Need advice about how to handle your personal finances? Whether the struggle is saving for retirement, organizing your bank files, or talking about money responsibility with your spouse or loved one, Post personal finance columnist Michelle Singletary offers her advice and answers your tough questions.

Read Michelle's latest columns, check out her Color of Money Book Club selection archive or sign up for her weekly e-mail newsletter.

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Michelle Singletary: Welcome. So glad you all could join me for another chat.

Got lots of questions already so let's get started.

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Gainesville, Va.: I'm having problems deciding exactly the best way to make my money grow and have spoken to a financial planner. I have around 18k in 401k, 17k in a regular savings account, and around 50K worth of equity in an unpaid mortgage. I need to make my money grow for me, my age is 48-working on retirement. I am afraid to invest high risk in 401K plan since this is basically my entire savings. Can you give me some advice. EA

Michelle Singletary: First let's order your steps. I always find order to help me decide what to do.

So

-- Make sure you have an emergency fund. Three to six months.

-- Get what I call a "life happens fund" to help pay for major expenses like car repairs, etc. That way you won't rob your emergency fund.

-- Beging to pay down any consumer debt (credit cards, car loan, student loans)

-- At 48 you still have at least a decade or two before you retire so don't be scare to invest in a way that isn't highly riskly but will let your money grow for you. You can build with the help of your financial adviser a very nice balanced portfolio of stocks and bonds. Include some growth stocks, large cap, international, small cap, mid-cap. Right now it's scary because the market is crazy but think long-term.

-- Finally don't you dare touch that so-called $50,000 in equity. That is not REAL money -- YOUR money until you sell. You should not invest that money because if you take it out it's not yours its borrowed money and you should not invest with borrowed money.

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Arlington, Va.: Hi Michelle, I have two really bad marks from student loans on my credit that I'm working to fix (my dad didn't tell me he stopped making payments and that they were calling his house for me. I know it's my fault though: I thought something was wrong and should have been more diligent about what was going on). One ($7,000) has a interest rate of 11%, but they will give me 6% discount off the balance if I pay it in full and remove the negative remarks on my credit. The other ($10,000) has an interest rate of 2% and while I am currently paying it, they are still reporting a default on my credit. They will not remove that information even when it is paid in full. Over the past 6 months I have saved $9,000 which I was originally saving to pay off the first loan--then I learned of the second. I planned to use that to pay off the first loan in full, but now I wonder if I should pay of the second to give my credit history an earlier start on repair. Either way, they'll both be paid in full by this time next year. Do you have any advice?

Michelle Singletary: Stop worrying so much about the hit on your credit. Doesn't sound like you need to get any new credit anyway.

For now, try to get a handle on this debt. Keep back some money for emergencies but otherwise I like your plan of paying off the first student loan if you get IN WRITING BEFORE you send a dime that they will remove the negative information on your credit report.

Then keep paying on the second loan and when you can get rid of that.

With time and on-time payments your credit scores will come back up.

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Southern Maryland Comment Period for Credit Card Regulations: Please provide the e-mail addresses of the regulators to contact during the comment period. "One rule would forbid a common practice called double-cycle billing, which results in cardholders paying interest on debts paid off the previous month during the grace period." This happened to me and I realized it after I had paid off my credit card debt. Typically I pay off my credit card every month. This time I did not and paid it off in two months with the last payment in Feb. The next month I received a statement and noticed I was billed for about $20 in interest even though I had not charged ANYTHING since I paid off my credit card bill. I called the 800 number and was told I OWED MONEY due to the average balance for the last 90 days!!!! This was the months of the Christmas season. I was more than livid. The company did waive the interest fee. I told the lady that I was so angry at this company that while she was "educating" me about the literature in fine print that was mailed to me I had taken my heavy duty kitchen scissors and cut up the credit card in minuscule pieces. I did not close the account since I had the account for over ten years. I think I could get better loan rates from the loan sharks on the streets. Oops, I forgot those illegal "lenders" have been pushed out of business by banks and payday lenders.

Michelle Singletary: Sorry folks I just didn't have room to list all the e-mail addressed. Thought folks would just to the Web sites for the agencies.

Anyway, if you want to comment on proposed rule changes for credit cards go to this link http://www.federalreserve.gov/newsevents/press/bcreg/20080502a.htm

And scroll down to the bottom.

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Currently deployed in Baghdad, Iraq: My question revolves around whether to buy a house in the D.C. metro area or pay off part of my $52,000 adjustable rate (currently about 7%) private student loan with the $25,000 bonus I will soon receive. I have another $98,000 Federal student loan and will have no other debt in about 3 months with good credit (780). This seems like a really good time to buy a house, but I would also like to pay down my debt. What is the best path to take? Thank you, Lisa

Michelle Singletary: First thank you so much for your service!

And for taking the time out to participate in the chat. Wow. That's great.

So the bad news. Put off buying a home for now. You have WAY too much debt to take on a home right now and all that goes into that.

Just wondering why you have $150,000 in student loan debt anyway? Did you mean to write $9,800??

Doesn't the military help with your education?

As for the bonus, hold back just a bit for emergency. But then I would use most of it to pay down the student loan debt.

Get rid of all that debt and experience the freedom you deserve.

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washingtonpost.com: Your Losing Hand

Michelle Singletary: Here's my column from today about the credit card proposals from the three fed agencies.

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Alexandria, Va.: Michelle, The $600 question...When I filed my taxes, I owed $1,800 but only paid $400 at the time. It is my understanding that if you still owe the IRS at the time they cut the stimulus check, that it will go towards what you owe. I was planning on paying the remainder of what I owe by the middle of July--which is about the time that my stimulus check gets cut (my social number ends in 98). So, should I pay everything except for the last $600 and let the IRS cover it with the stimulus check? I'm afraid that if I pay it all off at around the time they cut the check, that they will inadvertently put it towards what I owe anyway (sort of a double payment) and then it would take forever to straighten out.

Michelle Singletary: Whew.

Call the IRS. Get someone on the phone that can help you look at your situation. Yes, if you didn't pay the full amount owed they will snatch your stimulus check.

But also keep in mind you are racking up major interest on that IRS debt the longer it goes unpaid, even if they use your stimulus check.

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Washington, D.C.: I have the option of withholding my state taxes from my paycheck or not withholding. If I don't withhold I'd still have to pay at the end of the year. Am I crazy to think that I shouldn't withhold from my paycheck thus giving me more money every month (which I desperately need and would mostly save/use for important things)? Yes I would have to pay at the end of the year, but wouldn't that be mostly covered by my federal tax refund (I have a large refund usually because I have a small salary and a lot of deductions). Michelle, does this make sense?

Michelle Singletary: You should withhold enough to cover your tax situation.

No matter how disciplined you think you are if something comes up and you spend that money, you take a big hit if you can't pay it back. Not to mention you are required to pay in enough to avoid an underpayment penalty.

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Wisconsin: Hi Michelle, I'm a soon-to-be grad student with no debt (student loans or otherwise) and about $25,000 in the bank. I want to strike a wise balance between student debt and a little bit of savings. Do you recommend that I cover graduate school entirely with loans, and hold onto the savings (it will end up costing me about $75,000)? Or should I apply the $25,000 over the course of graduate school to ease up the amount of loans I have to take on?

Michelle Singletary: I recommend you work awhile and save up the money to go to grad school.

Or look for an employer who will help you pay.

It's what I did --my employer paid for my masters.

And we (my husband and me) saved up for his MBA.

That $75,000 in loans scares me to death and it should you.

I get an amazing amount of letters from folks who are deep in the hole because of graduate school loans. They aren't making nearly as much as they thought to pay down that debt and live the life they want.

But if you are committed to going forward hold back a little for emergencies and use the savings to avoid taking on more debt than you have to.

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Rockville, Md.: I find your columns on credit cards to always be very interesting. I'm the opposite I guess, I never carry cash and always use a credit card. It helps me track my spending and, to me at least, acts as a check on spending (do I really want to pull out a credit card for a $1 coffee? Maybe I'll just tough it out in the morning). I think the key at the end of the day is knowing what works for you. I know if I have cash it goes straight to the vending machine or medical university bookstore for candy. With my credit card, I'm less likely to buy snacks or spend randomly. It probably helps that my wife and I go over our credit card together every month and I don't like to have to answer questions about why we spent $3 on candy bars on a random Monday afternoon and the like.

Michelle Singletary: I hear you.

But again studies show when you buy with credit you spend more.

Maybe you don't use it for $1 purchases but you may be spending more on larger purchases.

I use credit. I'm cheap and I know I spend more with credit. Not enough to have any problems but more. It's a trap even for those of us who think we've got this game down.

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Not to mention you are required to pay in enough to avoid an underpayment penalty. : Amen! I got burned on that once! The state WILL make you pay a fine on top of what you owe if you aren't withholding enough (some % of what you owe). Aim for withholding JUST enough for state and federal taxes. No payment, no refund.

Michelle Singletary: Thanks for the testimony.

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Upper Marlboro, Md.: I want to use my Stimulus check to jump start my 3 to 6 month savings. I do not want to deposit it into my regular savings account because it will take forever to grow. What types of accounts should I look into to help increase my money?

Michelle Singletary: First, keep in mind the point of your emergency fund is not to grow. It's to be there for an emergency.

But try looking for the highest yielding savings account you can find. Shop around and shop for internet banks like ING.

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Myrtle Beach, S.C. : I recently moved to South Carolina to live the good life on my late grandparent's 100 acre farm. Unfortunately, the gunshots from hunters who live nearby ruined my dream of living on the farm. These people hunt (coon) daily and nightly. It's like living the film "Deliverance." I also inherited some property at the beach (N. Myrtle Beach) and I am building a beach home. I look forward to living in the beach home but can't sell the farm for family reasons. I will have about $2000 per month in mortgages on a $54,000 salary. I'm a bit scared of the prospect, but I'm looking for freelance work and perhaps a higher paying job though my current job at a university is stable. I paid for the house with an equity line on the farm and a construction loan. In all, it's about $400,000 in loans. One is at 5.6% construction, $190,000, and the other I'm currently paying 4.7% prime on the equity for the farm, $200,000. I was able to pay off all debt including car note, credit cards, etc. with the equity line as well as pay off the house. Any advice on how I should handle these mortgages? The construction rate of 5.6% will be the same when the house is built. The beach house is appraised at $650,000 now and I expect it to go up in the future being only 2 short blocks from the ocean.

Michelle Singletary: First let's change your language.

You didn't "pay off" anything. You just shifted the beach home, car and credit card debt to the farm house.

I would do some math. Look at your net monthly pay (not gross) and calculate what your mortgage note is for the beach home. It shouldn't be more than about 38 percent of your net take home pay. If it is, yup you've got to earn more money.

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Law Student (again): Hi Michelle, I wrote you a couple weeks ago re: law school. I'm definitely going to one of the two cheaper schools that I have been accepted to, rather than my preferred but more expensive option. I'll be paying tuition with Stafford loans. However, my question is about what to do with my cash assets. I have about $11,000 (all my savings) and do not own a house or make car payments. Do you think I should put my savings toward the tuition, use it for living expenses, or make a down payment on a house (so that I am paying mortgage rather than rent)? I could buy a house in the 100k-150k range. Thanks for your excellent advice!

Michelle Singletary: No house yet.

You are taking on debt and don't need the extra debt burden.

I sound like a broken record or scratch CD :) but put some of that $11,000 aside for emergency and then use it for tution and living expenses. Just try to take on a little debt as possible. If you can live with a friend or relative (if you have one near the school you will attend).

I know law school is tough but get a weekend part-time job.

Just do whatever you can to reduce the amount of debt you take on.

You will have have time to get a home when you aren't in so much debt.

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Brunswick, Maine: Hi Michelle, I'll be graduating this month and moving to Boston with a 40K job. I have no debt, but am hoping to go to grad school soon. How do you suggest allocating finances, percentage wise, specifically with regard to savings? I'd like a long-term savings plan but also one to help with school; is there a good way to do that with a mediocre salary? Thanks!

Michelle Singletary: If you can keep your living cost WAY down. Get a roommate, live with a relative (if you can). But save as much as you can for grad school by keeping your expenses low.

don't know about your job but in a few years you could also look for an employer who will help with grad school.

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Washington, D.C.: Hi Michelle, I'm working on paying off a number of credit cards, and I'll be free and clear by fall. Yay! But what's better for my credit score: closing each account as I pay it off, or keeping it open? I've heard conflicting statements: (1) that creditors don't like you to have too much available credit and (2) that having more credit open and unused looks better. My hunch is that during a "credit crunch," they'd prefer the first--what are your thoughts? Thank you!

Michelle Singletary: You should keep them open but not use the accounts.

If and when you need to say buy a home and the lenders says you have too much available credit then and only then on that lender's advice should you close the accounts.

Part of what goes into your credit score that is good is the length of time you've had a credit account. The longer the better impact on your score.

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bad credit but better off for it!: I have been working on reducing my debt. Oddly, I do not tend to agree with you on some areas, but your reference to your grandma is one thing that sticks with me. I recently paid off a credit card, but unknowingly received one more expense for apparent interest from the prior bill balance. Needless to say I disputed it, refused to pay until I noted a change in my other credit. I did not know the 30-day grace period is gone if you ever carry forward a balance. (It really shows how they have no intention of allowing you out of debt.) Well, the credit card company put the late fees or something on my credit report from which my other credit card company essentially froze my account leaving me with no balance and no available credit. In some respects I am scared because I always viewed the credit cards as a safety net and wonder how my credit score looks. In other ways I think I am better off for the long run. I got to thinking, how has my mother lived and survived all these years. She lived within her means, built a cash safety net for essentials, and saved for whatever she wanted. I am now going back to my mom's ways. My mom, retired and living in SE, Washington, D.C. probably has a net worth of over $1 million from her personal savings and real estate she owns in the City. No real question, but just in case you ever think folks don't get, we get it eventually.

Michelle Singletary: Glad you got it.

And for the record a credit card is never, ever a safety net.

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Edgewater, Md.: My husband and I did not buy a home we could not afford but recently managed to buy a nice home at a foreclosure sale. The problem is, our new neighbors hate us for having done this! Apparently the house was previously owned by a beloved elderly couple who fell on hard times. We, of course, were not responsible for those hard times and in fact knew nothing about them. However, we're now the so-and-sos who bought the X's house, which elicits alls sorts of unkind comments, even hisses on occasion! Other than being the best neighbors we can be, is there any way to counter this unfair perception? There have to be lots of people in our situation.

Michelle Singletary: Very interesting question.

I'm sorry for what you are going thu.

Maybe, just maybe you could have a neighbor party and invite folks over and well be very, very nice.

Or you could simply write a nice letter saying exactly what you just told me ending with, while we are sorry about what happend to an obviously lovely couple we want to be good neighbors.

Other than that, there really isn't anything you can do but let time and your actions show what good people you are.

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Northeast D.C.: Hi Michelle, I noticed that you only deal with financial problems facing middle class households. Is this because you only hear from the middle class and is thus the only audience to which you have to cater? Or is it simply that you don't really have anything constructive to say to the lower classes or super rich and simply can't relate to either extreme? They have financial pressures as well, and I know you mentioned that you grew up less fortunate on several occasions.

Michelle Singletary: Your note is so odd.

I give advice to all. Poor, middle income and wealthy.

The advice is the same, live below your means. Shun debt when you can. Invest what you can for your retirement or kid's college education.

I don't have a magic wand to help people how don't have enough income to live. All I can do is help them figure out a way to reduce their expenses or increase their income.

As for middle and upper middle same thing.

So to be honest, sounds like you have a chip and I have no idea how to knock it off your shoulder.

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Alexandria, Va.: Hi Michelle, I absolutely love your column!!! Had a quick question for you. With a 6 year-old and one on the way, hubby and I are thinking about buying a house. Although we qualify for a good amount, we were considering looking at homes $25,000-$50,000 below. Question is how much should we save? We have $7,650 saved but only have a life happens savings--no emergency savings. We didn't factor closing costs because most sellers will cover up to 3%. What are your thoughts...I just thought even though we don't want to be in over our head, now might be a good time to buy. Any advice you can provide will be appreciated. Keep up the good work! P.S. The only debt we have is 2 car loans as school is all paid off. Thanks!

Michelle Singletary: I know there are a lot of people who think now is a good time to buy because prices are down and there are a lot of foreclosures.

But the best time to buy is ALWAYS when you are ready financially.

You need more savings, especially with a baby on the way.

You need a good cushion of emergency and life happens because what if life happens and you decided to stay home with baby #2. I did for six months for all three of my kids. And we had to live off savings to make up for the pay I wasn't getting.

Take your time. Save more. There will still be homes to buy.

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Bowie, Md.: Michelle I love reading the column. I am a 26-year-old college graduate. I am looking into retirement options as I have a goal to retire in 40 years. I currently make $86,000 a year and have been employed for 3 years. I have bought a house and was wondering if it would be better to pay down my mortgage or take that money and put extra into my 401k which is valued at 35K. Just wondering where I should start.

Michelle Singletary: Read one of my earlier postings about ordering your financial life.

Be sure you have emergency fund, life happens fund. No debt.

Then aggressively save for retirement. If after you are sure you are putting away enough on a regular basis to retire when you want, then you certainly can begin to make extra mortgage payments.

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Bethesda, Md.: If one could live reasonably without debt of any sort except a home mortgage--no credit cards, home equity borrowing, auto loan, etc.--would it be folly to do that? Many of our depression-era parents lived "within their means," but today I think the next generation would say they lived way below their means. Those who grew up in the 1930s ran their financial lives to avoid losing it all, but today the many safety nets seem to condone or encourage borrowing for third cars, expensive renovations, and a lot of unnecessary but nice stuff--in which category I would put 100% financed investment properties. I don't imagine other cultures are as debt-obsessed as the U.S.

Michelle Singletary: You would imagine right!

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Gaithersburg, Md.: Hi Michelle, I've been reading your articles and listening to you on NPR for a while. I'm soon to be engaged and have thought about telling my boyfriend to think about purchasing a cubic zirconium or a ring that does not have diamonds. We went looking together recently and as much as I loved what we saw the idea of spending thousands of dollars on a ring seems absurd to me. I just don't see how that's money well spent. Am I being silly? Please note, while we're not drowning in debt, we aren't independently wealthy either.

Michelle Singletary: This really is a personal choice.

If you really don't "want" a diamond then don't get one. I think that's perfectly fine and not silly at all.

I'll be honet tho. When I got engaged I wanted a nice size diamond. Not sure why. Just did.

But my hubby got what he could afford, less than what I wanted but 16 years and three kids later I love my perfect little diamond.

If years later you still like her cubic and your husband what you got was a priceless engagement ring!

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Anonymous: Michelle: What is your view on cash? I found my credit card trap was really due to me wanting to keep cash available. So I would charge it instead of cash, make a small payment instead of using cash. This is especially true for frivolous stuff. Is there a percentage of take home pay that you should limit to your cash? Should you make all expenditures cash based or what?

Michelle Singletary: I think we all should use cash more --even me.

Cash is and should still be King.

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Fairfax, Va.: My husband and I have 1 credit card, which we pay off every month. It gives 1% back on purchases in the form of reward points that can be cashed out. I don't like using it for every day purchases; he does. I don't think I will convince him otherwise because we do pay it off each month. But in light of your column today, I think it's useful for people to ask themselves "will I spend even 1% more on purchases when I use the credit card (because it's easier to overspend with a card)?" If so, they have negated the benefits of the reward program. We're not big spenders and we save a lot, but I do know it's easier to order a more expensive entrees without a second thought when I'm paying with plastic.

Michelle Singletary: EXACTLY.

You so got my column today.

That 1 percent is nothing compared to how much more you buy with credit even those of us who pay off the balance and watch what we spend.

Let me give you an example. If you are going out to eat and you only have $40 in cash and you vow not to use a credit card. You will only spend that $40. You will order accordingly.

But with a credit card you might go ahead and get an appetizer or the more expensive fruity drink or dessert. You order more food because you can. But let's say it's just $10 more. That's still $10 more than what you would have spent if you were limited to the cash in your pocket.

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Centreville: I am a widow who is employed. I have not been able to save a lot until recently, and am putting about $100-200 of each paycheck into a credit union account. I have a very modest savings also with a brokerage and also a small IRA. I am a homeowner, and a few years back I refinanced to a 15 year mortgage. My property will be paid off when I am 67. Smart move, I think since I was was at a much lower salary than I am now, but that was my savings vehicle at the time. My house also needs upgrading. I owe about $3,000 on improvements that HAD to be done, not cosmetic. Where do I put my savings per month now? Into the brokerage account that I have lost money on, the credit union, and then buy CD's as I collect $1000, my IRA or into my major investment which is my house? Thanks!

Michelle Singletary: If the savings is your emegency money put it in the highest yeilding account you can find.

If it's long-term you need a plan to invest it depending on your risk factor and time.

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Burke, Va.: Hi Michelle - thanks for your great work. I've written you a couple times about this question (although maybe it's not interesting enough to write a column about it): what do you think of the (recent) phenomenon/revival of the "laws of attraction" theories and the suppositions in the best-selling book, "The Secret" that people can simply wish away debt and "call in" or attract wealth just by thinking "wealth" or abundance? In fact, the author herself said that she changed her bills to checks (and added zeros!) and said, "thank you! thank you!" to each bill-turned-check she wrote and the money just started flowing in...I have some friends whose lives have been uprooted (negatively) by this so-called financial intention practice. I agree that we are what we think and that expressing sincere gratitude is always necessary to live a peaceful life, but is it OK to just "wish" or "see" or "expect" abundance? Thanks for your time!

Michelle Singletary: I think much of it is nonsense.

I agree that postive thinking does help. But you can go into the bank or call your credit card issuer and say, "I wish that this debt be gone!"

It takes a combination of discipline, budgeting and motivation to achieve wealth.

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Manchester, N.H.: Michelle--we love your column, and are in an interesting situation. My husband's company got acquired by another firm. Now his future there is uncertain and the state of the economy is making me very nervous. He did receive a big bonus as part of the transaction and might get one year's severance if things don't work out. Should we take the bonus and pay off debts (home equity loan, car loans, some of the mortgage)? Or hold onto more than the usual "Life Happens" fund just in case he doesn't find a new job right away? Or put it into retirement and/or college savings funds? I'd love to hear your advice. Thanks!

Michelle Singletary: First, I certainly hope and pray your husband can hold unto his job.

But just in case, I wouldn't pay down the debt until things were stable. As you say, you might need that for living expenses. Until then tho do what you can to begin reducing your expenses. Act like he lost his job so that when and if he doesn't you are still in a great position to go forward.

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Caribbean (formerly D.C.): Hey there. Thanks for taking my question. My daughter, husband and I currently live abroad, but he is returning to the U.S. to take a great job. My daughter and I will remain abroad while I work at my job for the next two years. We have 2 checking accounts (1 in the US and 1 in the country we are currently in) and a number of bills that we pay through the U.S. checking account (mortgage, student loans, credit cards). The local/international account we use for rent here, food, tuition for our daughter's school, etc. Do you have suggestions on how we handle finances as a family while we are in separate countries? Does he take responsibility for the U.S. account, put his paycheck in it, and pay our U.S. expenses out of it and I take responsibility for the local/international account here, while both of us have access via check books, debit cards, and on-line banking? Generally I am the one to balance the accounts and I send an excel spreadsheet to both of us. Should we continue with that plan? Any suggestions, tips, words of advice as we step into this fairly tricky situation?

Michelle Singletary: You really can do whatever is the easiest. Just be sure you are pooling all the money and paying out what you need to run both households.

I do think keeping it all together will allow you to manage the whole better.

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Bethesda, Md.: Michelle, Thanks so much for these chats they are wonderful! Your subject today is great timing; I just received a letter from Citibank regarding my master card I have had for 24 years. This was my first ever card in my name only. They have informed me that my rate will be going up (double from what I have now) as of July 1, 2008 and I can accept that or opt-out (which is a joke) which means if I do that they can close my account and call my balance. How do you like that?? Luckily I had just paid this off in full and I haven't called to complain YET, and I will tell them they have lost a customer of 24 years because of this. By the way I have excellent credit with a score in the high 700's and have never ever been late with a payment. We need to do something to stop these vultures and I am in your camp: CREDIT IS EVIL.

Michelle Singletary: Credit is evil.

But you really don't have a problem if you pay off the balance every month. The interest rate only matters if you carry a balance.

So unless you have to pay an annual fee, keep the card open and punish them by NOT using it at all. That will fix them.

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Richmond, Va.: Charging everything AND paying it ALL off every month HELPS me budget. Every month it's all there in one easy table, easy to compare to previous years. That's how I started talking about the rising cost of food a month before I read anything in any paper. I looked at my monthly totals, compared them to previous months and saw, we were spending way more at the grocery store. If I had to look at a check book register, I'd be LESS aware of my overall spending patterns.

Michelle Singletary: Exactly how are you less aware?

Your checking account statement would have the exact same spending.

It's a lie those of us tell ourselves. Now you can decide to continue using the credit like that. I don't have a problem with that.

But stop believing their lie. And recognize we still spend more when we use plastic.

that's all I'm saying.

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Oakton, Va.: Michelle, My husband and I are thinking of refinancing, to both get a lower interest rate and also get rid of a home equity line of credit. My question is...would it be better to consolidate them both into one loan (30 year fixed at 5.875% for $417k) and pay, I don't know, maybe $5-8k in closing costs, versus keeping what we have now (we owe $352k and have 24 years left on a 30-year fixed at 6.25%, plus the HELOC, which is $70k at 5.5% currently, but due in 11 years)? The total monthly payment would be significantly lower; on the other hand, both interest rates are pretty good. Credit score not an issue. Thank you so much.

Michelle Singletary: Do the math.

Figure out how long it would take you to break even on the closing cost compared to the monthly savings.

If you plan on staying in the home longer than it takes to break even if might be worth refinancing.

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Largo, Md.: Hi Michelle, I am wondering what to do about my TSP plan. I have around $28K in my TSP and I put in $125 bi-weekly. For the last year, I have not seen any growth due to the stock market. I am wondering should I continue putting money in my TSP or in another type of savings account until the market does better. I am 35-years-old and have a while to retire but I would like to see my money grow at least a little in the TSP account.

Michelle Singletary: We are in a down market. That happens.

I would review my plan, make sure I'm well diversified and if so stop looking at short-term gains and losses.

Think long-term.

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New York, N.Y.: Hello, I have been reading your column for a while now, and I agree with most of what you say. However, you seem to advocate a life of no-fun, no-frills. I work 11 to 12 hour days, save all the money that I can, pay off my credit card bill every month, put the maximum into my 401(k), etc. But how I perceive the advice that you give is that I should feel guilty "getting the expensive fruity drink" or getting a manicure/pedicure. Yes, I understand living below your means, but at some point when does it stop being living and start being just surviving for the sake of saving money? One never knows what will happen in the future--how about a little room for some pleasure in life?

Michelle Singletary: Okay, since you think you are going to die tomorrow get the fruity drink for goodness sake.

And by the way you are totally misreading my advice.

I never tell people not to have fun. But if you are deep in debt, sweating paying your bills then yes you have to cut back and yes you might not be able to get that fruity drink.

But is life is good and you are doing all that you say you are doing have fun.

It's about balance. I'm about balance.

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Richmond, Va.: My boyfriend is graduating with $160k in law school loans and I am starting a Master's program and will be $50k in debt when I graduate (that's tuition only--I'll be going part time so I can still earn a paycheck). I see you tell folks with that much debt to hold off on a house, but...neither of us will be surfacing from that debt anytime soon. If we get married, are we doomed to rent for life?

Michelle Singletary: You are not doomed.

But I would concentrate on getting rid of that massive debt before taking on a even larger massive obligation.

And I wouldn't spend much on a wedding either.

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Washington, D.C.: Hi Michelle, I got my first credit card in 1989. I used it a lot at the time, but have not used it in several years. I did not cancel it because it showed a long history of good credit. There was no annual fee. I just got a letter from the company that they have closed the account because of lack of activity. Ack! Could this affect my credit score, and for how long? Thanks.

Michelle Singletary: It could lower your score but not by much.

it's a bum company for doing that so good riddance.

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Laurel, Md.: Hi Michelle, I see where NE D.C. is coming from but that's not your fault. I read the chats every week and people have problems like $20,000 in savings that they don't know what to do with. I WISH I had that problem! I don't even have $20 in my savings!

Michelle Singletary: And people are also in debt. I get questions from the broke and well off.

N.E. still has a chip.

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Michelle Singletary: Got to run folks. So sorry if I didn't get to your question.

I'll try to answer some in my print column or eletter.

Thanks again for joining me today. Great questions. And for those of you trying to get out of debt stay the course.

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