Negotiate Your Credit Card Debt in Five Easy Ways

Credit card debt is one of the top reasons consumers seek debt relief. American consumers have $102 trillion in credit card debt, according to the Federal Reserve Bank. As much we all want to pay our debts on time, hardships like divorce, medical bills and job loss happen. But that doesn’t mean the banks and credit card companies are going to forgive the debt. If you have trouble paying your credit card debt, you will have to reach out to them. Here are five easy ways you can negotiate your credit card debt.
Steps to Get Rid of Credit Card Debt

Talk to your credit card company.

This is both the easiest and hardest step to take. It is easier to avoid the debt—that’s why debt collectors have such a hard job. But you will have a better chance at negotiating your credit card debt if you call them before they or a third-party debt collector calls you. You may not get a friendly voice on the other end so don’t be afraid to haggle if you are not getting what you want.  The next steps involve how to reduce or erase your credit card debt.

Negotiate a lump sum payoff.

If you are having financial trouble, you may not have access to a lump sum of money. But if you can erase a lot of money off of your credit card debt, think about asking a friend or relative to borrow the money. But don’t pay the full amount with interest. The point of paying it off with a lump sum is to pay a lower amount. Negotiate until you get a good deal from the company.

Ask for a hardship or structured payment plan.

With this plan, your credit card company will freeze the debt while it negotiates a plan with you. You may get the interest rates lowered, too. Be sure to ask the credit card company if any annual fee can be waived, too.  Many credit card companies have a hardship plan and will work with customers with a positive payment history. This is a good option if you think you will get back on your feet in the near future. This plan may not work for you if your financial problems are long-term.

Workout another payment arrangement long-term.

Ask the credit card company if they will reduce the monthly payments and interest so that you can afford the bill. The downside is you will no longer be able to use the card’s credit limit (if it is not maxed out already). This is often called a “workout” arrangement because it will allow you to work your way out of the payment. You will have to stick to the arrangement you make or in many cases, the credit card company will be able to revert back to the original terms of the card. Make sure you read the fine print.

Talk to a debt relief specialist.

Sometimes the credit card companies won’t negotiate with you. But you still have options. Debt relief specialists can negotiate on your behalf to have your credit card debt erased or reduced. Be prepared to present all of your financial records and not just the credit card debt so that the debt relief specialist can have a complete picture of your ability to pay. Using a debt relief company takes the stress away from you and helps you get your credit card debt reduced.
Finally, no matter what you do make sure you have the agreements in writing. You don’t want the company to try to obtain the full credit card debt when you have agreed to a reduction.

The Freedom Debt Relief Program Could Help with Your Next Job

Credit card debt impacts so much more than just your credit score. Yes, credit scores do affect your ability to finance big ticket items like homes and vehicles. And if you are overextended with credit card debt or behind on these bills, your score will be lower than those who pay their bills on time. However, this is not the only way that credit card debt can wreak havoc on you. If you have high credit card debt, it could also hurt your ability to find a job, regardless of what your score is. Fortunately, Freedom Debt Relief could help.

Credit Card Debt and Your Career

Finding the right job can be stressful, especially if you are trying to enter a highly competitive market. You need the right skills, a strong resume, and the credentials to prove that you are the person for the job. Even if you have it all, you may still be one of several candidates. So, how do companies decide which person is the best person for the job?
Debt Management
Different businesses have different processes for hiring, but one common thread for many companies is that they want to run a credit report on candidates. This is especially common in financial and banking industries. If you are handling other people’s money, these businesses want to know that you can manage your own finances first. Now, they will not see your credit score and they cannot examine your report without your permission, but if you apply for a job that requests to look at it, can you really say no?
To ensure that your credit report helps you in your job search rather than hindering it, you need to take steps to make sure that it is in good shape. Programs like Freedom Debt Relief could help.

Steps to Improve Your Credit Report

The first step to improving your credit report is to know what is on it. Get a free copy of your report to examine it. There are plenty of ways to go about this. In fact, most credit cards these days offer free credit reports to their customers.
Once you have obtained a copy of your report, examine it thoroughly. Look for any discrepancies and challenge them. Sometimes there are things that wind up on your report that are just not true, and they can have a negative impact on it. However, according to the terms of the Fair Credit Reporting Act, if you dispute something, the credit bureau must investigate it. If they cannot verify the information they must remove it from your report.
After you have eliminated the discrepancies, take a good, honest look at the remaining information on the report. What does this data reveal about your spending habits, or your ability to pay your bills on time?
If your credit report does not paint a good picture of you, then you need to address this. Not only does it impact your ability to be hired in certain industries, a bad report can also affect your ability to rent a home, purchase a new cell phone, or even secure affordable utility services.
Paying your bills on time is a component of your credit score. But what if you fell behind on your bills because you simply cannot afford to pay them? What if they have gotten out of control? If this is the case, Freedom Debt Relief could help you put your debt behind you.

Freedom Debt Relief and Credit Card Debt

Freedom Debt Relief is the largest debt negotiator in the nation. It has helped over 400,0000 customers resolve more than $6 billion dollars in debt. They could help you resolve your credit card debt quickly and for significantly less than what you owe.
Their Certified Debt Consultants are here to help you find the right solution for your situation. They will evaluate your debt and go over your resolution options. There is no fee and no obligation when you call to get help.
Need to get your credit report in shape for the sake of your career? We could help you resolve your debt so that your report shows that you’ve paid or settled your financial obligations.
Give us a call or contact us online to start your free evaluation today!

Is It Better to Repay Debts or to Save First?

Once you finish college, get a stable job, find a place to live and start earning enough money a question inevitably comes up: “Should I start paying off my debts with the money that is left over every month or should I start saving up and then pay my debt once I have a substantial amount on my account?”. The short answer is that you should try and pay off as much of your debt before you start saving money. The long answer will include the “why” as well as the “what” you should do.
Repay Debts

Increasing debts

You see, it is all in the percentages that keep building up the amount of money you either have on your account or you owe. For instance, the money you have in the bank will have a very lowinterest rate, around 1%, while the interest rates on your debt can be anywhere between 5% and 21%, maybe even higher. So in the best case scenario, your debt is going to get bigger for about 4-5% every month, so when you get enough to finally pay off the original debt, the amount that you actually have to pay then will be much greater.

Profit for the bank

Another thing about banks is that yes, they are quite much into business and therefore aim for as huge profits as possible. And the major portion of profits for banks comes from your savings. The amount of money that you save with your bank is used to lend cash to other people or borrowers. The difference at which the bank borrows money from you and the borrowing rate it charges on other customers is their actual profit margin. In simpler words, it will always cost more to borrow money from the bank that what you would save.

Pay off your most expensive debts

Be sure you keep your credit cards after you have  paid them off in full, you will have a relatively good credit rating if you occasionally buy something with them and then pay it off quickly afterward. You can also get an interest free deal on a card and pay it off before the interest free period runs out. This will help you in case something unexpected comes up and you have used up all your savings.

Use your savings

If you have some money in your account right now, you should consider using as much of it as you can part with to pay off those debts with the highest interest rate first of all.  Therefore, you should take a look at your current debts, and mark the ones that cost you the most every year and focus on repaying them with the money you have saved – just leave enough money for your basic needs so you won’t have to take out another loan down the road.
There is something you should be aware of when trying to pay off your debt using your savings – not all debts can be cleared away efficiently using this method. For instance, certain types of mortgages will have actual penalties for paying before the set date. The best solution, in this case, is to take a part of your savings and put it into a different account that is specifically designated for the purpose of paying off the mortgage. The interest will keep building up and when the right time comes you can then use it to pay the debt. Be sure you are well informed about all the circumstances regarding your debt and read everything carefully before you sign.

Exceptions to the ‘paying-off-your-debts’ rule:

There are but very few occasions that can serve as an exception to this rule of paying off debts using your savings.  For example-

  • You can rule out the need to pay off your debts when the debts are cheaper than your savings. this basically means that if you feel that the cost of paying those debts are much higher than what you currently have in your savings account, then there is no point.
  • Penalty exception: if you already have debts that are incurring a stipulated amount of penalty on you, such as mortgages and other exclusive loans, you can consider not paying them until the penalty amounts have reduced. You can leave the cash in your savings account until the penalty is small enough.
  • Interest-free debt exception: This is specifically for those individuals who have constantly managed to pay off their debts so that they eventually become interest-free through prepayments. In such cases, if the interest rate on your debt is lower than the amount your saved cash earns after all tax deductions, you can easily earn from your savings and keep the debts as well.

Conclusion

The best is to make concerted efforts into paying your debts as quickly as possible. The sooner you pay off your debts, the happier and effortlessly you will be while managing your personal finances in the future. The advantages of paying off your debt first should be pretty obvious now – you will want to avoid letting the interest rate blow up and paying as much as you can right now.

Debt and the Affect It Has On People

The problem of debt is something that everyone may be familiar with. In which case, everybody may be able to relate when we say that debt can take a toll on an individual’s life. It is the thought that keeps sinking in about how you are in a big trouble with your credit and you cannot think of a way to solve the problem.

When you are preoccupied with such negative thoughts, the more difficult you find to focus on finding an effective solution.

There have been a couple of studies conducted about how money credit trouble affects people. It has been determined that this particular problem can create or start a series of troubles in a person’s life.

Debt Management

One, with debt, a person’s life becomes miserable. The negative effects of credit problems start in the person’s stress about possibly being harassed by the people he owes money too. When you are in debt and you have constantly failed to settle your regular monthly payments then you should expect your creditors to ring you a couple of times and send their threats of taking legal action if they do not get paid. Such demands can make a person fearsome. And it can lead to serious psychological effects.

Two, a person in debt becomes ignominious or disgraceful. Rarely anyone heavy in debt would like to share their story of failure. As a matter of fact, it is something to be ashamed about. At least that is what most people think and feel.

Three, people who are ashamed of revealing their miserable financial situations become forced to hide it. And it is not only because they want to make an effort to preserve their pride and dignity. They also fear what other people think especially the people that matter in their lives not only in their social scene but also in the professional arena.

Employers look into their prospective employee’s records completely. Just imagine how frustrating it can be to lose a job opportunity you are extremely qualified for but failed miserably in the financial aspect of a background check. And it is a cycle. Naturally, a person with debts to pay would need an income and a job to earn it but if he is denied the opportunity to make a living then the more he comes burned with credit and the shame and misery that come with it.

Four, a person with a bad credit record will suffer greatly in terms of his standing with financial institution. His chances of getting a loan again will be compromised due to the credit he failed to duly settle.

Fifth, every year, hundreds of people commit suicide because of their inability to repay their debt which they have taken. Moreover a person’s private, social and professional relationships gets affected due to his inability to repay the loan . In such cases, instead of committing suicide, people should focus on the brighter sides of life and be optimistic.

Relationships also become sour with marriages getting broken due to debt and ending in divorce. A happily married couple can find themselves in a very miserable state -of-affairs caused by undue spending by either spouse or by the husband and even both. As a result, the blame game starts.

On the professional side, jobs disappear with mounting pressure of bills, rents etc.

Sixth, a defaulter often suffers from emotional collapse owing to his inability to repay back the loans he has taken. He/she becomes fed up with threatening phone calls and e-mails from the creditors.Some people become so scared that they end up selling their precious house and cars. Property eviction can escalate into legal hazards often burdening the treasury in the form of court charges.

Seventh, escalating loans can compel a person to go bankrupt. The consequences of bankruptcy can be harsh and keep you jobless in the future. Bankruptcy is a serious financial repercussion of debt and can pave the way for a dark future for the defaulter.

But more than this, it has been found out that an individual who is in trouble with his creditors tends to jeopardize his life entirely. And this includes his personal, social and professional relationships which is indeed unfortunate. However, people in a similar situation should also realize that there is a solution to every problem even with debt and it always helps to look at the brighter side of things.

How Do I Handle Debt Collectors?

First of all, the best way to protect yourself from being harassed or mistreated by debt collectors is to know and understand your rights as well as the statute of limitations. Just because you are over indebted does not mean, the collectors can push you around. To handle such collectors properly and effectively, you should be well aware of what they can and cannot do.

For one, collectors are only allowed to call at certain times of the day. Moreover, the collector should respect your privacy. They are not allowed to call you at work especially if your employer does not allow it. And they cannot inform anyone else about your debt situation.

In case, you receive continuous calls beyond the limits as set by law, you can file a complaint against them. This does not mean however that you are excused from dealing with the debt. It merely serves as a way for you to keep the debt collectors at bay.

how-do-i-handle-debt-collectors

You can also actually make a written request for them to stop calling you. Once the letter is sent, you should, the calls should stop. Furthermore, if a collector contacts you over the phone, he should not make false statements to simply force you to settle the debt. In addition, they should talk to you in a respectful manner and not in a way as if you have committed a crime. It is prohibited for them to use abusive words or make any threats of violence.

Second, after receiving a call from a collector, it is essential that you request for verification. Most of the time, the creditors will contact an agency to handle debt collection in their behalf. However, it is in your best interest to check if the agency indeed has the right to collect payment for your debt.

Third, you have to learn to negotiate. After settling the issue on whether the debt is accurate and the collection agency is rightfully assigned for collection, you should make an attempt to negotiate with the collectors. Start by offering a payment less than what you can actually afford, this shall give you room for adjustment in case the collector tries to deny your offer.

Keep in mind that timing is everything. If you are feeling like the collector is acting firm, unfazed by your attempts for negotiation, then perhaps you can try to make a deal at the time they are more likely to bite into your offer which is usually by the end of the month. After making a deal, make sure that you have everything properly documented. Secure the agreement in writing. Such is important even before you send any form of payment.

Do not act defensively when you receive a call from a collector. Remember, they are only doing their job. If everything goes well, then you can come up with a favorable arrangement. Otherwise, you may consider filing a complaint against the debt collectors that keep harassing you and acting beyond boundaries as set by law.

Debt – Dealing With Them Without Any Hassles

Debt is never a problem if you have the right strategy to deal with them. Debt takes very less time to reach to levels where it get out of manageable limits. The best way to control it is to keep a tab on your spending and divert your savings into paying off your debts.

Debt has become serious with the economic crisis. There are a lot of people who have build debts to the level where the economic crisis has made it difficult to impossible for them to repay their debts. This is more owing to the fact that people are more into living a lifestyle wherein they are forced to live a life of paycheck to paycheck. This means that they cannot withstand even a partial pay cut. A major portion of their salaries simply goes into paying their debts. This is really a difficult situation and one has to take steps to keep a close look on their debts.

There are situations when you face problems like paying your bills; your account has been transferred to your debt collectors, receiving notice from your creditors to finish off your pending debt etc. This is the most common situation which is suffered by most of the people now. Facing financial crisis once in a life time is sure of getting ill or losing your job etc. But if you get careful then you can manage your finances so well that you can cope up with these problems.

Debt

If you are facing financial problems then you should help yourself by making a proper budget for your expenses and income by taking help of credit counseling, debt relief services, debt consolidation or reputed debt settlement agencies.

There are people who get confused about which option will be better for them to cope up with their debt. The method which is beneficial for you is known by the level of debt you are in and your future plans to cope up with these debts.

Developing a Budget

The first step to cope up with your debt is to make a proper budget of your expenditure from your income. Make a full list of your necessary expenditures like paying toward your home personal loans for people with bad credit, car loan, insurance premiums, grocery expenditures, utility bills, entertainment and all other. Then make a priority list among these expenditures and eliminate unnecessary things like entertainment and clothing expenditures. The main reason for making a budget is to use all your money in expending wisely.

Contacting Your Creditors

If you are facing problem in paying your debt amount then you should immediately contact your creditor informing about your genuine problem for not paying toward your loan amount. This will keep you in good faith and then your creditor will modify your repayment method so that you can pay toward your loan easily.

Dealing with Debt Collectors

Some creditors appoint debt collectors to deal with people regarding repayment collection. These debt collectors may harass you by calling and disturbing you, using bad languages. But according to federal law, the debt collector has some limitations like they are not allowed to call you in your working hours, or they cannot come to your office, they are not even allowed to call you after 9 pm. And if you are facing these troubles then you may file a complaint against them.

Debt Relief Services

If you are facing problems in paying off your credit card dues or any other dues and then you can’t make a repayment plan for creditor then contact debt relief services like debt settlement or credit counseling. They will help you by suggesting how to manage your finances in such a way that you can easily cope up with your debt.

But it is important to contact good debt relief agencies. This you can know by taking help of your state attorney general or by local consumer protection agency where you can find all records of these agencies that whether any person have lodged any complaint against this firm.

It is important to do some research before taking help of these agencies. Find out what are the services provided by them, and whether these services are helpful to you, the cost charged by them, and the time duration they’ll take to get results. Make a proper written contact with each and every point with them.

Credit Counseling

A credit counseling organization helps you in managing your income and debts. They guide you by making a budget of your expenditures so that you can save money and pay more toward your debt. These counselors are well trained and skilled in managing customer’s debt, credit, money and budget. They first know all your problems and expenditures by discussing each and every fact and then make a proper plan for helping you to cope up with your debt.

These credit counselors work on non-profit basis and give their services online, phones or by their local offices. It is better to take the help of these counselors personally by meeting them. They are easily approachable as many universities, credit unions, military bases, branches of U.S cooperative extension service and housing authorities operate counseling services.

But non-profit organizations don’t mean that their services are for free. They charge high fees for giving their services to you which they don’t mention initially and charge from you later.

Debt Management Plans

If you are in deep financial problem which is not easily handled by suggestions provided by credit counselor then they will refer you to debt management plan (DMP). These debt management plans help you to cope up with your debt by facing your creditors on your behalf. But a person should not approach these debt management plans to unless a reputed credit counseling firm has not referred you to do so.

In a debt management plan, you submit some amount of money each month and then this money are utilized by DMP to pay toward your unsecured debts like medical bills, student loans, credit card bills according to the schedule created by DMP and creditors. DMP may deal with your creditor in such a way that he may agree to lower down interest rate and unnecessary fees so that you can pay your debt easily.

Coping with your debt is not so difficult if you are smart enough to manage your finances and make wise decisions regarding your repayment plans. What most of the fail to understand is that the best way to minimize debt is to stop taking any new loans and building debt. Whatever debt you already have needs your attention and you need to be aware of the correct status of the debts at every point so that you can take proper steps to deal with them accurately.

What are Pros and Cons of debt consolidation?

It is true that someone who has many debts to pay is always distressed and even buried in depression, if he is going through financial crisis. Car loans, home loans, education loans, credit card loans and so on are basic necessities of a middle class man in this world running at the pace of light. But when all these climb on your head like termite after consuming your pockets, it becomes very hard to cope with the hassle circumstances. Debt consolidation, in that situation, comes up as a sigh of relief. But when anything is related to our money and financial management, it is very important to count on each advantage and disadvantage of it.

debt consolidation

Debt consolidation has its own pros and cons which you should explore before going for it.

Pros

Debt consolidation means to club all your debts and loans into one, which reduces interest rates that is a great thing to trim extra pay offs. All you have to fret about is one-time payment. One very important and aiding advantage of debt consolidation is that you stop getting calls and notices from banks and collection agents. When there is no one to trouble you by calling everyday asking for money, your psychological health becomes positive and this makes you constructive in your thoughts and production at your work. Debt Consolidation Company purchases your worries from the collection agents and pays off credit reporting companies.

If you opt for consolidate debt, it saves you from being declared bankrupt, how good this deal is, only a big debt holder knows. By devising a financial budget and with the help of consolidate debt, you can start to improve your reports and credit stores.

The best thing is you can start your financial management afresh where you can avoid all the wrong decisions you’ve made in past. There will be no one to give you frowns while you do this.

Cons

Once the funds are available, People often fail to manage their finance again causing themselves commit the same mistakes that they’ve done in past. It brings in more problems and accumulates more debts and financial obligations. Consolidation loans give you long timelines like 10 to 30 years to settle your one-time debt which however saves you from debts to pay on short tenures that too at high interest rates. For all this time, your assets or your property remains mortgaged tied to a home equity loan usually. This means your debt consolidation loan is given against the value of your assets which are kept mortgaged. If you fail to pay the consolidate debt, you end up losing your home and assets.

If you analyze deeply, you’ll get to know that in the end you will land paying more over several years than it had to be on short tenures. To burden you in the end, you’ll incur penalties like late fees or so.

So, before going to opt for a consolidate debt, you must be self-aware and calculative in your approach. Once you take a consolidate debt, you should manage your financial structure well in order to refrain these hassles circumstances again.

Strategies for Limiting your Debt in the New Year

As the New Year begins, those feelings of hope and joy about the promise of the New Year are easily replaced by feelings of helplessness when your credit card bills arrive in the mail. Many people rack up huge amounts of credit card debt while attempting to give their loved ones what they wanted for the holidays.

If you have put yourself in this position, the unfortunate truth is that only time and regular paychecks can get you out of the debt that you have already incurred. That being said, there are several steps that you can take to limit the amount of debt that you build up this coming year.

Strategies for Limiting your Debt

The most obvious answer is: “Don’t purchase what you don’t have money for!” However, many people experience circumstances that force them into using their credit card. Here are a few tips that will help you limit your debt in 2014:

• Minimize In-Home Expenses

The truth is that many people overspend money on their household ‘needs’. The gas bill, phone bill, cable package, home insurance, and rent contribute to your overall run rate.

Shop around with several insurance companies to explore the possibility of bringing your monthly payment down.

Purchasing several small space heaters to place throughout your home or apartment may help to reduce the amount of money that you pay out to your gas company every month.

With the popularity of cell phones these days, do you really need that land line at home? Disconnect it and that money will stay in your pocket. Cable television is in the same boat as your home phone. More companies are beginning to offer TV shows for free if you stream them online. Better yet, make reading your home entertainment or downtime pleasure.

You will also benefit from seeking bargain deals at the grocery store every time you visit. Finding cheaper alternatives, especially when buying bulk items, can add a significant amount of money to your wallet. Promotional coupons, buying sale items or store label items all contribute to reduced spending.

You should also consider saying “no” more often when asked to host or cater family gatherings or ‘football night with the friends’. This will significantly reduce the amount of food goods that you purchase and don’t consume yourself.

• Movie Madness

Whether we like it or not, this country is incredibly infatuated with Hollywood. Trips to the movie theater are frequent for family occasions, date nights, or chill time with friends. Many people will make at least 15-20 trips to the movie theater every year. This is most likely even a conservative estimate, but 20 trips at $12 or more per ticket will add up quickly. You do the math!

Movies are expensive. Especially if you are going in the late afternoon or evening. Try attending more matinees this year to save some cash. $6.50 rather than $11.75 sounds like a bargain any day!

Furthermore, renting movies via Red Box or Blockbuster, or simply streaming movies online will render the movie theater almost obsolete, so long as you can curb your enthusiasm to see that killer action movie on a humongous screen!

• ‘Friends with Benefits’

No, no, it’s not what you think! Many of us know several friends, or friends of friends, that offer some sort of service that you regularly pay an exorbitant price for.

Finding friends to take care of handyman work around your house, cut your hair, take your Christmas Card photographs, or care for your pet while you go on vacation will save you a considerable amount of money.

Yes, it might sound a bit like you are taking advantage of your friends. This is not the recommendation. Friends will simply offer these services at a much lower rate than the normal contractor. Furthermore, friends will tend to be more open to homemade gifts, baked goods, or other non-traditional forms of payment for their services.

Nobody enjoys digging a ‘debt hole’. Going forward into the New Year, minimizing your in-home expenses, reducing the amount of money you spend on movies, and seeking out ‘friends with benefits’ will help you to reduce your budget and, subsequently, reduce the amount of debt that you find yourself in at the beginning of next year!

Save money and get out of debt – Think out of the box with 6 tips

It’s rather common to wish to get wealthier with every passing day. However, one of the major differences between all those who’re actually wealthy and those who’re not is pretty basic. It’s more like the wealthy are the people who essentially earn interest, whereas the rest are busy paying interest or perhaps even seeking debt relief. This is obvious as the more interest you keep accumulating against you, the higher are your chances of going down the debt whirlpool.

So, you must be wondering that wherein lies the key to financial bliss. Firstly, it’s rather important for you to realize that money is the most effective tool that can ideally help you reach your goals. True financial independence calls for you to make money begin working for you. Moreover, as soon as that happens, you’ll not only be able to get out of debt, but also build yourself a solid financial foundation for your future.

Tips to save money which you thought wouldn’t work

Basically, the trick doesn’t lie in saving money itself. It’s more about making those things work which you initially thought wouldn’t. Now, if you’re looking for ways to get out of debt, then it’s high time to take immediate action. Read on to find out how you can do so.

Be easy and focused: The very first thing that most don’t think can work is to be as easy and relaxed as possible regarding saving money. What’s actually important is the focus bit. Getting tensed and panicking unnecessarily won’t get you anywhere and neither will your finances benefit from it. You need to go about everything easily because the more you force yourself at something, the tougher it’ll get.

Simple steps make the difference: Believe it or not, but it’s the small and simple steps that can make a major difference to your financial situation. Hence, don’t ignore that 1 dollar. Put it aside for you never know what they can finally amount to be.

Set yourself time limits: Simply deciding that you’ll do something or take a certain step doesn’t really go a long way. You’ve got to put a time cap on all your decisions. Most don’t realize the worth of time especially as far as finances are concerned. For instance, you decide to clear your debt on a particular credit card. In that case, simply deciding doesn’t really go a long way because with increasing time that so-called payable credit card debt is going to take on unmanageable proportions. Set yourself a time limit and work towards paying off that particular debt by then.

Try and be organized: No matter how busy you’re, good finances always call for organization. If you don’t know what all your outstanding debts are in the first case, then there’s no point in looking for debt relief. Get all your papers in order and know how much you owe and to whom. Most importantly, you should also know things like what exactly is needed for your everyday life. Unless you’re accurate about these things, it’s more than expected that you’ll land up spending more than required.

Try being innovative with your house: There are so many things all around you that you might be overlooking. Get yourself working and have a close look all around and see where exactly you can save money. For instance, when it comes to your house, then you could try some measures like say weather stripping. It’s rather easy to install and it can make a great difference in helping to keep out drafts. You could also insulate outlets and light switches also. People often forget that these are sources of air leaks. Steps like these will prove friendly to your pocket.

Make money with unused stuff: It might seem weird, but it’s surely worth giving a thought. You must’ve ignored or in fact not even spared a thought to what that clutter you’ve got could do for your finances. There are loads of opportunities online which you could make use of by selling those old books instead of letting them turn yellow, you could sell off electronics stuff instead of letting them rust. Or easier still, you can sell them all off at your nearest thrift store.

Keep in mind the tips discussed above and make use of the money that you make towards getting debt relief for yourself. Be alert and innovative and your finances are bound to get better with every passing day undoubtedly.

Consider Tax Refunds as Effective Means of Getting Out of Debt

Many financial advisers and entities go out of their way just to help people know how to use tax refunds for effective debt settlement. Indeed, tax refunds are money that you can use to settle your existing loans, credits, and other forms of debts.

However, the first thing that you must remember is that tax refunds are not money that just popped out of nowhere. They are money that you own; it’s cash of a certain amount that’s returned to you – mainly because you overpaid the government. Usually, the amount of refund that you might find in your check is in the vicinity of US$2,000 to US$2,500.

Here are tips and tricks on how to use tax refunds in solving your debt problem:

Avoid overpayment

First of all, make sure that you have no unusual deductions for the current year and hopefully in the future. If you have confirmed that this is so, you must change your withholdings in order to avoid doing overpayment. In the first place, you don’t want to give away your money and have anyone hold on to it for a year without the money earning some interest. It’s just an absurd thing to happen, don’t you think?

Make a correct adjustment

Calculate the adjustment in an easy manner, and this is by taking your tax refund amount and having it divided into 12. Adjust withholdings appropriately; which can be done through the help of your office’s payroll department. As this figure is adjusted, this can offer you a few hundred dollars of extra money a month that you can spend to pay off any of your existing debt; such as credit cards, car and student loans, among many others.

Now that proper adjustments are done for the future year, you can now focus on the right way of dealing with your tax refund that’s forthcoming.

Settle credit card debt

Most of us possess credit card debt. If you have one, settle it immediately. A $2,500 amount on credit card balance at 18% interest while doing minimum payments will require you 14 to 32 years to settle it completely. Others might want to use the refund however on financially rewarding endeavors other than reducing or even eliminating their debt.

What if you invest instead?

For instance, you might want to invest the money instead; insisting that you will just obtain the payment to your credit card debt from the returns that you will earn from your $2,500 investment. To be fair enough, let’s examine this route and find out if it is indeed a wiser way of using your tax refund.

This is actually a good investment if you will obtain the return that you need in order to fully pay your monthly credit card debt. However, for a $2,500 investment, you will need an investment scheme that will deliver 25 to 35% after-tax return for you to come up with the money to pay your debt.

However, if you use the tax refund to pay off the $2,500 debt on your credit card, and use the monthly payments that you waste on minimum payments and simply invest them during the same period of 14 to 32 years, such an investment will grow to a maximum of $175,000.

Now, it is a fact that most of us have more than $2,500 debt in credit cards. Apart from this, we also have to deal with student loans, car payment, and many others. Hence, as soon as you have made the right adjustment on the tax amount that’s withheld from your salary, use this amount to settle your most important debt. Pay off debt first before you even try to go to any financial ventures such as an investment.

And since, your tax return can’t do everything in terms of paying all your debts, it is advisable to seek professional advice – whether you obtain credit counsel or take advantage of a debt relief program. There are numerous debt management and relief options available, but the important thing is that you must act fast and promptly – to make things happen.

This guest post was provided by DebtSuccess.com, the debt management experts specializing in debt consolidation, debt relief, credit repair, tax debt, debt settlement and more.