reddit.com/r/personalfinance/
Thank you! You guys have helped me take proper steps in money, particularly my score. I did the same as you years ago and I just got into a good range. It really feels good to have that taken care of.
This is so good and so true! This is basically my story too. Feels so good to not be afraid of phone calls anymore!
Great presentation, not fun getting into debt, but fun being debt free!
Good for you!
I think I need to send this to my brother.
He needs a healthier Financial Diet.
what's with credit cards in america?
I have an "emergency" card just incase but have never used it (ive had it for 10 years but in the UK I get by fine with my bank card and cash and much prefer paying for my stuff outright :-)
+Sam Asher I use my credit card for everything because it helps me build up good credit history, which happens as long as you pay if off every month obviously. plus rewards stuff, most credit cards give you at least .5% cash back or something of that nature. Plus it's much easier to keep track of purchases and see where that money is going!
Wish I'd know at 18 what I now know at 38! Also - rehab credit cards?? Not heard of them in Australia but they sound like a goid idea done the right way.
Can you make a video about student loan debt specifically? Tips, info, tools, how to figure out how to lower interest and all of that.
You have saved me. A thousand thank you
You say you should save money while paying off debts, but I'm already struggling to pay the minimum off student loans and credit cards so after that, rent, food, utilities etc, i don't have extra money for savings. not everyone has a high paying job...
pobalex I work in retail and manage. if moving back home is an option consider it. try meal planning or prepping for the week to avoid over buying at the grocery store or eating out. there are ways to work with what you have. the first step though is to change your mindset from "I can't" to "what can I do to fix this". May it be picking up a part time job or something. it is tough. 80% of my monthly income goes to loans and insurance and the 20% goes to food and other necessities. it's just a big game you have to play and it sucks. but having a defeatist attitude or a negative outlook on it is the number one reason why things never change, in my opinion
if my parents had that attitude when i was growing up we would still be in a one bedroom apartment on WIC.but because both grow up in the projects/in poverty they decided when they started their family they would do anything they possibly could to give my sister and i a better life than they did. it all starts with a mindset change.
then get another part time job, hustle work yourself out of debt. deliver pizza if you have to. Most people only save enough for emergencies so a minimum of 1000, maybe more if you really need to probably no more than 5k until you are totally out of debt (except a mortgage), then dump everything onto those debts. either use a debt snowball, where you pay the minimum on every debt but the smallest and throw as much money as possible at that one, and go up the list (psychologically most effective and easiest to stick to). Or the debt avalanche where you also pay the minimum on everything except the highest interest rate debt and dump all your money on that one, and then you pay the next highest and so on, which is mathematically the fastest way to pay debt but can be harder to maintain for most people because you feel like you are making no progress for a long time.
If I were you I'd be looking at reducing your bills as much as possible, look at your housing and make sure it is the absolute bare bones cheapest housing that meets your needs, roommates if you don't already, and then go through your other expenses to see if you can wiggle them down, even an extra 20$ from cheaper car insurance can make a difference in the long run. get the cheapest insurance possible, make a good grocery budget and stick to it and don't eat out, make your own food at home eat oatmeal, rice and beans, spaghetti and marinara, meals that cost less than $1 per meal should be the bulk of your meals with very minimal eating out. (don't totally deprive yourself, just pick and choose and don't be afraid to just drink that water with lemon instead of a cocktail)
Also if your student loans are killing you, you can renegotiate your payments for a smaller minimum payment pretty easily until you are out of debt. But I hate to say it, getting more money might be your best solution here, and you should look into either getting a better job or getting a side job to help ease the burden. Plus if you're working constantly, it's a lot harder to spend too much.
Thank you!
Great video.
Could you please make a video about financial planning for a pet? You hear it is a lot of money but how much should I be saving up to be a responsible pet owner?
But how did you do it?? I just want to fix my credit. I can't figure it out.
She talks about it in a few of her other video's, she did it the long hard way which is the safest and most foolproof. Pay off your debts, check your credit history to see if anything is wrong that you can report and get fixed, make sure to pay at least the minimum on all your debts and don't make any stupid decisions involving debt.
great video! thank you!
Wow did you read the story of my life and do exactly the same thing hahaha! I can laugh about it now because I have good finances but I can't tell you what I was thinking at the time.
what do you mean by 'balancing the interest on each one" when referring to debt?
Plus what is difference between credit cards and banks. I thought credit cards were given to you by your bank?
What about government student loans? Should I pay those off first or credit card/line of credit debt? Also, is it better to save for a while and make lump-sum payments or make minimum payments each month?
Thank you so much for your advice! xx
+priya1992 make minimum payments WHILE saving up to make larger lump sum payments. You definitely don't want to skip out on payments for months at a time, even if your intention is to pay a big chunk at the end of it.
I heard somewhere that some debts are better than others. Does that apply to student loans?
And thanks for your advice!
+priya1992 You HAVE TO make at least the minimum payments on all of your debts, so your credit cards and your student loans. However, I would start paying more than the minimum on your credit cards because that likely has the highest interest rate. Usually you want to pay off debts in order of decreasing interest rate, i.e. start off with your credit card that has 20% interest and work your way down to those student loans with 7%.
Pay whatever loan has the highest interest rate. So for most people student loans are in the back of the line.
you can tackle it 2 ways... First is working out how much you can put towards your debts day that's $100 a week you pay the min on all cards and the rest you pay off the highest interest one. once that highest interest one is finally done you move to the next highest continuing to pay the min payment on the others. don't do any savings and cut back and sell what you can to get there quicker. the other option is the same process however it suggests to pay off the smaller debts first because it builds your confidence ie do you have unpaid small fines etc you can pay them first. both options work well but the principle is your knocking off one at a time
I know I have debt but I'm not sure how to find out who I owe and how much.
I want to pay off my debts but, I cannot figure out who to call to pay. it is seriously the most frustrating thing
Contact hackwhitewizard@tutanota.com .. he helped me clear all my debts ..
Samuel Rowan You should get a free credit report and on these reports will have the phone number on who to contact. I got mine from the free annual one. I would watch a lot of videos first just to make sure if you need to pay, dispute or let it run out.
Samuel Rowan if you check credit karma they list all your debt and they include numbers to call.
I would have thought it would have been more than that. I mean you can't really buy much at all with $500.
Im fresh out of highschool. I don't believe I have credit. Never had a card or anything. Is there a place I could check safely.?
Flippzfor Profit Check out creditkarma.com! I've been using that since I was 18 and it's helped know exactly what I had and what could help improve my score overall! Never had any issues with it and it's free :)
Cindy Morales Thanks!!
I have an outrageous medical bill that I'm never going to pay. I would never be able to pay it. I don't think medical bills hurt your credit though...? I'm not sure though.
+Shaynnanigans Medical bills definitely DO hurt your credit. They're one of the worst, actually. What you should do is talk to the provider to whom you owe the money and set up some sort of payment plan. Even if it's just $15/mo or something otherwise tiny, at least your account will remain active and current and show that you're making an effort to pay it off. Do not ignore medical bills, as much as they suck and as unfair as it seems for our health to be able to send us into financial ruin while living in an advanced country.
I think it depends. I have a lot of medical bills that haven't been reported to my knowledge
I will never understand credit score.
Why do you need to loan and get in debt, just to prove that you can pay up?
I think it's better for people to prove they can save up, than find ways to scrape by.
Also, credit cards should be banned. They are evil.
MsG-Louth it rewards people for spending money they don't have
This woman is lying she never had bad credit.
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Lol only the poor have a good credit score