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 U.S. citizens currently have more than $2.4 trillion dollars in debt. If you’re in that number, you have to tread carefully if you want to be sure you’re making the moves that decrease your debt instead of making it go up. Here are some debt mistakes you should be sure to avoid.
Making minimum payments or take your time paying it off. There’s one universal truth about debt and that’s that minimum payment are very expensive and time-consuming. Sticking to the minimum means you’ll pay a tremendous amount of interest and pay your debt off over the longest period of time.
Add to it before you pay it off. Perhaps what’s worse than paying the minimum on your debt is increasing it faster than you’re paying it off, even if you are paying extra on all your accounts. Avoid adding more debt on top of what you’re already dealing with. Pay off some of your existing debt before you take on any additional large expenses.
Being in denial about how much debt you have. A head-in-the-sand approach to your debt doesn’t mean your debt doesn’t exist and your debt (Read More....)
 Debt is a liability best avoided. Purchasing items with cash protects you from that liability. However, this isn’t always possible and financing is available for such cases.
Before taking on a new debt consider the following questions: Is this something you need but simply cannot afford to pay for outright? Will the purchase appreciate in value? Can all of the monthly expenses related to the purchase be paid comfortably? There are a few instances where the answer to those questions can be yes.
Mortgage
Finding a great deal on a house is far easier today than it was before the real estate bubble burst. However, paying for a house outright just isn’t feasible for many people. Fortunately, houses increase in value, and financing a prudent amount can be a wise investment versus paying rent.
A large down payment is always favorable when purchasing a home. Twenty percent or more down payment gets rid of the need for private mortgage insurance, or PMI, which protects the bank in case you stop making payments. Consider (Read More....)
People don't do things because they “should” do them. People do things because they “want” to do them. For a lot of people getting out of debt is a “should.” What is it going to take to make you “want” to get out of debt?
One thing that you lose when you are in debt is privacy. Most creditors don't allow you to take on debt without agreeing to some very harsh terms regarding a lot of your personal privacy. Once you are in debt you are obligated to reveal information to creditors. Here are several of things you risk when you go into debt and, some things you will get back once you are out of debt.
1. Identity Theft
Social Security Numbers are one of the most sensitive pieces of personal information that you have. The more you share it with creditors, the more often your own personal information is going to be stored in their databases.
Unfortunately, databases are hacked, employees accidentally release information and scammers can trick people into revealing information. The more often your (Read More....)
 Would Getting the Economy On Track Give Us A Free Pass Out of the Federal Budget Mess?
By Scott Bittle and Jean Johnson, Authors of Where Does the Money Go? Rev Ed: Your Guided Tour to the Federal Budget Crisis
It looks like the country might finally be gearing up to tackle our massive federal deficits and growing federal debt. If history is any guide, serious debate about unpleasant things like cutting popular programs and raising taxes will be accompanied by plenty of people hawking miracle cures that will take away our pain.So it's no surprise that a lot of commentators, on both the left and the right, say that the real answer to the deficit and national debt is to fire up the economy and "grow our way out of it," with some even calling economic growth "the miracle deficit cure."
There's hardly anything more popular than prosperity. Business people thrive when the economy is growing; it creates jobs and rising incomes so workers like it too. If you're a comic book fan, even super-villains like Lex Luthor and the Penguin enjoy the benefits. (Read More....)
Gold is flat and silver marginally lower despite dollar weakness this morning. Some market participants are blaming the precious metal sell off on speculation that China may take more monetary action to curb surging inflation. This is unlikely to be the reason for the sharp selloff, rather it looks like another paper driven sell off in the futures market by leveraged players on Wall Street with various motives.
The fact that silver is again in backwardation at the front end of the curve suggests that tightness in the physical bullion market continues and may even be deepening. Indeed, the massive increase in silver bullion demand from China (confirmed overnight - see below) suggests that silver’s bull market remains very much intact despite becoming overvalued in the short term towards the end of 2010.
Table Courtesy of Mitsui
Surging inflation in China, India, wider Asia and much of the world is of course positive for gold and silver as it will likely lead to an even greater appetite for the precious metals in order to protect against the ravages of inflation and the further depreciation of (Read More....)
 Getting out of debt - a 'how-to' guide
More and more people I know are falling into debt. Some of them have been able to clear their debts and get on with their lives, while others have struggled to repay what they owe and are still finding it difficult to get on top of their finances.
So, from my own experience, and from watching how my friends have done it, I have decided to put together this short guide about how you can get out of debt.
This three-point guide isn't guaranteed to get you out of debt, but it should certainly help improve your financial situation.
Create a realistic budget
The first thing you should aim to do is create a realistic budget. I must stress the word 'realistic' here - because if your budget isn't realistic, you will find that you won't have enough money to cover the cost of your expenses. Click here for latest debt news and advice.
I'll give you an example here… my friend created her budget by writing down absolutely everything she earns and spends each month. She then (Read More....)
 Today we have a guest post from a reader named Martha that I think you all are really going to enjoy. She has some very interesting insights into debt settlement....
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Debt Settlement: How to negotiate with creditors or collection agencies for debt settlement
Debt Settlement is the process of reduction in your debt amount. In the process of Debt Settlement the creditor reduces the debt amount to a certain limit and in return the debtor agrees to clear off the entire debt in a lump sum payment. Debt Settlement is also known as Credit Settlement and Debt Negotiation. The process of Debt Settlement does not arise till the consumer continues to pay off his amount regularly. It arises only when the consumer stops paying his installment regularly and the debt gets on accumulating.
The process of Debt (Read More....)
 For millions of Americans who want to get out of debt, the smooth advertisements of the "debt settlement" companies are a little too hard to resist. They promise to settle your debt for pennies on the dollar. They promise to get you out from under credit card bills that you can’t pay. But do they get the job done?
Well, for the most part, no.
The U.S. Government Accountability Office recently announced that an extensive investigation found rampant fraud, abuse and misrepresentation in the debt settlement industry.
The following is a quote from a GAO report to a Senate committee about what the investigation discovered....
While we determined that some companies gave (Read More....)
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