Eight Essential Tips For Getting Out Of Debt

Published on: 12 May 2018 Last Updated on: 09 August 2019
Out Of Debt

Do you feel like debt is slowly ruining your life? If so, you should know you’re not alone.

Although the road to getting out of debt is a long one, it’s not impossible to do so. We’ve put together a list of 8 tips for you to get started and live a debt-free life.

Let’s get started.

1. Find Out How Much You Owe :

This is a step that you probably have avoided for some time because you fear to know the number. But if you are serious about getting out of debt, you must know exactly what you owe.

Start by making a spreadsheet listing every single debt you have. It might also be helpful to specify if those debts are outstanding, so you know which ones need attention.

Once you know exactly what you owe, you’ll be able to see the bigger picture and not be blindsided by unknown debts.

The spreadsheet will help you keep track of your progress, and you will feel more motivated watching the numbers go down.

2. Stop Adding More Debt :

This might sound like an obvious step, but if you’re trying to get out of debt, you shouldn’t create new ones.

While it might be difficult to avoid temptation, you must do so in order to pay off your debts. If you pay off your debts, only to use them again, you will never finish.

Start paying for large purchases using cash, and not buy anything you cannot afford. This will keep you on track to paying off your debts faster.

If having your credit cards around is too much temptation, try cutting them up or freezing them. That way you won’t feel tempted to walk into a department store when you see a sale.

3. Try to Negotiate Lower Interests Rates :

It’s no secret credit cards come with really high interests rates, which makes it so difficult for people to pay them off.

If you signed up to enjoy the introductory 0% APR and now you have to pay more interest than you can handle, it’s time to renegotiate.

It’s possible to talk to your credit card company and try to negotiate a lower interest rate.

You can start by calling and simply asking them to lower your interest rates. But before you call, you might want to have a strategy.

Begin by calling your oldest credit card and using your loyalty to open up negotiations. Being a loyal card member might provide you with some extra benefits.

Don’t forget to always be polite.

4. Find Ways to Make More Money :

We understand it might be difficult to pay off your debts when you’re living paycheck to paycheck. In fact, this might be one of the reasons why you got into debt in the first place.

In order to help speed up the process, it might be a good idea to start making more money. Try to get creative and find ways to earn more cash.

Why not get a part-time job, talk to your boss about getting a raise, or find a side hustle. Then you can put that extra money into paying off your debt.

5. Focus on Building an Emergency Fund :

You might want to put all of your efforts into paying all your debt, but it’s also important to have a little saved up for a rainy day.

Even though you need to pay off your debt, you also need to build your emergency fund, both are just as important. The reason is if an unexpected expense comes up, you will have enough saved up to cover it without needing to use your credit cards.

Having money saved up will help with the process along so you stay on track.

6. Sell Items You Don’t Need :

If you want to look for other ways to make a dent in your debt, then look around your house. Sometimes we accumulate things of value without even knowing it.

You might be able to get some extra cash by selling items you have laying around the house. You might be able to sell old broken gold jewelry and get some money out of it.

You might also be able to also sell electronics, art, and furniture. There are many ways to sell your old stuff. You can have a garage sale, post on Craig’s list, or even sell on eBay.

7. Create a Budget and Stick With It :

If you want to have enough money to pay your bills and pay off your debt, you should make a budget.

Creating a budget will help you allocate where all of your money goes, so you don’t have to wonder where your money goes each month.

If you stick to your budget, you’d be surprised how much you could have leftover at the end of the month. Any money left over will be used to put towards your debt.

Having a budget will also be good practice for life after all your debts are paid off. Sticking to a budget will secure your financial future.

8. Decide which Debts to Start Paying First :

Even if you want to pay off your debt, you might not know where to start. This could be a confusing process for many people.

If you have student loans, car loans, mortgages, and credit card debt, you might want to start tackling your credit card debt. Credit cards have the highest interest rates out of all your other lenders.

Once you’re done paying off your credit cards, you can put that money towards paying off your other debts.

You can start paying off the credit card with the highest interest rate and highest balance. Once you do, you can move on to the next.

If you want to learn more about which debt to prioritize, request more info here.

Getting out of Debt is Possible :

Getting out of debt might seem like an impossible thing to do. However, it’s not as difficult as you think. Get started by making a list of all your debts, create a budget, and even try to find ways to make more money.

If you want to learn more finance tips, visit our blog.

Read Also :

Content Rally wrapped around an online publication where you can publish your own intellectuals. It is a publishing platform designed to make great stories by content creators. This is your era, your place to be online. So come forward share your views, thoughts and ideas via Content Rally.

View all posts

Leave a Reply

Your email address will not be published. Required fields are marked *

Related

bad credit

How a Smart Guy Gets an Amazing Commercial Lease with Bad Credit

Sometimes, things can go south when you need to take up a commercial lease, but you discover that your credit score is bad. There is an unfortunate stereotype about people with a bad credit score as they are seen to be a typical bad guy, starved off trustworthiness. Yet, in reality, a bad credit score can occur to just anyone. Bad credit essentially means a financial history of your inability to pay up loans when you were obligated to. Worry not, for in this guide, we will show you how to secure your dream commercial lease, even in the face of bad credit. 1. Do a wide search of your options: Honesty is quite needed here, and you have to search for all the options open to you. Your real estate advisor or lawyer can help you do it, but you need to be honest about the reasons why you were unable to meet the previous financial commitments so that they have adequate information to help you. When you know you have several options, you will be more relaxed to seek out a property owner who can accommodate your bad credit. 2. Get a good guarantor or co-signer: If, for instance, you’re considering getting an office space for lease Seattle with bad credit, getting a guarantor or co-signer with a high credit score to sign as a surety for you can help you secure the commercial lease. The property owner would know that he or she would have nothing to lose as your guarantor or co-signer will be held liable to pay if you default. Admittedly, since your credit is bad, it could be hard to get a guarantor, in which case, look for a family member or friend whom you would be willing to offer a percentage of the business proceeds, making the deal more lucrative and mutually beneficial. 3. Be willing to stake high: Negotiations for an office space for lease Seattle with bad credit could be quite tricky, but you can still get a fair deal. You would have to increase your stakes to make your offer attractive, despite your low credit score. You can offer to make a hefty security deposit, add collateral, or even agree to pay a higher interest rate. A business-minded property owner would be more interested in offering you a lease with such these attractive conditions. 4. Consider bartering: Bartering means exchanging what you have for something that you need. Identify a connection between your line of business and what the property owner can get in place of the payment and have the willingness to exchange, even if you’re a bit on the losing side. If finding a connection is difficult, you can join a barter club where the credit scores of the members can be used towards your lease. 5. Go for a motivated property owner: Property owners can sometimes be motivated to advertise that they are willing to bargain or offer leases to people with bad credit. Search out for them and be prepared to commit to their terms, giving assurance that you will keep to the lease agreement. When you need a commercial lease, and you have a bad credit score, you don’t have to panic. There are some things that you can do to rectify the situation. The bottom line is that whatever arrangement you decide to use, you have to document and sign it to protect yourself in the future. Read Also: Debt Consolidation Plans For Your Debt Relief Using Short-Term Loans To Help Rebuild Your Credit Score Revolving Debt Vs Installment Debt – Which Impacts Your Credit Score The Most?

READ MOREDetails
Short-Term Loans

Using Short-Term Loans to Help Rebuild Your Credit Score

Life in America is difficult enough without someone having to deal with credit issues. A low credit score usually has a profound effect on the choices people make and how they may have to live their lives. Make use of short-term loans to improve your credit score. No matter what kind of financial difficulties you may find yourself dealing with, nothing is ever etched in stone. Even bankruptcy comes with time constraints that make certain you will get a second chance. The truth is there are ways someone with a bad credit score can actively participate in fixing their own credit score. The discussion below will discuss how short-term loans can be used by borrowers to help rebuild their credit scores. Different Ways Short Term loans can improve Your Credit Score Are As Follows:-     There are multiple ways Short term loans can help you to improve your credit score. In this article, you will get the complete details of it. The Stigma of Bankruptcy: When someone is forced into bankruptcy to protect certain assets and their overall well-being, there's a price that has to be paid in the eyes of the credit market. Lenders don't like to be left holding the bag. The ultimate penalty is a substandard credit score, which subsequently makes it very difficult for the individual to borrow any kind of money for a period of time, usually not to exceed 10 years. What everyone has to remember is that poor credit performance is a historical perspective on the borrower's past behavior. Based on historical facts, potential lenders can rightfully assume the individual is a poor credit risk. The good news is history is a constantly evolving notion that gets rewritten every day. Using Short Term Debt to Rebuild One's Credit Score: If someone wants to rebuild their credit score, they have to convert bad financial behaviors into good financial behaviors. No matter how low someone's credit score might get, it's an objective rating based on certain criteria. As such, it can improve just as easily as it can fall apart. As you contemplate how to repair and rebuild your credit, you need to be aware that the only way to increase your rating is by strictly adhering to all future obligations. To that end, there's an interesting strategy you can employ to speed up the process. First, it's duly noted it is going to be difficult for you to secure new loans. Your credit score ratios and payment profile will interfere with the approval process. However, it's worth the effort for you to do whatever's necessary to establish short term debt with manageable terms. Initially, you might have to swallow high-interest rates and lender-friendly terms to secure a credit card, title loan or whatever other kinds of loan you can get. Once you have the first short-term loan in place, your credit score might take a small dip. However, your credit score will eventually start increasing as you make your payments on time. At some point, you can pay off that loan early and followup by securing a new loan. As you continue abiding by your agreements and perhaps exceeding expectations, your credit score with pick up momentum to the upside. Eventually, your bad credit history will fade into the past, being replaced by new credit history that supports the fact you are again becoming a worthy risk. How well does this approach work? Bankruptcy stays on your record for approximately 10 years. If you can represent to a succession of lenders that the past is the past and you are now able to handle your responsibilities, that bankruptcy will lose significance in the eyes of many lenders. Read Also: 5 Smart Ways To Boost Your Credit Score 7 Simple Tips To Pay Off Your Loans Faster Are Payday Loans Really As Bad As People Say? Title Loan Requirements: What You Do And Don’t Need

READ MOREDetails
Tax Implications

Tax Implications For Independent Event Planners

As an independent event planner, you have the freedom to set your own schedule and take on exciting projects that you’re passionate about. However, being your own boss also comes with certain responsibilities, including managing your taxes. Freelancers often face challenges in maximizing their tax savings and properly filing their taxes due to their unique work situation. In this article, we’ll explore the tax implications of being an independent event planner and provide helpful information to ensure that you’re on top of your tax obligations. 1099 Income and Taxes As an independent event planner, you may receive 1099 income, which refers to income received from a client or business that is not your employer. When you receive 1099 income, you’ll need to pay both the employer and employee portion of Social Security and Medicare taxes. This is known as self-employment tax. The self-employment tax rate is currently 15.3%, but only applies to the first $132,900 of your net earnings. Once you reach this threshold, the rate drops to 2.9%. It’s worth noting that the self-employment tax rate applies in addition to your regular income tax rate. This means that you’ll need to factor in both taxes when calculating your overall tax liability and use a quarterly tax calculator. To make things a bit easier, you can use a 1040 ES calculator to estimate how much you’ll need to pay in taxes for the year and to determine how much money you should set aside throughout the year to cover your tax bill. The 1040 ES calculator takes into account your 1099 income, self-employment tax, and any other income you may have throughout the year. Claiming Deductions and Maximizing Tax Savings One of the benefits of being self-employed is the ability to claim deductions that can help reduce your taxable income and lower your overall tax bill. However, freelancers often struggle with identifying which deductions they’re eligible for and how to properly claim them on their tax returns. As independent event planners, you may be eligible to deduct expenses such as office supplies, equipment, software and subscriptions, travel expenses, and marketing expenses. However, it’s crucial to save records of what you spend in order to claim them properly, and in case you get an IRS audit. You can also consider setting up a retirement account, such as a Solo 401(k) or a SEP IRA, which can help reduce your taxable income while ensuring that you’re saving for your future. Tax Implications of Incorporating Your Business Many independent event planners operate as sole proprietors, which means that they’re an individual who owns and operates a business. However, there are benefits to incorporating your business, such as limited liability protection and potential tax savings. Additionally, corporations are eligible for more tax deductions than sole proprietors, including health and life insurance premiums, employee benefits, and certain business travel expenses. Making your business incorporated can also help reduce your total tax liability. For example, if you’re earning a high income as a sole proprietor, you may be subject to the top income tax rate of 37%. However, if you incorporate your business and structure it as an S-corporation, you can pay yourself a salary and receive the rest of your income through distributions, which are taxed at a lower rate. 2023 Self-Employment Tax Calculator Looking ahead to future tax years, it’s always a good idea to stay informed about changes to tax laws and regulations. The self-employment tax rate may change from year to year, and it’s important to stay on top of these changes in order to accurately estimate your overall tax liability. The self-employment tax calculator 2023 can help you estimate how much you’ll owe in self-employment taxes for the year, based on the latest tax rates and regulations. By using this calculator, you can ensure that you’re setting aside enough money throughout the year to cover your tax bill and avoid any unpleasant surprises come tax time. Conclusion As an independent event planner, managing your taxes can be a bit daunting. However, by staying informed about your tax obligations, identifying available deductions, and incorporating your business if necessary, you can minimize your tax liability and maximize your tax savings. Utilizing tools such as the 1040 ES calculator and the self-employment tax calculator 2023 can also help streamline the tax planning process and ensure that you’re in compliance with the latest tax regulations. Read Also: 6 Ways to Stay Sales Tax Compliant Know the Applicable Stamp Duty when Gifting an Asset Commonly Misunderstood Facts About The Employee Retention Tax Credit

READ MOREDetails