More Than Finances

Get your finances in order!

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5 Personal Budget Tips For Those Who Have Poor Credit

When you have bad credit, it can feel like you’re doomed to a life of financial failure. Guess what: you aren’t! Bad credit is absolutely something from which you can recover. It might take some time and it will definitely take hard work, but it is absolutely doable. You just have to put together a budget and stick to it. Here are some tips to help you do that:

Loans

If you have bills that are past due and you need help paying them regularly, it might be helpful to take out a loan. Your bad credit might keep you from taking out a bank loan, but there are financial companies out there, like Crest Financial and others, that specialize in short term loans for people whose credit is less than stellar.

If you do decide to consult with CrestFinancial.com, make sure that you do not borrow more than you can afford. Bad credit loans tend to have very high interest rates and you don’t want to wind up paying back more than necessary.

The Envelope Method

If you aren’t used to following a budget or have a difficult time keeping track of your income and savings, using the “envelope method” can help you develop those habits. The envelope method is very simple: you create an envelope for every bill or expense listed in your budget. This includes creating envelopes for budget items like “groceries,” “fun money,” etc. Portion out your paychecks and income according to how much you’ve listed on your budget. Then pay bills directly from those envelopes. When there’s no money left in the envelope, you can’t buy anything else in that category. The easiest way to do this is with cash but there are digital apps that can help you here too.

Create Your Own Numbers

Everybody knows that they need to pay more than the minimum amount due on their bills if they want to actually pay off their debts. But how much more is enough? Even $10-$15 more is good but, if you really want to pay down your debts quickly and fix your history of bad credit, you need to offset whatever interest is charged to your accounts. Look at your monthly bill. Add together the minimum amount due, how much you’ve been charged in interest and then add another 10% onto that amount. You’ll be amazed at how much faster your debt shrinks when you use this method.

Bringing in Extra Income/Reducing Your Expenditures

It’s vital that you pay your bills on time every single month. This, more than anything else, is what will help you fix your bad credit history and raise your credit score. If you aren’t earning enough through your current job, you’ll want to find a couple of ways to bring in some extra cash while you also work hard to reduce what you spend. Driving for Uber, for example, can bring in extra money in your “spare” time and using Groupons can help reduce what you spend. There are many different approaches you can take here. Start exploring and choose the methods that work best for you and your family.

Buy Nothing

Check around your local area to see if you can find the things you need for free. You’re probably already great at shopping on Craigslist, but what about checking out your local Buy Nothing group? A quick search will turn up plenty of groups that are dedicated to helping their members get the supplies they need for as little money as possible. Take advantage of these groups so that you’ll have more money to allot toward your bills.

These are just five of the methods you can use to make creating and sticking to a budget much easier on yourself and your family. Over time, as you stick to this budget your credit score will go up and you reduce your risk of finding yourself in this same predicament in the future.

 

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To Borrow or Not to Borrow: When Does Applying for a Loan Makes Sense?

Though it would be nice to always have money to cover the unexpected events in life, it’s not that easy. There may come a time in your life when you just don’t have the money. An unexpected bill, a loss of income, or even an emergency repair could put your budget out of whack for months. Naturally, when you don’t have the funds you need, you ask for a loan. Though loans can get you over the hump, they do have to be repaid, which is why making the decision to borrow should not be taken lightly.

Borrowing funds from a lending provider can get you out of a jam when you have no other way out. However, many people end up in serious debt. They either take out more than they need, don’t repay the loan timely, or didn’t evaluate the matter to determine if they needed a loan in the first place. To prevent this from happening to you, here are circumstances in which taking out a loan is a good idea and when it’s not:

When Taking Out a Loan Makes Sense

A bill being more than expected – Instead of the average $200 for gas and electric you have to pay $300. You won’t have the money until payday, but to avoid late fees and other charges you need to pay the bill in the next day or so. In this instance, taking out a loan makes sense. It allows you to avoid the penalties that would be implied by the service provider. Also, because you’re able to repay it around your next pay cycle, you won’t accrue too much interest on the loan.

An unexpected emergency – Your car breaks down and you have no other means of transportation. You take it to the shop only to find that the repair is going to cost you $500. In this instance, taking out a loan might be your best bet. You can apply for a short term loan for $500 and pay on the balance over the next 14-30 days. This way you have about a month before you accrue too much interest but you still have your car to get where you need to be.

In this instance, it might also be beneficial to learn how to keep your car well maintained, such as these tips offered on the MaxLend Loans Twitter page. Doing so will minimize the chances of you needing a loan in the first place.

Let’s face it, there are times your bills are so costly you don’t have a cent left to your name. If you need extra cash to hold you over until your next pay, then this might suffice taking out a loan.

When Taking Out a Loan is Not Ideal

Now that you know when it is beneficial, let’s talk about instances in which taking out a loan is not a good option.

You’re in over your head – If you already have hundreds of dollars in debt, there is no reason to add a loan to the top of it. No matter how small the loan is, if you can’t afford to repay it right away, this will add to your frustration.

You can’t pay it back timely – Taking out a loan and agreeing to terms knowing that you can’t afford to repay is not ideal. The longer it takes you to repay a loan, the more of a financial burden it becomes for you.

You have other loans out – If you already have a financial obligation to another financial institution, adding another payment can cause more of a burden.

Do Your Homework

If you’ve decided that it is in your best interest to take out the loan, make sure that you do your homework. Not all loan companies are created equally and you want to do business with a reliable, reputable provider. Checking out the company website is one way to conduct research. The best information is often found on social media platforms, such as on this Max Lend LinkedIn profile. There you can review information about the company and also see how many others have used this service provider in the past.

When you need financial assistance, the most common solution would be to borrow the funds and repay them later. Though loans can be great tools for helping you when you’re in a jam, you really need to think it through before applying. Taking out a loan unnecessarily or without a proper plan of repayment in place could lead to increased debt, which is the starting point of a financial disaster. However, with a proper plan, taking out a loan could hold you over when you simply don’t have the means to do it yourself.

 

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Deciding On A Graduate School

When you are thinking about graduate school, you should always envision your long-term plan. You should have a goal set before graduate school to ensure that you stay focused on achieving excellence throughout the program. Too many students lose focus during graduate school or become unsure of what they want to do with their degree. Because you are making such a large investment by attending graduate school, it is imperative that you consider these things before you attend:

Your Financial Situation

Before you attend graduate school, take a look at your financial situation. See what type of program you can afford to attend. Consider how attending graduate school will impact your budget in the next 10 or 20 years. You want to make sure you have carefully weighed the consequences that you believe attending graduate school will have in your life.

Cost of Tuition

If is important that you also understand the cost of tuition for a graduate school program. You should know how much a graduate school program so that you can see whether it will be affordable for you. Some graduate school programs cost anywhere from $40,000 to $60,000 a year. You should make sure that you can afford this high cost. If you will be taking out loans to pay for the cost of this education, then you should make sure that you will be able to repay the loans with a job after graduation.

You should also make sure that you will have good employment prospects to pay back these funds. It is important for you to know that you will be employed so that you will not be stuck with high loans to repay upon graduation. Whether you want to be a professor or do research for a faculty department, make sure that your goals are clearly outlined so that you can begin working immediately upon graduation.

Likelihood of Employment After Graduation

In addition to tuition of the school, you should also look at the employment statistics of a graduation school. Make sure that the grad school has a reputation for putting students into the career fields they aspire to enter. Make sure that students are able to find good careers after they graduate. If you want to be a professor, then make sure you know how many students are able to enter the teaching field after graduation.

By carefully considering the information of different graduate school programs, you can make the decision that is right for you. You can also visit discover.com to weigh the pros and cons of programs.

Post by Amanda

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What Are Prepaid Cards and Are They Right For You?

Prepaid cards have become popular alternatives to credit cards in recent years for two reasons: they help people build or rebuild credit, and they help people control spending.  Just like it sounds, a prepaid credit card is a credit card that you put down an initial deposit, and your spending limit is equal to that deposit.

Why Get a Prepaid Card?

Prepaid cards sound very similar to a debit card, but they do allow you to build credit.  The reason is, when you apply, you put down a deposit.  That deposit is a guarantee that allows you to spend up to that amount.  Think of it like a security deposit when you rent an apartment.

However, unlike a debit card, you still pay off the prepaid credit card monthly like a normal card.  That deposit only comes into play if you don’t pay your bill.  So, they everything is still treated like a normal card except for that special security deposit.  And if you don’t pay your bill, the company will then use your deposit to pay off the balance and fees incurred, and they will close your account afterwards.

Is This Right For Me?

These cards are right for people who may not have credit.  The reason is that if you don’t have a solid credit history, lenders may be leery to loan or extend credit to you.  Using prepaid credit cards, you can build a credit history and show that you are responsible in making payments.  Just never be late and always pay off the balance in full.

These cards are also great for individuals rebuilding credit for the same reasons.  If you have a poor credit history, you may not qualify for traditional cards.  These prepaid cards can help rebuild your credit score if you use them responsibly over time.

Finally, these cards are great for people who are trying to watch or limit their spending.  Since there is a low set limit based on the amount of cash you deposited originally, there is no way you can buy something that you can’t afford.  If you feel like spending may be a problem for you, a prepaid card can help you by taking away frivolous spending options and making you focus on purchases that you can afford and need to buy.

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Take Advantage of the Housing Market to Become a Landlord

One way to build wealth is to become a landlord.  As you gain rental properties, you will have more and more passive income at your disposal, which can help supplement your day job income and increase your cash flow.

Take, for instance, Matt and Jessica who bought a home 10 years ago and have been aggressively paying down their mortgage.  Now, they only owe $50,000.  Despite the market, their home has retained its value, and they have $155,000 in equity in the home.

Since they bought the home 10 years ago, they have also saved aggressively by working side jobs in addition to their day jobs—Matt is a D.J. and Jessica is a photographer.  They have banked all of their side job money and now have quite a large amount.  They have decided to take advantage of the historically low interest rates to buy a bigger home.  However, they won’t be selling their current home; they will instead rent it out and become landlords.

If you are in the market for a new, larger home, there are a variety of home loans available to you, so when preparing to buy a bigger home, you need to determine what mortgage is the best fit for you personally.  Should you take out a 5 year adjustable rate mortgage (ARM) and take the chance that mortgage rates will be lower than they currently are, or should you take out a fixed rate mortgage with the assumption that today’s rates are quite good and locking in those rates would be wise.  Using  mortgage calculators as well as talking to a mortgage broker or loan officer can help you choose the mortgage that is right for you.

With careful planning and the right mortgage, you can find yourself in the enviable position where your tenants pay for your own mortgage payment through their rent payment.  Then, you can continue to grow your own wealth and, if you are interested, buy additional properties.

While being a landlord is sometimes difficult, such as when you have tenants who cannot or will not pay or when your property needs to have expensive repairs, it also has many financial perks.  You can grow your wealth and develop a passive income stream that can give you a good return on your money for years to come.

People enter the rental market through a variety of means.  If you are thinking about becoming a landlord, consider waiting until you plan to move to a larger property.  Then, you can use your former home as your first rental property.  You will know exactly how the property has been taken care of and what condition it is in, so you will not have any surprises as you might if you were buying a new property.