Creating A Budget and Staying Out of Debt

How to Live Within Your Means to Stay Debt Free

Debt reduction is a long drawn and effort intensive process. With several thousand Americans struggling with massive debt, the realization that it is best not to fall into the debt trap, has perhaps come a bit late. Often, huge debts are incurred because you do not have enough savings to meet unexpected expenses such as medical emergencies.

At other times, overspending using credit cards or on loans is the cause of excessive debt. When you control and structure your spending so that every dollar is spent on worthwhile expenses, it is easier to avoid incurring such debts. Here are some ideas that you can use to live life within your means and still enjoy it.

Keep track of your spending

One of the biggest mistakes that debt ridden people made is that they never realize their spending far exceeded what they were earning by way of salary, income from investments etc. Make a simple income expense sheet to tell you exactly how much money is coming in each month and how much you are spending.

This monthly statement helps you take stock of your finances and spending habits. If your spending is way beyond your income then chances are you are already well on your way to accumulating unmanageable debts.
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Managing Your Finances for a Debt Free College Education

Managing finances when you are in college can go a long way in ensuring that you graduate with no debts. You can manage your college finances with relative ease if you are willing to spend money wisely and save money when you can. Here are a few tips that you can use for effective money management in college.

Create a Plan for Expenses
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How to Avoid the Debt Trap

Post recession, many Americans found themselves barely keeping their heads above overwhelming debt they had incurred through various ways.

The most common way of incurring unmanageable debt was through excessive use of credit cards. But this is, by no means, the only danger area. There are many ways in which you can let yourself become exposed to a debt trap. Here are a few tips on staying clear of debt:

Build an emergency fund

Many people, who are otherwise conservative spenders, end up with enormous debt when emergencies catch them completely unprepared. It might be a home repair or a medical emergency that forces you to take a loan.

No matter what the underlying cause, when the emergency is upon you, you do not have the time or the clarity of thought to search for competitively priced loans. You simply opt for the easiest to get, fastest to process or simplest to understand loan. Unfortunately, it is these loans that are often also the worst.
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Cutting Down on Expenses to Get Rid of Debt

If your world has come crashing down and creditors are after your life, remember there is always a way out of every problem. If you are debt-ridden, you can still pay it all off with some planning and personal sacrifices. You got yourself into this financial mess and you can get yourself out of it as well. You simply have to be judicious with your money during this period. A drastic cut down on expenses will help you save enough money to pay at least a part of the money you owe.
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How to Recover From a Large Amount of Debt or Bankruptcy

No matter how carefully you have planned your finances, you may still face a situation where you have to take a debt to meet an urgent need. But getting out of debt is not an easy task, especially if it’s a large debt like a mortgage. An unpaid debt weighs down on the borrower’s mind and keeps him or her from freely spending money even on expenses that are perfectly reasonable. But this may not be a bad thing after all. [Read more…]

Reward Yourself for Reaching Debt Repayment Milestones

It’s never easy coping with debt, especially when your income is not sufficient for timely repayments unless you compromise on some expenses, turning the entire thing into a vicious cycle. It takes some determination to keep from getting side-tracked into over expenditure and focusing on resolving your debt issues. [Read more…]

Discuss Your Debt Situation with Your Partner to Avoid Marital Disaster

The basis of any marriage is the trust that both partners place in each other. A breach of this trust, when one partner has failed to disclose his or her debts, will at best cause marital discord and at worst end in an ugly divorce. To ensure that your poor financial management skills or faulty judgment do not cost you your marriage, complete honesty with your spouse is critical. [Read more…]

The Difference Between Good Debt and Bad Debt

Debts are a part of every individual’s life. Every body takes debt, whether it is short term or long term. But it is important to strike a financial balance – our expenses and debts should always measure up against our income. To understand which debts are ok and which should be handled with care, you need to know the difference between a good debt and a bad debt. [Read more…]

How to Stay Out of Debt When You are Unemployed

How do you weather the loss of a job and keep yourself going till you get a new one? It may seem very difficult, but if you have prepared for the worst and if you deal with the problem methodically, then you can pass the period of crisis without getting a huge debt burden. [Read more…]

Bad Economy Equals Layoff’s So Be Prepared

Companies had to cut down on their staff strength during the economic recession, because of which many Americans faced layoff during this period. The recession is now over and the employment market is picking up. But it is still advisable that you keep yourself prepared for the possibility of a layoff if your company is not doing too well. You do not want to be caught off guard if you are suddenly fired from your job. [Read more…]

Making Up for Loss Income Due to the Economy

Hard times have hit upon everyone since the financial crisis. If you have suffered the severe setback of losing a steady income, you need to take stock of your financial position and look for ways to get out of your problems.

You are probably wondering how you are going to meet your credit card and mortgage payments till you find a new job or another source of income. You may have savings but they will only suffice for a year at the most. The cost of living remains more or less the same and the prices of many products have even risen. You need a plan to manage your money and safely get past these expenses. [Read more…]

How to Ensure a Comfortable Post-Retirement Life

People are often unable to retire as early as they had planned. Either they do not have enough money in their retirement fund or they have debts piled up, and they have to keep working to get rid of them. To be able to retire early, you have to carefully plan your finances and maintain a strict control on your expenses. [Read more…]

How to Manage Credit Card Debt as You Get Older

The retirement years if not planned for, can be accompanied with unwanted financial troubles. A lot of senior citizens find themselves under huge credit card debt burden which takes a huge toll on their pensions and depletes their savings. Besides, with old age comes the additional burden of health care costs such as that for doctor’s visits, medications, and other related expenses. Handling all this along with your credit card debt would be nothing less than a nightmare. [Read more…]

Prioritizing Your Financial Goals for Wealth Building

I consider prioritizing financial goals and money allocation as the most important part of financial planning. People are often faced with questions of whether to repay debt, save or invest money. If you have to choose between these goals, then your current financial situation should be your best guide [Read more…]

How Rising Interest Rates Can Impact You

Interest rates have slowly started picking up and this will have a huge impact on your personal finances. It will increase the costs of your debt while giving you better returns on your savings.

During the economic recession, the Fed pumped in money into the economy. It kept the banks that were struggling because of high risk mortgage loans afloat by giving huge loans. It also made purchases of mortgage backed securities and kept the money supply in the economy at a high level. The economy seems to be on the road towards recovery and most of the banks were saved. [Read more…]

Repaying Your Debt vs. Building Your Savings

I have talked about the importance of having a budget and clearly defining the goals for which you are reducing your expenses. You will be able to save money by following a budget, but you will have many ways to use the extra money. Two of the most common ways to use that money is to build your savings or to repay your debt. But which one is a better option? [Read more…]

When to Opt for a Voluntary Foreclosure

Earlier people used to do everything to save their house from being foreclosed by the banks. But with the recent collapse of the housing market, a lot has changed. Many people who had bought homes without paying any deposit of their own ended up having no equity in their house and their financial situation just keeps getting worse. In many such situations, people are left with no option, but to foreclose their house. [Read more…]

How to Prepare for Getting Laid Off

Most companies had cut down their staff drastically during the economic recession. Some of my friends, and millions of other Americans, learn the hard way that being fired is a nightmare that can come true without warning.

It is even worse when you have not planned for the possibility of being fired and are caught off guard, as losing your job can easily lead to a financial disaster. The good news is that by following some simple tips, you can minimize the negative financial impact of a layoff, and start afresh. [Read more…]

Getting Help from Parents for Paying Off Debt

Financial experts often criticize the tendency of parents to pay debts of their adult children. But there is nothing wrong in giving financial support to children as long as it is done in a proper manner so that they can get a fresh start but do not become dependent on parents. [Read more…]

Manage Your Credit Cards Better and Avoid Unnecessary Debt

As a result of the recent recession, credit card delinquency rates in the United States are at an all time high. d.

So how do you go about getting a grip on your finances to ensure that you overcome these difficult times without accruing a lot of debt on your credit cards? [Read more…]

Credit Card Companies Offering Deals to Distressed Credit Card Holders

The credit card companies can offer bargain deals to distressed credit cardholders whose balance on the card has spiraled out of control and they can not afford to pay back the debt. And in today’s difficult times, these companies are more willing than ever to do whatever they can to settle the debts. [Read more…]

How to Increase Your Net Worth

Keeping track of your finances can help you make sound decisions in financial matters. A fair assessment of your position is critical to achieve savings or repayment goals because it will tell you how much extra funds you can afford to put into these areas. [Read more…]

Should You Trust a Company Offering to Settle Your Debt?

These days several companies claim that they can reduce the amount of money you owe if you avail their services. These debt settlement agencies are flourishing because of the desperate situation of many borrowers, precipitated by the poor economic conditions. [Read more…]

How to Get Yourself Out of Debt

If you’ve lost your job in the recent economic turmoil or lost money in the stock market, or if the price of your new house has collapsed, you could be looking for a way to get yourself out of debt. It is easy to feel worried and disheartened, but that is exactly what you should not do in this situation. Keep a clear mind and try to find a way out. Here are some things that you should try. [Read more…]

The Basics of Debt and How to Identify a Bad from Good Debt

Every person takes debt in his life whenever he acquires an asset or takes the benefit of a service without immediately paying for it in return. When viewed in this perspective, it becomes apparent that debts cannot be avoided completely. However, understanding debt can go a long way in ensuring that you take up more of good debts than bad. [Read more…]

How to Quickly Reduce Your Credit Card Debt

Holiday season tends to add a lot of debt on the credit card for most people. Now that things will be beginning to settle down after all your new purchases, it is time to think about how you would be paying those debts off. Credit card debts are not cheap, and it is very important to pay them off as soon as possible. Here is some advice on how you can reduce your credit card burden. [Read more…]

Will Greece be The Next Fallen Economy?

While investors are finding some solace and showing a modicum of approval in Greece´s plans to cut spending and raise taxes in order to meet their debt payments. The same investors are greedily licking their chops wondering who will be the next to fall victim to mismanagement and future debt default. [Read more…]

Low Interest Debt Consolidation

What is a low interest debt consolidation? This is a kind of loan that has a technique of putting medical bills, owing credit card debt, small bills and loans under the same roof. As an alternative to making imbursements to various creditors, the low interest debt consolidation loan involves having just one payment. This makes the family finances simpler, decreases the amount of payment monthly and assists in minimizing the risk of acquiring charges for delayed payment. [Read more…]

The Causes of Credit Card Debt

The leading cause of debt problems for most people is credit cards. There are a lot of advantages to having credit cards but you do have to be able to use them properly. If you don’t use your credit cards in a responsible manner you will likely find yourself with serious debt problems. It is important that you understand credit cards and how to use them properly. [Read more…]

Bad Credit Debt Consolidation Loans

If you are currently bankrupt or suffering from your bad credit history, your salvation may just be the bad credit debt consolidation loans. Through these loans, you may be able to restore your financial status which has been greatly affected by the drastic changes in the economy and certain financial difficulties. [Read more…]

Mortgage Loans and Debt Problems

Existing debts become more pinching when there is no more debt available in the market to reverse older repayments. This becomes a problem for everyone, involved in raising loans after loans. But usually a time comes, when it becomes necessary for a person to stop and think about repaying the loans that already exist instead of going for a fresh one. Mortgage loans can inflict difficult times for borrowers. [Read more…]

Debt Consolidation Loans

There are many different types of debt consolidation loans that may be of interest depending on your situation. The majority of debt consolidation loans takes a bunch of smaller unsecured loans and combines them into a bigger secured loan. The more collateral you are able to put up, the better the interest rate you receive will be. Therefore, you pay less interest over the term of the loan. [Read more…]