Most of us have either received or will receive a check from the government that’s intended to kick start the economy.  By sending us a check, our legislators hope that we will be in a position to spend it on “goods”.  A lot of people may do that, but some need to take stock of where that money will help them the most.

My friend, Crystal, is an example of the dilemma a lot of people will find themselves in.
Crystal is a single mother, owns a home she can barely afford, uses a lot of gas to take her children to school, has a sick child that requires special food and has taken her credit cards to the limit.  So, when she gets her check will she run out and buy something?

Protecting her home is a priority to Crystal.  If she loses her home, she loses the down payment she spent years accumulating.  Home ownership is the American Dream and she doesn’t want that dream to turn into a nightmare.  She had thought about selling her home, but her REALTOR® friend advised her to speak with her mortgage company.  She did, and they worked out a plan for her that was more affordable.  She could now afford to keep the home because a reduced interest rate and longer term lowered her payments.

Now her options are between, gas, food and Credit Card payments.  Obviously, she still needs her car so she will try to save money by driving slower (difficult for her!), taking fewer trips and changing the air filter every time she changes her oil (which should be scheduled regularly).

Next hurdle is the escalating food prices.  She was encouraged not to eat “out” and to buy fresh fruit and vegetables that are in season, shop the special ads and take advantage of those coupons so many of us have passed up because we thought they were “a pain”.  A lot of them can be found on the internet!

The Credit Card payments need to be addressed and because of the high interest rates and increasing balances, these debts should be paid off as soon as possible.  Even the Federal Reserve Board recognizes that many cardholders are facing an inescapable mountain of debt that is beginning to look similar to the mortgage loan crisis.  Crystal now needs to speak with the Credit Card Company to request a lower interest rate and some concessions regarding past interest charges.  Perhaps using her Government Check to lower her Credit Card debt will leverage her negotiations with the Credit Card Company.

Consumers are rightfully afforded protection in numerous business transactions.  Credit Card holders have really not been protected since most of the regulations were eliminated in the late 1970’s.  Homeowners have been using their Credit Cards for living expenses and it’s now weighing heavily on families.

Hopefully our check from the Government will do what it’s supposed to do for our economy, but families need to take a second look at what will help them most before spending it.  Preserving the family and the home should be the #1 priority and I would be surprised if any merchant would disagree.




By Martha Bullman
CEO Miami Dade Realtor Association