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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.

Redbook Cover Story on Debt-Free Living: The World Really has Gone Mad

April 1, 2009 · Filed Under Finances · 2 Comments 

Last week was Spring Break for my daughter’s school so we packed up the family and headed to Great Wolf Lodge for a few days of water park adventure (that’s why there weren’t many blog posts last week).  Anyway, between our water-parking and MagiQuest-ing, I happened to be perusing the gift shop when I noticed this magazine cover you see nearby here.

Redbook Cover on Debt-Free Living

No, it wasn’t the picture of Jaime Pressly that caught my eye but rather the large article title splashed across the top left: "Live debt-free – How women like you are spending less and loving it"  Seriously?  Redbook has an article on debt-free living?!  Spending less and loving it?!  If you check out the Redbook website, some other articles that pop out immediately are "8 Hilarious Sex Life Don’ts" and "10 Things your Man Really Wants in Bed."  So, excuse me if an article on the benefits of spending less than you earn and getting out of debt seems a bit out of place to me.

I haven’t been blogging for very long (about 9 months) but I’ve been talking about finances and the economy and related topics (a lot) for a number of years (just ask my friends – or the few that I still have) and I am taken aback by how many people I now encounter discussing the economy.  And now I see the Redbook article (I didn’t notice if there was a Cosmo magazine on the rack – now that would be something if they had articles about getting out of debt!)

I feel that it is very unfortunate that it takes extreme circumstances like we are going through now to pique everyone’s interest in this important topic.  If as many people discussed debt and savings and the economy a few years ago before all of this badness started to happen, a lot more people would be in position to weather this storm.  In fact, if enough people would have been more realistic about house purchases and investments, etc, etc, the effects of this whole downturn might have been a lot less severe.  Certainly, I am no economist, so take my opinion for what it’s worth.

Another benefit to being in a strong financial situation is that it is possible to position yourself for the long-term right now.  If you don’t have much debt and do have cash to spend, you can purchase stocks that are very cheap compared to their prices of a year or two ago.  If you have the time and money and believe that economy will eventually recover, then you can pick up some serious bargains and wait for the market to recover.  Or consider rental properties – in most places in the US right now housing prices are down quite a bit.  With some money and little to no debt you can purchase property for much less than it was selling for the past few years.  This could lead to some considerable financial benefits years down the road when the housing market recovers.

See, there is more benefit to being fiscally responsible than just being able to sleep easy at night or weather financial storms.  With the proper planning, you can not only survive an economic climate like we are experiencing right now but also thrive in it and set yourself up for long-term prosperity.

Why Should I Care about Spending Less/Saving/Investing?

February 11, 2009 · Filed Under Frugality · 3 Comments 

A while ago, my wife and I were sitting around the table chatting and working and, as often happens with me, I must have made some comment about saving money or avoiding debt.  She asked me what the big deal was about not having debt?  Why should we sacrifice to spend less so we can get out of debt and save and invest?  If so many people are using credit cards and home equity loans to buy the stuff that they want, do we really need to care about this stuff so much?  Are all of those people going to end up destitute or are they all going to be fine even if they used credit throughout their life?

Aside: I’m not sure why she asks me questions like this.  Sometimes, I think she just says this stuff to see how I’ll react ("I wonder if his head will explode if I ask him this?").  Maybe she is truly curious.  Possibly, she is trying to engage in an honest, albeit slightly controversial, conversation.  You know, like she pushes some buttons to try to get me thinking about things from a different perspective.  Yeah, let’s go with that one.

Anyway, given the current economic conditions in the US, this is a good time to discuss this topic (Ok, actually, it’s about a year too late to do anything positive about your situation, but humor me here).  First of all, a good deal of the economic turmoil we are currently experiencing is related to debt in one way or another…but that’s a topic for another post.

Fewer monthly expenses and more savings

So, let’s look briefly at some of the benefits of not having large amounts of debt in a time like this.  Obviously, if you don’t have a lot of debt payments to make, you therefore have less fixed expenses each month.  And if you have been paying yourself instead of paying debtors, then you probably have more money in savings and investments (well, in savings at least).  And put those two things together in a box and wrap it up and you’ve some protection and flexibility.

You have protection that enables you to pay big expenses that might arise  (like if your water pipes froze and burst ) or help you through situations such as losing your job or encountering some other major problem.  You also have flexibility in your life.  While most people are just very happy to have a job in times like this, your reduced expenses and increased money in the bank allow you to retain your flexibility – if you really hate your job and/or (somehow) see a better opportunity, you can actually consider taking that risk.

Not only surviving but also thriving

Most people focus on survival in these economic conditions, but there is another aspect that should be considered.  If you have done a good job of staying out of debt and saving some money, you are in a relatively unique position right now.  You  have money at a time when things are on sale.  Think about it – houses can be purchased for much, much less than a year or so ago.  The same is true of stocks.  You are not in a position, like so many appear to be, of hoping to survive, you are surviving and looking to thrive.

I can’t remember who said it (I think it was someone with a large net worth) so I can’t look it up, but I always found this (paraphrased – since I can’t look it up) quote interesting:

You make most of your money during a recession, you just don’t know it at the time.

If your job is secure and your debt load is low and you have money on hand, maybe now is the time to invest in that rental property you’ve been considering for a long time.  Been thinking about purchasing a property in foreclosure?  There are many available right now.  Almost all stocks are much less expensive than a year ago so even dollar cost averaging should pay off in the long-term.  These are but a few examples of opportunities that are available if you look around.

Then again, I’m sure the government will take care of us no matter what

On the other hand, to my wife’s point, why worry too much about debt and what-not – we’re in a bad place right now but our wise leaders in Washington are hurrying an economic stimulus package that I’m sure will help everyone out and immediately get us out of this funk.  Pork?  nah, surely they have the people’s best interest in mind and not only their own…(and if that doesn’t scare you into wanting to get out of debt, I don’t know what will).

It’s Been a Remarkable Week for BFN

August 29, 2008 · Filed Under Blog Links · 5 Comments 

I wrote a post last week titled 45 Ways to Earn Some Extra Money. Later that evening I happened to be playing around with my new sitemeter account and noticed that it said that BFN had 515 visitors that day. Since the previous days I had 11 and then 30 visitors I thought this must be some kind of mistake. As it turned out, the post was Stumbled by a few people and all of the sudden a bunch of people were checking it out.

My first Stumbled post!

I had heard of this phenomenon but honestly had not expected anything like this to happen so I thought it was awesome! I expected the traffic to die down by the next evening but it has kept going strong. In fact, I had two days of greater than 2500 visitors and cumulatively I have now had over 16,000 visits and 27,600 page views! I know that’s nothing for some blogs out that but it is positively astounding for my little blog. It is finally starting to die down now but it is still no where near my previous levels.

It has been fun to see so many people come to my site to check out a post. Some people seem to be clicking on some of the links in the post, as well. Hopefully they are making a little extra money or, better yet, maybe some of the ideas spurred them to think of some even better ones for themselves.

Not many are sticking around though

My RSS subscriptions have gone up from 13 to almost 50 – so that is pretty sweet (except for the fact that  only a minuscule percentage of all the visitors are finding the site "sticky.")

Here’s the 46th way to earn some extra money

I’ve already found the 46th way: Jury duty. I was finally called to my first jury duty appearance on Monday. I was somewhat dreading it at first, but by the time I got to the courthouse, I was actually looking forward to experiencing the process. I never got to find out if I’d be selected for the jury though. Just before we were to be taken down to the courtroom, the judge came in to the jury assembly room and told us the case had been settled at the last moment. Honestly, I admit that I was a little disappointed. Oh well, I still get my $30 for showing up. $30 for about 1.5 hours isn’t going to send me into retirement, but it’s not too shabby!

On to this week’s links

I’m finally getting my head above water and getting back to reading blogs like I used to before starting BFN. I have two new projects in the works, though, so we’ll see how well I can keep up with it.

Enough about me and my little blog, lets go to the good stuff…

Have a great weekend and God bless…

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…

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