Tuesday, October 27, 2009
Dave Ramsey Debunks Some Debt Myths!
Best selling author and radio talk show host Dave Ramsey tackles the debt myths.
Thursday, October 22, 2009
The Fastest Way To Pay Off Debt
There's some debate among financial planners as to the best way to pay down debt. Some say paying the highest interest rate debt first is the best way; others say paying the smallest balance first is the best way.
Both methods have advantages and disadvantages, so we'll take a look at both, and help you decide which method is best for you.
Method #1 - Highest Interest Rate
In this method, you focus on paying off your highest interest rate debts first. The basic steps in this method include:
1. List all debts in order from the highest interest rate to the lowest interest rate.
2. Commit to paying the minimum payment on every debt.
3. Determine how much extra can be applied to the highest interest rate debt.
4. Pay the minimum amount plus the extra amount towards the debt with the highest interest rate until it is paid off.
5. When that debt is paid off, apply the amount you were paying to the debt that is paid off to the next highest interest rate debt until paid off.
6. Repeat until all debts are paid in full.
This method is the best method mathematically, as you will pay less interest in the long run.
Method #2 - Lowest Balance
In this method, your focus is on the debt with the lowest balance. Note: this method was made popular by Dave Ramsey and is often called the Debt Snowball method.
The basic steps in this method include:
1. List all debts in order from the smallest balance to the largest balance.
2. Commit to paying the minimum payment on every debt.
3. Determine how much extra can be applied to the smallest balance debt.
4. Pay the minimum amount plus the extra amount towards the debt with the smallest balance until it is paid off.
5. When that debt is paid off, apply the amount you were paying to the debt that is paid off to the next smallest balance debt until paid off.
6. Repeat until all debts are paid in full.
This method may not be the best method mathematically, as you will pay more interest in the long run. However, this method allows you to pay smaller debts off faster, which may give you the motivation you need to stick to your debt payment plan.
So, which method is best for you? It depends…
Method #1 is best for you if:
* You have debts with similar balances
* You have discipline to stick to your debt repayment plan
* You are a numbers person, and you realize the benefit of paying off the highest interest rate debt first
Method #2 may be best for you if:
* Your debts do not have similar balances - i.e., you have a $500 credit card balance, a $12,000 credit card balance, and several in between
* You need motivation - paying off the smallest credit card balance may be the motivation you need to stick to your debt repayment plan
* You don't mind paying more interest over the long run in exchange for getting rid of smaller balances first
Tip: Why not use a combination of the two methods? Using a combination of both methods allows you to feel a sense of accomplishment by paying off that first debt (the smallest balance credit card), and gives you the motivation to start working on the next debt (the debt with the highest interest rate).
Remember, the method that works best for you is the one you will actually use. The most important thing is to make a plan and stick to it so you can live debt free.
Both methods have advantages and disadvantages, so we'll take a look at both, and help you decide which method is best for you.
Method #1 - Highest Interest Rate
In this method, you focus on paying off your highest interest rate debts first. The basic steps in this method include:
1. List all debts in order from the highest interest rate to the lowest interest rate.
2. Commit to paying the minimum payment on every debt.
3. Determine how much extra can be applied to the highest interest rate debt.
4. Pay the minimum amount plus the extra amount towards the debt with the highest interest rate until it is paid off.
5. When that debt is paid off, apply the amount you were paying to the debt that is paid off to the next highest interest rate debt until paid off.
6. Repeat until all debts are paid in full.
This method is the best method mathematically, as you will pay less interest in the long run.
Method #2 - Lowest Balance
In this method, your focus is on the debt with the lowest balance. Note: this method was made popular by Dave Ramsey and is often called the Debt Snowball method.
The basic steps in this method include:
1. List all debts in order from the smallest balance to the largest balance.
2. Commit to paying the minimum payment on every debt.
3. Determine how much extra can be applied to the smallest balance debt.
4. Pay the minimum amount plus the extra amount towards the debt with the smallest balance until it is paid off.
5. When that debt is paid off, apply the amount you were paying to the debt that is paid off to the next smallest balance debt until paid off.
6. Repeat until all debts are paid in full.
This method may not be the best method mathematically, as you will pay more interest in the long run. However, this method allows you to pay smaller debts off faster, which may give you the motivation you need to stick to your debt payment plan.
So, which method is best for you? It depends…
Method #1 is best for you if:
* You have debts with similar balances
* You have discipline to stick to your debt repayment plan
* You are a numbers person, and you realize the benefit of paying off the highest interest rate debt first
Method #2 may be best for you if:
* Your debts do not have similar balances - i.e., you have a $500 credit card balance, a $12,000 credit card balance, and several in between
* You need motivation - paying off the smallest credit card balance may be the motivation you need to stick to your debt repayment plan
* You don't mind paying more interest over the long run in exchange for getting rid of smaller balances first
Tip: Why not use a combination of the two methods? Using a combination of both methods allows you to feel a sense of accomplishment by paying off that first debt (the smallest balance credit card), and gives you the motivation to start working on the next debt (the debt with the highest interest rate).
Remember, the method that works best for you is the one you will actually use. The most important thing is to make a plan and stick to it so you can live debt free.
Article Source: http://www.wbdoyle.com/blog/
The Big Secret Of 0 Apr Credit Cards: Debt Reduction
The Big Secret Of 0# Apr Credit Cards:
Americans have fallen into the debt trap to an extent that our grandparents could never have imagined. We have to have everything, and we have to have it now. As a consequence, many of us are drowning in credit card debt. Here is a possible solution.
The days of low prime rates are over now, and 0 APR credit cards are harder to find. Not impossible, though. Many companies still offer 0 APR credit cards for limited period only so that they can attract new customers. This initial period of up to 12 months can save you buckets of money if you have high interest credit cards.
This is how to you can handle it: First, transfer your balance from your high interest credit card to your new one. This will lower your monthly payments and save you money every month. Second, don’t go shopping yet. Rather, take these savings and pay down the balance on your credit card. Now you’re paying principal instead of interest. Do this for the entire initial period and you’ll be surprised at how much you can pay off your balance.
Third, don’t use your new credit card to spend more money, because when the higher interest rate becomes applicable you could end up with an even higher balance that you had before. Once the 0 APR period ends, you can take advantage of the extra money provided by lower payments, right? Maybe. Since you’ve gotten so used to high credit card payments, why not delay your gratification a step further and continue to make payments at the same amount, thereby paying off the debt faster? In this way your new credit card can be used to motivate you to eliminate your long-term credit card debt. Note that your 0 APR credit card should never be used to spend more – only to lower your debt. Once the higher interest rate kicks in, your new line of credit is a useless to you as your old one was.
What debt management offers you is freedom – after all, which would you rather have, peace of mind, or more stuff that you probably don’t need anyway?
The days of low prime rates are over now, and 0 APR credit cards are harder to find. Not impossible, though. Many companies still offer 0 APR credit cards for limited period only so that they can attract new customers. This initial period of up to 12 months can save you buckets of money if you have high interest credit cards.
This is how to you can handle it: First, transfer your balance from your high interest credit card to your new one. This will lower your monthly payments and save you money every month. Second, don’t go shopping yet. Rather, take these savings and pay down the balance on your credit card. Now you’re paying principal instead of interest. Do this for the entire initial period and you’ll be surprised at how much you can pay off your balance.
Third, don’t use your new credit card to spend more money, because when the higher interest rate becomes applicable you could end up with an even higher balance that you had before. Once the 0 APR period ends, you can take advantage of the extra money provided by lower payments, right? Maybe. Since you’ve gotten so used to high credit card payments, why not delay your gratification a step further and continue to make payments at the same amount, thereby paying off the debt faster? In this way your new credit card can be used to motivate you to eliminate your long-term credit card debt. Note that your 0 APR credit card should never be used to spend more – only to lower your debt. Once the higher interest rate kicks in, your new line of credit is a useless to you as your old one was.
What debt management offers you is freedom – after all, which would you rather have, peace of mind, or more stuff that you probably don’t need anyway?
About the Author: Retired US Navy. Married 20+ years. Home Inchon, Korea. Work Seoul, Korea. http://www.wbdoyle.com/blog/
Wednesday, October 7, 2009
What does it mean to purchase structured settlements?
When a massive sum of money is stretched out over many of months, or years, there can be some tax rewards, and it does verify the receiver of future income. By requiring a large lump sum of money all at once, the individual who receives it gets a large amount of revenue all at one time, with nothing set aside for the future disbursements. Individuals who are damaged and have circulating medical expenses will need a tidy sum of money for their future care, and a structured settlement is good for that purpose.
Sometimes, all the same, the receiver has a good reasonableness for wanting a significant amount of cash instantly, instead of the smaller amounts over time. They might want to go to college, or buy a house, or take another good understanding for taking some, or all, of their settlement money up front. This is a good time to consult the companions who purchase structured settlements. On That Point there is a fee charged, from around 10 to 30 percent of the money gained, and the transaction is similar to realizing a payday advance, except for a lot more money, and the refunds go straight to the company that bought out your settlement.
It is attainable to have them buy just a piece of your settlement, so you get a lump sum of money now, and whatever remains would go on as before, but in a lesser amount of money. You would still get some future income, but not as much. When resolving to sell a settlement, it may be required to acquire courtroom approval. That is one manner that the legal system acts on your behalf, to be sure you are practicing this for a good reason, because the structured payment system was resolved upon for a soundly understanding also.
Require the time to study several companies who b>purchase structured settlements. before you take action. Often times, smaller competitors extend stronger rates and terms than the essential names like Peachtree and JG Wentworth.ee and JG Wentworth.
3 Mistakes to Avoid When You Sell a Structured Insurance Settlement
Many people receiving payments from structured insurance settlements often wish they could get their money in a lump sum amount instead of receiving payments for what seems like forever. However, most do not realize that is a very real option for someone that wants to break free from the periodic payments of a structured settlement. If someone is really interested in selling a structured settlement for a lump sum of cash, there are a few common mistakes they should avoid.
Mistake #1 Being too Hasty
Being in a hurry is often a bad idea when it comes to financial dealings. It is when we are rushed to complete something that we do not read the fine print and practice our due diligence in a business transaction. The same is true when selling a structured insurance settlement. Do not let the promise of a big check cause you to make rash decisions that are not necessarily in your best interest. In this process, it is better to take your time, research various companies, and choose wisely before you get caught up with a company that does not have your best interest at heart.
Mistake #2 Wasting the Money from the Sale
Mistake #2 Wasting the Money from the Sale
Structured insurance settlements are designed to save people from themselves. They are meant to keep people from frivolously spending all of their money and being left with nothing. Show financial responsibility when making decisions with your newfound wealth.
Mistake #3 ? Not Educating Yourself
You do not have to know every detail of the process of selling a structured settlement; however, if you have no knowledge, you are likely to be taken for a ride. You have heard the saying, knowledge is power? - this is true in many realms of life, including selling an insurance settlement. Take the time to know what you are talking about to be sure to get the best deal possible.
Source: http://www.articlealley.com/article_1058755_19.html
Monday, October 5, 2009
Is Debt Consolidation A Good Idea?
Most debt consolidation companies do nothing better than simply ruin your fico score in order to settle your debt. If you really want to work with an agency that will help you reduce your debt, contact a company member of "CONSUMER CREDIT COUNSELING SERVICES" (CCCS)!
Friday, October 2, 2009
Budgeting your credit card spending!
Although acquiring a credit card is much easier than adhering to a budget, planning your credit card expenses is esential to help prevent dire consequences from credit card utilization. This may stem from the fact that a credit card is by no means a mobile automated teller machine. It is however a means to get you out of an emergency situation such as a car breakdown, or for travel convenience. The following budgeting tips will provide you with great insights on wise credit card usage.
Spend within your capability!
With or without a credit card, one should always spend only what they can afford. In fact, you should spend like you don’t have a credit card because at the end of the day, you will have to pay back what you charged. It is true that you should never use your credit card to settle your grocery bills or to quelch your shopping needs. With all the discounts and bargains clamoring for your attention, it can be annoying to know that you will be paying more for it because of credit card interest rates.
What are some debt warning signs to look for?
Have a good concept of the Credit Limit!
Rather than viewing the credit limit as the amount of money you can use every month, think of it as a loan that you must repay within 30 days. Then, tabulate the amount of interest that you have to pay if you decide to settle your repayment over a period of six months. This way, the $7500 will look less tempting and when calls with offers of higher credit limit plans come in, you will have the good sense to put the phone down.
Financial Contributor Vera Gibbons speaks with Maggie Rodriguez about secret credit card company rate hikes:
Do not let your credit accumulate!
You need to be responsible to own a credit card but as luck would have it, there are emergencies that are unavoidable. In this case, you should settle your credit card bills as soon as possible. You have to be self-disciplined on this because credit accumulates and credit cards work on compound interests. The longer you delay your repayment, the more you have to pay.
A credit counselor discusses what debt settlement is and how it can help or hurt you:
Remember to controll your spending now, invest wisely and reap the benefits later at a time when you really need your money.
Some parts of this article were republished with permission from here: http://www.articlealley.com/article_1086464_81.html#
This article is free for republishing.
Tuesday, September 8, 2009
Obama's Government Grants Program Provides Relief from Your Debt!
Author: Lindsy Emery
Every so often, it seems like all things go wrong at once. You need a new tire, the washer breaks down, your son breaks his arm and your wife has her hours cut at work. When these things happen, sometimes the only alternative that we think we have is to pull out the plastic and begin charging our way through the problems. However, this method doesn't work for too long because soon the cards have reached their limit and we are fighting to make the minimum monthly payments. If this is a situation you find yourself in, then perhaps it is time for you to get debt relief through government grants.
Believe it or not, each year there are literally billions of dollars given to government agencies to provide grants for qualified individuals and families. Unfortunately, not many people know about these grants and the money is never awarded. Grants can be handed out to those who meet certain requirements and sometimes, people receive their money in as little as seven days.
The trick is knowing where to look and knowing how to apply. Begin by entering the search phrase: government grants for debt relief in your computer. The search engine should return many searchable databases. Once you find a database that you like, you can narrow your search. Most grants are open to U.S. citizens over the age of 18.
Don't let a bit of bad luck ruin your financial life. Take the time to see if there is a government grant perfect for you. You will be glad you took the step.
Believe it or not, each year there are literally billions of dollars given to government agencies to provide grants for qualified individuals and families. Unfortunately, not many people know about these grants and the money is never awarded. Grants can be handed out to those who meet certain requirements and sometimes, people receive their money in as little as seven days.
The trick is knowing where to look and knowing how to apply. Begin by entering the search phrase: government grants for debt relief in your computer. The search engine should return many searchable databases. Once you find a database that you like, you can narrow your search. Most grants are open to U.S. citizens over the age of 18.
Don't let a bit of bad luck ruin your financial life. Take the time to see if there is a government grant perfect for you. You will be glad you took the step.
Obama's Government Grants Program Provides Relief from Your Debt
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