Reed Financial Group

Most of the time people will find themselves drowning in a sea of debt and have no idea how they managed to get themselves into so much trouble. It happened much like wading into a real ocean does.

First, you are standing on a nice warm sandy shore enjoying the sunshine and the breeze. You dip a toe into the ocean and it feels really nice. You begin wading out and you are surrounded by things you have always wanted. You just keep getting deeper and deeper until you are in way over your head and you cant see a nice dry (debt-free) shore anywhere in sight.

People very rarely just suddenly get into deep financial and debt problems….it happens one credit card at a time. The first credit card might be an oil company credit card. The next one is usually a store credit card. Then you get the major bank credit cards. It is just so easy to get all of the stuff that you want and need using credit cards and making the minimum payments that are required is just no problem at all.

Before you know it, you are using these credit cards to make your car payments and your mortgage payments, maybe even to buy the weekly supply of groceries. You find yourself drowning in debt. It isnt a fun place to be, for sure.

You can get credit counseling, and you can get a debt consolidation loan or even a second mortgage. But you are really going to get out of debt the very same way you got into debt…one step at a time. The closer you get to the shoreline, the easier it will become to free yourself of overburdening debt. And next time, you won’t get too far from shore.

By: Milos Pesic

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Some people think that credit card consolidation can help to simplify their debts and bills repayment. For example, if you have a line of credit that can cover all your current loans and debts, you can transfer all your various bills and loans onto that single credit card so that you only make a single monthly repayment in future. However, do check whether your credit card transfer fees are worth the effort. Typically, you may need to pay around 3% to 5% of the transferred balance, although from time to time, there are some offers with zero or low transfer credit cards. Although credit card consolidation is convenient, note that it is only used for smaller debts and bills given the limit of your line of credit and the high interest on your credit account balances once your grace period is over.

On the other hand, debt counselors usually advise their clients to cut up their credit cards and terminate their line of credit such that they can help to restrain themselves from further buying on credit again which worsen their debt to income ratio. Although it can be very inconvenient without credit cards in the first few weeks, it is the most simple and effective way to avoid further debts when you buy what you can afford in full cash. This allows you to have more disposable income to repay your current debts quickly.

Nevertheless, it can be more effective to look for debt consolidation assistance from finance companies and loan brokers. These debt consolidators will provide you with a new personal loan which covers all your other high interest credit card bills or delinquent debts. The new monthly repayment for these debt consolidation loans is usually reduced compared to what you are paying for all your debts, but this is at the expense of a longer loan term. For those of you with cars or property, they can be eligible for secured debt consolidation loan collateral to lower the interest fees charged by the banks. For people with very bad credit, this can be the only feasible way to consolidate your loans with acceptable interest fees. The downside to secured debt consolidation loans is that there is a higher risk you must bear in the even that you default on the monthly repayments, you may lose your loan collateral.

Note that debt consolidation can lower your monthly repayment such that you have an easy time repaying your loans and this helps to quickly repair your credit ratings. However, your loan principals remain as they are. Although debt consolidators can send debt settlement letters to negotiate for interest discounts and forbearance, your main savings over the interest fees will come after your credit score is restored to good levels.

By: Morgen King

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Saving more than a couple of thousand dollars is not as difficult as it sounds. I am not going to harangue you on “you can do it”, or “importance of saving”, or “why not saving can kill you before the world ends in 2012.” No. Nothing like this. Here are few suggestions on how you can actually save few dollars, if not couple of thousands, next year.

1. Calculate the amount of money you spend buying kitchen paper. It may not be quite substantial, but why waste money on these papers when you can replace them with cloth napkins. Spending even a dollar on disposable papers seems to be a waste. Buy a cloth that can be washed and reused. You can save approximately $85 a year.

2. If your family comprises of you and your spouse, both working, why spend so much on cable. Unplug it and save anywhere round $600 per year.

3. Digital camera is perhaps the only device where we use batteries. If you use it a lot, switch to rechargeable batteries. Doing this will save not much, maybe $24. But every penny saved in this kind of economy is 3 pennies earned.

4. Why do we need a landline when all the family members own a mobile phone? I have disconnected it and I sometimes use Skype instead of landline, and mobile most of the times.

5. If you are still left with any gold after, after the “sell gold” advertisements, sell it off. Even if it is small gold scraps, sell it. But do not mail it across. It is better to sell it at the neighboring jewelry shop. You can earn some amount here.

6. Chopped and shredded vegetables, cheese, and fruits cost much more than the un-chopped, fresh ones. Instead of spending more, you can get the fresh ones and slice it at home. Doing this for a year can help you to save $250. Isn’t it worth a try?

7. Stop going to the gym and find a way to exercise free of cost. If the only reason you go to gym is losing weight, there are numerous ways to do it without a gym. By doing this you can save as much as $420 in a year. Till now, this is the biggest contributor to your saving.

8. Get rid of your printer. Okay, may be that’s not possible, you can at least promise yourself not to print unless necessary. Ink cartridges, color or black & white, can burn a hole in your pocket. I have to replace the cartridge once a year. However, it still costs me around $80 to $100.

Remember these points while preparing a budget for 2010. These are just 8 examples of saving money. We, together, can come up with probably hundreds of them, and imagine the amount we could save. If you have any such suggestion, please comment and suggest, for me, for all the readers. Let’s derive the most comprehensive and precise personal finance money management guide for 2010.

By: Carl M Thomson

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Suze Orman was on Oprah this week, giving emergency financial advice to people facing foreclosure, unemployment, or bankruptcy. Her 9 Steps To Financial Freedom will help anyone to avoid those disasters.

Step 1 – Seeing How Your Past Holds The Key To Your Financial Future

“Messages about money are passed down from generation to generation, worn and chipped like family dishes.” Suze Orman

It is important to spend time understanding your family’s stories about money – and the ones you created yourself, as you were growing up. Financial freedom begins with freeing ourselves from the burden of the past.

Step 2 – Facing Your Fears And Creating New Truths

“The trouble with fears is that when we keep them inside and refuse to deal with them, they grow, like weeds left alone in a garden. Take the fear of not having enough to cover the bills this month and let it wander around by itself, unchecked. Where will it go? It will become the fear of not having enough in general.” Suze Orman

New financial realities can only grow once you have faced your fears and replaced them with new, more empowering beliefs.

Step 3 – Being Honest With Yourself

“Most of us believe, or deceive ourselves into believing, that we need about $1,000 to $1,500 a month less than we actually do need to go on living the exact same way we live right now.” Suze Orman

It is very important to go back through your records and establish exactly how much you have really spent. Guessing won’t get you free!

Step 4 – Being Responsible To Those You Love

“It’s not OK when you get sick, or when you die, to leave financial chaos behind you for everyone else to clean up.” Suze Orman

Make sure you have a will, including a testamentary trust, adequate life insurance, income protection insurance, and health insurance. If you are not sure what any of these are, or how to get them, consult a financial planner.

Step 5 – Being Respectful Of Yourself And Your Money

“If you’re respectful of your money, and do what needs to be done with it, you will become like a magnet, attracting more and more money to yourself.” Suze Orman

The most powerful and respectful way to make money is to invest wisely. Plan for your future, take advantage of the superannuation plans that are available to you, face your debt, and stand guard over your money, ensuring that every penny you spend is a penny that must be spent.

Step 6 – Trusting Yourself More Than You Trust Others

“When it comes to every financial decision you will make for the rest of your life, you will choose correctly if you go with the answer that reflects your instinctual response.” Suze Orman

Your financial freedom is your responsibility, and it can only be planned and brought about by you. There is no “expert” or “insider” who knows better than you what you should do.

Step 7 – Being Open To Receive All That You Are Meant To Have

“Money is a living entity, and responds to energy, including yours, and to how you feel about yourself.” Suze Orman

Thoughts of poverty are the chains which bind – to release them, give money to a charity you feel stongly about.

Step 8 – Understanding The Ebb And Flow Of The Money Cycle

“How often have you heard, for example, of someone who is devastated by being fired, only to land a much better job and end up happier?”

To be at peace with the ebb and flow of money, remember two things. Always take the long view of your financial future, and believe that everything that happens is positive, if you are willing to let it be.

Step 9 – Recognising True Wealth

“True financial freedom lies in defining ourselves by who and what we are, not by what we do or do not have.”

You cannot put a price tag on your life. No matter what financial ups and downs happen in your life, you will be truly wealthy when you understand that none of that stuff matters. Not really.

“Money itself cannot make you financially free. Only you can make yourself financially free, and you can do it – and so much more. You have that power.”

By: Mark Bennett

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One of the easiest ways to make money online is through selling advertisements on your own website or blog. The basic idea behind this form of internet marketing is to build an audience of people visiting your website and then find advertisers who are willing to pay you to market their products to your audience.

The two most basic forms of online advertisements are text ads and banner ads. Text ads are essentially text links that advertise a certain product or service that a person surfing your website can click on to visit the advertiser’s website. Banner ads, on the other hand, are static or animated images that once clicked on will take a person to the advertiser’s website. Text ads take up little space and allow you to place many of them on your website or blog. Banner ads on the other hand are more visually appealing and can display more information so they are more likely to be clicked on.

Text and banner ad placement can be sold to advertisers on a weekly, monthly, or yearly basis. Advertisers will pay you a certain amount in order to display their ads on your website for a certain length of time. Furthermore, the kind of placement an ad receives on your website or blog will also dictate the amount an advertiser pays you. For example, you can charge more for an ad placed on the top of your website than for one placed on the bottom.

Finally, the most crucial step to catching the advertisers’ attention and making them want to pay you to advertise on your website is to show them you have a large number of visitors.

By: Folusho Orokunle

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I think I’ve heard it all when it comes to money. When people state that they are unhappy with their financial situation, I know that their problems likely fall into one or all three of the following categories.

SPENDING TOO MUCH – When I grew up we touched money – real money. If we didn’t have coins in our pocket we just didn’t spend. We didn’t have Lines of Credit, credit cards or Overdraft Protection. Cash was all we knew.

Often people buy things they don’t need with money they don’t have to impress people they don’t even like. They renovate – not based on need but on want. After purchasing a house that is at the top of their credit limit, they add the toys (boats, quads, campers, vehicles) and then they book trips to “get away from it all”. All of this compounds the problem.

The “secret” to financial health is to spend less than you earn. This might mean not adding to your wardrobe until you absolutely need to do so. You may need to eat at home more and pack a lunch. Shopping is a trap you will need to avoid as it just tempts you to buy more. And remember, you don’t have to try to keep up with the Jones’. Living on less will give you a freedom that the Jones family likely doesn’t possess.

NOT KEEPING TRACK OF FINANCIAL MATTERS – When you do not know how much debt you have or when your bills are due, you are at risk of overspending, losing a good credit score, and paying excessive penalties and interest. Even being one day late on a credit card payment can result in a large late payment charge and increase your interest rate by several points. Delinquency is reported to the Credit Bureau and this can affect all future attempts at borrowing.

In order to improve your situation and gain control of your financial life you will need to begin by getting honest with yourself. Start with four blank sheets of paper.

On one write “Assets” and list all of the items that you own or are buying through payments (house, vehicles, savings accounts, investments). Beside each put the value of the asset and then put the total of all at the bottom of the page.

On the second sheet write “Liabilities/Debts” and list all of the amounts that you owe to others. Also record the interest rate, due date and amount of the payments you are responsible for making for each item. At the bottom of the page write the total amount owed and the total amount for the payments required each month.

On the third page write “Income” and list all sources that make up your total household income each month (include rental properties, interest earned, part-time work).

On the fourth page write “Expenses” and list all the things that you pay each month (utilities, food, clothing). Don’t forget to add the total monthly payments that you listed as “Liabilities/Debts”.

Now that you have everything listed you will be able to do a proper assessment of your situation.

NOT HAVING A PLAN – There’s an old expression that says “People who fail to plan, plan to fail”. You may have to sell some assets to lower your debt or find a part-time job to increase your income. Perhaps your credit card company will reduce your interest rate if you call them and make a commitment to pay a specific amount towards your balance on a regular basis.

One of the first things you will need to do in order to get back on track is cut back on your expenses. There are many creative ways to do this. For example, instead of buying a $5.00 coffee every morning, make a pot at home and carry it in a travel mug. This will save $100 per month which can be used towards debt. The result is that your balance is reduced and the interest charged the following month will be reduced.

You will likely be able to turn things around rather quickly once you have a good plan in place.

When it comes to finances, a few small changes can make a huge difference and, over time, you can go from feeling overwhelmed to being in a strong position where you will be in control of your situation. If you need help with this, do not hesitate to contact a psychologist who is trained in problem-solving. The sooner you book an appointment, the sooner you will be headed towards achieving financial well-being.

By: Linda Hancock

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