5 Ways to Avoid Debt

Most people consider debt a normal part of life. It is a quick means to an end. It allows for instant gratification. In many ways you get a big pay-off for a seemingly small amount (monthly payments). In fact we have been so conditioned that many people balk at the ideas that will keep them from carrying debt their entire working lives. Here are five tips for avoiding debt. 1) Begin planning now. It sounds simple, but it is a very effective way to avoid debt. Most “emergencies” can be planned for now, so that you can avoid going into … Continue reading →

How Much Debt Is Too Much Debt?

Many people wonder how much debt is too much debt. It is truly a matter of perception. Banks will begin to consider you risky if you monthly debt minimum payments take up more than thirty six percent of your income. This would include your mortgage payment (or if you are renting your rent). The banks like you to stay within this amount, but is it truly in your best interest? At some point if you continue to borrow money, you will reach a point where it becomes extremely difficult for you to meet your monthly obligations. At this point you … Continue reading →

Is Debt Consolidation a Good Idea?

Debt consolidation companies are a big business. Many are non-profit organizations that will help you pay off your debt. They will negotiate with your creditors to bring down the amount that you owe them. They will take a monthly payment from you and distribute it to all of your creditors. This will mean that you may save money over time, you will pay just one company, and eventually your debt will be paid off. This sounds like the perfect solution to many people. However, debt consolidation does have definite drawbacks. It does not look particularly good on your credit report … Continue reading →

Five Ways to Stay Motivated to Get Out of Debt

Once you have formed a debt repayment plan, and begin working on it you will begin to see results. As you payoff your smaller debts a feeling of relief will wash over you. If you have a large amount of debt or debts of a larger size it may take you longer to fill the relief. It may also be difficult to stay motivated for the long haul. Here are five easy ways to stay motivated. 1) The best way is to create a chart of some kind in which you can mark off how much debt you have paid … Continue reading →

How to Set Up a Debt Reduction Plan

There comes a point when people realize that they just have too much debt. This stage hits different people in different ways at different times. It truly depends on how comfortable someone is with having debt in the first place. I know people who charge up one card, and then go and quickly apply for a new card. The day the new card comes they are out shopping and putting more money on it. I know people who would not dream of using credit cards in that manner, but always buy expensive new cars. I know others that do not … Continue reading →

Is Debt a Means to an End?

In many people’s mind debt is a means to an end. It is the way that you can get something you want now, instead of waiting until later. There is debt that is truly unavoidable (such as emergency medical expenses) and debt that is more acceptable than other debt (such as a mortgage). But generally debt is something that can hold you back. It can limit the choices that you make in the future. It can keep you from taking risks and opportunities, because you have obligations that you need to meet. I have personally seen families struggle under piles … Continue reading →

You Should Never Go in Debt for . . .

Debt can easily become a way of life. There are so many things that people want immediately, that could wait until they can afford it. It is difficult at times to balance your wants and your needs. Here is a list of five items that you should not go into debt for. Most of these items are purchased on credit cards, which tend to have high interest rates. 1) You should not go into debt for vacations. A vacation is a luxury. Many people tend to spend more on their vacations when paying with the credit card, instead of paying … Continue reading →

Can Debt Be Acceptable?

For many people debt is just part of life. Sometimes it seems that it is something that can not be avoided. There are times in your life when you may need to go into debt to purchase or pay for something, but you should limit these items to just a few. Debt can quickly take over your life and start a vicious cycle. Here are five items, which are more acceptable debt. If it is not on the list, don’t go into debt for it. 1) You will likely need to go into debt to buy a home. This is … Continue reading →

Five Tips for Working with Creditors

Many of us have had bills we can’t pay. Whether it’s the doctor’s office, the hospital, a bank or a utility company, a few techniques can help you communicate with your creditors and negotiate an arrangement that will work for both of you. Be proactive. Creditors are pleased when someone who owes them money takes the initiative to contact them to work out arrangements. This tells them that you’re responsible and conscientious and that you care about paying your debts. You are the type of person they can trust and they are likely to want to work with you. Find … Continue reading →

Five Common Mistakes People Make When Dealing with Creditors

One of the most unpleasant parts of finance is dealing with creditors, particularly those we cannot afford to pay. Here are five of the most common mistakes people make. If you can avoid them, your negotiation and conversation is likely to go much more smoothly. Avoiding the creditor. Although it’s natural to want to avoid people to whom we owe money we cannot pay, this is a mistake. Refusing to talk to creditors, whether it’s refusing to answer the phone, claiming that you have moved, or sending a creditor with a legitimate claim a cease and desist order, backs creditors … Continue reading →