Are you eligible for debt consolidation with bad credit?

Are you struggling to manage your multiple credit card debts? Maintaining multiple cards all with different fees and varying interest rates can be difficult to manage. You might default on your payment and incur insurmountable amount of debt. Therefore, in this situation debt consolidation can help you consolidate your multiple credit card debts with a single affordable monthly payment. You can consolidate your high interest credit card debts in to a low interest single monthly payment. But if you have poor credit then your consolidation loan application might get disapproved. So here are a few points that will help you get consolidation loan despite your poor credit:

1. Prepare a stringent budget plan so that you can overcome your catastrophic financial situation. You need to accept the fact that will not be easily to come out of debt. Therefore, following a monthly budget can help you pay off the debt in an organized way. Make sure that you keep track of your expenses so that your expenses do not exceed your income.

2. Review your financial situation and decide whether you need help of a credit counseling agency or professional debt arbitrator to manage your current financial situation. Make sure you find a reliable debt relief agency with a Better Business Bureau accreditation to manage your financial owes.

3. You can approach your bank or credit union to apply for new loan to consolidate your debts. If you have an account with the bank then you can apply for a personal or signature loan to consolidate multiple payments. But you might not be able to get a loan if your credit score is low. Traditional lenders and banks will check your credit report before approving your loan application. If you have poor credit score then you can apply for secured consolidation loan. You are required to keep security against the loan amount.

4. If you attend college then you can be eligible for financial aid that can be used for paying off your tuition fees, hostel expenses etc. This grant money can be used for paying off your student loan debt as well as other debts. If you want to acquire more information then you need to contact the school’s Financial Aid Office.

Therefore, if you follow these four points then you can get a consolidation loan despite your poor credit. Once you pay off the debts then you can work on repairing your credit report.

11 ways to Get out and Stay out of Debt

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners (www.holisticinvestment.in) a firm that offers Financial Planning and Wealth Management. He can be reached at ramalingam@holisticinvestment.in.

In spite of steady, regular income there are so many individuals who live paycheque to paycheque, carry their credit card outstanding, and fail to save anything for retirement. If you are one of them, now is the right time to take action to come out of debt and stay out of debt. It is not only possible; it is unbelievably achievable.

1. List down all your debts

You need to take stock of all your loans. It could be credit card due, personal loan, car loan, housing loan, education loan, loan from FD, loan from insurance policies, loan from your employer, hand loan and so on. For each and every loan you need to note down how much you owe, the present interest rate, EMI, Number of months to be paid.

2. Negotiate for lower interest rates

If you could negotiate the interest rate and bring it down then you can come out of debt faster. Most of the credit card companies come forward for negotiation if you really show interest in repaying. They need not run after you to collect the debt. It will reduce their expenses. So they will be happy to negotiate. Balance transfer offers from credit cards are also a way to reduce your interest rate.

3. Refinancing and consolidation

Replacing a loan with another is known as Refinancing. By doing a refinance it should reduce your interest rate and it should bring down the time you are in debt. But most often people go for refinance that provide them lower EMI but increasing the time they stay in debt.

4. Categorize your debt

Housing loan can increase your net worth over a period of time. Housing loan gives you tax benefit also. For a business man car loan provides some tax benefit. Based on these factors a debt needs to be categorized. This will help us in comparing different loans.

5. Prioritize your debts

After sorting out various loans, now we can comfortably prioritize the loans. Obviously this will be based on the interest rates and tax benefits. At times paying off a small loan first can give you a lot of motivation to get out of debt.

6. Creating and Executing a Debt payoff plan

You need to create a debt pay off plan with different scenarios. So that you can find out how some more savings or a different repayment order will help you to get out of debt faster. When creating a plan, you need to choose one which is comfortable to your attitude. Otherwise, you may not execute it properly.

7. Refrain yourselves from applying for fresh loans

You need to make a vow that you will not be adding any fresh loans, till you come out of all your debts completely. Think for a moment, how you will feel when you become debt free. This will give you a lot of positive energy to come out and stay out of debt.

8. Postpone buying major assets

Buying a property or any other assets need to be postponed till you get out of debt. With your new ownership comes the new, probably large and unpredictable expense. This can make you deviate from your debt pay off plans and at times the consequences could be uncontrollable.

9. You stop using your credit card

There are two groups. One group of people uses the credit cards responsibly. That is they will repay the credit card dues in full when they receive the bill. The other group will pay the minimum amount due and carry forward the balance amount due. If you belong to the second group, you need to stop using credit cards temporarily. Take out and keep your credit cards in the locker. Once your financial situation and buying habits improve, then you can start using your credit cards again.

10. Change your spending habits.

Being in debt obviously means that you have been living beyond your means. The solution is very simple. Spend less than you earn and you will get out of debt soon. You need to change your spending habits. Then only this simple solution will be achievable. If you buy things you don’t need, you’ll soon sell things you need. Don’t save what is left after spending; spend what is left after saving.

11. Involve all your family members

You need to inform all your family members and dependents about your debt status. Then you will be able to take decisions with much more clarity. Moreover, if your family members know about your debt, they will also change their spending habits and support you in getting out of debt faster.

Consider the postage stamp: Its usefulness consists in the ability to stick to one thing till it gets there. Similarly, you need to stick to your debt pay off plan till you get out of it.

10 Things To Do Before You Retire

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners (www.holisticinvestment.in) a firm that offers Financial Planning and Wealth Management. He can be reached at ramalingam@holisticinvestment.in. If you want to write for us please send an email to me [at ] melvinpereira.com or get in touch with us at the contact page.

Don’t put off today what you can’t afford to do tomorrow. In spite of the world wide pension crisis and a growing acceptance that we must plan and save for our retirement, the harsh reality is we are actually not saving enough. Research reports reveal that only 15% of the individuals are saving sufficiently for their retired life. Here are a few tips on things to do before you retire so that your retired life is more comfortable and enjoyable.

Get Rid of All Your Debts

If you are taking a housing loan, personal loan, car loan or any other loan make sure that you will be repaying them on or before your retirement. You need to choose the term of the loan in accordance with your retirement age. You can enjoy your retired life when you have 100% financial freedom, not when you have to repay your loans.

Protect Your Emergency fund

Emergency expenses can happen any time. But the possibility goes up during the old age. So we need to enhance the emergency reserve year on year based on the inflation and change in your expense levels. Emergency fund will give you a sense of security and also you need not touch your other investments during emergency where you need to pay pre-closure penalty. Also don’t forget to refill the emergency fund once you met an expense out of emergency fund.

Establish a Retirement Budget

You need to visualize your retired life well in advance and need to create a budget for your retirement. That is you will not be going to office. So the expenses on transport and clothes may come down. Also you will have more time to spend. You may need to spend more on leisure travel and health care.

 

Examine Your Cash Flow

Take a close look at your cash inflow as well as outflow. Is there going to be any income after retirement? Like rent, royalty…. Would there be any unwanted outflow during retired life? Like paying life insurance, or SIP. At times during your beginning of the career , you could have taken a policy where you need to pay premium up to the age of 60. But now you may plan to retire at 55 itself. So you need to realign your existing policy and other investments in sync with your retirement age.

 

Grow Your Retirement Corpus

Find out how much corpus you need to have when you retire so that you will be having complete financial freedom. A professional financial planner will of great assistance to you in this regard.

 

Develop a withdrawal strategy

How are you planning to withdraw your cash outflow during retirement from the retirement corpus? Monthly, quarterly, half yearly or annually? Through Sytematic Withdrawal plan in mutual funds or by way of dividend or interest. All these will have a great impact on the corpus you need to accumulate. So you need to decide in advance.

 

Minimize taxes

Your retirement corpus and retirement income need to be tax efficient. You need to pay taxes as and when the fixed deposits matures irrespective of that you withdraw interest or reinvest under a cumulative option. But you need to pay interest only when you withdraw from the mutual funds. Careful selection of investment vehicle can reduce your tax during the retired life.

 

Get Sufficient Mediclaim coverage

The moment you retire, your employer will stop covering you under the group mediclaim. So you need to plan for your individual medical cover well in advance. At old age the medical expenses are inevitable. If you have not planned it properly the all your retirement plan will become a mess.

Consider Inflation adjusted annuities

The monthly income you need when you retire is not going to be the same even after 5 years of your retirement. Inflation will increase your retirement expenses year after year. So year after year your retirement income needs to go up.

Oversee estate planning

How your fixed assets and financial assets need to be distributed to your legal heirs? Create a WILL. You can avoid creating relationship problems to your next generation because of your left out wealth.

Guest Post – How to save more by spending smarter?

Saving more by spending would be ridiculous, but by smarter spending it would be the best thing you can do to yourself. To be able to manage your everyday finances is a great art in itself, and the Guest post by Mr. Ramalingam is trying to help with just that. But to be able to be ideally manage your finances better, you would need to monitor it first. More on that in further posts, but here is his thoughts on how to save more

The willingness and the ability to save money is the secret of building wealth. So as to save money, you need to spend less than you actually earn. Though it looks very simple when you say, it is really difficult to implement. There are plenty of ways to help you start saving money even on the very tight budget. Saving money or spending less is all about the personality, belief system, values of a family. Spending less and saving more are lifelong living skills that need time to develop. Unless and otherwise, you have a written financial goals, you will lose your focus and go after consumerism and materialism.

To save more, obviously you need to spend smarter. To spend smarter, you need to understand you own spending patterns.Consciously you need to track all your expenses on a daily or weekly basis. So that you will be able to find out what influences your spending pattern.

Spending money has got so many influencing factors. But all these influencers can be classified into five broad spending influencers.

  1. Emotions: Your emotions play an important role in your spending pattern. The positive feelings like happy, fun, joy can influence you to spend more on entertainments and gifts. The negative feelings like envy, jealous, shame, stress, depression, frustration can influence you to spend more on smoking, drinking, buying things you actually don’t need, relaxation and healthcare.
  2. Traditional Thought: This is because of you belief system and your thought process. I need to buy a silk saree every year for my wedding anniversary. I have to bust crackers for Diwali. These are all the classic examples of how your traditional thoughts will influence your spending pattern.
  3. Society: Society in which you live will have more influence on your spending. You have to buy a car as all your colleagues are coming to office in their own car. On the occasion of your kid’s birthday, you need to arrange gifts for all the classmates of your kid.You should be watching this movie, on a first day first show.This influencer is caused by friends, colleagues, neighbours, relatives, and club members. Even at times, the advertisements and promotional offers like a discount sale can make you to spend more.
  4. Habits: Habits formed when you are growing up can make us spend impulsively. Generally this will be for our sensual pleasures.Spending on movies, music, eating out, smoking, drinking are the best examples of these influencers.
  5. Commitments: This includes paying off your debts and loans, commitments towards family like school fees, buying groceries and other provisions, paying rent, paying for medical insurance. You are committed to pay these expenses earlier.

By tracking and analyzing your each and every expense, you will be able to identify the influencers which made you to spend.Here are some strategies to overcome these influencers and spend smarter:

Control Your Emotions:

Instead of spending money, you can control your emotions by doing something else like doing yoga or meditation, watching comedy shows on TV, going to temple or beach. You need to solve the root of the emotion. You have to do introspection and need to keep a balanced mind always. Balanced mind is a key for spending smarter.

Self Talk:

You need to consciously change your thought patterns to come out of traditional thinking. “I don’t really need a saree for every wedding anniversary”. “I am not a kid; so I need not bust crackers on diwali”. These kinds of auto suggestions will change your thought process and you will be able to really prioritize things on which you spend.

You are unique:

You were born original. Please don’t die a copy. There is no need to feel bad if you don’t get to spend or buy things like your friends or people around you. You are unique and special in your own way. You need to discuss with your family and friends about “How to live happily by achieving compromised spending patterns?”

Learn and unlearn Habits:

The unwanted habits which make you spend more can be unlearned. Good habits which make you spend smarter can be learned. Habits can be learned and unlearned. But you need to know it is not a quick fix. It involves a process and a commitment.
A habit is an intersection of knowledge, skill, and desire. Knowledge is ‘what to do and the why’. That is we need to spend less to save more and become richer. Skill is ‘How to do’. That is ‘how we spend less and what are all the strategies to be applied for spending less’. Desire is the motivation, the want to do. What are we trying to achieve by spending less? How that is more important to us than spending more. In order to make something a habit in our lives, we have to have all three.

Unwanted Commitments:

You can’t avoid certain commitments like groceries, schools fees. But definitely you can discontinue unwanted commitments like the club membership in which you are not actively participating and not getting any actual use out of it; the chits impulsively you have enrolled with a jewelry shop.

Money not spent is saved. These above strategies will only work if you truly have a desire for future financial success. You need to be disciplined and persistent in the course of implementing these strategies. The more you practice smart spending,wealthier you become.


The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners (www.holisticinvestment.in) a firm that offers Financial Planning and Wealth Management. He can be reached at ramalingam@holisticinvestment.in.

Money Management now made portable

Finance is something that is very personal to people, definitely divulging ones financial information to another person is not something we are comfortable with. It is quintessential that this information is kept securely and managed properly to organize your financial life. There are many Software available online for the management of personal finances. The only problem being that these personal finance managers need to be installed on a computer which then restricts your access to the information you need when you might need it most.

A great alternative is to use finance managers on your phone especially if you have an iPhone or another high specification phone. The other way is to use portable apps, We all know about portable apps by now. If not then you can read my post about portable apps here. In this post I wanted to share some portable apps that are specifically designed for the portable environment.

Money Manager Ex  (Open Source)


Authors Website : Money Manager Ex

Download: You can download it directly from HERE

Notes: Be sure to choose the zip download and not the installer!

RQ Money (Freeware)

Authors Website: rq.sk/rqmoneyen.html

Download: You can download RQ Money HERE

GNUCash (Open Source)


Authors Website: GNU Cash Portable

Download: get GNUCash Portable

PWS Money (Freeware)

Authors Website : http://www.pwsmoney.com/

Download : http://www.pwsmoney.com/test/php/counters/click.php?id=10