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How to Deal with Money Problems without Going to the Extreme

Bad Credit Advice — Fri, 21 Jan 2011 17:51:07 +0000

Some people are extremists with everything they do. If they try to lose weight, they eat almost nothing an exercise 2 hours a day, or they give up and eat junk on the couch all day. There are also financial extremists. These people might start by charging everything to their credit card, taking out lots of loans, and not paying attention to their finances at all. They find out the consequences of their mistake so they go to the other extreme. They file personal bankruptcy or they live on nothing until it’s paid off.

Dealing with money problems in extreme ways isn’t always a bad thing. Living on next to nothing for a few months to wipe out debt, save a healthy emergency fund, and start retirement contributions is great, if you can do it. For the rest of the non-extremist individuals with debt problems, you need a way to deal with your debt without going to the extreme.

First, gather all your debts together. Which debts have the highest interest rate? What are the minimum payments? How many debts do you have? In order to minimize the amount of interest you have to pay, pay off the debts with the highest rate first. Pay the minimum payment on all debt and throw every extra penny toward the high rate loan, whether it has the biggest balance or not.

In order to pay more toward your debt, without giving up everything you enjoy, set up a budget. You can budget in eating out now and then or going to the movies as long as you pay more than your minimum payments. If you want to pay it off faster, you have to cut out more expenses. The more you pay the faster the debt goes away. Also, if you pay it off faster, you’ll have more extra money sooner, the money that is currently going toward your minimum payments.

Money Management: Simple Ways To Better Your Finances

Bad Credit Advice — Tue, 16 Nov 2010 04:19:03 +0000

If you are struggling with finances, you will be glad to know that by simply learning a few basic tips in the area of money management, you can be well on your way to financial freedom. Yes, it will take a lot of work, but it will be well worth it in the end. So, now let’s see how you can get started on the right track.

Money Management: Where You Can Begin

An important aspect to money management, is to do whatever it takes to get out of debt. Debt enslaves you, and often brings a lot of stress.When you eliminate it from the picture, you will have more freedom to do whatever you want with that money. To help get ahead with your debt, you can apply for debt consolidation loans.

Another aspect of the consolidation loans is that you will be able to consolidate all of your debt into one easy payment. This alone will help you to get ahead, and quit worrying about multiple payments each month. Another great thing, is that most likely, you will be able to get a lower interest rate too. This alone is worth getting the loan for, as it will really help you to get ahead.

Money Management: More Tips For Thought

It is also a good idea to learn a few quick ways to make money online. A couple of ways to approach this, is to learn how to design web sites, and even web graphics. You could also apply to participate in survey programs. This is basically where you get paid to fill out information regarding products that you may use, or consider using. It’s a simple, easy way to earn some extra cash.

It is also important for you to build up an emergency fund. Start out by opening a savings account, then set aside a percentage every month. Over time, you will be able to build a comfortable fund. So when tough time may come, you can always rely on your savings. And hopefully this will help you to avoid going further into debt.

Money Management: Closing Thoughts

Before you know it, you will be on your way to a more structured financial future.

Money Management: How To Get Ahead

Bad Credit Advice — Thu, 04 Nov 2010 18:58:04 +0000

In our current economy, now is the perfect time to take a look at your finances, and see what needs help. You can study a few basic areas of financial management, and apply them to your lifestyle. It will take some extra time, but it will be worth it in the end when you have the advantage of a more structured financial future. So let’s see where you can begin.

Money Management: First Steps

One of the first steps that you will need to take is getting yourself out of debt. Debt is often what hinders you from getting ahead with any other area in life. To help you get rid of your debt for good, consider getting a debt consolidation loan. These loans are an excellent way to get ahead with paying it all off.

The consolidation loan will do many things for you. First, it will organize your debt into one simple payment form. It will also help you to become more focused on paying the debt off as well. Another great thing is that you will get to work with consolidators who will be aiding you in getting lower interest rates in place, so that you can finally begin making great headway.

Money Management: Learn To Make Money

Another way you can combat your financial situation, is to learn simple ways to make money online. For example, you can learn to build web sites, blogs, and even offer web graphics. Many companies have online web sites, where they will pay people to write on the sites, and keep them updated. Do your homework, and you will be sure to find all kinds of things that you can do online.

A fun, yet simple way to earn some extra cash online, is to participate in paid survey programs. Basically, all you have to do is fill out information products you have used in the passed. Sometimes, they will ask you questions regarding products that may be coming out in the future. There are many different types of surveys, so do your research, and find the one that is best for you.

Money Management: Closing Statement

All of this will take time, but in the end you can enjoy financial freedom in your future.

What Are Second Chance Checking Accounts?

Bad Credit Advice — Wed, 22 Sep 2010 20:33:06 +0000

If you have had problems in the past with your checking account, such as carrying a negative balance, or writing too many checks without the funds to cover them, you may be in a nationwide system known as ChexSystem. This system is a way banks communicate potential problem customers with each other, which makes it extremely hard to get a checking account with any bank that uses this system once you are in the system.

If you feel as though you are not in the system legitimately, you can contact ChexSystem and your bank and ask for removal. However, if you are in the system legitimately, you will remain there for five years, no matter if you have settled the debt with your bank or not. You can request to be removed, but whether the bank complies with this request is solely up their discretion.

Because of this system, it can be extremely hard to find a bank willing to take a chance on you, or a bank that does not use the system to screen applicants. However, there are certain financial institutions who are willing to take a risk on those who have mishandled funds in the past. These institutions offer second chance checking accounts to individuals who are in ChexSystems, but certain rules and fees are different for these checking accounts.

Any bank that offers this type of second chance banking usually requires an upfront deposit to open the account. This can be as little as $100 to as much as $500, depending on the financial institution. This deposit is required to ensure there are funds to cover any checks you may write that go over your balance. Aside from an initial deposit, some second chance accounts require an active monthly fee. This fee is usually around $15 a month, but can be more.

All of these stipulations are in place on this type of account to better ensure the financial institution’s safety in giving you a checking account. The good news is that if you are responsible with your account for a certain period of time, from six months to a year, your financial institution may decide to upgrade you to a standard checking account, despite still being in ChexSystems. This is because you have shown yourself to be a valued customer with responsible spending. This is something not all banks do though, so do not expect to apply for a second chance account and be promoted later on.

How To Eliminate Debt

admin — Tue, 21 Jul 2009 16:12:21 +0000

Three steps to eliminate debt:

1. Stop acquiring new debt.

2. Establish an emergency fund.

3. Implement a debt snowball.

Here’s how to approach each step.

Stop acquiring new debt (This step can be accomplished in a morning.)

This may seem self-evident, but the reason your debt is out of control is that you keep adding to it. Stop using credit. Don’t finance anything. Cut up your credit cards.

That last one can be tough. Don’t make excuses. I don’t care that other personal finance sites say that you shouldn’t cut them up. Destroy them. Stop rationalizing that you need them.

* You don’t need credit cards for a safety net. * You don’t need credit cards for convenience. * You don’t need credit cards for sky miles.

You really don’t need credit cards at all. If you’re in debt, credit cards are a trap. They only put you deeper in debt. Later, when your debts are gone and your finances are under control, maybe then you can get a credit card. (I don’t carry a personal credit card. I don’t miss having one.)

After you kill your cards, stop all recurring payments. If you have a gym membership, cancel it. If you automatically renew your Xbox Live account, cancel it. Cancel anything that automatically charges your credit card. Stop using credit.

Once you’ve done this, call every credit card company that you just killed. Do not cancel your credit cards (except for those with a zero balance). Instead, ask for a better deal. Find an offer online and use it as a bargaining wedge. Your bank may not agree to match competing offers, but it probably will. It never hurts to ask.

Establish an emergency fund (This step will probably take several months.)

For most, this is counter-intuitive. Why save before paying off debt? Because if you don’t save first, you’re not going to be able to cope with unexpected expenses. Do not tell yourself that you can keep a credit card for emergencies. Destroy your credit cards; save cash for emergencies.

How much should you save? Ideally, you’d save $1,000 to start. (College students may be able to get by with $500.) This money is for emergencies only. It is not for beer. It is not for shoes. It is not for a Playstation 3. It is to be used when your car dies, or when you break your arm in a touch football game.

Keep this money liquid, but not immediately accessible. Don’t tie your emergency fund to a debit card. Don’t sabotage your efforts by making it easy to spend the money on non-essentials. Consider opening a savings account at an online bank like ING or Emigrant. When an emergency arises, you can easily transfer the money to your regular checking account. It’ll be there when you need it, but you won’t be able to spend it spontaneously.

Implement a debt snowball (This step may require several years.)

After you’ve finally stopped using credit, and after you’ve saved an emergency fund, then attack your existing debt. Attack it hard. Throw whatever you can at it.

Many people say to pay your high interest debts first. There’s no question that this makes the most sense mathematically. But if money were all about math, you wouldn’t have debt in the first place. Money is as much about emotion and psychology as it is about math.

There are at least two approaches to debt elimination. Psychologically, using a debt snowball offers big payoffs, payoffs that can spur you to further debt reduction. Here’s the short version:

1. Order your debts from lowest balance to highest balance. 2. Designate a certain amount of money to pay toward debts each month. 3. Pay the minimum payment on all debts except for the one with the lowest balance. 4. Throw every other penny at the debt with the lowest balance. 5. When that debt is gone, do not alter the monthly amount used to pay debts, but throw all you can at the debt with the next-lowest balance.

I’m a huge fan of the debt snowball. It still takes time to pay off your debts, but you can see results almost immediately.

Supplementary solutions

You can do other things to improve your money situation while you’re working on these three steps.

First, focus on the fundamental personal finance equation: to pay off debt, or to save money, or to accumulate wealth, you must spend less than you earn.

Curb your spending. Re-learn frugal habits. (Frugality is something with which most college students are all too familiar.) You can find some great ideas on the internet. Also check Frugal for Life.

While you work to spend less, do what you can to increase your income. If possible, sell some of the stuff you bought when you got into debt. Get an extra job. (But don’t neglect your studies for the sake of earning more. Your studies are most important.)

Finally, go to your local public library and borrow Dave Ramsey’s The Total Money Makeover. Don’t be put off by the title – this is a fantastic guide to getting out of debt and developing good money habits. I rave about it often, but that’s because it has done so much to help my own personal finances. After you’ve finished, return it and borrow another book about money.

The most important thing is to start now. Don’t start tomorrow. Don’t start next week. Start tackling your debt now. Your older self will thank you.

by JR Rooney

About the Author:

JR Rooney is an expert on debt andCollection Company. JR works for this Collection Agency Click here to get your own unique version of this article with free reprint rights.

You Should Most Likely Use Your Savings To Pay Off Debts

admin — Sun, 19 Jul 2009 07:38:34 +0000

If you’ve recently been checking websites and newspapers looking for financial advice, then you’ve most likely noticed that the most common question being asked right
now, isn’t how to get a bad credit loan, or if it’s really possible to get a government grant to pay off debts, it’s “Should I use my savings to pay off my debts”.

BTW – There are no government grants available that can be used to pay off debts!

So Should You Use Your Savings To Pay Off Debts?

It probably needs to be explained right up front, why so many people keep asking the question, and why there are so many different answers. The answer is, that no two people’s situation is the same, which in turn means that the answers will vary.

The First Part Is Easy

Take a look right now and seeing how much interest you’re paying on your debts, and compare it with how much you’re getting on your savings. If you’re receiving less interest on your savings account than you’re paying your creditors, then paying off your debts would obviously make sense.

But that’s by no means the whole of the story, and it would nice if it were as simple as that.

If you have enough money to pay off all your high costing debts and still have some money on hand, then of course you should pay off your debts, but it’s unlikely that you’d be reading this, if that were your situation.

Always Keep Some Money For Emergencies

a) Imagine that you used all your savings to pay off a lot of your debts but still had a lot to be paid off. You get an unexpected medical bill, get laid off, or have to take
care of some other unexpected event, and you can’t make the minimum payments on your credit cards or other loans. The extra interest that you’ll have made will get wiped out very quickly, and so will your credit rating.

b) Suppose that for some reason your salary doesn’t get deposited into your bank account when it should do, and there are a myriad reasons why that can happen, such as holiday week-ends or glitches in someone’s payment system. Most, or all of your payments will go unpaid and you’ll incur all kinds of charges and fees from lenders.

Just How Big Should Your Nest Egg Be?

It varies a little, but a good yardstick would be at least three times your monthly expenses, and much better would be six months. Most Europeans would consider six months to be about right, whereas many Americans haven’t even got two weeks survival money in their savings accounts. The State of California had the American mindset and look at it now. It’s paying people with IOUs because it’s bankrupt.

And Now For The General Advice

Although there’s no fixed answer to the question of whether a person should use their savings to pay off their debts, there is some general advice that can be given.

1) Set aside three months expenses if you can, but not less than two months, in case you need the cash to cover any unexpected events.

2) Use the rest of your savings to pay off or pay down the debts that are costing you more interest that your receiving on your savings account. If you’re able to pay off all your credit cards then you should obviously do so, but if you can’t, which is far more likely, then try to pay off the ones that are charging you the highest interest.

3) If you do manage to get rid of your high costing debts, the next step would be to increase the amount in your savings account to six months if you can.

4) If you have a good job and succeed in doing all of the above, then you might want to think about making some investments, and if you have a hobby that you’re an expert on, then you might want to invest in that. I’m talking about stamps, collector’s items and antiques etc and not financial investments, unless you really understand them.

It’s good to be cautious, but paying large amounts of interest for little or no reason makes little sense. So if you have the money to pay them off then you should do so, as long as you keep some money set aside as suggested above.

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The author of this article was a film producer, and award winning film sound editor for many years. One of his primary interests is economics, and one of his websites ->
http://get-financial-help.org is for people with bad credit that need a loan. The cost of an extended list of lenders is extremely small, and anyone not getting a loan within 60 days gets a full refund.