Dominique Brown has a mission, and that mission is to get your finances cleaned up. In person, in writing and on Your Finances Simplified, she straightens out misconceptions, clears up confusion and offers smart, balanced writing about finance online. We checked in with her about debt and personal finance.
If you could do away with one misconception about personal finance, which one would it be and why?
That personal finance and financial planning in general is for the wealthy. Personal finance is everyday advice that everyone, regardless of their net worth, has to deal with. At the end of the day, everyone has a budget, whether it's written down or not.
What's the absolute worst type of debt you can collect? How can it be avoided?
The absolute worst type of debt you can collect is any debt not associated with achieving your financial goals. There is nothing wrong with debt if you use it wisely. However, getting into debt - whether it's student loans, credit cards, home loans or auto loans - that doesn't help you get to your goals is foolhardy.
Are there any early warning sign of financial problems that we can use to head off more serious problems at the pass?
To me, the early warning sign of financial problems is when you can't be specific about your finances. If I were to ask you, "How much did you save last month?" or "How much did you spend eating out?", if you can't tell me with any legitimate accuracy, we have a problem on our hands. There should be no guessing with your finances. When you begin to guess with your finances, you're on a slippery slope.
How has personal finance changed as you've been writing about it?
I do not believe personal finance has changed much since I started writing about it. I believe there are still too many people who lack financial literacy.
What should you ask yourself before making any personal finance decision?
"How does this action get me closer to my financial goals?"