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Melt credit-card debt by freezing the plastic

My credit-card interest rate is 23.99 percent. My credit isn't good enough for me to transfer the balance to one of those no-interest credit cards, so I'm thinking about signing up with a credit counseling service to help me lower the interest rate. Would this affect my credit?

As a college student, I am not making enough money to pay off the credit card. No matter what I do, the balance just won't go down.

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Credit counseling can indirectly affect your score, so it's not a good option unless you're already falling behind on your payments.

The widely used FICO credit scoring formula ignores any reference to credit counseling that's contained in your credit report. Your credit-card company, however, could make you suffer if you use one of these services by reporting you as late - and that does hurt your score.

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A better approach if you're current on your bills is to simply get serious about paying this debt off. Most likely the reason you're not climbing out of debt is because you're still digging.

You absolutely, positively have to stop using the card. Freeze it in a block of ice if that's what it takes.

Then put every extra cent you have toward paying off the balance. If your current income isn't sufficient, get a second job or look for other sources of income to help you generate more cash that you can use to pay off the card.

You'd be smart to deal with this now, rather than wait for things to get worse, as credit problems almost inevitably do.

You recently answered a reader who couldn't find a copy of her late father's living trust and who feared that the estate would have to go through probate as a result.

Before she goes on a hunt for the signed document, she needs to find out whether any property, stocks, bonds, savings accounts, etc., were ever placed in the trust. That should be easy to do - title to property would be recorded that way, so tax bills, brokerage statements and bank accounts would be addressed in the name of the trust, rather than in her father's name.

If nothing is in the trust, finding the signed papers might not matter. Too often, people think all you have to do is create the trust and all assets go into it automatically. That's not the case.

You're quite right. Estate planning lawyers see this every day: Clients spend time, money and effort drafting a living trust but never get around to actually transferring their assets, rendering it pretty much useless.

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The story of the reader with the missing trust, however, has a happy ending:

Good news! I wrote to you earlier about not being able to find my father's living trust. It turns out that one of the banks where my dad had an account also has a complete, signed copy of the trust. My attorney says we should have no problems avoiding probate, and so far we haven't.

That's great to hear, and thanks for providing the opportunity to once again remind readers that they should let their loved ones know where to find important documents such as living trusts and wills.

The Los Angeles Times is a Tribune Publishing newspaper.


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