December 15, 2015
The statisticians may tell us that the recession has been over for three or four years and that incomes have returned to pre-crisis levels. But for millions of people in the UK, the reality is that times are still hard and money short.
The good news, however, is that while you may have had a difficult year financially during 2015, there is no reason why you can’t make a New Year’s resolution to get your finances back on track in 2016. The situation is rarely hopeless, particularly if you are in work or have some other regular income. Even if you have large unsecured debts, there is usually a way for you to start reducing them and increase your disposable income at the same time.
If you want to tackle your financial issues in the year ahead, then you’re going to need some discipline and some determination to change the way that you may have behaved over the last few years. Getting your finances back on track may not be easy but it is probably simpler than you think:
1. Stop beating yourself up
This is a prerequisite if you want to reduce your anxiety levels and make a start on tackling whatever financial problems you may currently be facing. It’s human nature to keep going over past mistakes and blaming oneself for silly decisions but what is done is done and now is the time to drop the blame and start concentrating on the future. Learn to accept what has happened and move on, concentrating instead on implementing positive steps to improve your financial outlook.
2. Make a financial inventory
Do you actually know how much you owe banks, mortgage companies and other financial organisations? It’s important to have a grasp of your total liabilities so that you can put in place long-term plans to repay this debt entirely. That means making an inventory of everything you owe – both secured and unsecured – as well as the remaining loan terms and the interest rates which you are being charged on each loan and credit card.
3. Prioritise credit with higher interest rates
If you’re going to make inroads into your debts in 2016 and relieve the pressure you’re under, then you should start increasing the amounts you repay on the mortgages, loans and credit cards that charge the higher amounts of interest. This is the only way that you’ll be able to increase the speed that you reduce your total amount of debts.
4. Make a list of everything you spend for a month
If you’ve got Excel or other spreadsheet software and know how to use it, then this is a brilliant tool for doing this important task. Make sure you list all of your income and all of your expenditures. Don’t be tempted to miss out things like coffees from the coffee shop or the odd treat – you need to be completely honest with yourself about where your money is going before you progress onto the next step.
5. Make a household budget
Once you’ve worked out everything you spend for a month, you’ll be in a good position to set a household budget. Using your spreadsheet program, list all outgoings (with the fixed ones at the top) and all of your income. Let the software work out totals (if you know how) and then calculate whether you should have money left over or if you are spending more than you earn. If it’s the latter, look at the non-essentials on your list and consider what to cut. Think about your food budget – could this be reduced either by using a cheaper supermarket or by cutting out some of the items which might be considered luxuries? The household budget will make it much easier to see where you can save money and divert that into reducing your household debt.
6. Consider consolidating debt
If the amount you’re paying in interest, fees and other charges is overwhelming you, you might want to make 2016 the year when you consolidate all those cards and other loans into a single, monthly repayments. Plenty of companies beyond the high street banks offer consolidation loans and the amount of interest you’ll pay may be surprisingly lower than you’re currently used to. The amounts on offer go all the way up to £25,000 for unsecured loans and even higher if you consider secured lending.
7. When you’ve paid off a card, close it
If you’ve got unused credit available, there is always going to be the temptation to start buying things that you probably can’t afford. The easiest way to stop yourself doing this is to close card accounts when you have paid off the outstanding balance. Always leave yourself one to cover financial emergencies but get rid of the rest and use the money you are saving to pay off further debt.
8. Debt repayment is a snowball – learn how to use it
When a snowball rolls downhill, it not only gathers speed but it grows larger and larger as it picks up more snow. Debt repayment is exactly the same if you are disciplined about it. When you start paying back debt, you reduce the amount of interest that you’re paying and so release money to pay off even more debt and so on. If you hit the loans and cards with the highest interest rates first, you’ll be tackling the biggest source of your financial worries and releasing more and more money to pay off other debts more quickly.
Article provided by Mike James, an independent content writer in the financial sector – working with a selection of companies including Solution Loans, a technology-led finance broker with many years experience – who were consulted over the information contained in this piece.
, Credit Card Debts
, Debt Problems
, financial planning
, personal finance
October 18, 2015
If you are worrying about the huge debt you have incurred, its time you take some professional help. There are many debt counselors who listen to your problem, enquire about your lifestyle, and come to a conclusion about your financial status.It is then that theyadvice you to take necessary steps to counter your debt. In this article, we are going to discuss how debt consolidation loans and their types.
Why do people become indebted?
In this era of consumerism, everyone is exposed to the tricks of marketing strategies. It does not matter whether you are a business owner or a service holder. Our needs and expectations have compelled us to live a life based on credit. You have everything you want, but you also have to pay a monthly amount to the credit providers.
Mentioned below are some of the things that generally push people into a credit mongering spot.
- Monthly groceries
- Cell phone bills
- Car expenses
- Petrol or diesel
- Household tools
Over-indebtedness is quite a common occurrence in the US society. There are numerous people like you who reach a position when they cannot pay off their debts anymore.
What do you understand by debt consolidation?
The procedure of simplifying repayment of debt and saving you money is called debt consolidation. It involves taking a new loan at a lower interest rate for paying off smaller debts.
When can you opt for debt consolidation loan?
As a layman, you might not consider debt consolidation to be a useful way to pay off other loans. However, given the situation that you are being repeatedly being harassed by numerous creditors, you can opt for credit consolidation. It is the most effective and the finest solution under such circumstances.
Payment notifications convert into harassment when credit providers hire external agents to recover your debts. If you thing that your debt has reached out of your grasp and people are harassing you unnecessarily, you can opt for debt review. The debt counselor will enquire into your expenses.If he or she realizes that you are overburdened with debt and are being harassed unnecessarily, he or she will suggest you to consolidate your debts.
What are the different types of debt consolidation loans?
# Personal Loans
This is the most common loan suggested by debt consolidators to those who do not own a home. The rate of interest on this type of loan depends on credit score. It is a useful way to displace your existing debt; provided the debt counselor plans its utilization properly.
# Home Loans
If you have a home, you can opt for a home loan because it comes with low rate of interest.
# Secured Loans
If you are encountering bad credit, the counselor can also suggest you to get secured loan because of its reduced interest rates. The loan type gets its name from the practice of attaching a security to the loan amount. You have to attach an asset as security for being eligible for this loan. The asset lowers the interest rate on the loan. The financial institution also finds itself in a secured position in case you cannot repay this debt. The mortgaged asset should be high value things like, your house, car, plot of land in your name, etc. Your motive should be to return the loan amount to the financial institution. Otherwise, your assets will be repossessed.
With a huge debt and multiple creditors you cannot lead a stress-free life. But, if you consolidate the debt, you can pay off all creditors. Debt consolidation is very effective as you don’t have to worry about the creditors and the process is quite fast.
, Debt Burden
, Debt Settlement
, personal finance
, Savings Plan
October 17, 2015
You may be at a stage of commencement of your graduation degree, but possessing a huge burden of student loan in your head. With unemployment rates increasing day by day, students’ loan are getting tough for repayment. Now, here are few methods through which students can get out of the debt burden situation.
Student Mindset: A recent study shows that, individuals between the age of 18 and 34 are very careless about their spending habits. They admit on their own that they are unnecessary spending on items that are really not required by them. As college students mostly stay on a limited budget, after their graduation, they can easily maintain the same lifestyle by controlling themselves properly. They can manage their working lifestyles by staying with roommates by sharing apartments, old cars can be kept for longer period of time, and expenditure can be controlled on eating out or shopping. If you get into an expensive lifestyle just after you finish your graduation, it will be very difficult to manage your spending habits.
Retirement Accounts: Make sure that you are contributing sufficient amount in your retirement accounts when you have started a new job. Roth IRA can be a good choice for you to save your money for retirement as well as not get debt burdened. The sum of money which is being accumulated in your retirement account can be withdrawn at any point of time, in case of emergency. These amounts always remain penalty or tax free if you withdraw them at any point of time.
Create and Stay within Budget: Creating a budget helps you to maintain your lifestyle just within your means. You must include savings for meeting your short term goals like purchasing a home or spending a vacation. According to debt review, you must not forget your long term goals like retirement. You can track your expenses through offline records or by online tracking sites or mobile apps.
Take Care of Your Credit: You must keep a thorough watch with your credits. You should make sure that you are repaying your loan within the scheduled time. If you want a good credit score, try to close your credit cards which are not very necessary. This will surely decrease your credit history and will improve your score.
Prioritize Higher Interest Rates: Try to keep a priority list of repaying your interests and higher interests must be paid at first. When an individual joins a job, he might be possessing student loans at first but gradually his loans may increase. Now, you must know how to prioritize the repayments by paying off your loans one by one starting with higher interest ones.
Loan Repayment Options: Students can repay loans with various options either directly to the Federal Government or through some guarantors. Loans can also be decreased with some income based repayment. With some extended repayment plans, you can extend your repayment for a period of about 25 years but in this case you must have an outstanding amount of $30k or more. This plan holds suitable for situations where your income is unstable or low.
Never Default: Try not to default your repayments in whatever case it may be. If you miss any single repayment, it can hurt your credit very badly. The Government can easily confiscate your tax refunds, if you default any repayment.
Learn properly the ways to protect your tax refunds by defending yourself from lawsuits. If students can adopt skills for managing their money properly, they will surely come out of their debt burden very easily. They must learn to control their financial situation by their own so that they do not face tough times in future.
, Debt Problems
, personal finance
, Students Loan
October 15, 2015
Making a commitment to improve your financial situation involves increasing financial awareness, proper planning and controlling debt. Credit card debt can be a stressful situation to deal with and paying down your debts as soon as you can is a critical financial goal.
If you need to get back on track with your bills and reducing debt, you need to have a plan. Credit card bills need to be paid off every month, preferably in full. You have to establish how the balances will be paid down and fully paid off eventually.
Being strategic will help to preserve your credit and prevent the impact of high balances. Proper planning will enable you to deal with financial emergencies because you will be able to cover any unexpected costs that may arise.
Saving is another essential financial goal because it enables you to set aside funds and afford purchases without landing in debt. Debt is a habit that is relatively easy to form and there are various lifestyle adjustments that you can make to avoid it. Such changes will make it easier for you to stick to your budget and fulfill your financial responsibilities each month.
Income and Expenses
If your expenses exceed your income, you need to figure out how you can earn an extra income to accommodate your lifestyle. If increasing your income is a challenge, it is advisable to cut down on your spending until you do. The only viable ways to ensure that you do not spend more than your earnings is by getting a higher income or reducing your spending. For more about debt review, visit here.
In order for you to be able to handle your money more efficiently, you need to develop a positive attitude. With the right attitude, you will be able to make better financial decisions. Spare some time on a regular basis to evaluate your budget and find out which areas need improvement.
Regardless of how small a debt may be, paying it off is an accomplishment and takes you a step further towards financial relief. One of the best ways to celebrate such accomplishments is by setting up a savings account where you can direct any extra money that you have. As your personal finances improve, you can look forward to being debt free and having access to more money.
An emergency fund will enable you to be self reliant as opposed to depending on credit cards whenever an unexpected financial situation arises. Save a percentage of your earnings and create your own emergency fund. Several households continue to deal with debt as they take on more loans and credit card debt to cover their costs.
Situations such as lack of income and medical bills can cause people to go into debt. If you are in debt, there are various options worth considering. You can find your way back to financial control when you plan, work hard and remain persistent. When your finances are back in order, make an effort to keep them stable and avoid debt.
, Credit Card Bills
, Debt Problems
, financial planning
, personal finance
October 12, 2015
Home loan India is the perfect option for those who want to get a place of their own and do not have the necessary funds to pay the entire amount. For people who have a decent monthly income, this can be really easy however for those who have a fluctuating income it can be a real challenge at times.
The different factors for the housing loan evaluation
To evaluate the kind of housing loan a person is eligible for, there are a few factors that play a vital role. They are
The individual’s job and field- There are certain fields that are not permitted to get a loan due to the nature of the way the field operates. This is called Negative professions. This is one of the main reasons why financial institutions need to know the field that the person work’s in.
Property location – Knowing where the property is located is also another important factor. Just like how there are black listed professions; there are also blacklisted areas as well as limits that are set.
Personal history of the person – This helps the loan company to know how the house operates as well as the number of earning members that are there in the family. This also helps them to know if the person has any other loans taken out elsewhere and help them to determine the creditability of the person’s ability to pay back.
Required documentation to take out a home loan India
Income Proof – Be it a single borrower or a joint one, the income proof is used to make the necessary evaluation and decide how much loan can be given to a person as well as the monthly repayment.
Personal identification Proof – This includes the person’s driving licence / their voter ID/ Pan Card/ Aadhaar card/ passport etc
Resident Proof – If it is a second home, then the person can submit the present address proof which can be in the form of the electricity bill / passport/ receipts towards the property tax paid etc. In the case of the first ownership, then a letter can be taken directly from the builder if it is a new or ongoing project or after the registration is completed.
Business Proof- This is applicable for those who own a business and want to go ahead and apply for a loan.
Experience Proof – Some banks require a letter from the place of employment where they have the experience of a certain amount of time at the present company.
Age Proof – Different banks have different age criteria’s to give different kinds of loans as well as the tenure and amount of the loan.
Property documents – This would include all the various documents such as the sale deed, registration deed, NOC (society or builder), Occupation Certificate etc.
Buying a house requires a lot of finance which has to be paid either in full or in installments depending on the kind of property you choose, home loan India gives you a financial backup to live your dream.
, financial planning
, Home Finance
, Home Loan