Can I Get a Debt Consolidation Loan?
Do You Have to Have Good Credit to Get a Debt Consolidation Loan?
If you're struggling to pay off your debts and can't find a good way to increase your income, you may be thinking about finding relief by other means. As you probably know, there's an entire industry that's devoted to helping folks pay down their consumer debts in a timely fashion. A significant amount of the activity that occurs in this industry involves a practice known as debt consolidation lending.
Debt consolidation loans are large loans that may carry relatively low interest rates. They are ideal for borrowers who carry large amounts of credit card debt. Debt consolidation loans enable these borrowers to pay off their high-interest debts and may dramatically simplify their debt payments.debt consolidation loan application form.
True to the "consolidation" in their name, debt consolidation loans are designed to reduce the number of monthly debt payments that a struggling borrower must make. Instead of 12 outstanding credit card bills, a credit card consolidation borrower only has to worry about making a single larger payment to his or her lender.
If you're behind on your credit card payments, you may be wondering whether you have to have good credit to obtain a consolidation loan. Unless you've been very lucky, your credit score is probably not as solid as you would like it to be. You might have a justified worry that you'll be unable to secure approval for your loan.
It would be ironic if you were unable to secure a credit consolidation loan as a result of your poor credit profile. After all, consolidation loans are designed to help borrowers who struggle with large amounts of credit card debt. Most such borrowers have less-than-ideal credit scores. Debt consolidation lenders that adhered to strict credit-score standards when screening borrowers would be cutting out a significant portion of their "target" clientele.
For this reason, it's possible to get a debt consolidation loan with bad credit. Many debt consolidation lenders are willing to issue loans to distressed borrowers. Unfortunately, such loans typically come with some problematic drawbacks.
High interest rates are one of these drawbacks. Whereas "prime" borrowers may be able to secure low-interest consolidation loans, borrowers who have poor or mediocre credit may have to pay through the nose for their loans.
Even in this low-rate environment, it's not uncommon for lenders to charge annual interest rates of 15, 20 or even 25 percent on their sub-prime loans. This might substantially raise your borrowing costs and negate any of your loan's potential savings. If you can't save at least 5 percent on your outstanding debts with a consolidation loan, this course of action may not be worth the hassle.
The potential need to collateralize these loans is another serious drawback. Although each lender's policy is slightly different, many may require you to put up some collateral as a condition of your loan. This could take the form of a car, house or other valuable asset. If you become unable to make the payments on your loan, this asset could be subject to seizure.
The prospect of doing further credit-score damage is a final weakness. Since these credit facilities are so large, the monthly payments on credit card consolidation loans can be massive. If you fall behind on your loan or become unable to make your payments at all, you run the risk of a credit-damaging default.
Once you default on your loan, your credit score will drop precipitously. In turn, this will make it difficult for you to take out another loan. Even if you can find a lender that's willing to approve your application, your new loan would probably carry a far higher interest rate than your original credit facility.
Before you take out a debt consolidation loan, you'll want to consider all of the credit relief options available to you. Although you may be able to secure a loan with a poor credit score, there are certain risks associated with this course of action. In the end, you're the only person who's capable of determining how best to tackle your unsecured debt burden.
by Lacie Kehm
Retirement planning is not one sexy topic partly because people nowadays have a “live in the moment” mentality. The idea is that they want to enjoy what they have now which does not leave much room for future planning. This has an adverse affect on how they view and prepare for their inevitable retirement a few decades down the line.
It might be true, most especially with the younger generation that retirement is still a good 40 to 50 years into the future, it is important that they understand how important planning for retirement is. One thing that could help is the fact that sooner or later, it will happen. It is not a question of “if” but of “when” it will come. There are those that are able to retire at a young age while some are forced to work until old age.
In fact, according to Nerdwallet.com, because of the increasing student loan amount, the property market and the way millennials view investments – they are on track to a retirement age of 75 years old. There is no question that this is too old and a lot of people would prefer hanging up their corporate jersey, so to speak at an earlier age than that.
Planning for retirement can be an anxious time for some people that is why they prefer to just postpone it and put it off for another time. But as this happens and retirement planning is put off, it becomes harder to reach their specific goal. What could have been earning compound interest is lost and the chance to retire early is compromised.
Planning for retirement
If you are already serious in planning for retirement, here are a few things you might want to look into to help you plan better.
- You can get professional help. Marketwatch.com explains that professional help with retirement planning should could cover maximizing returns on investment strategies but it should be more than this. At this point, you might already be scratching your head with this so imagine how you would feel if you dig deeper into details. This is one of the reasons why you might want to hire professional help at the onset so you can understand the process better. No one was born an expert and you need to learn the basics just like learning how to walk before running. A professional can set you off on the right track.
- The sooner you start, the faster you finish. There are times when retirement is a matter of wanting to retire at a certain age and needing to retire at a certain point in your life. The difference is between how early you start and how consistent you are in reaching your goal. The earlier you start saving up for retirement, the earlier you can retire at an age that you want. The problem with some older consumers is that they are forced to work for a longer time because they still do not have enough for their retirement. It is always better to retire when you want and not be forced to work for a longer time than you want.
- Keep yourself healthy. Your health is a financial investment and this could not be more evident when you hit retirement and your body starts to collect on all those years of neglect and poor health habits. You would have an easier time enjoying your retirement if you are not going in and out of the hospitals. It would be a more enjoyable cruise if you were not at the doctor’s clinic most of the time. You would also have an easier time budgeting your money for retirement if you did not have to keep buying medicines. The bottom line is that keeping yourself healthy at present is a great investment when you get older. You get to enjoy life more at old age.
- Pay down your debt. Another thing that can help in retirement planning is managing your debt payments and making sure that you are able to pay off most, if not all of them before you hit retirement. By that time, it is ideal that your expenses would only revolve around your basic needs. Plan to pay off most of your debt accounts such as your student loans, credit card debt, auto loans and especially your mortgage loan.
- Find something to do. One of the things that most retirees forget is that retirement does not equate to lack of activity. This is one sure fire way of losing a grip on interests and hobbies and has an adverse effect on a person. This is similar to going cold turkey for people who are smokers. It is hard to just abruptly stop and simply stay at home.
How to get in trouble with your retirement planning
One of the quickest ways to have problems with your retirement fund is not having any to speak of. According to Statisticbrain.com, about 38% of consumers do not even save any funds which they can use when they retire. Here are a few more situations which can also do a number on your retirement fund.
- Thinking that retirement is too far in the future. This is a common problem for consumers which leads to starting too late in their career to plan for retirement. What happens is that for a fact, retirement will come around age 60s to 70s so for a young consumer, this is still decades into the future. They would feel they have a lot of time on their hands and this can give them a false sense of security. When it comes to retirement, it is better to start earlier and reach your goal at a time when you still have the energy to enjoy life.
- Relying only on one source of fund in retirement. Your social social security is a great source of money during retirement but solely relying on this can land you in trouble. This is the proverbial eggs in one basket. It is always better to have multiple sources of funds especially when you are already retired. Diversifying your money can help ensure that you have a steady flow of cash at a time when you are no longer employed full time. This can also help you weather financial trouble at an old age. It might be a good idea to have some other investments that can give you decent returns during retirement. You might even pursue that photography hobby and earn something on the side as you do something you love.
- Using your children as your retirement plan. This should not happen and should never be used as retirement strategy. You have a responsibility to your children in molding them up to be responsible adults so they can take care of themselves when they grow up just as you should as a grown up. They can give and share with you their success but it should never be compulsory on their end.
Retirement planning is a long process and what you need to remember is that the earlier you get started with it, the faster you can reach your goal. It also gives you enough time to get back up on your feet in case you make some wrong decisions along the way because once you make costly mistakes near retirement, you are putting your fund in jeopardy.
You might be one of those people who are trying to find a way to make your finances recession proof especially after what happened in 2008. That year saw the housing bubble burst that had ripple effects reaching individual consumers. There were a lot of people who were out of jobs and companies were not hiring.
No one wants to experience that again and fortunately, the economy has been able to reel from that economic nightmare. But history has a way of repeating itself and if the Fortune.com article has any foreboding effect, people have to start paying close attention to the economy once again because there might be another one coming.
The article points out that Deutsche Bank analysts has reason to believe that the US has a 60% of experiencing another recession in the coming 12 months. This is an interesting development and could be used to start looking at the economy a little more closely. Consumers can also use this opportunity in making sure their finances are recession proof. It might be a difficult task but at the very least, you can improve your finances this way.
There are decisions in life that can lead to financial trouble and if there are economic factors to consider, things get a little more complicated. By your own, you can get into a multitude of financial problems without any economic problems as a factor. It would be nice to try and get your financial affairs in order so you are always ready to face problems head on.
Trying to get your finances recession proof
As you read through and decide that you want to proactively try and recession proof your finances or at least get them in order, here are a few things you can do. These can help you prepare for another economic slowdown and strengthen your finances as well.
- Strengthen your reserve funds. You never know what will happen in the future and what financial emergencies will present itself in your household. Add the fact that economic factors might make it harder than it should be for your and your family. One way to prepare for this is to strengthen your emergency reserves to be able to face any financial needs in the future. If you suddenly find yourself out of a job, you have your emergency fund to cover your expenses until you get to find another one. If there are looming news about an economic slowdown, you might want to increase your reserve funds just in case you have a harder time looking for another job.
- Start living a frugal lifestyle. One of the quickest things you can do to help your finances is to start taking on a frugal lifestyle. This can drastically lower down your expenses and help you save more from your income. Another advantage it has is that over time, you get used to living below your means and it comes naturally as you make financial decisions. You are able to be more discerning with your expenses and in the process, be a little wiser with your financial decisions. This is a big factor when you are trying to weather financial problems that is caused by either personal mistakes or economic challenges.
- Diversify your income. Another thing you can look into to help you prepare your finances for worst-case scenarios like a recession is to diversify your income. It simply means that you have to aggressively look for other sources of funds which can complement the existing ones. Initially, this will be a big boost and help you increase the fund coming in. It can be a great tool in increasing your reserve funds and paying your debts. But if another recession does come around and you get hit by losing your job, you are not too affected because you have other sources of income. It can be your passion for baking and how you are able to sell online and even within your community. It can also be your photography hobby and how you are able to sell prints off the events you are covering. You might even be able to live off being a graphic or web designer while money is tight. The important thing is to look for ways to diversify and increase your sources of income.
Here is a video that gives you ideas on how to earn extra cash on the side:
- Be aggressive with debt payments. This is another thing you can do and it can be easier when you are living a frugal lifestyle and adding more channels in your revenue sources. This is more important as Nerdwallet.com shares that an average American household has over $130,000 in debt that covers most types of financial obligations such as mortgage loan, credit card debt, and even student loans. In times of financial emergencies, most people would have a challenging time meeting all their payment obligations. This is because everyone would be concentrating on the basic needs such as food, clothing and shelter. All others would be lower down the priority list and could be earning fees, penalties and interest as you miss the payments. This is one reason why it is a good idea to be aggressive in paying them down especially if you have some extra funds in your budget.
- Think twice about major purchases. If you are trying to build a recession proof plan for your finances, there would be a few things that would have to go and one of them would be your major purchases. You do not have to put them all in hold altogether but you just need to think twice before committing to that expense. Try to find out first if it is a need or want and you can go from there. If it is a want then you might be able to bump it further down your priority list. If it is a need such as a new camera body for your income-generating hobby then save up for it and buy it. You can recoup that expense anyway with the income from your photography gig.
How to get further down the debt hole
It is always easier to increase your debt amount rather than cut them down. Just like it is easier to eat whatever you want and gain a few pounds rather than hitting the gym and sweating it out. But if you are trying to look at a recession proof budget, you are better off being proactive in keeping debt at bay. Here are a few things you might want to watch out for to help keep away from more payments.
- Failing to appreciate your present job. Thinking it will always be there and that income will constantly be trickling in every month because of your current job can be a problem. You might come to a false sense of security and become lax and passive. You need to make sure that you are always learning and contributing to make yourself relevant in the office.
- Mindless credit card purchases. One of sure fire things you can do to increase your credit card debt is to aimlessly make purchases by charging expenses to your heart’s content. Keep your impulsive nature in check especially if you have your credit cards with you.
- Missing due dates. NFCC.org shares that about 25% of consumers do not pay their bills when they come. This can lead to a lot of money lost on interest and totally avoidable fees and charges on your account. Make sure that you are on top of your payment schedules so you do not miss anything.
It is a challenging task to try and make your finances recession proof especially if you are struggling with a lot of debt payments in your budget but it is not totally impossible. Some people might point out that there is really no way to make any budget recession proof and there could be an argument to make with that statement. But when you try and do your best, you at least strengthen your finances in case of unexpected economic downturns.
It is always scary for people when they are faced with new things in life and that includes first job finances for the young graduates. You might have experience with some summer jobs or side jobs during college meant to help you pay for school. You might also have had the chance to work in your family’s business in the past. But when you are already on your own with your first job after college, things are a little bit different.
For one thing, you need to understand that this is not just a simple means to an end like your summer job. In the past, you would take up whatever job you can get your hands on to save up for a console game or a comic book. You might even be putting the money aside to help you buy books and pay down interest on some student loans.
But those are mostly short term goals and when you take up a job after graduating from school, this is a start of a long journey and first job finances comes into play. Even before you think about earning extra income or getting chasing your hobby and turning it into a money-generating passion, you need to get your finances straight first.
This should be the sentiment of young graduates especially as CNBC.com shared that there are almost 2 million graduates in 2016 looking for a job. Although the prospects are bright where companies are heard to be hiring more than what they took in last year, it is still about managing the money that comes into play. That first job will be worth nothing if you cannot handle your finances properly like an adult.
Tips on first job finances
If you are all set to report for your first day on the job or you just received an offer, here are a few things you can look at to help you plan your finances. Just like in your freshmen year where you really did not know what you were doing the first few times out, the same can be said when you get your first job. But you need to understand that the stakes are higher so it is better that you get all the help you can get. Here are some of them.
- Audit your student loans. Student loans is something a lot of people have first hand experience in. There are some older consumers who are still making payments on their own student loans. WSJ.com said that the average debt amount for a 2016 graduating student would be at about $37,000. This is a big amount considering you have yet to get your first paycheck. But you need to face this head on especially now that you have the ability to ship away on it. You need to audit all your student loan accounts to have an idea how much it is and who your lenders are. You can make repayment easy through debt consolidation but you need to closely understand the different options you have with your federal and private student loans.
- Keep tabs on your credit card. At this point, you might already have a credit card that you have been using since college. In fact, you might have more than one in your possession. As you are now trying to manage your first job finances, you also need to keep an eye out on your card usage. You might still have your old mentality in school where your card serves as your emergency stash that you use in cases where you really need to buy something but you are short on cash. You now need to view your card as a tool to help you manage your finances and improve your score.
- Check your credit score. When you are starting to take notice the need to manage your finances better, you will come across the importance of your credit score. This is basically how lenders see and view you as a consumer with regards to your financial obligations. The lower your score, the riskier it is to lend to you. And the higher your score is, the easier it would be to be approved for loans in the future like a car or mortgage loan. You can check your score with free tools from the credit reporting bureaus to be on top of those numbers.
- Prepare your budget as you go along. One of the most crucial building blocks of your first job finances is your budget. The fact that you could be doing this for the first time might intimidate you but you just have to look at the bright side – it is your first time so you can do it as simple as you want. You just have to keep in mind that this will mostly be a trial and error especially in the beginning as you try to get a grip on your expenses. But there is no need for those complex and hard to understand charts or formulas. Just look at the income that will be coming in from your first job and any other sources of funds. You then list down all your expenses you have as well as other funds that you need to build up. Then take a look if you have enough coming in to cover all your financial needs. You can tweak your list until you find one that you are most comfortable working with.
- Set up your financial accounts. One other thing you need to do is to have your financial accounts in order. Think of it as having different envelopes so you can slowly save up money for various expenses. You can talk to your bank to have an idea what accounts you can open such as a savings account or a checking account or both. You can manage first job finances better when you have specific accounts to use for specific occasions such as paying for utilities or setting aside reserve funds.
Things to avoid when managing your finances
As you move forward and manage your finances with your first job, it is ideal to have an idea on some of the common problems others have had to go through. This can help you prepare and plan your financial steps as you reach for your goals.
- Getting too many credit cards. Creditcards.com shares that on an average, consumers carry with them about 2 to 3 credit cards. This can be used to separate one for utilities, grocery and gas money. But one of the pitfalls of first job finances is taking in as many credit cards as you can. These can be offers or even card applications which can even lower down your score with multiple hard pulls on your score. But more than the credit score, having too many cards can give you a false sense of security with your finances and you might end up using more than what you can pay off at the end of the month.
- Not understanding your job offer. You might be too excited that you just scanned through your job offer and signed along the dotted line. You need to put time and effort in understanding your job details and in reading between the lines. You need to be aware of the contents of your offer and not just your salary.
- Spending more than what you are earning. This can happen when you have too many credit cards or when you do not have any budget list to speak of. You tend to spend more than what you have and put your finances on jeopardy. You need to be mindful of your spending and keep it under control.
First job finances can be intimidating at times because compared to how you manage your money in the past, this is a more serious approach which has long-term repercussions. You just have to start small and build up from there as you go along.
If there is one thing you can do right this very minute which can lead to a better financial standing, it is to start saving. Whatever money you have in your wallets or pockets, take them out and set aside an amount you can commit to save. Put it aside for now and go on with your day. Tomorrow, do the same thing and before you know it, you have already started with a habit of saving.
One of the reasons you need to do it constantly is because people are creatures of habit. The more you get used to doing a certain task, the easier it is to do. It becomes like a second nature activity for you and you get to go on doing it without putting in much thought. But of course, this is easier said than done and there will be challenges you need to face along the way.
One of the hurdles you need to address is how everyone else around you views saving. According to Gobankingrates.com, there are about 52% of American consumers who only has about $1,000 under their savings account. What is more troubling is that there are over 20% of adults who do not even have their own account set up for saving money.
Believe it or not, there are some people who has a fear of savings which basically stems from lack of knowledge. Some of them do not have an idea what it is for and prefers to live in the moment and spend from one paycheck to another. There are some who just does not know where and how to start saving for their financial future.
How to start saving for beginners
If you want to start saving and have a positive impact on your financial future, here are a few things that can help you get started from scratch. Everyone has to start somewhere and if you want to save, take a look at these tips.
- Start small. When you were trying to learn how to play basketball or volleyball, was your first lesson about learning how to dunk the ball or how to deliver a killer spike? When you first went out to golf, was your sole intention to score a hole in one? These are things you try as you progress through your learning. The same with saving money because you have to start small. You cannot just get half of what you are earning right off the bat and put it into your savings account. This can leave you vulnerable to cash shortage and eventually missing out on payments. When you are just starting out, it is best to start with a small amount and eventually increase is as you go along. This helps you develop the habit early on without being shocked with the amount.
- Look at small rewards. As you go along, it might be a good idea to set small rewards for yourself as you make or hit saving targets. You can do this every week or once a month to help you feel good about your saving goals. One thing you need to keep in mind though is how you spend for those rewards. Rather than help you incentivize the task, you might be creating false sense of right to spend ridiculous amount of money. Your rewards has to be in tune with the amount you are saving so you do not spend more than what you are putting aside.
- Make the task easy. According to a report by Nacha.org, there is a high awareness level for US consumers about direct deposit. Almost 80% of American adults are familiar with the service. This is a good thing because being able to use direct debit when you are just about to start saving can be a big help. You can automatically set up the amount to come out of your account every month or week depending on when you get your salary. This helps you budget better because the money is already out of your main account even before you get the chance to spend it.
- Keep yourself accountable. This is easier said than done because it is easier to skip a month without anyone knowing if you just keep everything to yourself. One way around this is to let your husband, wife, fiance, family member or a trusted friend about your saving plan. This way, someone can check up on you and monitor your progress if you are really saving on a regular basis.
- List down your to-do list. Having a to-do list is a great way to get you started with saving money if you do not want to subscribe to a direct debit system early on. You need to have a physical list which you can go back to from time to time to make sure that you are on top of things. More than just being a list, it serves as a reminder that you have set out a task and that you need to hold yourself accountable in reaching your goal.
Financial situations that hurts your effort in saving money
Along the way, you will undergo and experience financial situations that might make you believe you are doing something good when in fact, you are putting your finances in peril.
- Tax refund. IRS.gov shares that the the average tax refund check consumers get is just a little over $3,000. This is a big amount for anyone who is not expecting any refunds to come their way but if you look closely, this is an amount you could have used elsewhere. If your taxes were filed correctly, you could have used that money to increase your savings amount, your reserve funds or even your investments. This would have helped you start saving. That amount was with the government for quite a while and you did not earn any interest off of it.
- High deductibles. This helps you lower down your premium amount and makes your household budget more manageable. But if you are taking this route, you need to make sure that you have ample savings to cover any unexpected insurance claims that would come your way. The out-of-pocket expenses is what stands in your way between getting the insurance to cover your need or not.
- Investing in depreciating assets. You might have a habit of buying various things in life thinking that they serve as investment in the long run. But you need to look at how depreciation plays a crucial role with the things that you buy. If you think those gadgets will be worth the same after some time then you are sadly mistaken. They start depreciating as soon as they are shipped out of the factory where they were made. Same thing applies with a car or other toys. You can look at buying property or pieces of land that has a better chance of appreciating in value.
Here is video explaining the difference between buying a car brand new versus purchasing a second hand car:
- Lending money to relatives. Just as borrowing money from relatives should be given a lot of thought, it also means that you have to make sure you are making the right decision lending to them. You might have a hard time recouping that amount in the future because relationships can get in the way. It might be better to just invest the money so it earns interest along the way.
It might not be easy to start saving money for your future need but there are baby steps you can take to get you started. One key component is consistency and developing the habit of saving so it becomes easier over time.
Debt obligations will always be part of most people’s financial journey. From a simple credit card charge for that dress for a wedding to as big as a mortgage loan from the bank. Debt is already deeply ingrained in the society that people do not shun away from it. In fact, there are even a few that embrace it and integrate it into their way of life.
Just like with anything in life, too much debt can ruin your life just like too much food can make you obese or too much work can increase your stress level. Anything in excess can be harmful for your in the long run. That being said, debt is also a great tool that can help you achieve your financial goals and dreams rather than wait for things to fall on your lap.
Take student loans for example – it is a hot topic simply because there are a lot of students who seems to rack up a huge balance when they graduate. What is usually highlighted is the suffering and the sad plight of the borrowers who has to repay the amount. Taking out the political issues in the example, student loans help young graduates get better chances in life by landing better paying jobs.
Nerdwallet.com shares that the average mortgage loan debt for a household is at about $168,000. This is usually one of the biggest debt obligations shouldered by consumers. But as big as it maybe, it allows your family to live under the security of a roof over their heads and rooms to sleep in at night. You can save up for a house so you can buy it in full but on an average salary, your children will all be grown up even before you complete the payment.
In fact, a mortgage loan will improve your net worth and a student loan will increase your chances of netting a higher salary. The problem starts when you take in too much and pay out too little. You are forced to shoulder the numerous fees, penalties and various charges that will be added onto your account when you start missing payments.
Universal truth when you get out of debt burden
But if you keep at it, you will soon feel chip away on that debt commitment and be able to either lower it down or pay them off completely. When you get to that point, here are a few things you can expect and might have learned along the way.
- You get to save money. The interest you are paying your lenders can now be used for other areas of your financial life. You should know by now that as you pay your lender, you are assessed an interest payment over and above the principal payment. As soon as you pay off that debt obligation, you get to save the amount you were paying for that account and not lose money in the process with interest payment. You can then use the money to either aggressively pay off other debt obligations or put the money in your reserve or retirement funds.
- It helps you improve your credit score. As you pay off your financial obligations, you also improve your credit score in the process. By now, you should have a clear understanding on the importance of having a high credit score and what it can do for your finances. Debt payment is one of the key components of your score. The more you monitor and ensure that your debt obligations are met, the better it is perceived by credit reporting bureaus and the higher your score. The higher your credit score, the lower the chance financial lenders will view you as a high risk borrower and be able to extend very low rates for your loan applications.
- You get to pursue a career you want. This is one of the things that slips away from most people without them realizing it. Because of debt commitments, they are sometimes forced to take on a job only because it pays regularly and they can get a higher salary compared to what they really want to do. But if you are able to manage your debt commitments, you might be able to pursue your passion early on. Even if it does not pay well, you do not have a lot of financial obligations to weigh you down.
- You get to retire at an age you want. Nerdwallet.com shared that the present generation of young consumers could be looking at a retirement age of 75 years old. This is due to the fact that they have so much deb to pay off starting with their average student loan debt which is further complicated by reckless financial decisions such missing out on credit card payments and taking out high interest loans. Having a good handle on your debt accounts allows you to retire at an age that you want and not at an age that you need. The difference between the two is that retiring at a particular point in your life is dependent on the amount of savings you have. The sooner you are able to save up for the inevitable retirement, the sooner you can retire and enjoy your money.
- You can help you children out with their finances. This is a matter of choice because there are parents out there who prefers that their children learn things on their own. But it would be nice to have the luxury of choosing to help your kids without putting your own finances in jeopardy. The only way you can do this is when you have a good handle on your own financial challenges. As soon as you get that in order, you can then help your children.
- It is possible and it can be done. As you take on your debt obligations, there might be times that you doubted yourself and your ability to get out of debt. But now that you have managed to lower down or even pay off some of your financial commitments, you know in yourself that it can be done. With determination and hard work, you were able to reach your goal and take control of your debts.
Getting the money to pay for debt obligations
Now that you have an idea on what it would be like to be able to manage your debt commitments, here are a few tips in getting the money together to pay for your debt accounts. This is most helpful if you are still on your way to better financial management.
- Working hard with your day job. This is one of the most common routes people take because it is already there and just a matter of tweaking their work ethic. They can be more active to take advantage of promotions or other financial rewards in the office.
- Supplementing income with a second job. Another option most consumers look into is getting a second job to complement their existing income. This can be a few hours of work after their day job which can add up to a significant amount at the end of the month.
- Monetizing your hobby. Payscale.com shares that bottom-earning photographers earn about $21,000 a year. Imagine if you can take up that camera and start shooting events over the weekend. You get to do what you love and you earn in the process. You might not earn that much but it can be enough to help you pay for your debt accounts.
Lowering down and even paying off debt obligations is not an impossible task. It may be hard and challenging but it can certainly be done.
You might have heard people say that anything in excess can lead to trouble and the includes having too many credit cards in your possession. It might be surprising to hear that it can also relate to having too much money, work, and stress triggers. Too much money can lead to a life that can be morally questionable, too much work can land you in the hospital so does stress.
When it comes to credit cards, there are some people who doesn’t seem content to have just a few of them. They apply as much as they can and accept whatever cards come their way with no questions asked. According to Creditcards.com, the average consumer has about 2 to three cards with them with baby boomers having the most cards in their possession.
One possible reason for this is that having cards can give some people a false sense of financial security. This is because they equate their credit card limit with actual budget money they can spend every month. What they often fail to understand is that these cards are just credit extended to them by lenders. In reality, they can be compared to taking out a short-term loan every time you use them.
These short-term loans given by lenders disguised in shiny plastic cards are always due every month. There might different due dates for every credit card but the principle is that whatever has been purchased using the card, they have to be paid on a monthly basis. The statement comes in outlining the amount and all the details of the expenses.
Having too many credit cards can be a painful form of torture every month as you wait for your card statement. Although you might think that you can manage them just fine because you are only paying the minimum amount each and every time. Doing so makes you a favorite for the lenders because they get to earn a lot from interest and other fees that they will assess on your account in the succeeding months.
Potential problems when you have so much credit cards with you
If you are one of those individuals who seems to be “trigger-happy” when it comes to owning a card, here are a few possible financial scenarios you might encounter.
- Spending more than what you can pay off at the end of the month. Having too many credit cards already says a lot about your impulsive behaviour. This can ripple out to your shopping tendencies where you could lose control and develop the nasty habit of spending more than what you can manage every month. This can complicate into a lot of financial problems starting with unmanageable debt, maxed out cards, and not to mention the possibility of coming up short in covering important expenses at home.
- The annual fees add up every year. As you own credit cards, you would quickly find out about how annual fees can quickly add up to hundreds of dollars when you combine all of them. This is always a part of your card fees and lenders include this in the bill once a year or spread it out over the course of the year. According to Bankrate.com the average annual fee for a credit card is around 11.06%, if you have ten or more cards, you can only imagine how much they all total and the amount that goes to annual fees every year. Imagine if you can save that amount and over time be able to invest that money?
- Overlooking payment due dates. This is one of the problems that can plague consumers who are way in over their heads with the number of accounts and payables they have to manage and keep track of every month. The more credit cards you have, the more monthly statements you have to deal with and the more challenging it gets to stay on top on all of them. This situation can lead to some missed payments and additional fees and charges racking up on the account.
Here is a video that can give you some tips with your credit card use:
- Using one card to cover another. Think of having to hold a hot coal on one hand and as soon as it becomes too hot for one hand because you already have blisters from the heat, you transfer it to the next. But the problem is, it will soon be too hot for that hand and you would need to transfer it to the original one further complicating the blisters and making it worse. The same situation can happen to your cards if you ever try to pay off one with the other. You are just preventing the inevitable which is paying off the balance. The time will come when you really have to pay for the debt which might have already ballooned in amount because of all the different charges that has added up.
- Credit score can dip with too many applications. Every time you apply for a credit card, lenders will perform what is commonly referred to as a hard pull on your credit score. This helps them determine how well you have been attending to your financial obligations and gives them the ability to determine the risk involved in extending you credit. This is part of the whole application process but what you need to be on the lookout for is your score dipping. Having too many credit cards can mean multiple applications which means several hard pulls on your score. Each pull will result to a dip in your score so multiple applications can result to a significant drop in your credit score.
How to address problems from having too much credit cards
If you are in this situation and already experiencing the problems mentioned above, here are a few tips on how to address them and get yourself out of that credit card mess.
- Have a budget and stick to it. The number one most effective way of dealing with impulsive buying is having a budget and actually sticking to it. You need to sit down and be able to identify how much you can spend every month and stick to it.
- Talk to your lender and ask for a decrease. There are instances when you can ask your lender to lower down your annual fees or even how to totally waive off the fee. Each lender will have different views and opinions on this request but there is no harm in asking. The worst thing that can happen is they tell you that it cannot be done.
- Setting up payment alerts. You can ask your lender about it, you can set it up using your own personal calendar or even look for an app that can remind you. The idea is to help you be reminded that payments are coming up and you need to send them out to your lenders. If you already have too much debt to handle, you can look at debt consolidation to combine all your payments under one account. The beauty in this is that you only have to deal with one payment amount and more importantly, one due date to remember.
- Cut down on the number of cards you have. One of the easiest things you can do is to cut down the number of credit cards you have to make it easier to manage the payments. But you need to proceed with caution because it can adversely affect your credit score. You might discontinue the card that carries the longest credit history you have. This can result to lower credit scores because credit history plays a big part in your score computation.
Having too many credit cards might work for some people but for most, it can be a financial burden that is hard to carry. It can result to too many financial complications that can make it harder for anyone to reach their financial goals in life.
You might be one of the many consumers who has been scouring all possible resources just to get your hands on information to improve your finances. At this day and age, there are hundreds of online information that can come to a simple search you make on your computer. The challenge with this wealth of information is weeding out factual information from fictional theories and what will actually work within your current situation.
It is a tough challenge to manage personal finances especially when you are trying to juggle a lot of factors all at the same time. There is your income which can come from your day job and even some cash-generating hobbies on the side. You then have to look at all your expenses from your daily costs to big monthly obligations such as rent or mortgage. You then have to align all these with your long-term goals and check if what you are doing at present is bringing you to where you want to be in the future.
When you start considering these when it comes to your finances, you could suddenly feel that you are way in over your head with the amount of work that you need to do. Tracking your income and controlling your expenses to make sure that you get to where you want to be could be a tall order for anyone especially if you do not have any background in financial management.
But even with this challenge ahead, a recent survey conducted by Gallup.com showed that there are roughly 44% of US adults who believes that their financial standing is better compared to previous years. But even with this, a greater majority of people are not that optimistic with their finances. If you are one of these majority, you might still be in the dark on how to manage and improve your finances and still looking for ways to achieve this goal.
One of the easiest and simplest things you can do to help your finances is to declutter your home. This can be as easy as starting with a clean-up day so you can go through and audit the things you have at home. You get to clean your house in the process as well while you go through every nook and cranny trying to clean up.
Improve your finances as you declutter
As you declutter your household, here are some of the financial benefits you can get out of it. It will not only help you improve your finances but give you some extra encouragement as well to work harder for your goals.
- You let go of excess baggage. You tend to make better decisions when you have less things to worry about. Think of your workspace for example – there are a few people who prefers to work with what they call “organized mayhem.” This is where their workspace has stacks of papers all around and files are just everywhere. If you want to have an easier time with work, you need to clear up your desk. It helps you think and concentrate better. The same goes with your household because the cleaner and less items you have, the easier you get to think and make financial decisions.
- Money saving activity. As you declutter your house, you are also giving yourself the chance to save money in the process. As you look around and get used to a clutter free life, you get to fight off the urge to buy useless items around the house. This helps you concentrate on the things that you need and are important around your home. You no longer have to spend and lose money buying stuff you do not need.
- Resist the urge to shop. As you develop the attitude of decluttering and ultimately living in a minimalist lifestyle, it changes your shopping habits. As you move forward, you will no longer feel the need to keep on buying things to satisfy a compulsive behaviour. You can go back to your new take on life and clutter around you. This keeps things in perspective and prevents you from charging to credit everything and anything that pleases you eyes.
- Make extra money. If you are trying to improve your finances, one of the sure fire things you would need is extra money. As you declutter your house, you get to end up with a few more items than you need. One tip is to sell your stuff with garage sale to monetize the items you no longer need. Statisticbrain.com shares that there are about 165,000 various garage sales all around the US each week. There are a lot of people who knows the value of monetizing items they no longer need and using the amount they raise to add to their savings or investments. You can also look at selling your wares online and be able to connect to a lot more people.
Surefire way to screw up your finances
As you now have an idea how decluttering can work in your favor as you try and improve your finances, here are some of the pitfalls that can set you back and prevent you from reaching your goal. It is best to know them ahead of time to help you steer clear of these situations.
- Deliberately paying after the due date. The rebel in you might be testing the waters but there is no need for this. It is a well documented situation where you already know what happens next.. Your lenders are given the prerogative of charging you fees that adds up to your next billing statement. This also has an adverse effect on your credit score.
- Not paying attention to credit score. You need to keep a close eye on your credit score as it affects your ability to take advantage of financial tools in the future. You might not have an idea that you are already carrying a low score. This can either increase the interest rate you will be assessed when you take out a credit card, mortgage loan or even a car loan or be denied altogether. It is important that consumers regularly monitor their score even with free reports they can get from reporting bureaus.
- Thinking that retirement is too far away. Although Nerdwallet.com recently found out that the younger generation is looking at 75 years old as their retirement age because of increasing financial obligations. This can give the impression that retirement will be too far down the road and that it does not require any immediate action. But consumers need to understand that what they do at present affects their retirement age altogether. The sooner and more aggressive you become with retirement planning, the better you improve your finances and retire at an age that you want.
- Trying to keep up with the Joneses. This is one of the big problems facing Americans at the moment because they are so used to comparing what they have with that of their neighbours. As soon as a new car drives up their neighbor’s driveway, there are people who immediately wants to have one as well. You need to be content and remember to go back to why you want to declutter in the first place. This can help you put things in perspective and follow through with your lifestyle plans.
It is natural to want to improve your finances and build a better future for you and your family. Decluttering is one of the easiest and fastest things you can do to help you achieve this goal.
Over the course of your efforts in managing your financial accounts, you will come across a lot of types and might wonder if you really need to know all of them. You will have a few that you manage to make sure that you have enough for retirement and a couple more to make sure that you are able to manage your daily finances.
And these are just some of the ones that you will come come across which you feel you must know. It is true that one of the potential problem areas in your budgeting skills could be lack of knowledge on the basics of money management and the accounts that you manage play a vital role in this set up. If you do not know what your 401(k) is how a 529 plan can help your kids in college then you would not be able to maximize these to your own advantage.
It is critical to have a good handle on your finances and this include identifying the financial accounts that will help you achieve your financial goals in life. This is similar to when you decide to do a 180 and focus on your health and exercise more. You need to have a clear understanding of the tools that you can use to help you get to your goal.
When you walk astray and lose sight of your financial goals, you could end up in serious financial debt. Just like how Nerdwallet.com explains how a household’s average credit card debt is already at $16,000. This can start to be unmanageable when you factor in late payment fees and other surcharge amounts that lenders would start to put in with every late payment.
Financial priorities you need to consider
If you are serious about your financial goals in life, here are a few of the financial accounts that you need to focus on and manage accordingly.
- Retirement fund. It is important to understand that you do not have the ability to work for as long as you want. You might think you can still work but your body ages through time and regardless how much you take care of your body. The time will come when you can no longer get to the office and report for work or even manage that business you built up. That is why your retirement fund to help you with your financial needs long after you stop receiving your pay checks. THe older you get, the harder it is to build it up so it is important to start saving early.
- Reserve funds. Financial problems will come and rear its ugly head when you least expect it and when it does, you better be prepared or debt will follow soon after. Being prepared comes in the form of your reserve funds particularly your emergency and rainy day funds. These two will help you address hurdles such as losing your job or simply having the need to get your fridge serviced. When people do not have money for emergencies, the logical thing is to borrow and that puts them in debt.
- Mortgage loan. This is one of the financial accounts that you need to focus on and should always be on top of your priority list. You do not have to bend over backwards trying to make extra payments on the house because there is a big chance that it has the lowest interest rate among all your debt accounts. Focus on it in terms of not missing payments or defaulting on your mortgage all together because you can end up losing your house in the process.
- Student loan. WSJ.com shares how some seven million Americans have not been able to make a single payment on their federal student loan. This type of loan is one of the hardest to discharge and it has the tendency to follow you around wherever you go. What makes this unique for most people is the fact that it is usually the very first debt they are faced with right after leaving college. All those years paying for the cost of attendance boils down to one amount as soon as graduates step off the stage on their graduation rites. With this, it is wise to make sure that the amount is paid off in time or earlier if possible.
- Credit card debt. Compound interest is a double-edged sword because as helpful as it is with investments, it is just as dangerous on credit card debt. When you forget about a payment on your card, you give your lender the right to slap ridiculous fees and interest on your account. The sad reality is that this becomes part of your principal amount on your next billing statement where interest is assessed. That is a double black eye and can quickly increase your debt amount in a short amount of time.
Getting things done
If you are bent on improving your finances, here are a few strategies you can consider.
- Fix your household budget. You would always need a starting point and when it comes to getting your financial matters done, you need to begin with your household budget. There are a lot of tips to help you with your budget but the first thing you need to do is to have one. It is better to start with a bad one than none at all because you can at least have something to work with and improve as you go along. Your budget will help give you an idea on how you are distributing your income towards all your financial obligations in life.
- Involve your family. When you need to get things done, it is a lot easier when you include your family in the picture. First off, you and your husband or wife should be on the same page when it comes to managing money. You also need to include your children in your budgeting tactics and it can be as simple as talking to them on how you are planning for the family vacation or if they want to start with a piggy bank. Educating them early about money management is also a good thing to do which can help not only the family’s finances but theirs as well in the future.
- Increase your income. Between increasing income and lowering expenses, the former always seems to be harder. This is because people can just cut back on some purchases and they get to cut costs. But increasing income means getting some overtime work, getting a second job or even looking to set up a business on the side. This takes a lot more effort than simply cutting back on expenses but this is more of a long term solution. This can even guide in finding out your next financial moves like a business or a hobby you can profit from.
- Lower down debt. You need to lower down your debt because the interest payments are taking away what you can essentially save and earn off on with the help of compound interest. Take your credit card bill for example because once you choose to make just the minimum payment on the card, you end up paying for several fees and penalties together with the interest rate on the card. But if you do not carry a balance, you can use your money and invest in and make it work hard for you.
Over the course of your life, you will have many financial accounts that you will have to manage but the article points out some of the most important ones you need to focus on.
There are a lot of credit card mistakes that you will make over the course of your financial life but if you are a parent with children at home looking up to everything you do, these mistakes suddenly becomes lessons for the young ones. What you do, how you act, the way you react to situations in life will always be used by your children as a standard of how things should be done.
Parents are children’s first teachers in life and they mold their character and behaviour based on what they pick up from adults around them. With this in mind, you need to be more careful with how you manage your finances especially your credit card usage around the kids. They will accept wrong financial behaviour from you and deem them as appropriate. As Creditcards.com shares that the average card balance is over $5,000 per user, this becomes an even tougher job.
You might not realize it but you are being observed by your little ones with the way you deal with present day problems. From how you handle your relationship with your husband or wife to how you manage the household and even how you use your credit card in everyday purchases. When they see how easy it is to pay for things because you just swipe and sign, they might find it hard to associate it with actual money payments.
They do not see any money transfer from one hand to another so the idea of money takes another form in their minds. What older people have been accustomed to where they work, earn money and pay for purchases with actual dollar bills. This exchange had a big hand in helping older people understand the value of money because they see the transfer of funds. This is one of the reasons people have so much credit card debt.
Credit card mistakes kids see in adults
If you have children at home, here are a few things you might want to guard with your credit card use. This will help you impart practical and useful financial lessons over to your kids.
- It is acceptable to pay the minimum amount. When you opt to just pay down the minimum amount, you are sending the wrong message to your kids and you are digging yourself into a debt hole. Minimum payments allow lenders to add various fees and charges on your next bill and it increases the amount you pay over time. That minimum amount is just a suggestion and what you need to be concerned about is the total amount due. When your children learns that adults just pay the minimum amount on their cards, they might just do the same and copy that when they get older.
- Chase those rewards no matter what. One thing credit cards have over cash payments is the fact that lenders are able to offer rewards and other incentives for using the card. It can be points system where it accumulates over time or a discount over the purchase or even cash rebates that goes back into a consumer’s bank account. From all these, credit card mistakes can still come out especially when consumers start chasing these rewards regardless of purchase necessity. They will buy and use their card just to get the points and that is a wrong message for the kids who will look up to the actions of the the older people. You also need to look into the difference on late fees as Forbes.com explains that there are reward cards that put a higher fee than regular cards.
- Always transfer to a zero percent card. Having a zero percent interest card is usually because there is a promotional effort on the side of competitive lenders in hopes you getting your business. The idea is you get to transfer your balance over to them and it seems that you do not pay interest on that amount. You would then transfer everything you have just to save on payment but be sure that you are able to read and comprehend the fine print. There are cases that the zero or low interest will only be for a specific period of time after which the new lender can assess a higher rate – sometimes higher than or just the same as your past lender.
- Use your card as often as possible. This can stem from the desire to get rewards, convenience or worse, lack of cash. But everything in excess will not be good for you including credit card use. You need to balance your payment method with cards, cash and even online payment. You do not need to use credit cards all the time especially if you are already having a hard time tracking what payment goes where. Sit down and take a long hard look at your budget and plot out where the payments are coming from. Once you get a good handle on this, be sure to stick to it. Credit card mistakes such as these ones tends to stick with the young generation because they think that there is no limit to how they use their cards.
- Get as many cards as possible. Some consumers plan to use a specific card for a specific purpose which leads them to opening up more accounts than they want. There is a card for gas and another for shopping. There is a designated card for groceries and even for the utility bills at home. Some even have a separate card for car maintenance, house upkeep and for emergency. Combine all these and you might have more accounts than you can handle. This approach can work for some people but it takes time and skill to balance and juggle all these cards. One wrong payment and it can cause a ripple effect on the others that would be hard to track. Teach the younger ones how to manage a few cards and show them how easier it is because even people with high scores make credit mistakes such as this one.
Credit card use is not just an issue for everyday consumers because even in the presidential race, credit card use is being used as an ammo against some frontrunners. Take a look at this video:
How to use your card to help your finances
Credit cards has been getting a lot of flack in the past for all the wrong reasons because consumers have been quick to point out how their finances have been ruined by that small plastic card. But at the end of the day, it is still the consumer that ultimately makes the decision on how to use it. In fact, credit cards can actually help people with their finances.
- Understand how it affects your credit score. Credit card mistakes can easily ruin your credit score so in light of that, imagine what it can do to help you restore your score if used correctly. You need to understand the factors that surround it such as payment history and even amount owed as explained by MyFICO.com which are a big factors in putting a score together.
- Assign specific cards for specific use. This is one of the easiest ways to manage your cards because you are forced to watch how you swipe that little credit plastic whenever you are out. You can even recruit the help of your kids to help remind you to only use a specific card for specific purchases. This in turn also teaches them the value of proper credit card use.
- Show your kids how you pay your bills. This makes them understand that whatever purchases you signed for in the past does not magically disappear. It comes back as a payment obligation that needs to be addressed and paid up. This lesson can help them in the future and prevent them from knocking at your door on weekends asking for dole outs because they are having problems catching up with their card payment.
- Always negotiate with your lender. This is one of the things that most consumers usually overlook. This is because most people would only consider calling their lender when there is a problem with their account. But if you have been making on time payments and have been a good customer, it is possible to ask for a lower rate from your lender. Of course, it is not something that can be automatically given to anyone who calls in but it is worth a shot.
There are a lot of credit card mistakes that people make in their life. The sad part is that when kids are around, they adopt these misconceptions thinking that it is normal and repeat the same mistakes all over again.
The last thing you need as the holidays come closer is getting entangled in avoidable financial disasters. Avoidable because there are some financial problems that you cannot seem to get out of regardless how well you prepared. Just as there are accidents in life, the same can apply to your finances where a curve ball can surprise you when you least expect it.
Financial control is a delicate balance and that couldn’t be anymore harder during the holiday season where buying gifts but keeping out of debt is a tightrope act for a lot of people. There are some who have been planning for the holidays for months in advance in an effort to keep their finances intact while others are just looking to wing it.
It is easier for those that planned for the holiday expense compared to those that did not because they at least put in some effort into the season. Needless to say, these are stressful times when you have to make sure that you get to visit or invite over friends and relatives and have a gift at hand for all the important people in your life.
USAToday.com explained in an article that one of the biggest problems and fears of American consumers is taking in too much debt and that is sure to pick up with the holiday expenses looming just around the corner. Although there are a lot of people who have already started buying gifts for the holidays, a lot more are still waiting for the day after Thanksgiving sale.
Financial problems can arise from these items
Here are some of the most common problem areas that consumers normally face as the year comes to a close. These are oftentimes the leading causes of financial disaster in a household budget.
- Holiday shopping abuse. The holiday expenses really puts a lot of people off track with their year end shopping. It is even harder now because the new issuance of chip credit cards can slow down the process with a lot of people still trying to get used to the new card says ChicagoTribune.com. From what was a momentary swipe of the card with the old cards would now be a few seconds if dipping for the new ones. Regardless of the process, consumers need to keep a close eye on their purchases this holiday season.
- Lack of financial goal for the coming year. If you are into sports then you would understand the importance of having a clear cut goal for whatever it is you are doing in your sport. If you are playing golf then the idea is to win by hitting the ball and getting it to go in with lesser swings than your opponents. In basketball, it is to put in more points by shooting the ball in your side of the court compared from the other team. The same with finances where having a goal is very important. One way of improving your chances of reaching your financial goals is to have some that you will work hard for to reach.
- Absence of savings. Statisticbrain.com shares that the average savings for an American family is only roughly a shade below $4000. This might not be enough for emergency expenses or even just to welcome the coming new year. You need to make sure that you are able to put in some amount aside for various purposes. It can be your reserve funds or for gift buying for the holiday season. It can even be a specific amount to be able to make a significant dent in your student loans.
- Bigger expenses than income. One of the things that you need to look at is your household budget and a path straight to financial disaster is when your income is being overshadowed by your monthly expenses. Before the year ends, you need to look at your budget and determine where your expenses are in terms of your income. If that is the case, you need to make some drastic adjustments on the current budget and take a look at your spending to determine how you can put it in check.
Getting your holiday shopping under control
There is no question that one of the biggest contributor on expenses before the year ends is holiday shopping. The day before Thanksgiving and the few days left before the year ends are some of the costliest times of the year. Here are a few tips to help you manage the shopping and avoid potential financial disasters.
- Create a list of people and budget. It is important to have a list for your holiday shopping so you do not go out and blow all your money on just a few gifts when you actually want to thank a lot more people than that. You need to have a list of the people you want to buy gifts for and an estimate of the amount you want and can spend per person. This helps you keep track of what you have already bought and who already has a gift.
- Stick to that list. One of the most important budgeting skills consumers need to master is not just having a list but following their list. Consumers need to remember that it is not a suggestion that they can choose to follow from time to time. Not following their list defeats the purpose of making one in the first place.
- Look for ways to lower down cost. Holiday shopping can lead to financial disaster when you get lost with your purchases and get caught up with the season of giving. One way to lower down your expenses during the holidays is to personalize or use your talents in your gift giving. If you know and love baking, you can bake cookies or cupcakes for people that you love. If you are a photographer by hobby, you can give your friends and family some of your best work that they can frame and hang up on their walls as their home decor. You can use your talents and skills to help lower the need to head out and buy expensive gifts for your loved ones.
- Buy early. If you really need to buy gifts, you might want to start buying early so you can save on both time and money. Money because there is a good chance that the earlier you buy, you catch the prices before they surge up for the holidays. If it so happens that you bought at full price and it goes on discount in a few days, there are some merchants and card companies that offers price protection and reimburses consumers the difference. You also spare yourself the hassle of having to visit the stores with hundreds of people fighting over the same products.
- Use your credit card wisely. Your card will be one of your main tools in buying gifts for the holiday season so you need to prep it for the impending expenses. If your card has a significant balance on it, it is best to pay it down or pay it off entirely so you can use it to buy gifts. If you believe you will need a higher limit then call your lender and ask for an increase in your credit limit. Just be sure to pay off your balance at the end of the month.
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