3 Smart Ways To Payoff Debt In Less Than One Year

There’s no denying the fact the in today’s tough economy many are in debt. However many are also looking for ways to combat this debt and pay it off any which way they’re able to. Even though looming debt can seem to be something unmanageable, it can be quite manageable when a plan of action is put into place and the right tools are used. Let’s take a look below at three methods you can use to pay off debt in less than one years time.

1. Create An Action Plan

One of the first things you might want to consider doing is to create an action plan to get your goals going in the right direction. If you wish to payoff your car note and need about $5,000 to do so, then you need to do some math and calculate how much and how long it would take to pay off in less than a year. Once you figure out what it would require, then you can set an action plan to start the payoff process. This could be saving $200 a week for X number of weeks till you reach the goal. Or it could simply mean knowing ahead of time what the amounts and days look like to reach the end result.

2. Start A Debt Fund

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How are Minimum Credit Card Payments Calculated

So you have a few credit cards and you work to pay the bills diligently every month, even though sometimes money gets tight, but do you really know what you’re paying? Often as consumers, we get complacent just paying bills as they come in without actually thinking about what this money is really covering. So how does the credit card company calculate how you pay them back?

In some cases, the minimum payment required each month is calculated by taking a small percentage of the total debt owed on your credit card. Typically this is between 2% and 5%, and you can usually find the calculation value listed on your credit card statement. In other cases, the credit card company uses a formula that takes 1% of your total debt plus the interest accrued for that month.

The real trouble for consumers with either of these payment calculation options is they maximize the amount of time you stay in debt. This means you take longer to pay your debts back. In turn, this gives your debt more time to build interest with each month that passes. Considering the APR on your credit card is probably higher than 15%, your credit cards (Read More….)

Is There Really Such A Thing As ‘Good Debt?’

Hearing experts such as CNN Money, Forbes, and Fox Business talk about good and bad debt as it relates to different types of loans can get confusing. After all, isn’t all debt bad for your overall financial health? Trying to determine what types of debt you should and shouldn’t have can be daunting, so consider these three factors when making your decision.

Interest and Fees

When you borrow money to pay for anything, you must consider both the principal balance you are borrowing and the interest you will accumulate. Lenders, such as banks and credit card companies, don’t give away money for free; they expect to make a profit off of the loan they give to you. Interest rates vary from lender to lender, so it’s important to understand how your rate will affect your repayment.

Student loans and mortgages typically have low interest rates. Since the rates are low and therefore more affordable, experts tend to classify these as good debts. On the other hand, credit cards have notoriously high interest rates and are labeled as bad debt. Interest on credit card (Read More….)

Debt Management Program

The latest recession has taught many people some hard truths about credit and finance. With those hard truths came tough realities, such as dealing with financial burden. When the burden becomes too big to handle, there are some steps you can take to regain your footing and take the financial bull by its horns. One of the steps you can take is debt consolidation, which simplifies your finances and therefore makes it easier to manage.

Debt consolidation is the process of combining multiple bills and loans into one bulk payment per month. There are generally four options and methods for consolidating debt: refinance of debt, personal loan debt consolidation, debt settlement, and consolidation through a debt management program.

Refinance of Debt

Sometimes referred to as debt restructuring, refinance of debt is the process of changing the terms and conditions of a debt obligation. Usually, the goal of debt through refinance is to take advantage of better interest rates, reduce monthly payment sums, and reduce risk.

In these economic times refinance of debt is the most difficult (Read More….)

3 Tips for Getting Out of Debt

Most people have some amount of debt, but if your debt is consuming a serious part of your monthly budget, you’ve probably tried to come up with a plan to pay down your outstanding balances. If you’re ready to climb out of debt, here are three tips to help you get started.

1. Get professional help from a local accountant.

If you live in New York, look for a NY CPA (Certified Public Accountant) who can help you develop a budget and start paying down your most serious debts. An accountant will provide essential help if you have a relatively complex budget and can also help you prepare for taxes and reduce your outstanding balances as quickly as possible.

2. For credit card debt, try to cut your interest rates.

You can often do this by simply calling your credit card company and asking for a lower rate or by taking out a low-interest loan and paying off your debt with the loan. Many credit card companies also have special programs to help you start paying down debt, so check to see (Read More….)