Dear Reader,

Can I talk to you about something?  It’s been bothering me for a while and I think it’s time to discuss it.  See, I’m concerned because it seems that we are continually making the same mistakes over and over again.  We’re supposed to learn from our own mistakes and/or the mistakes of others, but I on’t think we are listening.  I’ll just cut to the chase.  It’s the reasons why we end up in small claims court.

See, over the last few years, small claims court reality television shows have swept the nation settling all types real life disputes.  I don’t have a particular issue with these shows, they are actually very entertaining.  But to be honest, I think you’d rather avoid standing before Judge Judy or Judge Milian. 

But what I find interesting is that the cases are mostly the same, just different faces.  It can be a bit tricky, but there are ways we can avoid most of the drama in our lives.  I thought I’d write a about a few ideas I think you will find beneficial and maybe save you the trouble of having to go to court.

NEVER Co-sign for a loan

You co-sign a loan for a friend or family member because they can’t get the loan on their own.  They have good intentions.  Matter of fact, they even promised they would pay the bill on time.  They don’t mean to be late with the payments, but life happens.  They don’t mean to default on the loan, but the payment is too much for them to handle.  Their actions directly affect your credit and your future.  It all boils down to this, either just say no OR be prepared to make the payments if they can’t.

Read ALL Contracts Prior to Signing

I read a crazy statistic the other day.  It said that only 10% of people read contracts prior to signing.  10%! Contracts can be as complicated as a making home purchase or it can be as simple as understanding the store policy when buying a cup of coffee.  You must have a clear understanding of the terms just in case you have a change of heart.  We are entitled to change our minds, but at what consequence.  Just take that into consideration.

Avoid Loaning Money

I’ve not had this problem, thankfully, but I know of a few who have.  It’s a nightmare.  Your word against theirs and broken promises.  You risk ruining the relationship over money.  I know it’s hard to say “NO”, but it may be better than bearing the expense of saying “YES”.  If you can’t afford to give it, then it may be best not to loan it.

Now maybe you have no way to avoid loaning the money.  You could have them sign a promissory note which would include all the terms of the loan (parties involved, amount loaned, interest rate, payment schedule, signatures, etc.)  In the event that you would have to resort to small claims, the promissory note is considered as a written contract.

Document Accidents

The best way to handle an accident is to exchange personal information with all parties involved and be sure to get an accident report.  The report helps the insurance company determine who, if anyone, is at fault and will help to alleviate any future story changes.

To give an example:  In my early twenties, I was in a minor fender bender and was offered cash on the spot to “keep it moving”.  Can you guess what I did? Yes, I took the money.  But let me explain…It was only a minor scratch.  Looking back now, I realize that I should have reported the accident.  I could have made a horrible mistake  in accessing any possible internal damages.  My young eyes were not trained for that sort of thing.  But, you live and learn.

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Not every scenario will fit within these four boxes, but most will.  We’re given opportunities daily to make better judgments.  Minimizing risky outcomes is up to us.

Does all this make sense?  Have you encountered any of these scenarios?  How did you handle it?  Share your thoughts in the comments.

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Thank you so much for reading! Please feel free to share this article with your family and friends.  This website is becoming a success because of you and your support.  I wish you lots of financial success.  I send you much love!

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Gavel Image by scottamus

Today, I would like to tell a story about an incident that happened to me last summer and the positive that came from it.

What happened…
It was late July of 2008 and I was working for a small subcontractor in the Baton Rouge area .  They were informed that the large contract they were helping to manage was not going to be extended as they presumably thought.  Because of this fact, the majority of their employees (including myself) were going to be laid off.  I was really o.k. with it, being that I needed the break.

Well, during the first week I was at home, I decided to put my truck in the shop to have a minor dent repaired.   After a week the repairs were done, everything was great and my truck was beautiful again.  The next day, I took my brother to the National Guard Base as he was going on his 2 week yearly military training.  He’d given me some information to give to our mom to take care of while he was out of town.

I decided that since I was out, I would drop the information off to our Mom while she was at work.  I stopped right behind her car on an angle, but instead of putting the car in "Park" I kept my foot on the brake.  As my Mom was talking to my daughter and our dog (Missy) through the back window, Missy started to gag on something she shouldn’t have eaten.  I panicked…..OH NOOOOO!  SHE’S GOING TO THROW UP IN MY TRUCK!!!!!  Not realizing it, I took my foot off the brake and the truck started to roll.  You can imagine what happened next…

My mom started to scream at me…calling my name.  I thought she was talking about the dog.  She just kept screaming and actually started to irritate me.  Finally, at the point when I was “hitting her car” she yelled….. "MY CAR!!!", but it was too late.

My first thought was…"I JUST got my truck out of the shop yesterday, I’m currently unemployed, what am I going to do?”  I got out to assess the damage to both vehicles.  I bent my front driver’s side and her rear passenger side.   Arghhh, not a great start to the day.

My Reaction…
I left the scene shaking and nervous.  I was so mad with myself, "How could I be so careless?"  Now, I was going to be out of another $500 to repair my truck AND I was still out of a job AND we were a few months away from paying off our debt.

Initially, I was having a little bit of trouble managing my emotions.  I just knew that later on my mom was going to hit the roof.  I replayed the  coulda, woulda, shoulda’s in my head.  I immediately called my insurance company on my way home and told them what happened.  I must say that they treated me with the utmost respect and care.

My mom called to let me know that no matter what, everything was going to be alright.  Sidenote: I hit her car and she’s calling to console me (go figure).  I then realized that even in this moment, I had to find a way to be – grateful.  I’d been listening to many different audio series centered around positive thinking and how to draw it into my life.  I had to now put it into action.  I immediately changed my sorrowful and somber attitude and decided that no matter what…everything WAS going be alright.

The Result…
The following week, I was called for a job interview and guess what?  I was got the job.  Was this because of my great attitude towards the negative that happened in my life?  Was it the fact that I chose joy instead of wallowing in self pity?  I choose to believe so…

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You see, personal finance is not always about the dollars and the cents.  We will always have small to major events occur in our lives.  We have to face them with a positive attitude and the courage to know that everything will be fine.  Mistakes are made, bad decisions are made, BUT situations can still be turned around for our good.

"Learn to get in touch with the silence within yourself, and know that everything in life has purpose. There are no mistakes, no coincidences, all events are blessings given to us to learn from."  - Elisabeth Kubler-Ross