Debt

Growing My Income Without Making More Money

February 27, 2020 By Trey LaRocca 1 Comment

This will be my first entry of the diary-style variety, and it is for a good reason. As a 21-year-old with no degree, a full time-job, and all of his very own bills, I think it is important to shine a light on one thing: I’m doing okay! As much as the media wants to tell you that young people are dying without free college or major social safety nets, it just isn’t true. You don’t have to game the system, milk any welfare, or strike it big to live happily in the US as a 20-something. With that said, there are some efforts I am making to ensure that I stay comfortable without finding a whole new job, or adding a side hustle to my already busy schedule. So this is about the two main ways I am growing my income in ways that any of you can replicate today!

I’m Selling My Car

I know, a scary first step. No, I’m not saying you all need to go carless to save money. In fact, that isn’t even what I’m doing. When I was 18, I had focused hard on working instead of going to school, and I had a full-time $13/hr job while still living with my parents. Up to this point, my family could never afford to get me a car– I didn’t even have my license. So once I could do it myself I got a used BMW 3 series for $10k that stuck me with a $190 car payment. This isn’t too bad a payment, but the insurance for someone my age makes my current car expenses ring in at around $380. So, to increase my usable income, I’m selling the car and buying a $2000 1990 Lincoln Town Car. No payment, and $70 liability insurance gives me around $310 more to play with each month.

Better Grocery Shopping

Today I had a little bit of time at the end of my work day, and I used it to check out my bank account. Specifically, I was looking at every time I bought food outside of my grocery shopping. Between a night out with my friend, a date with my girlfriend, the vending machine at work, and some “forgot my lunch at home” days at fast food spots, I managed to rack up about $300 in extra food expense. Noticing that the most common and preventable scenario was forgetting my lunch, my next grocery trip will be focused on good sandwich makings, meat, rice, and other packables that I can bring to work without much extra effort. Date night is important, and so is blowing off some steam with friends, but there is room to cut down. My goal for next month is to cut it down to $150, giving me the same amount in extra income to save or invest.

I hope you enjoyed this inside look into how I am bettering my situation. To all the young folks out there like me: You don’t need to have a degree or a high paying job to make it. I live in southern California, splitting rent with my girlfriend in a beautiful beach city I grew up in. No degree, no six-figure income (not even close), and no crazy internet fame. Just a reliable job and some good habits! As long as you stay smart, you can improve your situation and grow your income today!

Syracuse Mortgage Loan-Tips For Paying It Off Faster

February 7, 2020 By Alexa Mason Leave a Comment

A lot of people own their house outright. While some purchase their homes by paying cash, there are others who have no choice but to get a mortgage loan to buy the home of their dreams.

If you are one of those who need to take out a mortgage loan to finance the home you want to buy, you might worry about paying it off. Well, you don’t have to get tied up with your mortgage loan for a long time. There are a few ways on how to pay it off quickly that you should know about. You can start here by considering the following tips:

Make an Extra Payment for the Principal

One of the best Syracuse mortgage loan tips you can consider to pay it off faster is to make an extra payment for the principal. The majority of mortgage lenders will let you make extra payments and consider it as principal only. It means that your payment will go to paying down the principal instead of your loan’s interest and principal.

If you pay a bit of extra principal in your mortgage loan, it will save you lots of interest charges. In addition to that, it will get you out of the loan a few years ahead of the original schedule. Thus, considering extra principal payment can make a huge difference in paying your mortgage loan faster.

Prioritize Your Home Loan

Another tip to pay off your mortgage loan fast is to tighten your belt on other less important expenses. It is never too late to budget-start your month. It will help you increase your savings over time. You should also ensure that your household services like the internet or electricity are worth paying for. The reason behind it is that there is no point spending money on some things you do not really need. It is also a waste of money if you overpay for the things you do. So, always determine where you can make cuts and use your extra money to make payments on your mortgage loan.

If you prioritize your mortgage loan, you will just wake up one day that you are debt-free and enjoying your home without thinking about mortgage payments.

Consider Downsizing

Downsizing your home might be a drastic step for some homeowners. However, if you really want to get rid of your mortgage loan as soon as possible, it is beneficial to sell your bigger house and use the profits to purchase a less expensive and smaller home.

Use the profits you get from selling your big house and you might be able to pay for your new home cash. But, even though you need to get a small mortgage, it still means that you have reduced your debt. Your next goal should be getting rid of your remaining debt quickly. Well, if you have a small balance, it is never impossible.

Round-Up Your Balance

Make it a habit to round up your balance when paying your mortgage. For instance, if you need to pay $1,578.92, why not round it up and pay $1,600 instead? The extra money you paid from rounding up your balance can be used to reduce your payment next month or you may just use it to pay for the principal. As mentioned above, paying extra for your loan’s principal will help you pay off your mortgage quickly.

Consider Mortgage Refinancing

One of the ways to pay down your mortgage more quickly is to get a new loan for mortgage refinancing. It may help you reduce your debt in various ways. In fact, mortgage refinancing may lessen the interest rate, which can help you enjoy savings.

Homeowners may also refinance for a short term to get rid of mortgage quickly. Although monthly payments are higher with a short-term loan, you will be able to enjoy reduced interest costs. Those with FHA or Federal Housing Administration loans may eliminate PMI or private mortgage insurance if they are used to refinancing conventional loans. The insurance on a conventional mortgage may be dropped if someone has twenty percent equity in their property. Money used for the premiums may be diverted to the loan’s principal to speed up repayment.

Conclusion

It is not impossible to pay off your mortgage loan faster. The only thing you should do is to follow those tips mentioned above. Once you have done it successfully, there are some benefits you can enjoy from paying your mortgage loan faster. Aside from reducing your debts, it can also give you peace of mind, which is priceless. So, if you are ready to lessen your financial woes, don’t hesitate to implement those tips and see the difference. If you are confused and need more information about paying your mortgage loan, make sure to seek professional help.

Is Your Credit Score Keeping You In Debt

January 24, 2020 By Susan Paige Leave a Comment

If your credit score is low, getting out of debt can be much harder. It diminishes your ability to take certain actions that could improve your situation, leaving you with an uphill battle that may seem insurmountable. Once you’re in deep, digging your way out of debt is a cumbersome task even if your credit score is stellar. However, if yours is poor, the journey is usually rougher. However, that doesn’t mean things can’t improve. If your credit score appears to be keeping you in debt, here’s what you need to know.

How a Bad Credit Score Makes Getting Out of Debt Harder

When your credit score is poor, particularly if it has been for some time, reducing your debt is often challenging. Usually, you’re stuck with high-interest rates. As a result, a larger portion of your monthly payments goes to interest than they would if your rate was better, slowing your forward progress.

Additionally, you have fewer alternatives to explore that can help you get out of debt faster. For example, many people recommend personal loans for consolidating high-interest debt. But, if you don’t qualify or can’t get a better rate, that might not be a suitable option.

What You Can Do to Improve Your Debt Situation

While certain options for getting out of debt might not be viable, that doesn’t mean all hope is lost. There are things you can try, even if you have bad credit.

First, you can see if you have access to a reputable credit counseling agency, ideally a non-profit that is affiliated with the National Foundation for Credit Counseling. They can work with you to develop a functional budget, often at no cost.

Additionally, for a small fee, a credit counseling agency may be able to set up a debt management plan. In these scenarios, they work with your creditors to secure lower interest rates and reasonable payments. Then, you’ll be able to pay off your debt faster and pay less in interest.

Negotiate Your Debt Settlement

If you can afford to send a lender a lump sum near what you owe in total, then your second option is to negotiate your one debt settlement offer. In these cases, you may be able to pay less than the full amount you owe. However, this isn’t always an option and does have drawbacks. It could hurt your credit more, or you may have to claim any forgiven amount as income, impacting your taxes.

You may be able to qualify for a personal loan if you have a friend or family member with good credit who is willing to cosign. However, you could put your relationship at risk if you can’t make your payments.

Similarly, if you have access to a 401(k) loan, you could use the value of your retirement account to get things under control. But that means putting your financial future at risk as a means of controlling your debt.

Bankruptcy Could Be The Best Option

For those who have an impossible debt situation, bankruptcy might be the best choice. Again, this approach hurts your score, but that doesn’t mean it isn’t the best answer. You may be able to stop any current and future collection efforts on your existing debts, effectively getting them discharged legally.

While these options may not seem great, they might be worth exploring. If you can get your debt under control, building your credit score up after might be possible. Then, you can move forward, aiming to make smart choices to prevent you from struggling with debt or your credit score again.

Is your credit score impacting your ability to get out of debt? Share your thoughts in the comments below.

If you enjoy reading our blog posts and would like to try your hand at blogging, we have good news for you; you can do exactly that on Saving Advice. Just click here to get started.

When Should You Use Your Credit Card?

January 9, 2020 By Trey LaRocca 1 Comment

One of the most controversial topics in personal finance is that magic piece of plastic in your wallet. Everyone you ask will have a different opinion, with many just saying to avoid them altogether. While I wouldn’t call someone a fool for holding that opinion, I do honestly think credit cards have a place in your life.

The major hurdle here is assessing exactly how large that place is, and your ability to stay disciplined. Studies have shown that sliding a piece of plastic that isn’t linked to your cash makes it easier to spend money. As a result, going overboard is extremely common. So, for those who aren’t sure how to maximize the benefits of credit while mitigating the risk, here is the answer to the golden question: When should you use your credit card?

When?

An obvious first step is to address the main question. There are a few use cases that I find the most low-risk as far as habit-forming goes. The first is bill payment. Selecting one low-cost bill to put on your credit card each month will make sure that you have utilization to build credit, but don’t run the risk of overspending.

Bills tend to stay relatively similar every month, so “going crazy” when using a credit card to cover a bill isn’t all that tempting. If you are too young to have bills quite yet, consider using your card to cover something else that you usually already cover with cash. The important part here is to make sure you are using it once or twice a month. Keeping the use infrequent keeps you from getting used to leaning on the card.

How much?

This one is a little less subjective. As far as responsible wealth management goes, a credit card is too high-interest to be heavily utilized. I don’t care what “rewards” you get. If you were the one benefiting the most from those reward programs, they wouldn’t exist. Credit bureaus do want to see some usage every month, though, and the highest scored utilization level is typically 1-9% each month.

If you keep your bill or routine credit spending in this range, your FICO score will increase rather quickly. A more obvious underlying rule here is to never spend more than you can pay off at the end of the month. Our directive is to never get interest charged on our credit card spending– that’s money in the toilet. Pay your card off every single month in its entirety. Then watch as your credit limit and FICO score skyrocket.

Know Yourself

To close this one out, here is a vital piece of the puzzle. You need to evaluate whether you should even have a credit card. If you have filed bankruptcy in the past, or came close due to impulsive spending, having a credit card in your pocket is a bad move. If you haven’t had enough time to get into a situation that dire, but know you have spending issues, don’t try it out.

Credit cards can help you in many ways, but none are as severe as the ways they can hurt you if misused. So, take a look inward before considering any of these rules, and make sure you have the discipline to stay focused on your goals. Just like any other addiction, impulsive spending is a temptation that never really goes away. Be responsible and don’t test waters in which you have already drowned.

Saving Money: How A Secured Loan Could Help

December 17, 2019 By Susan Paige Leave a Comment

Saving money and taking out loans does seem like contradictory actions, but it is possible to achieve both at the same time. Loans and credit are often associated with financial hardship and a time when money might not be readily available. This is not strictly true, there are times when taking out a loan or putting a payment on a credit card could be tactical and actually help you save money in the long run.

We are looking at when a secured loan could save you money and how best to use them to exploit the biggest benefits and the biggest savings!

What Is A Secure Loan?

A secured loan is a source of credit that is secured by an asset. This means that any money that is borrowed, is done so against an asset which is most likely a property. This means that it is less risky to lenders and they are more likely to offer lower loan rates, ultimately saving you money on the cost of a loan. A secured loan does usually have a minimum threshold though, some lenders start at $15,000 minimum but it’s more likely to be about $25,000. Caps on the amount that can be borrowed are really quite high but will be subject to the value of the asset you are willing to make available. This could be anywhere up to $100,000.

Many might get a secured loan thinking it is safer than other financial products. This is actually a little mis-led because, as with all financial commitments you may make, there is risk involved. Voluntarily putting the equity in your house up to secure a loan means that if you miss payments and default on the loan, the creditor will make a claim on your house. The penalties for missing or late payments, and the threshold for when a creditor has the right to claim your asset, will differ from lender to lender. Some creditors may be more strict than others and it may be worth comparing the best secured loans companies to ensure you feel confident with your agreement.

Don’t fret too much if you know you are not going to be able to make your repayment dates, as long as you contact the lender as soon as you are aware of this. FCA regulated lenders (which all the best secured loan lenders will be) are required to follow protocol and may be able to provide advice to help you get a grip on your finances. Moreover, when you are dealing with the financier directly, they could work to arrange alternative repayment dates that suits your financial situation a little better. This might be just after payday, for example, rather than half way through the month.

What Can Secure Loans Be Used For?

Secured loans are flexible financial products that can be used for almost everything a personal loan can be used for, but with the added benefit of having higher borrowing limits and providing borrowers with access to even more cash when they need it.

Transferring Unsecured Debts

Just like an unsecured personal loan, a secured loan can be used for debt consolidation. This means that you can transfer multiple debts into one place, making them easier and tidier to manage. There are so many benefits to using a secured loan in this way:

Transferring your debts into one place helps you save money as you are less likely to incur multiple late fees and other costs as multiple debts are hard to keep on top of.
Secured loans are typically available for lower rates and are cost-effective for debt consolidation because they could work out so much cheaper throughout the duration of the loan, when compared to the cost of multiple other loans.
The high borrowing limit means you are likely to be able to transfer all outstanding debts and just owe the one creditor, rather than several. Standard unsecure loans might not be enough to cover outstanding debts.

The risks should not be totally disregarded but shopping around for the best secured loan rates and being confident that you can meet the repayment schedule as agreed will not put any of your assets at threat.

Home Owner Loans & Home Improvements

Secured loans are sometimes referred to as a homeowner loan. This is because the most common asset that is put up is the equity that you own within your property. Moreover, one of the most common reasons people take out a secured loan is so that they can spend the money on home improvements, home repairs and emergencies or other property-based expenditures.

This may seem a little frivolous, especially if you are trying to save money, but there are several instances in which a secured loan for changes to your property could save you money:

Upgrading For Efficiency – Whether you are still using outdated appliances or have single glazed windows and doors, taking out a secured loan with a good rate could help you to save money on your bills. Making changes to your home could save you around $1000 per year on energy costs.
Moving Home Is Expensive! – Reports differ, but moving home is an extremely expensive affair. Taking out a secured loan and making changes to your home could mean you don’t have to move at all. With higher borrowing limits at a low rate, you could build a brand new bedroom, convert your attic or build an outbuilding – whatever you feel is necessary. What’s more, this kind of spending is an investment, you will get a return when you do eventually feel it is necessary to move, whereas when you move home, the money is just spent and lost.
Bulk Buying Saves Money – Taking out a loan to completely renovate an area of your home or property could be much more efficient than saving up and paying for the works little by little. You will also get a much quicker benefit of your new, upgraded home.

Secured Car Financing

Although this is not the kind of financing that puts money directly into your account, car financing is often a type of secured loan. This works because a creditor will pay a business for your vehicle and you make repayments to them. When the repayment terms are met and all the money is paid off, you will own your car. Until that point, it technically belongs to the creditor. These may be independent or a branch of the trader where the car was purchased.

Firstly, it is vital to shop around for the best deals for car financing, but in many cases, this is the cheapest option for those who cannot foot the full cost of a new car. You could save money because the interest and APRs are low on secured loans, but you also have the flexibility of a lower deposit. This means you don’t have to stretch your finances too thin when you do not have the capacity or back-up cash to cope with a big deposit.

Compare Secured Loans For The Best Rates

Consumers, homeowners and savers looking for loans should always compare their financial products before they commit to them. You can either use price comparison websites, or better yet, for even quicker access to the funds you may need urgently, apply directly with a lender that is also able to act as a broker and connect you with other lenders or present alternatives that may be the most cost effective for your situation.

Comparing loans online is simple with tools such as moneysupermarket.co.uk. Savings experts recommend that consumers use two comparison tools to ensure they are not weighted or biased, for example, using a dedicated comparison tool and an independent lender that will also show you the loans available from competitors. Moreover, it is also recommended that for safe-borrowing, you should do a little investigation into a company before entering a loan agreement with them. You may be made aware of consumer complaints or could find companies that are recommended or the ones that are better left untouched because they bolt on extra fees and hidden costs!

Other Benefits Of Using A Secured Loan

Other than the potential savings on the total cost of a loan, there are other benefits for those who are considering a secured loan, or at least comparing their options.

Firstly, you are more likely to be approved for a secured loan, in comparison to an unsecured loan, especially if you have a bad credit score or it’s anything less than perfect. It’s easy to slip with your repayments on loans or forget the payment date and get a negative mark on your credit score. The consequences when you take out a secured loan can be a little more severe, but they won’t be anything too major if the payment is made quickly and the mistake was genuine. A secured loan is backed by the value of different assets, whatever that might be, which means those with bad credit can offset their risk to borrowers by offering an asset as a back up.

A secured loan is also a good option for those with a bad (or unestablished) credit score or low credit rating because they could rebuild their score. As we have already established, a secured loan is easier to obtain than an unsecured loan if your history is less than perfect. This means that if you are looking to rebuild after injunctions or harmful marks on your profile, such as a CCJ for example, a secured loan is one of the safest and low-cost ways for you to do this. In the long term, making the effort to rebuild how credits consider you as an applicant could also save you money, as you may present as less of a risk and have access to lower APRs, more advantageous interest rates, longer or extended incentives such as interest free months and other rewards or benefits that a creditor might offer to an attractive borrower.

Another advantage of using a secured loan is that it means those people with bad credit, or those who are looking to borrow larger amounts¸ do not have to find a guarantor, who otherwise might have locked in a loan at a decent rate. This allows those who do not have a suitable person to use as a guarantor to still have access to the money they need to complete their home improvement project or manage all their debts in one place, at a cheaper rate.

Although it might not be saving money, one of the most common reasons you might apply for a secured loan is because of the higher or lifted lending limits. As a secured loan is borrowed against something, a pension for example, lenders are happier to lift their limits and will often have a set minimum and maximum. This means homeowners and all other borrowers could get their jobs done in one fell swoop, rather than in installments. Ultimately, this could reduce the number of loans used and save money in the long run, but individuals would have to compare rates and also consider that

How Fast Can You Increase Your Credit Score With Self Lender

November 8, 2019 By Tamila McDonald Leave a Comment

Living with a bad credit score or minimal (if any) credit history can be difficult. Usually, you won’t qualify for favorable terms on credit products like credit cards and loans. You may get stuck with higher interest rates, large fees, or other financial penalties do to your less than ideal credit. As a result, many aspiring borrowers take active steps to improve their credit score before taking certain actions, like trying to get a mortgage or car loan. Self Lender is a company that says they can assist with building your credit, all while helping you save, too.

How Self Lender Works

With the Self Lender Credit Builder Account, you can build a better credit history. The company doesn’t conduct a hard pull on your credit report, so your score isn’t harmed by opening the account. By making your monthly payments on time, your credit score typically rises. Self Lender reports to all three major credit bureaus, so your on-time payments will show up on your Experian, TransUnion, and Equifax reports.

While that may not sound any different than other loans, Self Lender does something that’s a bit outside of the box. Instead of giving you the money from your loan, that cash is held as a Certificate of Deposit (CD), a type of savings vehicle. The bank holds onto the loaned money as a CD while you make payments. Once you finish paying off your Self Lender installment loan, that CD matures and unlocks, allowing you to receive the money.

At the end of the repayment, you receive the principal amount you borrowed (minus any interest paid). As a result, you are able to build your credit history while building a savings habit. However, in exchange for the ability to increase your credit score (and unlike many other savings options), you do have to pay fees and interest along the way.

Self Credit Builder Account Fees and Interest

Since the Self Credit Build Account is technically a lending product, you will encounter some fees and interest. First, there’s a $9 administrative fee for opening the account. Second, there is an annual percentage rate (APR) of just under 16 percent.

In comparison to many credit-building credit cards and personal loans, the Self Lender fees and interest rates are actually very low. This may make it a more affordable way to rebuild or create your credit profile.

How Fast Your Credit Score Will Increase

How quickly a Self Lender account can improve your credit score will vary. Your unique situation, prior credit history, and activity on other credit accounts all play a role. For example, if you miss a payment on a loan or credit card with another lender or issuer, that may offset any benefit from making on-time payments with Self Lender.

Similarly, how diligent you are about your Self Lender payments is a factor. Missing a payment or being late can harm your score.

It’s also important to note that a borrower’s credit score might initially drop when they open a Self Lender account. The new account reduces the average age of your accounts. However, this impact tends to be small and short.

Make On-Time Payments with Self Lender

By making on-time payments with Self Lender, you may see credit score improvements within one to six months after making your first payment. However, your results will vary.

How much your credit score improves isn’t guaranteed. Self Lender states that, on average, an account holder with an account in good standing usually sees a 45 point increase during the first six months. However, your previous credit score and history, as well as actions on other open accounts, could cause your results to be different.

For those establishing a credit score, expect it to take a minimum of six months of on-time payments to see a result. While some may see progress sooner than that, others will have to wait a bit longer than six months to make progress.

Do you have any tips that can help someone increase their credit score quickly? Do you believe that slow and steady is the only way to improve your credit score? Share your thoughts in the comments below.

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