Issue Date: April 9, 2006
Which debt to pay first?
If you have multiple debts, is it better to pay off the smallest debt first or to start with high interest rate debts?
Kelli Weissert, Phoenix
Pay more than the minimum whenever possible.
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First, come up with a pay-down plan -- the pay-down debt adviser at bankrate.com can help. (Click on "calculators" to get a monthly plan for each debt, up to three years.)
Tally up what you owe -- the interest rates, principal and minimum monthly payments for each debt. Put the debt with the highest interest rate at the top of your list, and pay it off first. (If two cards have the same rate, apply more money to the larger balance.) Then proceed down the list.
But, says Greg McBride, of Bankrate.com, "If you would get a boost by knocking out some smaller payments first, then do that, especially if your budget is tight."
Most card issuers recently raised the minimum payment on credit cards, but you should still try to pay more than that each month. And pay on time: Late fees can run as much as $49, even if you are just one day past due. If you miss payments on three credit cards twice a year, you could have paid an extra $294.
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Turn money questions to gold
As you file your taxes this month, consider how much of your spending involves the kids. Recent surveys find that as many as 74% have a say in everything from groceries to vacations, but only 43% actually discuss finances with Mom and Dad. The upshot? Children know something about the value of a dollar, but nothing about their parents' values.
Money is as fraught a topic as sex, but you can change that. Here are some answers to tough, and familiar, questions, from Eileen Gallo, who co-authored "The Financially Intelligent Parent" with her husband, Jon.
"Why can't I have___?" Avoid the standard money conversation stopper: "Because I can't afford it." It's far better to explain, "That toy isn't made well," or, "You have others like it." Your child won't say, "Oh, thanks, Mom/Dad," but she'll know where you stand.
"Are we poor/rich?" Find out why he wants to know. A young child needs reassurance he'll be safe no matter what. An older child, hoping to impress friends, can be told you're no Bill Gates. Then, explain tactics you use to manage money. Ask for ideas on how the family can sock away extra dollars.
Most important, model the ability to talk, even argue, and resolve differences about money. The message: Money isn't taboo.
Ann Pleshette Murphy is our new ParentSmart columnist. She is ABC's "Good Morning America" parenting expert and author of "The 7 Stages of Motherhood," out in paperback this week.
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Eggs are OK for your heart -- really!
If you're avoiding eggs because you think they'll raise your cholesterol, stop it. Revisionist science says the anti-egg crusade was a mistake.
Eggs aren't as bad as you thought.
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In the 1960s, doctors thought cholesterol in food clogged arteries and that egg yolks were prime villains. But just because eggs themselves are high in cholesterol doesn't mean they raise your blood cholesterol.
That idea has bitten the dust, says Anthony L. Komaroff, M.D., in "Harvard Health Letter." Research shows people who eat an egg a day are no more likely to have heart disease than those who eat eggs less than once a week, he says. "The cholesterol in food doesn't affect the levels in your blood all that much," Komaroff says. "My wife and I have eggs several times a week -- guilt free!"
Another high-cholesterol food that does not raise your blood cholesterol: shrimp.
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To be a fox, walk a dog
A recent study shows a pet may be just what you need to shed pounds.
"We're more likely to stay committed to helping another being than helping ourselves," says Rebecca Johnson, director of the research center on human-animal interaction at the University of Missouri-Columbia vet school. "Participants who barely could walk at the beginning of the program were walking 20 minutes, five days a week by the end because they were dedicated to the dogs."
All sedentary and overweight at the start, participants in the study lost an average of 14.4 pounds in 50 weeks without making any changes to their diets. The dogs were borrowed from a program the vet school runs. If you can't house a dog, call your local humane society and volunteer as a dog walker.
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