free debt management tips Archives - Page 3 of 10

Free Debt Management Tips: Six Bills You Could Easily Get Cut

March 27, 2017 debtmanagement

If you think your bills are fixed and can’t be cut, you have another think coming. According to the bill negotiating service, BillShark, we consumers could save as much as $50 billion a year just by haggling over certain bills. Cell phones are where you can currently get the best deals, as the cell phone companies are currently engaged in a price war. The founder of BuildFixers, Ben Kurland, has noted that if your cell plan is more than six months old, this might not be the most efficient plan for you.
If you think your bill fixed and can’t because you have another think coming according to the building associating service bills we consumers could save as much as 50 billion a year just by handling over certain bills cell phone bills are where the biggest savings can currently be found as a cell phone companies are engaged in a price war. Billfixers founder, Ben Kurland, has noted that if your cell phone plan is more than six months old, it may not be your most efficient plan.

Six other bills you could get cut in without working out much of a sweat are:

Pay television

Of course, when we say pay television, we basically mean cable TV. If you have more than one cable company in your area, you can probably get a better deal simply by changing providers. We have two cable TV companies where we live, and they are currently slugging it out to attract new customers. If you have only one cable TV provider where you live, consider cutting the cable entirely. You should be able to get all your local channels with an indoor HDTV antenna. Then, there’s Netflix, Hulu, and Amazon Prime for catching up on old programs and for movies.

Alarm systems

If you have an alarm system in your home, it’s almost certain you can cut your bill. If you have a long-term contract, try haggling with your provider. If you can’t get a better deal, Vivant Home Alarm is currently offering free installation and says it charges less than two dollars a day. You could do even better with SimpliSafe. It uses a fast cellular connection, so you can monitor your home 24 hours a day no matter where you are. SimpliSafe also includes 24/7 professional monitoring and police dispatch, and costs just $14.99 a month – with no contract.

Storage units

If you have a lot of stuff in a storage unit, you may not want to consider moving it to a new unit just to save money. But if you haven’t yet rented a unit, there’s a website, SelfStorage.com, where you can find the best storage units close to you at the best prices. The site allows you to view and compare storage options nearest to you, and without the hassle of calling around for prices. When you find one, you can then book the unit free in just a few minutes – either online or on the phone.

Gym membership

Want to get in shape on the cheap? Joining a gym can get expensive. In fact, one source says belonging to a gym costs an average of $58 a month. You can beat this by using free passes. Some health clubs offer free one-day passes, while others have week-long passes, or even two week passes. If you work for a large employer, it probably offers some kind of workplace wellness program, which would be like a gym membership except for free. And some cities have discount gyms that cost as little as $10 a month.

Satellite radio

Since there’s only one satellite radio provider, SiriusXM, you can’t comparison shop. However, you can save money with SiriusXM. It doesn’t talk about this much but it actually offers three pricing tiers. The first is titled Mostly Music, and offers 80 channels of great music. It’s priced at just $10.95 a month. While this tier does not include online streaming, you could add it for just $4 a month. The next tier is called the Select Package, which costs $14.99 a month and includes more than 150 channels of sports, music, and comedy – though you cannot add Internet streaming to this plan. Finally, there is the top tier, All Access that provides all of the 160+ channels, as well as online streaming from your tablet, phone or computer.

The Internet

You may be able to get a better deal from your current Internet provider just by threatening to switch to a different company. It’s also possible to save money by reducing your usage. Think about how you use the Internet. If it’s just for general web surfing, email and social media, you only need a speed of 1 Mbps (megabyte per second). But if you’re an online gamer, you’ll need 1-3 Mbps, and if you’re into high-definition video streaming (think HDTV movies), you’ll need 5-8 Mbps.

In summary

Write a list of all your bills. Then, ask yourself how many you might be able to cut. We’re willing to bet you’ll find more than just the six mentioned here. The fact is, it only takes a little time and effort to get a lost of your bills reduced.

3 Important Tips for Managing Credit Card Debt

March 7, 2017 debtmanagement

Of all possible debts, the worst by far is credit card debt.

The reason it’s so bad is because it’s what’s called variable debt. Other debts like a mortgage or auto loan are fixed debts. They have one payment a month and a fixed term, so you’d know exactly when you’ll have the debt paid off. For example, auto loans typically have terms of five, six, or seven years. Personal loans typically have a term of three or five years.

That old demon called compounding

Fixed debts also have fixed interest rates. As an example of this, the interest rate on a personal loan can be as low as 5.99%, though most come with higher rates. The interest rates on a 30-year mortgage are still near all-time lows. In addition, the interest on these loans is built into their monthly payments. When you make your last payment on one of these loans, that’s it. You owe nothing more.

Unfortunately, it’s different with credit card debts. While they do have fixed interest rates, your debts are compounded each month. Let’s suppose you owe $1000 on a credit card at 15% interest. At the end of the first month, when interest charges are applied, your balance will then be $1013, and so on. It gets even worse if you owe $5000 on a credit card with an APR of 16%. If this is the case and you make just the minimum payment of $125 a month, it would take you 4.8 years to pay off your balance and would cost you $2000 in interest.

Tip #1: Avoid credit card debt

The best thing you can do with credit card debt is avoid it like Ebola. If you have more than one credit card, choose the one with the lowest interest rate, and then freeze the rest in a block of ice. That way you won’t be tempted to use them. You can use the remaining one, but never charge more than you can pay off when you get your statement. This offers two benefits. The first is the obvious, which is that you won’t be running up debt. The second is if you use that credit card sensibly, you’ll have a record of your spending that you could use in budgeting.

Tip #2: Negotiate with your credit card providers

If you’ve run up a serious amount of debt on several credit cards, contact your card issuers and negotiate with them. One of the upsides of credit card debt is that it’s unsecured debt. Almost all unsecured debts can be negotiated, and credit card debts are no exception.

Four things can usually be negotiated with credit card companies. The first is your interest rates. If you have credit card debt at 19%, you might be able to negotiate it down to, say, 13%, which would mean lower monthly payments. The second thing that can usually be negotiated is to have your payments waived for a few months. This would give you time to get your balances under control or to catch up on your payments.

Third, you could negotiate to have your credit card debt converted into a fixed, monthly loan. While you wouldn’t be able to use the card anymore, you’d at least know what your monthly payment will be each month, and when you will have the debt completely paid off.

The fourth thing that you might be able to negotiate is your balance. This is the hardest by far because you need to be experiencing a serious financial emergency to get the credit card company to agree. This could be that you’ve lost your job, just went through a divorce where you were stuck with almost all the debt, or were hit with huge medical bills. And you may be required to provide documentation that proves your emergency.

Tip #3: Settle your debts

A secret that credit card companies would rather you didn’t know is It’s possible to negotiate settlements. Let’s suppose you owe that $5000 we mentioned earlier. You could contact the credit card issuer and offer to make a lump sum payment of maybe $1500 to settle the debt. Your offer probably won’t be accepted but with a little back-and-forth you might be able to settle it for $2500. Of course, you would need to have the money available to immediately send the credit card company.

In summary

If you’re struggling with credit card debt to the point where you’re several months behind, take heart. You do have alternatives that could help you better manage or even pay it off in a reasonable amount of time. The important thing is to choose a strategy and start contacting your credit card companies.

5 Amazingly Simple Tips for Debt Management

February 27, 2017 debtmanagement

Being seriously in debt is just no fun. It can keep you lying awake nights wondering what you’ll do about it. Debt can even have a bad effect on your health, as the stress related to it can cause fibro myalgia, a spastic colon, arthritis, high blood pressure, and even heart disease.

Fortunately, there are tips for managing those debts, and to ultimately get them paid off. And these tips are amazingly simple.

1. Make a plan

This is something you might dread, but making a plan to pay off your debts is absolutely critical. You wouldn’t start tearing your engine apart without a plan for repairing it and the same is true of your debts. The easiest way to organize them is with a spreadsheet such as Microsoft Excel or the free Google Sheets. Be sure to list all your debts with the names of your creditors, your balances owed, and the interest rates.

There are two popular ways to pay off debts. The first is called the avalanche method. It’s where you order your debts with the one with the highest interest rate at the top down to the one with the lowest interest rate. You then focus on paying off the debt at the top of your list as this will save you the most money. The second pay off plan is called the snowball method. Instead, of organizing your debts with the one with the highest interest rate at the top, you organize them so that the one at the top is the debt that has the lowest balance. If you focus all of your attention on paying if off, you should get it repaid fairly quickly, which will give you momentum to pay off the debt with the second lowest balance, and so on.

2. Consolidate your debts

A second good tip is to consolidate your debts. You can do this several ways, depending on the type of debt. Is most of your debt credit card debts? You could consolidate them by transferring all their balances to a new card with a lower interest rate, or better, yet one of those 0% interest balance transfer cards. You would then have only one payment to make a month, which should be much easier to remember. Plus, those monthly payments will be lower than the total of the monthly payments you’re currently making.

Is your problem student loan debts? In this case, you have two alternatives. The first would be to get a federal Direct Consolidation Loan. The interest rate on this loan would be based on the weighted average of the interest rates on the loans you’re consolidating, and then rounded up to the nearest one-eighth of 1%. So, your new payment should be for a good deal less than your current payments.

Second, you might be able to get a private debt consolidation loan. Interest rates on loans such as this are now at practically an all-time low. In addition, there are a number of online lenders, where you should be able to find a pretty good deal.

3. Get counseling

Just as, if you were having serious marital problems you might go to a marriage counselor, you could go to a debt counselor for help — in the form of a nonprofit consumer credit counseling agency.

When you contact one of these agencies, you’ll be assigned a debt counselor that will review your finances and either suggest a budget designed to help you get your debts under control or what’s called a debt management plan (DMP). This is another way to consolidate your debts because if you accept the plan, you won’t be required to pay your creditors anymore. Instead, you’ll make one affordable payment a month to the credit counseling agency, which will then disburse the money to your lenders. It typically takes from four to five years to complete a DMP, but at the end you’d be basically debt-free, and you’ll have good credit.

4. Learn to negotiate

One of the things lenders don’t want you to know is that almost any unsecured debt can be negotiated. If you’re wondering what are unsecured debts, they are the ones where you weren’t required to provide any collateral. Medical debts, credit card debts, department store credit card debts, and old cell phone bills are typical of unsecured debts that can be negotiated. A good rule of thumb is to never pay one of these debts without first trying to negotiate a settlement.

The way this works is about the same as with any negotiation. You contact one of your lenders, and offer to make a lump sum payment, for say, 40% of your balance. The lender will probably refuse this offer, but will likely make a counter offer, and you then go back and forth until you arrive at a number that’s acceptable to both of you. Of course, you must have the money available to make that lump sum payment.

5. Use the nuclear option

Bankruptcy is often called the nuclear option because it essentially blows up your credit. But it is a way to get out from under most of your unsecured debts. However, bankruptcy can’t free you from secured debts like auto loans and your mortgage. It also won’t discharge alimony, child support, family support, and student loan debts. But if your biggest problem is your unsecured debts, then filing for bankruptcy would definitely get you a fresh start.

6 Important Tips for Dealing with Debt Collectors

February 20, 2017 debtmanagement

Most debt collectors are probably great husbands or wives, are good to their children, volunteer for good causes, and are nice all-around people – when they’re not at work.

Unfortunately, once these people go to work, all that niceness often vanishes. Debt collectors are almost always paid on a commission basis – or a percentage of whatever they can collect. This is serious motivation for them to say and do whatever is necessary to get you to pay up. In fact, if you’re contacted by a debt collector, the best way to think of it as if a German Shepherd has gotten ahold of your leg and won’t let go.

Of course, it’s easy to get that German Shepherd let go. All you need to do is pay the debt collector whatever he demands. And in some cases that might actually be your best option. But In most cases, it won’t be. So, you need to know these six good tips for dealing with a debt collector, especially if he comes becomes abusive.

1. Learn your rights

A few years ago, our Congress passed the Fair Debt Collection Practices Act (FDCPA). It spells out very specifically what debt collectors can and can’t do. If you’re being harassed by a debt collector, you need to know your rights. For example, debt collectors cannot contact you before 8 AM or after 9 PM at night. They also cannot contact you at work unless you’ve given them your permission. They can’t contact family members to discuss your debt, and theoretically, they can’t be abusive. Go to this site, to learn about your rights when it comes to debt collectors, so that you can stand up for yourself.

2. Make sure it’s really your debt

If you’ve never made a mistake in your life, you must be some kind of a Saint. And debt collection agencies are no Saints. When you’re first contacted by a collector, be sure to get the debt verified. The debt collector has 30 days to do this. If it turns out it’s not your debt, don’t dillydally. Get it fixed. A debt collector can put negative information on your credit reports that will stay there for seven years. This can affect your ability to get an auto loan, a mortgage, other loans or cheaper insurance.

3. Protect your bank accounts

If you refuse to pay a debt collection agency, it could sue you, and ask the court to freeze your checking or savings accounts. As you can imagine, this would have a very severe effect on your family finances. What experts advise is to create separate accounts for things such as disability checks or Social Security checks, as these are exempt and cannot be used for debt payments that have been court ordered. In fact, you should probably let a debt collector know if you have a bank account that contains only exempt funds.

4. Get a consumer lawyer

If you are served with a notice that a collection agency has sued you, be sure to get an attorney that specializes in consumer law. This is critically important because if the agency gets a judgment against you, it could garnish your wages. For example, a good attorney could find that the statute of limitations on your debt has expired, and that you’re no longer liable for it. If you can’t afford an attorney, at least show up in court because if you don’t, the creditor wins.

5. Record your conversations

If the collector makes threats or uses abusive you language then you need to record your conversations to document it. Some states won’t allow you to record a conversation unless you have the other party’s permission. You will need to check it out to see if this is true where you live. But if it’s allowed, record your conversations. In fact, it could be a good idea to tell the debt collector you’re recording the call even if you’re not. He’s less likely to be abusive if he thinks you are.

6. Get any agreement in writing

Don’t send in any payments until the agreement you’ve made with the debt collector is in writing and signed by a representative of the collection agency. As part of the agreement, you should also try to get the collector to agree to report your debt as “settled for full amount due,” or similar wording. If not, it will be reported as “settled for less than full amount due”settlement,” or something comparable and this will have a very negative effect on your credit and your credit score.

11 Incredibly Simple Things You Could do to Get Out of Debt

February 13, 2017 debtmanagement

How would it feel to be debt-free? We’re guessing you’d feel pretty darn good. There’d be no more the stress of dealing with creditors, no more trying to remember which payments to make on what day of the month, and most important, your entire paycheck would be yours – no more sharing it with your creditors.

If you’ve been trying to pay off your debts, you may have already done the big stuff like selling your house and downsizing, or getting rid of that travel trailer. But have you forgotten some of the small, simple things you could do to become debt free? Or maybe you’re stuck. You have a few ideas but just can’t get those creative juices flowing.

Well, take heart. Here are 11 almost ridiculously simple things you could do to get out of debt.

1. Begin couponing

If you have a favorite supermarket, be sure to sign up for its emails. You’ll then get a steady stream of money-saving coupons, some of which will actually be for stuff you buy on a regular basis. There are also sites like coupons.com, dailycoupon.com, retailmenot.com, zulily.com, and shopathome.com, where you can download printable coupons. Then, build your meals around them.

2. Cut that cable

If it feels like your cable bill just gets bigger every year, that’s not your imagination. America’s cable companies just keep increasing their fees. Technology has gotten to the point where there’s just no reason to subscribe to cable anymore. You could get an antenna for less than $50 that will get you all your local stations – free. Add a couple of subscriptions like Netflix, and Amazon Prime Video, and you should be able to should get all the programming your heart desires and for less than $25 a month.

3. Quit eating out

How often does your family eat out? Let us say you eat out just twice a week, and that you spend $40 on a meal. That’s $320 a month. Eat in those two days you’ve been eating out and that’s $320 a month you could use towards debt reduction.

4. Learn to love the word “no”

When it comes to saving money there’s just no word more powerful than the word “no” when it comes to your money. It’s one you need to learn to love. Make it a critical part of your vocabulary. Embrace it. It’s a word you’ll be saying very often when it comes to your spending. No matter how much you want that new blouse or that new billfold, just say “no.” Ditto 23that new fishing rod or smart phone.

5. Avoid expensive hobbies

Do you have an expensive hobby like golf? That can easily cost you $200 a month. Do you collect expensive football or baseball cards or antique greeting cards? Then, stop playing golf, or sell all those cards. Use the money to either pay down debt or to help fund your kids’ college education.

6. Sell a car

Is yours a two-car family? Maybe it doesn’t really need to be. If the payment on one of those cars is the US average of $400 a month, then sell it and bank the $400, which is really $4600 a year. We’re pretty sure that putting $400 a month towards paying off your debts would get you debt free a lot faster.

7. Freeze your credit cards

Yes, we really mean it. Freeze all your credit cards in a block of ice except for maybe one with a low limit and keep it available for an emergency. Some experts say you should shred your cards, but we prefer the block of ice method as your cards would still be there to use when you get debt-free.

8. Sell stuff

If your family is typical you have a bunch of stuff sitting in your garage, attic, or basement that’s just gathering dust. Put it on eBay or Craigslist and sell it. You might be surprised at how much you get for stuff you think of as just one step above junk. Or, even better, if you have a skill for making things, put it to use by making stuff and selling it online.

9. Merge your bank accounts

If you’re married, do you and your spouse have separate bank accounts? Merge them. There’s no reason the two of you shouldn’t be able to share one account. You’ll save money, and it will simplify your household accounting.

10. Use your local library

Do you remember libraries? They’re places where you can get books free, which is a lot cheaper than buying from Amazon.com. If your library system is like ours, you might even be able to check out, and download e-books, and then read them on your tablet.

11. Don’t invest

We understand this is a shocking one. But once you become debt free, don’t invest your new-found money in the market. Start putting 15% of your gross income into a retirement plan, instead. That could be a 401(k) if your employer offers one, or if not, a traditional or Roth IRA. Then, invest that money in something safe and sound like an index fund.