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Guest Post – How to pay off debts and take control of your financial situation

February 11, 2011 · Filed Under Paying off Debt · 28 Comments 
Ryan Smith is a contributory writer associated with the Debt Consolidation Care Community and has written several articles for various financial websites. He holds his expertise in the Debt industry and has made significant contribution through his various articles.

In order to take proper control of your life it is very important that you keep a good control on your finances. This means that you must take good control even on your debts and make efforts towards paying them off.

Some tips that you may follow in order to take control of your debts are as follows.

1. Lowering the debt to income ratio: It is very important for you to lower your debt to income ratio. This is because the debt to income ratio is a reflection of your financial state. Most lenders will check your debt to income ratio along with your credit report. In case you have a very high debt to income ratio you may be denied loans. This will have a very bad effect on your financial life. Thus, you are to try and lower your debt to income ratio if the ratio is more than 30%. This will help you take control of your financial life.

2. Setting up a debt repayment plan: If you want to get out of a financial crisis and maintain a healthy financial life, then you will have to pay off your debts. In order to do so you must set up a debt repayment plan. The purpose of formulating such a plan is that it helps you to concentrate all the extra amount of money that you have and use it to pay off your debts. Another advantage of setting up a plan is that the process of debt repayment will be faster than it would have been otherwise.

3. Paying off all your old debts: One of the ways in which you will be able to come back on track is by trying to pay off your old debts. In order to do so you may approach a single company at a single time and gradually pay off your debts. As you keep on paying off your old debts you will be improving your credit score as well. This helps your financial situation greatly.

4. Stopping the usage of credit cards: It is very easy to get into credit card debts because you will not be able to realize that you are sinking into debts until it’s too late. Thus, when you face a financial difficulty and want to take control of your finances, then you will have to stop using your credit cards.

These are a few things that you can do in order to pay off your debts and take control of your financial situation.

BFN Giveaway: Win a Premium Membership to BeDebtFreeAmerica.com

January 28, 2010 · Filed Under Giveaways, Paying off Debt · 6 Comments 

Last week I shared a debt repayment calculator site and today I’d like to share another one that you might find interesting.  This week, let’s take a look at BeDebtFreeAmerica.  Also, Chris, the creator of BeDebtFreeAmerica, has donated a certificate for a free Premium membership at the site so let’s take it a step further and run a giveaway, too.  Check out the bottom of the post for details.

What is BeDebtFreeAmerica?

BeDebtFreeAmerica.com

BeDebtFreeAmerica is a “debt elimination tool” that can help you optimize your debt repayment schedule.    It seems to work in the standard manner you would expect from such a site.  You enter all of your debts and their associated information (balance, interest rate, etc) and the software creates a customized, and customizable, plan for you to efficiently pay them all off.

Multiple Reports

BeDebtFreeAmerica provides the user with multiple reports so that can keep on top of your plan and how it is proceeding.  You can view the details for one debt at a time, or a detailed list of every debt, monthly payment, interest paid, balance remaining, or just the stripped down basics of what to pay each month.  For people who like to look at data a bunch of different ways (ok, for nerds like me) this is a handy feature.  Click here to check out a sample account.

The tool appears to use the interest rate method for determining to order of payoff (pay off the highest rate loan first) but the site states that sometimes it chooses to give a smaller debt higher priority in the payoff list a la Dave Ramsey’s debt snowball.  It does provide what I consider to be a nice feature in that you can manually adjust the order the debts are paid off if you decide that you really want to pay off a specific debt first (or last, I guess).

Free “Kick-the-Tires” and Premium Memberships

I like that BeDebtFreeAmerica provides free access as well as a premium membership.  Even the premium component currently only costs $30 for a lifetime membership though, so it’s not exactly big bucks we’re talking about.  The free component provides the basic functionality but you are limited to four debts and it limits some of the capabilities.  For instance, with a premium membership, you can modify interest rates and add extra payments at any time and can view all of the reports (you only get the basic report in the free account).  Check out this comparison for more details.

Overall this looks to be a pretty nice tool and I’d recommend you take a  look at it if you are in need of the assistance.  The ability to try it out via the free membership is a great way to delve into it and take it for a test spin.

Win a Premium Membership

But why settle for the free membership when you win a premium membership!  If you are interested in winning a premium membership to BeDebtFreeAmerica, all you have to do is leave a comment on this post.  Tell us how many debts you are going to pay off with its help….or if you don’t feel like doing that, then just say it’s none of our business!

To Review:

  1. Leave a comment below
  2. Updated: The giveaway will close Tuesday, February 9th, 2010 at 11:59 PM EDT.
  3. I will randomly select a winner using random.org .  The winner will be announced February 10th and I will contact you via email – so please leave a valid email address in your comment.
  4. Good luck!

Check Out SeeBeyond2020.com – Online Debt Repayment Calculator

January 21, 2010 · Filed Under Paying off Debt · 2 Comments 

As I come across interesting and/or helpful sites on the web, I try to pass them along in the hopes that you might find the interesting and/or helpful as well.  Through my personal experience, I’ve seen the freedom that comes with being out of debt and after taking Dave Ramsey’s Financial Peace University, I’ve seen the power of the debt snowball as a tool to accomplish that goal.  Along those lines, this online debt repayment calculator was brought to my attention: SeeBeyond2020.com.

SeeBeyond2020.com is a subscription service that attempts to provide you with a plan to get out of debt in the shortest amount of time possible.  Now, this is not some debt consolidation deal or anything along those lines.  Instead, it simply provides you with a plan to apply your current payments to your various debts in the most efficient manner to reduce your overall time until you have paid off all your debts and save you some money (hopefully a lot of money). You can see their little “How it Works” section for a bit more detail.  Probably the most interesting thing to investigate if you are considering the service is an actual example plan.

As I mentioned, this service is a yearly subscription service.  And it appears to me that you don’t really get an overall, comprehensive plan.  Instead, I think that you get a monthly email telling you exactly what to do that month with each of your current debts.  For full disclosure purposes – I have not used this service so I can’t offer any personal recommendation one way or another.  In this case, I’m just pointing out a service that you might be interested in investigating. One other note if you are a big Dave Ramsey fan – I was not able to tell if this service followed Ramsey’s debt snowball technique for getting out of debt.  Frankly, I doubt that they do but I am not sure.  UPDATE – per the comment from Roger below, see that SeeBeyond2020 uses a hybrid snowball/avalanche method for determining your payment plan.

If you have used this tool, please leave a comment to let us know how well it worked for you and  your overall impression and recommendation.

We Did It – No More Student Loans!

August 20, 2008 · Filed Under Paying off Debt · 13 Comments 

As I heard the garage door open, I grabbed my papers and ran downstairs to meet my wife and two older kids. I put the two papers on top of the new box and went to the door to meet them. "Quick – come in, I have something to show you." As we all came into the kitchen, I said, "I have good news and I have great news, which do you want to hear first?" "Start with the good news, of course," my wife replied. Click here to continue reading…

Am I Stupid to Pay Off Our Student Loan?

August 5, 2008 · Filed Under Paying off Debt · 10 Comments 
Question mark

First, I have to apologize – we are not allowed to use the word "stupid" in my house. It just slipped out – honest. 🙂 Anyway, what I really meant to ask is "am I silly to pay off our remaining student loan?"

We have one student loan left

When we moved from the southwest back to the east coast, we had just completed paying off all of my student loans. That left us with (from highest to lowest balance) my wife’s student loans, a mortgage, and two car loans. As seen on my story page and the first checkpoint post , that was the point in time where I started to get really obsessed with paying off all of our loans and getting rid of everything except the mortgage. Click here to continue reading…

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