Getting Over Credit, Debt, And Other Horror Stories

When people think of credit and debt, their minds immediately go to the worse case scenarios of them. We’ve all heard ghost stories of how bad credit can drag you down and limit your options and how debt can become a spiral that can truly be very hard to climb out of. But the problem is that a lot of people focus on the negative consequences of these stories that they fail to consider just how helpful credit and debt can be. Here, we’re going to challenge the phobia and help you use credit and debt better.

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The sooner you come face-to-face with it, the better

There’s a significant portion of adults who have never once checked their credit report. Some of these people might not know to, others have chosen not to because they’re staying well away from credit as much as possible. However, even if your record is immaculate, your report might not be. You might have to repair your credit score by no fault of your own but because there are erroneous accounts on them. For instance, you might be getting bad reports based on accounts that are mistakenly tied to your name but aren’t yours. Or you might be up-to-date with all your payments but your creditors made a mistake in reporting that you missed a payment.

It’s the next step in a better financial life

When used responsibly, credit and debt are the steps you take to make some of the biggest financial decisions in your life. When you get a car, when you buy a house, when you start a business, the chances are you take out a loan for them. With better credit, which is built by taking debts responsibly, you have the chance to get the best discount auto loans and the best mortgages. Having no history of credit isn’t going to help you get better deals. You have no history of being a responsible debtor, after all. Only by building a healthy credit history can you get the best deals.

Credit cards aren’t the devil

Those pieces of plastic might be considered the single most dangerous aspect of credit. Yes, people get themselves into credit card debt they can’t handle by using it to make lifestyle purchases they otherwise couldn’t. But that debt can be used positively to build up your credit so long as you have pre-planned a budget to always keep on top of it. Debt management turns debt from a danger into a simple part of life. You can get rewards cards that turn credit card use into extra purchasing power, whether it’s through air miles or through grocery vouchers.

Wise use of credit and responsibility for debts can be one of the most effective financial tools at your disposal. It can improve your purchasing power and it can help you make some of the biggest financial decisions in your life. In any account, it’s important to come face-to-face with it so you make sure that it’s not marred by errors that could come back to haunt you.

The Ultimate Guide To Spending Less

Extracted from The Ultimate Guide To Spending Less: 117 Tips! by Klaus Nymand.

Are you the type of person who wants to save money but isn’t about that spreadsheet life? You don’t live for crunching numbers and you don’t need an in-depth course in personal finance. This guide to money saving tips is exactly what you’ve been hoping for.

Use this guide on how to save money to pick up savings tips you like and skim over the rest. There is something in here for everyone. Remember that the smallest change can yield big results over time.

1. Use The Envelope Budgeting Method

This method works best for cash stashers. You have to have some willpower or the ability to not rob Peter to pay Paul. Work out your monthly expenses and assign an envelope for each. Deposit the correct amount of cash in each envelope each pay period to equal the amount due at month’s end.

2. Segment Your Money In Multiple Bank Accounts

These days, most of us need our income available in digital form. We pay bills online and that’s a challenge with the envelope method above.

Luckily, you can accomplish the same end by opening a second checking account. This second account is your master envelope. Put all of the correct apportioned amounts into that account each pay period.

When it’s time to pay your bills, all of the money is ready to send out from that account.

Paypal has a great prepaid debit card that you can use for this purpose if you can’t or don’t want a new bank account.

3. How To Use Prepaid Cards To Budget

In fact, prepaid debit cards can really help with budgeting! For starters, there are no overdraft fees to drain your already strained finances. If you play your budget to the razor’s edge, a prepaid card will give you some peace of mind. Use them to pay bills and shop online.

4. Why You Should Keep An Allowance In Cash

If the methods above sound like too much work, reverse engineer it! Figure out what your weekly bill figure is. Leave that amount in your bank account and take cash as your spending money.

Of course, if you prefer your spending money on a card, grab a prepaid debit and load it with your weekly allowance.

5. How To Earn More With A Side Gig

Depending on your talents, you may find a side job is a great way to budget since it creates more money to work with. Websites like Fiverr, Upwork, and People Per Hour make it relatively easy to pick up some digital side work you can do from home. You can even monetize your photos through platforms like Pixabay.

The Penny Hoarder is a great resource for learning about potential side hustles. Just be sure to research anything you find there before you jump into it.

6. Leverage Rounding In Your Budget

If you have some room in your budget after bills, try rounding all of your bills up a few dollars. If your electric bill is generally $37.50 a month, stash around $40. This will slowly pad your bill account for emergencies.

7. Remember To Pay Yourself First

When money is tight it’s so easy to scramble to pay your bills and forget to set any aside for a rainy day. Whether you invest in a retirement account or keep a meager savings, putting your own savings at the top of your bill list helps you actually save.

This tip covers matching your employer’s contributions to your retirement accounts if you can.

8. Eliminate A Luxury On A Rotating Basis To Save

Think of this tip like financial Lent. You’re going to look at your debit account and see where you spend the most money on a luxury. Hopefully, there is more than one so you can rotate your cuts. If not, you can go a week on and a week off.

Once you see where you are spending extra money, abstain from those purchases for a week. When the week is over, add that bonus back in and remove something else.

This way you never feel too depressed about skimping to save money.

9. Choose Accounts That Work For You

Bank of America’s Keep The Change program rounds up every purchase using your debit card and deposits the change in your savings account. This is a brilliant way to save if your problem is actually setting money aside.

If you can’t swing that kind of increase in your spending, look for new accounts you can open that give cash with sign up. This may be actual cash or in the form of a gift card.

Many online banks provide higher interest rates to their customers to entice them to sign up. If you are paid through direct deposit you can open a high-interest checking account at a bank like Allied Bank and earn more interest than most standard accounts.

10. Try Micro-Investing

The Stash app and others like it capitalize on the popular trend of micro-investing. Users invest as little as $5 in fractional shares. Buy as often or as rarely as you like. You can also combine this tip with skipping a luxury and invest the cash instead.

In addition to Stash, Acorns and Clink work similarly but with slightly different features.

To read more of Klaus Nymand’s excellent money saving tips (there are 117 in all) please visit 

https://moneybanker.com/us/blog/ultimate-guide-to-spending-less-117-tips/

Building a Firm Financial Foundation

Effectively administering your personal finances encompasses broad responsibilities, ranging from everyday budgeting to long-range concerns, such as retirement planning and preparing for a child’s higher education expenses.  For the best results finding security and stability, individual money managers start with solid footing, building upon each favorable financial outcome.  Without a consistent base, on the other hand, individual finances are vulnerable to damage and distress.

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Building a sturdy financial base begins early in life, as young adults transition from dependency, carving-out their own financial territories.  And the process continues for a lifetime, calling on effective money managers to remain proactive shaping positive financial outcomes.  Consider the following concerns, at the heart of your financial stability:

Use Strong Credit References to Support Your Financial Health

From your first financial interactions, your behavior handling money lays the groundwork for credit references, which follow you for a lifetime.  By setting-off on the right foot, you not only establish short-term credit references, but early success also puts building blocks in place on which to raise a strong financial structure.

Although it is a representation of your actual credit behavior, your credit score ultimately takes on a life of its own.  Beginning with your first credit card, car note, or revolving store account, credit reporting agencies monitor your behavior making good on debts and managing money matters.  Successful financial outcomes boost your score, while inconsistencies reduce your strength of credit.  Each circumstance is judged according to its particulars, so it is hard to generalize about the impact of credit mistakes.  Suffice to say, however, it doesn’t take many missteps to undermine your credit strength, resulting in an uphill battle correcting deficiencies.  In addition to responsible use of credit opportunities, adopt these strategies to maintain credit integrity:

  • Always pay on time
  • Utilize various forms of credit
  • Close unused accounts
  • Check your credit score annually

Select the Right Financing for the Job

Various types of financing serve non-commercial borrowers, helping people fund everything from routine daily purchases to major, big-ticket buys.  Matching the correct loan or revolving account to your funding need can save money on the cost of purchases and reinforce your financial foundation.  Using equity financing to carry-off home improvements, for example, is a sensible approach to renovation.  While relying on a high-interest credit card to pay for residential upgrades may not be prudent.

Fortunately it is easier than ever to evaluate lender rates and terms, using online resources to compare and contrast borrowing alternatives.  Your credit history, income and employment status are important considerations when vetting financing alternatives, leading you to the most cost-effective solution for each funding need.

Build a Strong Financial IQ

When it comes to money matters, knowledge is empowering – in more ways than one.  Not only does financial understanding give you peace of mind, ensuring you are making the right moves, but a well-rounded financial IQ can also have a direct impact on your bottom line.  Building and reinforcing financial savvy protects your monetary interests and  whether or not you are mathematically inclined, general accounting principles are important tools for making the most of your financial resources.  Understanding how to balance your budget, for instance, is essential for long-term financial success, resulting in a sustainable flow of cash through your home.  And knowledge of fundamentals such as depreciation, dollar-cost averaging, and APR weigh heavily on your ability to effectively manage money.  For the most consistent financial outcomes possible, use your commitment to financial understanding to make informed decisions, without leaving money on the table.

Your financial security relies on a sturdy base and ongoing discipline managing money matters.  From a high credit score to a strong financial IQ, it is up to you to use all the tools at your disposal, building and preserving a solid financial foundation.

Financial Faculty: An Education In Money

Money. It’s amazing that something which is, in reality, completely fabricated can be so difficult to understand and control. No one finds this task easy. And, no one has mastered the art entirely. But, there are still those out there that are better at managing their money than the rest of us. For the lucky few in this position, money will be on their mind a lot; without having to consciously force themselves to be careful. This sort of attitude isn’t something you are born with, though, it’s something that is learned. To help you out with this, this post will be going through three of the biggest areas of finance. And, the ways that you can start working to take control. This sort of effort will make life much easier for you; so, it’s worth giving it a shot.

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  • Budgeting And Saving

Like any good financial guide; this has to start with budgeting. Without the ability to budget, it’s impossible to make improvements elsewhere. The best way to start something like this is by limiting your spending to the bare essentials. After doing this for several weeks, you will have a good idea of the money you have spare each week. This effort will get you nice and far into proper savings; if you use the money, you have left over correctly. Of course, it is also very helpful to make some actual plans for your budget. Knowing how much you’re allowed to spend each week before the week even starts, is a great way to ensure that you don’t end up in trouble. Nearly no school teaches kids to budget; so, this is something you learn by yourself. But, it’s very much worth it.

With a good budget in place, you should find it nice and easy to start working on your savings. A lot of people think that they have plenty of time to start saving. And, they will put off for a long time. But, with anything like this, it’s always best to start as early as you possibly can. This gives you more time to put money away; giving you the chance to save more during your time in work. Plus, being young doesn’t make you immune to the woes of money troubles. So, to protect your financial future, you should always have savings. Experts recommend that you save at least enough to live for three months out of work. This gives you the chance to get into another role; if you have trouble at work. And, it gives you a good reserve to help you in dire times.

There are loads of services out there to help you with an area like this. In fact, this is one of the biggest areas of finances. There are loads of different mobile apps and other tools which can be used to monitor your money and budget accordingly. This sort of resource can be great while you’re learning the ropes. And, to save, you should be using a dedicated savings account. Bonds will be too far; as you won’t be able to access your money when you want to. So, instead, you need to find the best instant-access account you can. Most banks have more than one. And, they don’t have strict requirements to be able to use them. Have a look at some comparison sites to find the account with the highest return.

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  • Loans And Borrowing

Borrowing money is often seen as a negative way to handle your finances. But, this isn’t always the case. Loans can be a great way to afford something you otherwise couldn’t; as long as you choose the right loan. In most cases, payday and short term loans are best to avoid. They are expensive and hard to settle if you have further money issues. And, they will hammer your credit rating; if you fail to pay them on time. Your credit score is one of the most important aspects of your finances. It’s dictated by your financial history and is usually the deciding factor when it comes to companies giving you a loan or other agreement. Using websites like Experian is a great way to monitor this part of your money. They can give you the advice to make improvements. And, they don’t charge a huge amount for the service. But, this is only one side of the coin. Now, it’s time to get back to borrowing.

Financial experts talk about strategic borrowing all the time. And, it’s something that makes a lot of sense; when you understand it. This practice involves planning your loans to have as little impact on your money as possible. It’s designed to help people get money through loans without having to change their life massively. Of course, though, like anything like this, it takes loads of work to get started. A great example of this can be seen in consolidating loans into one bigger one. By moving loans from here to there, and having them all in one place at the end, you will make them much easier to manage. And, they will be cheaper, too. The same sort of idea can be applied to getting a long-term loan instead of several shorter one; you just have to plan ahead.

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  • Investment, Passive Income, And Career

Now, it’s time to look at how you can make some money; not just how to save or give it away. Investment is one of the best ways to make money, in the modern world. Investment enables you to make extra out of the money you already have; without having to do much more work. For people new to this game, it’s best to start off small. Look into peer-lending and share options which will make you some decent money in a short time; but, have a decent amount of risk. Then, consider some longer options, like government bonds, too. This will give you a good range of choices. So, now, you just have to think about what would be best for you. To get some extra help here, it could be worth talking to a professional investment advisor. These people have loads of experience in this field and can help you make the most of your money.

But, what are the benefits of investing? You have to put in an awful lot of work into something like this. But, when you think about the results; it’s worth it. Over time, your investments will grow and start to generate a decent amount of passive income for you. When you’ve got enough invested; this could cover things like your mortgage or rent each month. And, this is a great benefit. Along with the income benefits, you also benefit from having money saved by inaccessible. This means that you have assets and wealth; but, you can’t waste in on a whim. This gives you the security of a savings account, with the financial gains of a low hours job.

Of course, you can’t just think about the money you make passively, though. You also have to consider the money that you make through your work. As you work on your career, you should always be aiming to make your future brighter. This means that you should never stay in a job for more than a few years without making any progression. It’s essential that you climb the ladder as early as you can. Otherwise, it will be hard for you to find another job which can get you somewhere. Of course, one of the best ways to skip this step is by starting your own business. But, this will be hard in itself.

Hopefully, this will give you a good idea of what needs to be done; if you want to start working harder on your finances. Most people don’t bother with this sort of effort. And, most people haven’t been taught how to handle it. But, it’s easy to make sure that you’re handling your money well. It just takes some work.

Important Steps In Getting Your Loan Approved

Getting approved for a loan certainly isn’t the easiest process in the world. With Brexit pushing the future of the nation’s economy into uncertainty, lenders are less strict than they were during the recession of the noughties, but more strict than they have been in the past. Bottom line: it’s still very important to present a great package if you want your loan to be approved. Here are some important steps to getting your loan approved…

Review your Personal Preferences

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Before you head straight to your bank and start asking questions, spend some time researching the market, and seeing what your alternatives are. This is an essential step to ensuring you can get your hands on some of the best offers on the market. This means thinking about the type of loan you’re looking for, the terms that you can reasonably afford, and how you’re going to pay off the loan in the shortest period of time possible. When you’re looking for a specific type of loan, such as a personal loan, auto loan, or a mortgage, scouring the market and avoiding impulsively jumping at any of the offers that arrive in your email inbox, is absolutely essential to coming out on top.

Know your Limits

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When you’re pursuing a loan, it’s important to be aware of your current credit score and your history. All good lenders will tell you the bracket of credit scores required for approval for a certain loan. You can prepare in advance by requesting a copy of your credit and history a few weeks prior to your actual application. Start reviewing your history for accuracy, and make sure you have enough time for correcting any kind of errors in your history. These days, lenders put a lot of emphasis on how you’ve used credit in the past. If there are any mistakes left in your report, you may wind up with a much lower score, which can obviously hurt your chances of being approved. Always consider your personal finances when you’re planning to pursue a loan, and target deals based on your limits, and realistic ability to make repayments which you can comfortably afford.

Manage your Expectations

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We’ve said it once and we’ll say it again: rushing through the process of applying for a loan is never a good idea. Loan officers have very strict protocol to follow when they’re approving loans and getting the money to applicants. Through the entire process, you should be discussing the sequence of your events so that you’ll know what to expect moving forward. While some loans can be pre-approved right out of the gate, you may not know all the specifics until a number of weeks have passed. Ask the experts when it comes to following up. Your overarching goal should be securing a loan that you definitely have the means to repay. Getting turned down for loans can be frustrating, but it’s important to understand your situation thoroughly and manage your expectations, and not to ruin your credit by applying for loan after loan.