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Consolidating Your Debts to Decrease Your Commitments
One of the biggest problems with the financial climate today, is the amount of personal debt that many people have incurred.
For most people, their income is limited and, in some cases, has even reduced due to redundancy, or having to take a cut in pay, and, of course, ever-rising prices.
There are many ways to try and sort out personal financial problems, though some are better than others. For instance, it is not generally a good idea to take out further borrowing on credit cards. Any special deals the card companies use to obtain your custom usually have a limited life; when the term expires, you may well find you are on a very high rate of interest, and your debt will start increasing again.
One piece of advice I would offer is to approach a professional for free advice and ask about consolidation loans, (you could try your bank, or a charity like CCCS, or a company like Debt Free Direct). The idea behind consolidation loans is that you borrow enough from the bank to repay all your existing debts. You will then have just one commitment, to the bank that loaned you the money. These days, you can even negotiate terms and interest rates, so, although you may find you are making monthly payments for many years to come, at least you will just have the one commitment. As long as you do not take on any further debt, once you have repaid the bank, you will be debt-free.
If you have a mortgage, you may be able to ask your mortgage company for a second mortgage, borrowing enough to repay your existing debts. You will then have to re-negotiate the life of the mortgage, and the amount you pay back monthly, but, as with a bank loan, you will only have one monthly commitment to worry about.
Of course, it is best to avoid debt in the first place, but this is easier said than done. Consolidating your debts in one of the ways listed above, is the next best solution, and will help to make life a little less stressful.
Tagged consolidation loans, debt, finance, Money
Make Your Hard-Earned Cash Work for You
In the current financial climate, everyone is trying to save money. For every family, there are many unavoidable financial commitments but, with careful budgeting, you can ensure you get the very best value for your money.
Charges for essentials, like insurance, and utilities, such as electricity, telephone, and gas, have increased a great deal over the last two years. Now is a good time to find out if you are paying the lowest prices possible. Today, there are many websites which compare the different tariffs and charges of major energy and insurance providers. By simply inputting your current details, you will be able to find out if it is worth switching to a new company. At the moment, all the well-known companies are fighting for your custom. You may find only small savings with each one, but the overall amount per year could be significant.
The cost of basic food items has also increased considerably recently. Although the supermarkets make some effort to provide bargains to tempt you to spend, there are ways of reducing the amount you pay at the till. For instance, for every big-name brand you currently buy, try a lower-priced item, say, the supermarket’s own-brand, or their ‘value’ range. By saving a few pence per item, over the course of a week, you will have saved a few pounds – far better kept in your pocket than in the supermarket’s tills.
Another tip is to plan your meals for the week ahead, list all the ingredients needed on your shopping list, and shop only for those particular items. Stick to the list, and you will not be so easily tempted to overspend. You will also be surprised at how little you throw away at the end of the week.
By following these frugal tips, you will see a real difference in your spending habits, as well as the amount of money you have left at the end of the month.
Surely the budget takes place in March?
Every newspaper and every news reports tells us we are in the grip of the start of a recession, but for many of us we do not need the media to tell us about the recession many of us are living with it from day to day. This year has seen a large increase in home repossessions, those looking for debt management help and advice and even an increase in the number of people being declared or filing for bankruptcy.
Many household consumables have increased in priced over the last 6 months, most of us are struggling with increased utility costs and as the winter draws in, many people have to choose whether to eat or heat their homes. So how do we manage, is it possible to cut back on unnecessary spending and try to make savings? The answer is yes, there are steps we can all take to spend less and even save some money.
How do we cut down on unnecessary spending and make savings? The key to this is honesty and budgeting. We need to look at our household expenses and spending, identify the essential items and reduce the extras. When we have identified what we spend our money on we can take steps to reduce our spending, we need to agree our budget and look for the best deals. Perhaps we need to look at simple things like our mobile phone contract, or our broadband/telephone package and look for better deals. Perhaps we need to remove some non-essential luxuries such as satellite television packages or even buying non-branded goods when we do our shopping.
We have to be totally honest about our spending, if we hide things we are only bluffing ourselves and this will not help us make savings. There are lots of competitive deals around on things such as insurance, so we have to make sure we are getting the best possible deal. Where possible we should also use cash back sites to make our purchases, making sure we earn something from the essentials that we need to buy. We should all be trying to reduce our carbon footprint to save the planet, but this may also help us to economise on our food and heating bills, if we use less we will spend less.
Because the current economic climate is so gloomy we need to be actively reducing our current debt, this will enable us to make greater savings when the economy perks up.
Tagged debt, Debt Management, Money
Nothing is ever what it seems
It isn’t good economics for an IVA for under £20,000 to be taken on due to the fees imposed by the insolvency practitioner. The amount charged by the practitioner is very steep and problems keeping up the payments can prove very difficult. You should however seek IVA advice.
It is said that a certain amount is paid every month and gives the impression that the same amount throughout the IVA is kept to, but this is not true – the amount can change as the wage changes and as the cost of living is getting ever steeper it can prove difficult to justify your expenditures. It can seem a good way to rid yourself of the debt burden but it is for 5 years and that is a large portion of your life to commit for. If you own your own home at the end of year 4 you can be asked to re-mortgage and quite a large amount taken away from you which may mean you have paid all your debts owed anyway – considerably more than the 25% you are told you will pay.
On the other hand with bankruptcy you will automatically lose your home and if in certain employment, the police force being one of them, you will lose your job
But it is something that has to be thought about very carefully as an IVA is not an easy get out.