How to Prevent Getting into Debt?

By orsonL - December 19th, 2010, 20:04, Category: General

An ounce of prevention is worth a pound of cure, but can you really prevent yourself from going into debt? Well, professional debt management agencies say yes and offer many tips that are helpful for preventing yourself from falling into a debt trap.

Debt Management Solutions
If you manage your expenditures wisely, then there is no danger of going into debt. But most of the time, we tend to drift off course with our spending under the pretext of one excuse or another. While some unexpected necessities are valid excuses, there are various expenditures that we incur unnecessarily. But debt agencies offer effective
debt management programs to help us learn money management.

Invest in a Savings Plan
Debt management experts suggest a savings plan as an effective trick to prevent going into debt. Saving at least three months of salary is ideal because it would cover any unexpected emergency situations like medical bills, job loss or moving from your current home. The interest rates of savings accounts are another reason to stick with this plan for the long term.

Here are some effective debt management tricks:

       Pay your monthly bills using a bank transfer. Some banks even offer a discount for making payments through online banking, so it is a smart move to take advantage of this feature.

       Use your credit card for convenience and not as a necessity.

       Credit cards are one of the primary factors that lead to debt. That is why debt management counselors recommend devising a strategy like setting a credit limit for yourself. Try not to cross that credit limit.

       Organize your earnings and expenditures in comprehensible accounts. It will help you know which bills are the priority to be paid.

       Debt management analysts also suggest income insurance. If you ever have to stop working due to illness or accidental injury, this insurance will make up for your losses during that time of need. However, it is advisable to check out what is covered in the insurance plan before buying it.



Considering the cost of education these days, student loans are hardly avoidable. And if you are an international student, it is even more likely you will need loans. But
debt management planners still have some tips for you:

       Be serious about your studies. If possible, try to complete your education ahead of the scheduled time. It will save you from extra loans.

       Find a part time job. Make it a point to put 10% of your income into a savings account.

       Limit your partying habits. Once in a while is good, but if done in excess, it will turn out to be expensive.

 





How to Fix your Debt Problem

By orsonL - December 19th, 2010, 18:00, Category: General

Is your debt problem strangling you? Well, you donít have to live with it forever. Debt management programs can offer many strategies to handle various debt related issues.

Reasons for Debt Problems
Most debt problems occur because of bad management of personal finances. Credit cards offer the most convenient way to borrow money, but this often turns negative for cardholders. Credit cards also offer the easiest option for buying, not to mention the safest because you donít have to worry about losing your money. But if not used wisely, credit card usage can lead to serious debt problems. Debt management programsoffer many strategies to deal with a debt crisis.

Debt Management Programs
Debt handling agencies offer debt management programs in which they educate debt-stricken consumers. Starting with counseling, negotiation and finally settlement, experts from agencies can cover every stage to make you aware of your debt problems. They can also teach you how to get rid of debt. But the initial wake-up call has to happen on your end. How serious are you about your debt problem? Are you looking for a way to get rid of your debt? If the answer to both of these questions is yes, then approaching debt agencies can be quite useful.

Below are some effective strategies for conquering your debt problem:

       Stop paying with credit cards all the time. Most people buy things they want, not need, which augments the debt problem. Consider credit cards as extra money, not a necessity.

       Always check the interest rate and other administrative fees before signing up for a credit card. The market is flooded with various credit card companies showcasing attractive offers, but you need to choose the offer with the lowest interest rate.

       Debt management planners suggest checking whether reward points are available as partial payment of your credit card debt. You may be able to save some money by trading your reward points.

       If you have multiple credit cards, transfer most of your debt to the lowest annual percentage rate (APR) card. As the interest rate is low, you can save a good deal in paying off other debt.

       Make a deal with yourself. Debt management planners suggest either you increase your income from additional sources such as a part-time job, or put a stop to your unnecessary expenses to get rid of your debt problem. Ultimately, the choice is yours.

How to Choose the Best Method of Debt Clearance

By orsonL - December 16th, 2010, 20:12, Category: General

Trying to figure out the best way to clear your debt? Debt management services offer the most effective debt clearance methods through debt management programs.

Debt Management Services
Accumulating debt is certainly a matter of serious concern. Once it happens, the biggest concern is how to pay it off. Debt clearance is not easy, especially when the accumulating amount of debt is too much to handle. In this period of economic slowdown, it is not uncommon to see more people mounting up revolving debt in the form of store cards and credit cards. Per a recent federal research report, the revolving debt of an average American was $15,788 in May 2010. Debt management servicesoffer many effective strategies to ease your debt clearance process.

Debt Clearance Options
Does your current financial instability make it impossible for you to clear all of your debt? Well, no worries, there are debt clearance options available. You can choose a debt management program from professional agencies, including a debt settlement program. If the amount of your debt is very high, then you can even file for bankruptcy. All these methods will help you clear your debt quickly. However, each of the above mentioned options has its own pros and cons, so it is advisable to weigh the risk factors before choosing.

Periodical Debt Clearance
If you have borrowed small sums of money from various creditors, then a debt management plan will be the most effective means of debt clearance. Although it is not the quickest way, debt management service providers recommend it for gradual debt settlement. Based on your disposable income, your debt analyst might negotiate with your creditors to freeze interest charges to stop them from increasing further. According to the Federal Trade Commission, it is now a standard practice of collection agencies to distribute payments on a pro rated basis.

Debt Settlement
if you opt for this debt management program, you can settle up to 50% of your unsecured debt. There is also an extended time period of three years allotted to clear the remaining debt. If you are unable to clear your entire debt within the stipulated time period, you can ask for an extended repayment term.

Bankruptcy
If you have lost your job and are currently unemployed, then it is obvious that you will not be able to pay off your debt. In this case, Chapter 7 bankruptcy may be the only way to clear all of your unsecured debt.

 

 

 

Effective Strategies for Debt Problems

By orsonL - December 16th, 2010, 19:02, Category: General

Are debt problems causing you sleepless nights? With effective debt management solutions, you can get rid of your debt problems once and for all.

Current Debt Scenario
According to a Nilson report, the cumulative amount of unsecured debt in the U.S. reached a staggering $972.73 billion in 2009. And considering the growing standard for expenditures, that amount is likely to multiply this year. Active credit agreements are available, but it is still becoming more and more difficult to manage debt. Debt management solutions can make it easier for you to handle your debt problems effectively.

How to Manage Debt Problems
There are various types of solutions available for handling debt problems. Debt management experts will first analyze your credit history and decide on the best strategy for your debt problems accordingly. If you have a low credit score, you can opt for a debt settlement program. But if the amount of your credit debt is high, there are other options too, including zero percent interest rate balance transfers and debt relief or debt consolidation programs. A professional debt analyst can guide you through these prospective solutions in more detail.

 

Zero Interest Balance Transfer

If you have a bad credit rating, you cannot take advantage of this opportunity unfortunately. Thatís why debt management experts always advise keeping your credit rating healthy. A zero interest balance transfer gives you the option to transfer money away from higher interest rate credit cards in order to pay them off for less. There is actually a nominal transfer fee of 4% in balance shifting, but you still stand to save a substantial amount of money. Many credit card companies offer this introductory rate for up to 12 months. Once the time period is over though, you can request an extension of the zero percent interest rate balance transfer option.

Debt Relief Programs
Debt management analysts will suggest two options:

Debt Consolidation -- Debt consolidation facilitates the option of making a single monthly debt payment as opposed to a number of them. Consolidation loans are also available at low interest rates, so they are a good idea to for reducing higher interest debt payments.

Debt Settlement -- This is an effective solution for larger debt problems. Debt management experts even consider it a good alternative to bankruptcy. With this scheme, you can reduce your debt payoff by up to 50% and settle the remaining debt within a period of 36 months.

 

 

 

 

Debt Fighting Tricks to Control Debt

By orsonL - December 15th, 2010, 20:02, Category: General

Worried about how to get rid of debt? With these debt management tricks you can give your debt problems a tough fight.

Debt can happen in a number of ways. Unexpected medical bills, accidental expenses of a spouse, extended sick leave, mortgage loan, credit card bills Ė all these are circumstances that can push you towards debt one way or another. Debt is like an avalanche Ė if not handled in time, it can blow right over you.
Debt management agencies are there to help you in your fight against debt.

Stop the blame game.
You might not realize it, but 99.9% of the time we tend to blame others for our debt situation. Be it for reasons like student loans, mortgage payments or credit card issues, nobody can force you to be in debt. These factors could have aided you, but if you are not able to control your expenses and get out of debt, you know whom to blame. Once you accept the responsibility, the next stage is to seek
debt management solutions.

Know your debt.
It might be surprising, but there are people who actually have no idea how much money they owe to creditors. Ironic, isnít it? Well there are debt management analysts to help. They add up your credit card bills, student loans, car loans, home loans, etc., to prepare a detailed debt payoff structure.

Make a smart move.
Donít let irresponsible finance related decisions spoil your chance of becoming debt-free. Just because something is on sale doesnít mean you have to buy it, especially if you donít need it in the first place. The idea of ďsaving moneyĒ by buying on discount is illogical. So strictly follow the debt management plan. It will help you streamline your expenses.

Be consistent in interest payment.
Does it matter if you miss an interest payment one month? Or if you make a late payment? It does, a lot. You might make it up in your next payment, but it will generate a bad credit rating for you anyway. And a bad credit report can have a negative impact on your credibility with creditors. Thatís why debt management analysts recommend being consistent in debt payments.

These are not hidden secrets, but tested debt management tricks which, if followed with dedication, can bring you into debt free territory.

 

Smart Ways to Handle Debt

By orsonL - December 15th, 2010, 17:08, Category: General

The serious repercussions of debt can send a chill up your spine, but then you have to be smart about your debt pay off. Debt management services can offer some tips on how to handle debt.

When is the right time to pay off debt?
Debt means less equity, a higher credit card balance and the slow approach of bankruptcy status. Itís a common perception that debt should be handled as quickly as possible to save yourself from insolvency status. Well, here is a twist. Per
debt management services, itís a bad idea to pay off debt quickly. You should be smart about your pay off. Often people make the mistake of hurrying and end up doing more financial damage in the process.

Donít target the wrong debt.
Many people have mortgage loans to increase their home investments. Some even opt for a 15 year term instead of the regular 30 year term so they can pay it off sooner. But in a hurry to free themselves from mortgage loans, they end up delaying other debts which ultimately become an issue. Hence
debt management planners suggest not focusing solely on your mortgage when you also have other loans like credit cards, student loans, personal loans or one of many other possibilities. After all, mortgage loans are usually low interest based, and tax deduction is also facilitated. So itís a bad idea to pay if off too quickly in lieu of other more costly debt obligations.


Donít neglect your retirement savings.
ďI have my whole life to save for retirement, better to get rid of debt now.Ē Itís a common perception of many young people. But
debt management philosophy says otherwise. Time never waits for anything, so it is better to make the most of your money when the time is favorable. Remember, retirement savings offer many tax advantages, which it is not wise to sacrifice for the sake of setting debt.

Bankruptcy should be the last resort.
Many people assume bankruptcy is a great tool to get rid of their debt status forever. But bankruptcy has serious repercussions on your future finances. It will be tough to get credit cards anymore, and for many years you canít apply for mortgage loans either. Hence debt management analysts strongly recommend only opting for bankruptcy when all other means of debt payoff fail.

 

 

 

 

Getting Out of Debt Ė 8 Easy Steps

By orsonL - December 14th, 2010, 20:15, Category: General

More and more people find themselves buried under a mountain of personal debt with no idea how they got there and no idea how to get out. The first and foremost thing most people do is lie to themselves about their debt problems. But unfortunately, unless you accept that you are in debt and talk about it, you will never understand how deep of a hole you are in. It is important to dig yourself out of debt before it is too late. Follow this simple eight step plan to be rid of debt for good.

 

1.    Get a clear snapshot of your finances Ė Start by getting a clear picture of your finances, debts, investments, mortgages, etc. List out all of your mortgage payments, credit card payments, loans or any other such expenditures. Calculate your debt-to-income ratio and viola! You will know where you stand. This will give you deeper insight into which areas you should concentrate your efforts first.

 

2.    Pay off your credit card debt Ė This should be your second step towards financial freedom. Line up all of your credit cards from highest interest rate to lowest. Start attacking them one by one. Pay the minimum on all of them, but pay more on the card with the highest interest. Once you have paid off that card, use the same money to start paying extra on the second card. Continue until you have paid off all of your credit cards, but remember not to acquire any new debt in the meantime. Once you are free from credit card debt, keep only one, and do away with others.

 

3.    Learn to use cash - Keep one credit card and use it only for emergencies when cash is not available, such as an illness. Put away your credit card so that it is not available for everyday use. See to it that your credit limit is not increased; do not accept increases above an amount you can easily pay off in three months.

 

4.    Evaluate you expenses and lifestyle Ė Refinance your home mortgage, and shop around for lower insurance rates and more economical utility plans. Your mortgage payment, insurance and property tax should not be more than 35% of your income.

 

5.    Donít borrow money to pay off debt Ė Many credit card companies and banks offer consolidation loans. Consolidation means combining all of your debts into one. By tying all your loans together in this way though, you could lose everything if you do not pay it back. If you want to borrow, ask a friend or family member in order to get the loan interest free or at a nominal rate.

 

6.    Look for part time work options Ė To bring in some extra cash, look for alternative ways of earning money. A part time job is a great idea, but there are many ways to bring in that extra buck.

 

7.    Be a savvy shopper Ė Look out for deals, discounts and bargains when you go shopping. You can also find coupons online. Surf online to compare rates before you buy. You will be surprised at how much you can save.

 

8.    Ask for help Ė Donít hesitate to ask for help if you feel that you are not able to handle your financial problems. There are many non profit debt management companies that provide free debt management advice. Their counselors can provide you with an effective debt management program that is customized and has easy-to-follow steps.

 

While these tips can help you overcome a debt crisis, you also need to remember that you have to follow some basic money management principles to avoid falling into the trap again.

 

Debt Management - A Step towards Financial Freedom

By orsonL - December 14th, 2010, 17:05, Category: General

Are you one of the many who are trapped by debt and desperately looking for financial freedom? With some easy-to-follow strategies, debt management can be the key to being debt free forever.

Debt Scenario
The debt situation is very serious in all corners of the world today. Even powerful countries like the US and UK havenít escaped from the trap of debt. Monthly bills, credit card interest, mortgage loans, educational loans, medical expenses - the list of the various forms of debt is endless. With so many bills to pay off, itís not unusual to lose track of debt payments. But with an effective debt management solution, you wonít have to worry about anything.

A Debt Management Secret
According to debt management analysts, a little debt is not so bad. In fact, it can turn out to be profitable for you. Sound contradictory? Well, not really. A home equity loan can be a good option for achieving income tax balance. Also you can consistently pay off your creditors if your debt amount is less, and it will build a good credit rating for you. Based on your rating, you can also obtain other loans with lower interest rates.

Debt Management Keys to Breaking the Cycle of Debt

Curb High-Cost Debt
Debt management strategists often suggest paying off your highest interest credit card balance first. But donít stop your lower interest debt payments, rather continue with the minimum payments. Once the higher interest debts are paid off, you can work on the balances of your other debts.

Maximize the Usage of Debt Consolidation
Debt consolidation is a good option for paying off debt. Debt management expertssuggest a number of ways in which to speed up your debt payment proceedings. Some prominent strategies are:

 

       Balance transfer from high interest credit card to low interest credit card. However, it is advisable to have a clear understanding about the transfer fees before choosing the option or you could end up paying more than the initial credit card payoff.

       Home equity loans offer low interest rates, and there is also a tax deduction provision. Hence, itís a good debt management strategy to opt for a consolidation loan.



Avoid Sacrificing Retirement Savings
Retirement saving is a wise plan for saving for the future. Even though debt payment should be your highest priority, debt management analysts recommend it shouldnít be at the sacrifice of your retirement savings.

 

Follow Simple Credit Debt Advice and Be Money-Smart

By orsonL - December 13th, 2010, 18:56, Category: General

Twenty and bankrupt? Sound scary? Being twenty should mean dreams, brand new career, energy, fun and growing bank accounts! But debt and bankruptcy have become a gloomy reality today. Just check this statistic: nearly one quarter of all the bankruptcies filed in recent years were by by consumers under the age of 25. But why? Letís try and assess.

You are pursuing graduation. You own one or more credit cards. You are fun loving, swanky and smart.  Sale at the fashion store, pizza and beer, coffee shops, fun with friends Ė why miss out on any of this when you have money? Plastic money, that is. What next? You are in a load of debt before you realize it. Every month you have multiple payments staring you in face.  You are at loss for how to deal with the creditor calls. No solution? Thereís one Ė bankruptcy. So you were fun loving, swanky, smart Ė but now bankrupt with low a credit score harming your job prospects and a bleak financial future.

You donít want this to be your story, right? Being debt free is possible. You just need discipline, self control and the right credit debt advice. Here are the five most simple and effective tips on how to get out of debt:


1.  Letís face it. Escapism is no escape route from debt. If you believe that ignoring debt will someday make you debt free, itís a myth. Donít run away Ė face the situation. Accept your mistakes. There is always a way out. You just need to take the right steps and get the right advice on credit card debt. Discuss with family, friends or debt help counselors and start right away.

2.  Start now. If you believe that putting off your debts until you are forty is the best way to live a stress free life today, think again.

       Mounting debts can harm your credit ratings; your debts will become more expensive.

       You will most likely only qualify for a small mortgage when you plan to buy a house. Your dream house might just remain a dream.

       Paying for enormouse debt could leave you with nothing much to save. What will you do when you retire?


So start before itís too late.

3.  Pay more than the minimum. Did you know that if you keep making just the minimum payments on the average credit card debt of $3,262 accrued by college graduates, you end up paying more than twice the actual amount spent by the time you pay the last instalment after 18 years? It is worth to pay $20 for the dress you purchased at the sale price of $10? So banish the myth that by paying the minimum you are actually repaying your debts. With accrued interest, your debt is growing larger and the credit card company is pocketing all the money. You can better utilize this money as an investment, saving or even spending. Plan today to repay all your outstanding credit card balances.

4.  Budget. How many times have you looked at your credit card statement to assess the whereís and howís of your expenditures? How many times have you noted that your expenses exceeded your income at the end of the month? If you are really serious about avoiding debt or overcoming debt, you must follow this credit debt advice as a habit.

A budget is a must-have weapon in the war against debt. It will keep you apprised of all the fixed and varied expenses that must be paid without fail so you know how much is left for other spending. Then, later in the month when you want to make unbudgeted expenditures, you will know whether you can afford it or not. So, at the beginning of the month, simply write down all of your fixed expenses, estimated variable expenses and all your sources of income. Then assess if you are spending more than your income.

A recent study by the Federal Reserve shows that an average American spends $1.22 for every $1 dollar that he earns! Do you need any other reason for the debt epidemic? Only a budget can make you aware of the fact that you are spending more than you earn. So prepare a budget and manage your finances smartly.

5.  Shun that credit card. After getting ample advice on credit card debt, you have now decided to begin your credit card debt repayment in earnest, planned how you will go about doing it and also outlined a budget for yourself. Now can you afford to spend with plastic money once again? No. Stop and think before you swipe your card next time. If you keep repaying and spending, it is like trying to get out of a hole while you keep digging deeper. Spend only as much as you can afford to pay back. Still better, shun the cards altogether and use your prepaid debit card instead.

So start today. The first step is always the toughest, but soon youíll be cruising along the road to being debt free.

 

 

Learn How to Eliminate Credit Card Debt

By orsonL - December 13th, 2010, 17:26, Category: General

Is your credit card balance getting out of your control? Are you experiencing sleepless nights? To gain peace of mind, do you need to find a way to get rid of your credit card debt?

 

If you are living in dread because of unsecured debt that you are unable to pay, you are not alone. In recent years, the amount of financial debt accrued by individuals has escalated to staggering and unprecedented levels. Why? There could be many reasons, like the economic downturn, job loss, illness, etc. To deal with such a situation:

 

Acknowledge the Problem -To eliminate your credit card debt fast, the first and the most important step is to acknowledge that you are in trouble. Otherwise, you will find it very difficult to solve! Credit cards are designed to aid financial disarray. It is a temptation best avoided. If you are in debt, the first step is to write down the amount you owe for each of your cards, starting with the highest interest rate first. Then start attacking the card with the highest interest rate, while paying the minimum amount for the others. Continue this process till you are rid of all the credit card debt. Remember to destroy the fully paid cards so that you are not tempted to start using them again.

 

Consolidate All Credit Cards Ė Another option is to bring all your card balances under one umbrella, i.e. consolidate them onto a single card. Rather than repaying the amount owed to each credit card, it makes a sense to consolidate the accounts and pay back just one card over a long period of time.

 

Use a Debit Card or Cash Ė Use a debit card or cash for all your daily expenses. Avoid incurring any more expense on your credit card until you have either substantially paid your debt down or completely wiped out the balance. After that, use it judicially in case of an emergency, not for dinner or shopping. Never have more than one card at any given point of time.

Debt Management Solution Ė If you are unable to sort out you debt problems, you need to get in touch with a reliable debt management company. There are many such companies who help people with debt problems. Their consultants are experts in their fields and will negotiate with your creditors on your behalf to strike the best deal possible and to your satisfaction.

 

Check the Credentials of the Company - Before you hire a debt management company, check out their credentials and, if possible, opt for a nonprofit debt management company. A reputable debt management company will be accredited by the United States Organization of Bankruptcy Alternatives ("USOBA") or The Association of Settlement Companies ("TASC").

 

If you want security and peace of mind, get in touch with one of the debt management companies out there and become free from credit card debt.

 

 

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