debt and bankruptcy

monitoring your credit is simple. in the past, you'd have to request your credit report from a credit-reporting agency, which you can still do. nowadays, you can also sign up for a free credit monitoring service which will supply you with a list of the items included in your credit report as well as simulated credit scores. the credit queries that take place to monitor your credit do not negatively affect your credit.

while free credit monitoring services cannot give you accurate fico scores, they can show you if your credit has been pinged or if new accounts have been opened. it also shows your balances and creditors. some have tools for helping you estimate your credit score should you pay down debt. using a free service plus your free yearly credit report should be enough for you to be able to monitor your credit adequately. if you find an error, you can challenge your credit report.

the simple answer is both. while it is important to pay down your debt, you'll also want to save for a rainy day. if you lose your job or incur medical bills, you'll want to be able to continue to make your payments and not go further into debt if possible.

if you can, pay off your high-interest loans first. transfer high-interest debt to low-interest accounts if necessary. living paycheck to paycheck is dangerous no matter your circumstances. most personal finance experts advise that you put aside three to six months of your living expenses into an emergency fund. once you have achieved emergency saving goals, you can concentrate on paying down low-interest debt and contributing to your retirement.

in the past, many parents thought it was their obligation to pay for their children's tuition. nowadays, not every parent automatically assumes this "obligation." some parents are having a difficult time paying their own bills and saving for retirement without the added expense of college tuition. if you can help your children get through college, there are potentially many advantages for them. on the other hand, if you cannot reasonably afford to pay for their college, you may want to consider alternatives.

should i take on parent student loans?

in most cases, it is not prudent to take on debt to pay your child's college tuition if you are not in a good financial situation yourself. do you have an emergency fund saved? do you have retirement savings? do you still have younger children to support? do you have multiple mortgages on your home? you do not have to feel obligated to take on parent-student loan debt if you cannot afford it. you'll be better off if you can find other ways to help your child pay for college.

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