By financen | July 22, 2013 - 4:27 pm - Posted in Debt

Being deep in debt can cause a number of problems – everything from damaging your credit score to making it difficult to get loans. Luckily, there are some fairly easy ways you can get rid of that debt and get back on the road to fiscal fitness.

Get out of debt

Get out of debt

  • 1. Cut spending

Obviously, there are things you have to buy, such as food and clothing, but getting serious about getting out of debt requires that you cut down on other things. For instance, maybe you can cut out a weekly pub visit or two and direct the savings toward paying off your debt.

  • 2. Cut up your cards

This is a drastic move, but if you don’t have ready access to credit cards, you are unlikely to spend money you don’t have. Keep one card for emergencies, and destroy the rest.

  • 3. Get a plan

To get rid of your debt, you’ve got to have a plan for paying it down. There are different methods you can use. Some people like to concentrate on paying off the smallest debt first, because you get it paid off faster and get a psychological boost. Another method is to pay off the debt with the highest interest rate first, which saves you the most money in the long run.

  • 4. Don’t pay late

Making late payments not only hurts your credit score, it also adds late fees and finance charges to your bill that make it more difficult to get it paid off.

  • 5. Ask about lower interest rates

If you have good credit and have been making your payments on time, ask your credit card company if it will consider lowering your interest rate. This will lower the amount of finance charges you have to pay every month, which will help you pay off your debt faster.

  • 6. Consolidate balances

If you get an offer for a balance transfer with a lower interest rate, take a good, long look. If it offers a significantly lower interest rate, it’s likely worth it, even if there are fees involved. The lower interest rate will save you money over the long run.

  • 7. Direct any extra money to debt

If you get a bonus at work or unexpectedly inherit money from aunt Frances, use all or most of it to pay off debt. It may be tempting to buy a new TV or finally get season tickets for your local football club, but paying debt should be your priority.

  • 8. Find ways to generate extra money

While unexpected found money is great, it’s not realistic to expect some. Instead, make your own luck. See if there are any extra shifts you can pick up at work or sell some stuff you don’t need.

  • 9. Use a rewards card

This takes discipline, and if you are in debt because of out-of-control spending habits it could be risky, but getting a cash-back rewards card could help you cut your debt. The trick is only to use the card for necessary purchases — food, petrol, etc. — and then pay the bill in full every month. You can use the cash back you generate to help pay down your debt.

  • 10. Ask for help

If your efforts aren’t paying off fast enough, don’t be afraid to ask a family member for help paying off your bills. The worst that can happen is they say no.

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By financen | January 28, 2013 - 3:42 pm - Posted in Debt

The most common reason for anyone getting buried into debts is because they do not try to live within their means. Few of them get into debts due to other unfortunate reasons like loss of job or property, huge medical bills or other unexpected financial crisis. Whatever may be the reason, it is important to know effective ways to get out of debts as quickly as possible.

get out of debt

get out of debt

Everyone should keep a track of all their assets and liabilities, along with their income and expenses. In order to stay in control, you should cut off some unnecessary expenses. For instance, if you are in the risk of loosing your home, there is no point in buying other fancy things like a flat screen TV or a recreational vehicle. It is important to concentrate in saving your home from getting repossessed by your bank. Many people are sensible enough to identify their expenses that is very important in their everyday life.

If you are in overwhelming debt situation, selling off your assets will be a good option to pay off your debts. Sell off those assets that is not giving you any cash flow. It will be a wise decision to sell off those assets and use that money to pay off your existing debts. This will immediately reduce the amount of cash outflow from one’s account. When the liabilities and cash outflow goes down, their will be an increase in income and it will be sufficient enough to cover the living expenses and other monthly installments and also to pay off your debts.

You can consolidate multiple debts into one single monthly payment plan. A debt consolidation company can talk with your creditors and explain them about your present financial situation. They can negotiate with your creditors to reduce your current APR and combine everything into one monthly payment plan as per your budget. When all the debts are consolidated into one payment, it reduces the risk of missing any payments when you have multiple creditors to deal with.

If the APR on your home loan is high enough, you can look for a home loan modification program. The counselor will talk with your bank and make your home loan repayment plan a little easier by reducing the current interest rate.

It is very important to save a portion of your income every month so that you are prepared for any unexpected emergencies, like job loss, death in the family, health issues etc. even if you may not have to go through such tough situation, saving is still recommended because that is your money that can be used by you at later times.

These are some of the few effective ways to get out of debts. You can use all these methods to lead a debt free life and enjoy with your family.

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By financen | January 20, 2009 - 5:58 pm - Posted in Debt

When people are overwhelmed by their huge debts, they often go through various emotions of emotions, embarrassment and incompetence. They often feel neglected within their society. If you are one of these people struggling through huge debts, you are not alone. Don’t let these feelings hamper your financial making decisions and moving on with your life. Consumer credit counseling can get you out of debts and after reading this article, you will figure out that there is still a lot of hope in your situation.

One out of every ten credit card users needs credit counseling. There are so many people who need help in straightening their finances. Talk to a professional debt counselor and he will help you find a way towards a debt free life. Money management is not something that was taught in the early childhood days and most people learn by trial and error. When you are speaking to a credit counselor, these are few things that will possibly happen.

A debt counselor will analyze your present financial situation:

  • He will work out a plan on how to get out of debts and discuss it in details
  • He will work out the most suitable options on how to pay back the existing debts
  • He will give you step by step advice on how to pay back the existing debts
  • He will keep you informed about your present and future credit ratings and will work on improving it.

You need to keep in mind that when you are consulting with a credit counseling company, you are responsible for your debts and you will only have to pay it. The credit counseling company will assist you in managing your present finances and find out easy ways to pay off the existing debts. If you are considering the debt settlement alternative, you don’t have to pay back the full amount to the creditors. The creditors can be convinced to accept something less than the full amount but it will hurt your credit ratings. Based on your present financial situation and your credit ratings, you will decide the most suitable plan in your case to get debt free. Visit a credit counseling company and learn the proper ways to manage your money, stay out of debt and make investments for the future. With the help of this information, get your finances straightened out and get a fresh start.

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