Financial Helper

Your Personal Financial Guide

The True Cost of High Interest Debt, Magnified

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Is high interest debt really a problem? Some people are starting to say that it’s not, and it means that regular families just need to focus on their everyday lives. The argument of just walking away from debt without consequences is a very bad one. There’s no one to just ignore the debt. Eventually, those debts are going to catch up with you. Creditors can force a County judge to levy a judgment against you. These judgments are indeed public record, so anyone and eyesore can look them up. If you have dreams of owning another home or doing anything else that requires credit, you could end up being very disappointed.

The point here is that debt matters. It’s not something that you’re going to be able to get away from anytime sooner. Just when you think that you have debts taken care of, it feels like old debts are shaken up and thrown back in your face. As long as you’re thinking about the best way to get out of debt, you can’t be wrong. You’re not really as behind as you think you are. Sure, our friends might tell you that you’re behind, and then you might feel like you just can’t catch up. But that’s not reality. That’s not something that you need to worry about. You have to focus on your debts, and you have to make sure that you’re taking it all in stride. Do things one little piece at a time.

High Interest Debt

The best thing that you can do about high interest debt is see if you qualify for any special program. Even though you might not like to think about it, doing an Individual Voluntary Arrangement is a great way to get back on track. The creditors agree to accept a bit less than what you owe, leaving you able to make realistic monthly payments. If anything, that’s the real problem with high interest debts — the interest becomes so large that it’s virtually impossible to make the payments that you would need in order to get out from underneath the debts. If you have just one debt that has a high interest rate, then you might be able to extricate yourself very easily. But what if you’re like many families and you have a lot of different debts piling up? That’s a great way to just make yourself frustrated. It makes much more sense to see that if you want to get out from underneath the debt, you need to explore every single program possible. That’s where the real success is going to be.

It’s time to make an action plan that you can trust. You need to definitely talk to a credit counselor that can address not only how you’re going to be able to find a road out of debt, also someone that can help you with the emotional side. There’s no shame in admitting that debt stresses you out. When you feel like someone is hounding you for money, you start wondering what your life is really supposed to look like. If you know that your life needs to be more than this, it’s time to get things turned up in the right direction. Why not look into all of it today, while it’s still on your mind?

Is There a Right Time to Spend When You’re in Debt

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Debt is something that complicates the rest of our lives. Just when we think that we have things under control, debt shows back up to remind us who’s really the boss here. It’s a hard thing to deal with, but you have to confront it. You have to stare it down and realize that you can overcome your debt problem. You just need to find the strength to do it.

What about spending? After all, your bills are going to keep going. And there are going to be things that you need along the way. So here’s our thoughts on the matter.

If you know that you’re not going to be able to stick to a hard line budget, then you definitely want to take “baby steps”. Cut down expenses gradually. Generally, humans do not do well with deprivation. It tends to make us absolutely crazy. It’s going to be a better idea if you actually take the time to figure out what you need and what you want.

Debt

Spending can refer to either. You should be spending on the essentials you need, and only going with some of your wants. That’s the real way to make things easier as time goes along. You might even find that your tastes change at time passes. This is just part of the process. It’s never a bad idea to just see where you go. Don’t punish yourself or use negative language. You can beat yourself up about the debt, or you can figure out how to make it better for your own purposes. What is your choice really going to be?

Another point — you want to think about the purchases you need to make in order to keep bigger problems from happening. For example, you might need to fix your car. While the repairs you make aren’t necessary now, they will definitely be necessary later. You also want to make sure that you’re paying the essentials like property taxes and any other taxes that need to be paid. Otherwise you’re going to run into some big problems in terms of penalties. If your local government fines aren’t paid, you could even have a warrant issued for your arrest. Definitely not what you want to look forward to at all!

There is a right time and a right place to spend, and you’ll learn how to balance these two things over time. Good luck!

Debt Consolidation Always Sounds Like a Good Idea

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Imagine a day where your debt comes so manageable that you’ll actually look forward to paying off another little piece of it. After a while, those pieces will eventually disappear completely, leaving you with the debt free lifestyle that you’ve always wanted. How do you actually get to this point in real life?

Debt consolidation is actually the answer that you are looking for. In short, debt consolidation takes all of your bills and boils them down to one payment each and every month. Usually the interest is completely removed, or dramatically reduced. This gives your money even more power than if you hadn’t gone through a debt consolidation program.

Now, you might wonder why companies would even agree to this type of thing. Simply put, they know that a little bit of money is better than no money at all. If you’ve struggled to pay the same bills over and over again, they might be concerned you’re going to default. If you default, then they aren’t going to get any money anyway. This is an alternative to bankruptcy.

Debt Consolidation

What’s nice about debt consolidation is that it gets rid of the high interest rates that make it so hard to pay off debt in the first place. Some people assume that debt is just designed to stick around no matter what, but the truth is that a debt free life could be closer than you imagine.

You just need to make sure that you give debt consolidation a chance. It’s always tempting to ignore something like this, but the reality is that you just have to trust in your own instincts. It’s one thing to assume that you’re going to have challenges…but why not set things up to make it so that you don’t have to think about the challenges at all? You need to ensure that you’re always looking at the bigger picture.

Keep in mind that if you do indeed go into a debt consolidation program, it’s really a big commitment. You have to make sure that you pay that reduced payment each and every month on time. There will be no leeway given so you can’t have a bunch of late payments. This is a time to show the lenders that you really are turning over a new leaf. If there is something that happens out of your control, you need to contact them immediately. This will keep the debt consolidation program going and prevent you from getting your actual balances called in, with all of that interest. Then you would have lots of fees to work through, putting you into a worse position than when you started. Why not make sure that you have everything taken care of as much as possible? It’s up to you! Good luck!

Reducing personal debt – Some Advice

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Getting out of debt is something that takes time. Rather than looking for a ‘quick fix’ that’ll get you out of debt overnight, you should be focusing on ways to reduce your personal debt at a sensible rate – neither too quickly nor too slowly.

What does ‘too quickly’ mean?

It might not seem to make sense, but there is such a thing as ‘too quickly’. There are many things in life that are basically more important than reducing your personal debt levels, such as paying the mortgage / rent, paying Council Tax, buying food, heating your home, getting to work…

So there’s no point putting every penny you have towards your unsecured debts if it means you’re falling behind on your essential bills – or risking your family’s health.


What does ‘too slowly’ mean?

In general, the more quickly you repay a debt, the less it’ll cost you in the way of interest. If you’ve never done it before, it’s well worth spending some time with an online credit card calculator.

Just put your details in and see how much difference it makes when you ‘overpay’ your debt every month (when you pay more towards it than you actually have to). Just be prepared for a shock when you see how much more it’d cost if you only ever made the minimum payments.

If you’d like to talk about your situation and get some help figuring out what to do, you can talk to an expert at Debt Advisory Centre Scotland, who supplied this article.

Take the right approach for you

So it’s up to you to decide how quickly you should tackle your debts. You’re the one who knows how much you can afford, how many of your luxuries you can live without, how much overtime you can work, and so on. Having said that, getting some professional debt advice could make a big difference, and keep you from running into problems that thousands of people have already overcome. As they say, there’s no point reinventing the wheel. Plenty of people before you have put their debts behind them – and the right debt adviser will know which approach is likely to help in your situation.

Here’s a brief – very brief – look at some of the approaches you could consider, depending on your situation. Just remember that it’s no substitute for one-to-one debt advice from a professional who can listen to your story and answer your questions.

Overpay your debts

As mentioned above, pay more than you have to. Just make sure you’re not neglecting any of your financial commitments: you should only use ‘spare’ money to overpay your debts, so double-check to make sure you’ve paid everything you have to before you do this.

Consolidate your debts

If your credit rating is good enough and you have access to low-interest rate loans or a balance transfer credit card with a 0% introductory period, consolidating your debts could make it easier to make some real headway on them.

As before, just remember that the more slowly you repay a debt, the more it’ll cost you in the long run. Having said that, taking out a debt consolidation loan could be an opportunity to arrange a shorter repayment period: as long as you’re confident that you can stick to it, this could be a good approach to take if you’re not sure you’ll be able to stick to making more than the minimum payment towards your debts every month.

Consider a professional debt solution

Not all debts are manageable. If you can’t afford even your minimum payments every month, you could really benefit from getting some professional debt advice. There could be a professional debt solution that can help you.

Straw that Broke the Camel’s Back

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Many times it’s the little things that push our tolerance level down to zero – for example having to pay out on additional pet insurance payment when you are already stretched to the limit. But before you throw in the towel and leave your pets (and your wallet) vulnerable to extra cost by cancelling your pet insurance, consider taking some professional advice.

Choose one of the UK’s specialist debt management companies and you will discover you are not alone. Many people are in the same boat, especially in these times of recession. More importantly, you will also find out that there is a way out. With professional advice you can take the first step towards being debt free without sacrificing any of your current essential outgoings – including that all-important pet coverage.

When you decide to seek help the first thing you will feel is a weight being lifted from your shoulders. Most people struggle on with debt for months, sometimes years, before they will ask for help. This does nothing but cause additional stress, more sleepless nights and frustration.

As soon as you realise you are unable to cover your debt repayments contact the professionals to help you escape the debt maze. Always choose a company who is reputably qualified and is approved by the Office of Fair Trading (OFT).

You will find that your debt management company will have specialists in debt consolidation on the team as well as professional IVA advisors, so when you contact the company you are open to receiving a whole portfolio of professional services.


One of the most positive aspects of contacting a professional debt advisor is that he will actually listen to you. You will immediately feel there is someone on your side at last. Once your personal position has been discussed fully with a workable budget in place, your advisor will then discuss with you the best way to help you become debt free. There are a range of options dependent upon your individual situation.

Never ever feel that you are alone. Contact the professionals without delay and allow them to help steer you towards a debt free and stress free future.

Going Into Debt For The Right Reasons – And How to Come Out On Top Again

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Debt is a pretty charged word, if you ask us. When you bring up debt into any conversation, chances are good someone is going to feel like you’re talking directly to them. But is that really the case? Are you really talking to them, or are you just remarking on the irony of life? It just depends on the conversation, we guess. The truth is that debt doesn’t have to be a dirty word at all. In fact, there are actually people that go into debt for all of the right reasons. Does that mean that debt is bad, or our idea of debt is bad? It just depends on your core financial blueprint. We’ll explain in just a moment.

You see, if you’re committed to a debt free lifestyle, you might find it hard to imagine that there are people that apply for loans all of the time, for all sorts of different purposes. Maybe you’ve worked it out that you could take that dream vacation and pay it back, since you have a stable income to do so now. Or maybe you’ve always dreamed of going back to nursing school and helping people. You have a lot of different options to choose from, and you don’t always have to worry about which option is going to hurt you the most. You need to think about which option is going to be the one that allows you to repay the loan over time.


For example, is a mortgage bad? Only if you cannot pay the mortgage off over time.  The mortgage lender is trusting that you will be able to take care of your financial responsibilities. They are essentially taking a gamble on you, which is why the mortgage application process is so long. You don’t want to find yourself being unable to get the house that you’ve always wanted, gut you also have to think about a lot of beyond the horizon situations that might take away from your enjoyment of your home in the first place. For example, if you were to just get the most expensive home that you can afford, you’re always going to be worried about losing your job. Or getting sick. Or losing your spouse and then having so many bills that you cannot afford. That’s the honest truth — and a lot of homeowners are in that boat. You don’t have to follow suit.

We cannot stress enough the importance of a plan if you’re going to go into debt like this. Whether it’s going back to school or buying a home or even buying a car, you need to make sure that the debt makes sense for your lifestyle. Don’t go off of what your friends are doing. Friends are classically notorious for leading us to believe that they are on much more stable ground than they actually might be. That’s a recipe for disaster, if you ask us. Don’t think that you have to go through that at all — plan smart, plan well!

When Other Options Fail, an IVA Can Help You Out!

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Finding the road out of deeply-rooted debt is challenging. You might feel that there’s no real need to work on your debts — especially if your debts aren’t that old and the creditors seem to be working with you. But when you stop making timely payments, you are putting your family’s future on hold for a long time. When you’re in debt, it’s not like you can really make other choices.

You can’t dream about a new car, or even rebuilding your credit. You can’t go into a new house or anything of the sort. You will be hopelessly stuck trying to make ends meet and never really getting anywhere fast. Is that really the example that you want your children to see? After all, it’s been shown that your children get their personal finance habits directly from you. So if you aren’t any good with money, chances are good that your children will follow suit. Thankfully, there is another option to look into when other options fail: the IVA.


This stands for Individual Voluntary Arrangement. It is something that is between you and your creditors. They will agree to letting you pay one monthly payment, often without interest, for all of your debts. This gets your debts reduced in a very short time — roughly between 3 and 5 years. At the end of your payment period, the rest of your debts are discharged. This gives you a clean slate and sets the tone for you to get things really done. If you aren’t careful about the path ahead of you, you could end up getting your arrangement cancelled. Then you would be liable for all charges incurred in the setup, and that would mean even more debt than you had originally.

Sticking to your IVA program is really the best approach to take, but a lot of people really don’t stick to the program…then they blame the program for still being in debt. That’s the wrong attitude to take, but if you have to learn that the hard way be our guest.

Don’t wait another minute to take back control of your life. It’s better to make sure that you rest up, consider your options, and then make a decision that you can be proud of. Getting out of debt isn’t always easy, but it is truly always worth doing. Good luck with everything that you do!