Bankruptcy And The Alternatives

  By David | March 30, 2010 - 7:47 am | Bankruptcy, Debt Advice, Debt Management, IVA Leave a comment

If you are deeply in debt then it may be that bankruptcy appears to be the only option. There are others and below I briefly mention 3 of them. If you are thinking of bankruptcy then your local Citizens Advice Bureau can advice you of your options and who to speak to next.

IVA
An IVA is the most common way to avoid bankruptcy. If you have assets that you would otherwise lose by going into bankruptcy an IVA can offer a level of protection.

Debt Management Plans
Talk to your creditors directly. If your creditor knows that you are really struggling to meet your repayments they may well suggest a more manageable course of action. After all, if you go bankrupt they lose everything.

Re-mortgage
If you are home owner your property is under threat if you go into bankruptcy. If you are in a position where you have regular income coming in but cannot meet your financial commitments this could be a good alternative.

Debt Relief Order

These were introduced in April 2009 as a way for people with limited assets to declare personal insolvency without declaring Bankruptcy.

Five tips to save money today!

  By cashmachine | March 22, 2010 - 9:47 am | Debt Advice, Frugal Tips, Saving tips, Savings Leave a comment

Saving money doesn’t have to involve making large sacrifices. My granny always used to say if you look after the pennies the pounds will look after themselves. Small savings of even just a pound everyday can have a great impact on your finances. Here are five tips on how to save a pound each day:

  1. Bring your own lunch instead of buying sandwiches. This will fatten your wallet and thin your waist. Shop sandwiches are often unhealthy and always more expensive. Try keeping an empty water bottle with you that you can fill up from the tap to avoid paying a pound for mineral water.
  2. If you a big coffee addict try keeping sachets of instant coffee with you at work. Microground instant coffee can be almost as nice as the real deal and certainly its cheaper than Starbucks.
  3. Walk or cycle to work, or into town if you are going shopping. This way you can save heaps of money from bus fares and parking machines.
  4. If you are a big texter try signing up to online services which offer free text messages to UK mobiles. This will save you money on texts and its much easier to write a message on a proper keyboard.
  5. If you need to send somebody a card, try making one. Use a funny picture from a family holiday, or draw one of your own. People will appreciate the homemade touch and you can save the money from the card to get them a better present or send it first class!

Most of the time we can save money with just a little bit of effort and if done regularly enough this can make an impact! You don’t have to stop leaving tips for the waiter in restaurants to save money on a daily basis!

Why I don’t lie about debt

  By moneybags | March 13, 2010 - 7:57 pm | Debt Advice Leave a comment

I don’t lie about debt to my partner. I think that one of the main things about an honest relationship is transparency, and it is an important feature to maintain a healthy relationship.

I have seen in the past, with firsthand experience, how debt can affect families. My Dad suffered greatly with debt when he was in his mid-forties and he almost had his house reclaimed due to a mortgage he really couldn’t afford to pay off. He eventually shared his problems with the rest of us, and we were able to help him.

It increased family tensions, and I would not wish to put my family through similar circumstances which is why I think honestly is essential in any relationship.

I have, of course, had debt problems and sharing them with my partner really relieves the weight that the debt carries. If I had them bottled up I would not know how to cope.

I’m a celebrity – get me out of debt!

  By cashmachine | March 11, 2010 - 11:24 am | Bankruptcy, Money Leave a comment

If financial problems wrack you with worry, take comfort in the knowledge you are not alone. In fact, the list of the rich and famous who have struggled with debt is a surprisingly long one. Here is just a small selection;

kim-basingerThinking of buying a whole town? It is not cheap and may well lead to bankruptcy. Just ask Kim Basinger. The Batman star planned to turn the town into a tourist attraction, building movie studios and hosting a film festival and paid and initial £20 million for her troubles, but met financial difficulties 4 years later in 1993, and sold her stake. Her loss was untimely as she shortly after pulled out of movie Boxing Helena, which led to the studio suing and winning a cool £5.5 million. Bankruptcy was filed for soon after.

Shane-RitchieShane Ritchie may have been the landlord of the Queen Vic on Eastenders a few years back, but if you ever bump into him in your local, he is unlikely to be the one buying the drinks! Ritchie faced arrears on the £8,000- a month mortgage of his £2 million mansion which he eventually sold to avoid bankruptcy. His fresh income was then splashed across a 40th birthday party before putting his final pennies into a film, box office flop Shoreditch. Friends then stepped in to help Ritchie after he failed to pay the mortgage for a year and he had his car repossessed.

Mike-TysonSelf proclaimed ‘baddest man on the planet’ and former heavyweight champion of the world Mike Tyson earned more than £165 million in his career, which saw him become a household name. Tyson’s career skewed off course however, as he openly admitted to being addicted to a rather unhealthy concoction of, “…chaos, money, jail, drugs, alcohol / liquor, girls & strip clubs”, and his knock-out blow came in 2003, when Tyson declared bankruptcy. ‘Iron Mike’ has long since sold his mansions and fleet of fast cars and now lives in a rented home.

George-Best“I spent a lot of money on booze, birds and fast cars. The rest I just squandered.” Famous words from the late George Best, the Manchester United football legend. Indeed, George’s life was one long party. After his drinking problems spilled onto the pitch causing Best’s career at the top to end prematurely, he turned to gambling to ‘fill the void’. Neither his money nor his liver could keep up with his hectic lifestyle however, and Best was declared bankrupt in November 1982, and sadly passed away in November 2006.

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Don’t Go Bankrupt Before Reading This!

  By cashmachine | February 26, 2010 - 3:46 pm | Bankruptcy, Debt Advice, IVA Leave a comment

Instead of declaring bankruptcy, how about trying these commonly used debt solutions….

1. An IVA. These were introduced by the Government as a way of debt management without resorting to the complex legal process of Bankruptcy. You negotiate a percentage with creditors of how much you can pay back, and if they agree you may end up paying significantly less than before. It’s not an easy option however, so you should seek advice.

2. Debt Consolidation. Instead of paying the huge interest and fees on separate credit, store cards and loans, these firms can give you one loan which means one payment. Although these are advertised heavily on TV, they are rarely suitable as they mean a very long term commitment.

3. Remortgaging. If you have equity in your home, remortgaging can be an easy way of getting some extra cash at a low rate. It does mean however that the length of your mortgage will increase and again, it’s not for everyone. It could be a risky option, given the ups and downs of the mortgage market.

Borrow to upgrade home

  By green | February 15, 2010 - 5:55 pm | Borrowing Leave a comment

Home improvement loans are a definite no go area. I think that home improvement loans are a false economy for the following reason.

Most home improvement loans are borrowed money, usually that either increase your mortgage balance or run along side it for the entire duration of the loan. Now then, lets do the sums, supposing for argument sake that you borrow ten thousand pounds.

This in theory adds, say twelve thousand pounds(£12000) to your home. Now that great if your going to sell up and move on to something bigger and better, but what if you don’t.

You will be paying a massive amount of interest on the initial borrowing, which will far outway your accumulation. Paying ten grand for twenty five years at even five percent interest is a massive amount.

Don’t do it unless you can afford to pay it back early, paying for a new kitchen for twenty years when It may only have an expected life span of 5 years is a mis-noma. Necessity should be giving in online saving as this will be the foundation of saving for a home upgrade.

10 Weird Things To Do With Your Money

  By cashmachine | January 29, 2010 - 1:07 pm | Money 7 Comments

Throughout the recession we have continually been warned to be creative with our money.  However, it is doubtful that the financial experts issuing such warnings had the following in mind when they recommended creativity!  Some people appear to have taken creativity to the extreme by differing origami shapes from bank notes take a look at the 10 best money origami produced so far.

10. Fish

Could these fish possibly be the most expensive around?

money-origami-fish

9. Toilet

Talk about flushing money down the toilet!  All that’s needed now is toilet roll made of money to complete the look.

Money_origami_toilet

8. Camera

This camera certainly looks expensive but does this latest gadget have the quality credentials to match?

origami

7. Elephant

This is fantastic; the creator has even managed to give the elephant an eye and tusks!

elephant_money_origami

6. Shirt

Is this going to be the next big fashion trend amongst men in the office?

money-origami-3

5. Snail

Who knew that you could make a snail out of bank notes?

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4. Hang Glider

This is very inventive and with the level of detail in this particular origami it is likely that a lot of time and effort went into this one.

amazing_odd_interesting_funny_origami-Hang-Glider_200907232112233627

3. Flower

A flower made of money, which woman wouldn’t be happy to receive a bouquet made up of such flowers this Valentines Day?

300px-DollarRoseIStock

2. Queen Elizabeth’s Hat

The Queen adds a new hat to her already really rather extensive collection.

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1. Spider

Most people are scared of creepy crawlies but it’s doubtful that people would shy away from this spider.

amazing-origamiWhich one’s your favourite? Let us know with a comment below!


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How Not To Go Bankrupt

  By cashmachine | January 25, 2010 - 5:45 pm | Bankruptcy Leave a comment

One alternatively to being bankrupt is not to be in debt in the first place. That’s easy for me to say, since I have this knowledge first hand. There’s so many simple rules that you can live by to ensure this never happens and I will try to outline the lessons that I have learned herewith.

Make a budget; you can never underestimate how much this saves you, work out your monthly incomings and outgoings. If you want to be really thorough keep a diary of all your spending over a month. Cut out all the unnecessary things, cut out the things you can live without and shop around for anything at all you can find cheaper. Every penny helps.

Secondly, cut out the vices in your life, drink, fags, gambling, woman or whatever is your passion for spending too much money unnecessarily. Lastly, don’t buy things that you don’t need, it sounds easy but it isn’t, impulse buying was always a weakness for me and its easy to bang it on a bit plastic and worry about it later. Avoid the worrying about it later part.

Teaching Children Finance

  By green | January 12, 2010 - 5:54 pm | Savings 2 Comments

As soon as children can understand a little about money, you can start to teach them the value of saving and the dangers of debt.

When they get pocket money, encourage them to save a little each week. Then tell them about bank accounts; make it fun, tell them “when you put pennies in the bank, then you get more pennies back.”

Explain about savings accounts and where they can find the best rates by checking newspapers or online. Explain how their money will earn interest. And especially tell them about the sense of security if they have some money saved.

You’ve told them the good news about interest on savings, now is the time to explain how interest works the other way ….. when someone is in debt. Tell them how interest is added …… and at a much higher percent than on a savings account ……. and how the debt can spiral out of control.

If you instil in your children the need to save, put some money aside, then they should be off to a brilliant start.

Communicate with debt

  By cashmachine | December 23, 2009 - 6:00 pm | Money Leave a comment

It really depends on your situation. If you are still in an early and fledgling relationship then I think that you shouldn’t have to share your debt problems with your partner. It is more about diverting the actual truth rather than lying.

If you’re in a long lasting relationship then couples should share debt problems and should not lie to each other about their problems. This is what I do, and I find that a problem halved is a problem solved. I often share my financial problems with my mother who is also willing to lend a helping hand whenever I need it.

My sister has suffered from debt in the past, and did not share it with her husband for a long time. He was unaware that she had huge debts on her credit card. Eventually it all came out, and they divorced suddenly. She is now financially solvent and has no more debt problems.