It’s the New Year and most of us are trying to recover from massive hangovers. I’m not speaking about the after effects of too much partying, although this could well be the case. The hangover I’m referring to is a financial hangover.
Over the holiday season, Australians used credit cards like never before, with retailers recording one of their busiest years to date. Despite warnings from the RBA and business media, Australians went crazy this year accruing further credit card debt.
As it stands, Australians have more credit card debt per capita than our American counterparts and this trend is set to be rising. Following on from this is the effect personal debt has on inflation and interest rates leading many economic speculators to believe that the RBA will raise interest rates in February 2008. Other commentators believe if this doesn’t happen the banks will surely raise rates themselves without an official rate rise, in order to mitigate the affect of the sub-prime disaster in the US.
So what’s the cure for a financial hangover? The answer is simple, cut back the spending and pay off some debt. This is probably easier said than done but there are a number of debt management strategies that you can use to help.
Firstly, and most importantly you should look at your budget. A budget is necessary starting point so you know how much you earn, where you money goes and who you owe money to. Debt Fix has developed a fantastic budget planner located at www.debtfix.com.au and best of all, it’s free.
Next, you need look at who you owe money to and how much is owed. If you are struggling, contact you credit provider and tell them. They will most likely suggest a repayment plan, but make sure it’s affordable before you agree to anything.
Some people with more serious debt problems might consider using a debt solutions company like Debt Fix.
Debt Fix can speak with your creditor on you behalf and find solutions that are affordable and sustainable. When it comes to finding a debt relief solution, Debt Fix is expert in its field and when it comes to your debt problems, Debt Fix can give free, expert advice.
So why not look at 2008 as an opportunity to put your debt problems behind you and embrace a brighter financial future.
Debt Fix is a company that actively encourages the promotion of greater debt management awareness. Debt Fix helps people struggling in debt through free debt assessments and providing free advice and options for people looking for a solution to manage their debts more efficiently
January 4th, 2008
Could debt consolidation be the answer to your financial problems? You know it is a popular solution. You are always hearing about agencies that can help you get rid of this unwanted debt or to shrink it down to size. But how can you tell if this is something you should consider?
First, you should consider just how much debt you have and if this is really a burden. If you are having problems paying these bills month after month, this may be the answer you have needed. Yet, if you still have a lot of money left over each month after you pay your bills you may want to just increase the amount you pay on each of your debts. If you do this, you will slowly eliminate these all on your own, with no contracts and with no third party intruding into your finances.
Secondly, you should understand what debt consolidation is. To consolidate your debt, you are ideally combining most if not all of your monthly loan payments and credit card payments into one bill. This also means you are paying a lower amount because you will essentially pay a lower interest rate on one bill instead of several.
Sounds good? It can be a good situation for many people.
Yet, there are other factors you should consider before you rush out and sign a contract with a debt consolidation company as well as provide them with all of your financial information such as:
* Is the company a reliable one? Check them out with the Better Business Bureau.
* Although the company says they will begin making payments for you on such and such a date, it is a good idea to go ahead and make at least one more month’s payment on each of the debts that is going to be consolidated Sometimes the agencies gets behind and when this happens it is your credit that suffers and it is you that is liable.
* Make sure you understand the numbers, not just how much you will save each month. You should also be aware of how long you will be making these payments and then do the math. How much will you actually be saving?
* Make sure you really understand those contracts, especially if you are putting your home up as collateral.
Could you actually raise your credit scores by taking out a debt consolidation loan? Yes, over time you may actually be able to raise it because it may be easier for you to make that one monthly payment versus those several payments. You may also have more peace of mind knowing those bills are being paid.
Yet, if you put up your home as collateral and that payment is still high, you may even become more stressed than you once were.
The question as to whether you should consolidate your debt or not and whether this action will help your finances in the long run, is a hard one to answer. The best way to approach this is by doing the math, doing the research and not to make hasty and quick decisions.
Jeffrey Meier of Jam727 Enterprises at http://www.Jam727.com offers information articles on Debt Consolidation at http://www.jam727.com/DebtConsolidation/debtconsolidation/Debt_Consolidation_Facts.html
January 4th, 2008
