Times are difficult right now and many people are finding themselves dealing with bill collectors for the first time in their lives. Sometimes debt even results in marriage problems. Be prepared. Debt collectors are not nice people. They are paid to be tough and give you a hard time. Do not be frightened. Instead, stand your ground and realize that you are not the only one receiving this treatment. You, too, have rights and be sure to exercise them.

Do not provide personal information to the caller. Realize that you are not speaking with the organization to which you owe money. This is a bounty hunter attempting to earn a small percentage of your debt. Treat them as such.

Understand the possibilities. The debt collectors do have the right to contact you by mail, phone, or fax at home or at work. They are only allowed to attempt to reach you during the hours of 8 am and 9 pm. They have the right to ruin your credit rating and could take you to court to garnish your wages.

Do not allow these people to intimidate you. They must meet certain standards. It is illegal for them to threaten physical harm or arrest. Obscene language is forbidden and they may not intimidate you into thinking they can take your property. To assume your property rights, they would require a court order.

Never pay money you do not owe. Frequently, debt collectors have old information and are basing their calls on this. If you do not believe you owe this money, or if the amount is incorrect, dispute the claim in writing. If the debt being collected is an old one, remember that there is a statute of limitations which differs from state to state, but usually runs three to six years. A collection agency who tries to collect an old debt is breaking the law. If you agree to pay even a small portion of an old debt, this may reaffirm the debt and require that you repay it in full. Do not pay any portion of an old debt unless you are prepared to pay the entire balance.

If you feel that a debt collector is acting unfairly, you can file a complaint with the Federal Trade Commission or your state attorney general’s office.

It has become necessary to carefully review your credit bills and the notices contained therein. Even after doing this, you are still in danger of risking your financial standing. It is up to the individual to constantly be vigilant about following up and confirming credit limits and interest rates.

A current trend with card issuers is that they are arbitrarily reducing the credit limit on cards and, frequently, not even advising the cardholder that this has happened. It would be nice if we had safeguards in place to keep this from happening but, apparently, we do not. Yes, they are entitled to reduce your credit limit at will and not even legally responsible to advise you. Some send notices that are included in those fine print inserts we receive with our bills. Others just change the amount on your statement and assume that you will notice it. Many of us, of course, do not. It’s amazing how when they want to get you to be their customer, they send you all types of beautiful promotional key rings and promotional mugs, but once you become their customer they don’t even feel important notices are important.

There are many consequences that can result from a reduction in your credit limit. You can be denied when attempting to make a large purchase. Even more upsetting, is to be approved for going over your limit for which you will be charged a fee, possibly as much as $36. Once you’ve gone over your limit, your interest rate will frequently be adjusted upward. This can happen with all of your outstanding debt, not just this particular card. By lowering the ratio of debt to available credit, your credit rating is in danger. A review will possibly lower your score which results in higher interest charges on both current and future loans. It is even possible that you could be turned down for employment as many companies routinely check your credit ratings before offering you a position. Debt can frequently lead to marriage problems which brings just more trouble into your life.

There are several things you can do to stay on top of this situation.

Verify your credit limit with the issuer, especially prior to making a large purchase.

Get your free credit report annually and also request your credit score, which will cost a fee. Monitor these closely as you want to be certain that all information is accurate.

Be certain to keep your outstanding balance at 50% or less of your available credit limit. Anything higher makes you look like a greater financial risk and will result in a lower credit score or higher interest rates.

Make it a habit to pay your bills early. Even if there is a mail delay or a processing delay, you will still be on time thereby avoiding any late fees.

By keeping a sharp eye on your financial situation, you will maintain a good credit rating which will be a savings to you in the long run.

Prices are soaring and salaries are stagnant. How do you cope with all of this? Consider the following as possibilities to help save money and enable you to survive in today’s economy.

Think about budget cuts: Plan your meals and shop with a list. Do not purchase anything that is not necessary for the next week.

Reduce restaurant visits. Dinners out are very expensive and do not fit into the budget on a regular basis. Reserve these for special occasions.

Review your debt and be sure you are paying off the most expensive of these. High interest credit card debt must go before others, so concentrate the bulk of your payments in that area.

Plan for an emergency. If possible, put aside $100 a month for your emergency savings fund. Your goal should be to cover at least three months’ living expenses in this account.

If you are considering selling your home, think about renting. Today’s market is very poor and most homes are not selling at this time. Waiting it out may be worth your time.

If your employment situation seems at all doubtful, consider additional education, networking for other positions, and watch newspaper ads. It is always a good idea to be prepared for such a change.