Each week on SOAPnet’s new original reality series Bank of Mom and Dad, a twenty-something woman who is drowning in debt, must pay the ultimate price ... letting her parents move in! With the assistance of money coach Farnoosh Torabi (that's me), Mom and Dad will teach their daughter to rethink her spending habits and transform her relationship with money.
Ever shop to make yourself feel better because you had a bad day or a fight with a friend? At what point does it become a problem?
For Shameeka Philip, the newest female contributor on Bank of Mom & Dad, the situation became extremely clear when she found herself owing more than $60,000 to creditors.
The main mistake she made was using her entire $40,000 line of credit (money that was supposed to go toward home renovations) mainly for travel, spa trips and shopping sprees. (She also reduced her hours at work so she could travel). The rest of her debt stems from other credit cards and a student loan.
Now, with hopes of having a family one day and settling down, Shameeka needed to repair her financial wreckage and address her out-of-control spending habits once and for all.
Her mother Meshele and stepdad Brian moved in for one week to help their daughter learn her mistakes and open her eyes to smarter financial decisions. Along the way I offered budgeting advice and savings tips like these:
Lower Your Interest Rates. Even in this recession when we’re hearing horror stories about card companies raising rates, there’s still hope for some customers who want to reduce their interest rates in order to better pay down their balances. In Shameeka’s case, her $40,000 line of credit was carrying a whopping 18% interest rate. Her minimum payments each month of $1,265 were barely chipping away at the principal and most was going toward interest.