Tag: Budget

How To Become a Freelancer and Make a Full-Time Income

by Phillip Warren

Today, I have a fun interview to share with you that will show you how to become a freelancer.

I recently had the chance to interview Ben Taylor. Ben has been freelancing since 2004, and he has worked for dozens of companies.

Yes, this is a career path that you can learn!

As Ben will tell you in the interview below, a freelancer can be anything. You can be a freelance designer, personal trainer, nutrition coach, online teacher, virtual assistant, writer, and more.

If you are looking for a new business or even just a side hustle so that you can learn how to make extra money, learning how to become a freelancer may be something that you want to look into.

In this interview, you will learn:

  • What a freelancer is, who they work for, what they do, etc.
  • How much a new freelancer should expect to earn
  • How a person can find their first freelancing job
  • The steps needed to take to make money as a freelancer

And much more!

He also has an informative course called Freelance Kickstarter. This course takes you through the step by step process of creating your own freelance business.

Check out the interview below for more information.

How to become a freelancer.

 

1. Please give us a background on yourself and how you started as a freelancer.

I'm Ben, and I live by the sea in England with my wife and two young sons.

I started a career in tech back in 1998, and by 2004 was Head of IT for a government department. It didn't take long for me to tire of company politics, and the endless meetings that were more about displays of ego than really getting anything done.

I came from an entrepreneurial family and my parents both had businesses rather than jobs. The businesses weren't always successful, and there were definitely periods of “feast and famine.” However, I was well used to that and I think that branching out on my own was something I was destined to do.

My move into freelancing splits into a couple of clear phases:

Initially, in 2004, I quit my IT job, walking away from business class travel and a gold-plated pension with nothing more than a vague plan to begin to work as a freelancer!

I started to provide IT support and consultancy to both businesses and individuals. I do actually still do some of that work for a select group of long-term clients, but by 2009 I had managed to burn myself out with it. The business was going well, but I was working ridiculously long days and every holiday I tried to take was interrupted by constant phone calls and emails.

So phase two began when I sold off most of my client-base and moved to Portugal! That's when I really started to broaden my freelance horizons. I had to start from scratch, with an unclear intention to start writing for a living, and no real plan for how to do it.

I did lots of things, including wasting a LOT of time down fruitless blind alleys. I wrote for content mills, started blogs, found clients on freelance job boards, and – slowly and steadily – started to build my income back up. The difference was that I was doing it all completely on my terms with work I really enjoyed. 

I was also living in a dream destination whilst doing it.

 

2. Can you explain what exactly a freelancer is, who they work for, what they do, etc.?

This seems like a basic question, but it's very worthwhile. There's a considerable difference between freelancing and remote working that not everybody appreciates.

First off, a freelancer can be anything. For some reason many people immediately think of writing when they think about freelancing. But you can be a freelancer designer, personal trainer, nutrition coach, online teacher, virtual assistant, and dozens of other things.

It's also worth noting you don't only have to be one of those things. I AM a freelancer writer, but I also still dabble in IT consultancy, run my own blogs, provide coaching, and even build websites for people (if they ask nicely and the price is right!)

Regardless of what you do as a freelancer, the important thing to realise is that you are running your own business. The big plus of this is that you are in total charge. But the big negative is that you don't have any of the safety nets you have if you are employed by a single company. This means you're responsible for everything from your own insurance and healthcare to your own technical support!

Freelancers typically work for several different clients. There are myriad places to find those clients. It's quite common for freelancers to find clients within their existing professional networks, and not at all unusual for ex-employers to be among them. Then there are freelance job boards like Upwork and PeoplePerHour, which provide an endless stream of new opportunities.

 

3. How much should a new/beginner freelancer expect to earn?

This is an incredibly difficult question to answer! I can think of one freelancer I coached who's in a very specific writing niche. He went onto Upwork with an initial rate of $100 per hour and found lots of work. I started out in IT consultancy charging a similar rate and was quickly earning more than I did in my full-time job.   

However, at the other end of the scale there are people with limited experience or specialist skills who will need to pay their dues. This means building the foundations of a freelance career by proving yourself and taking low paying jobs to build up examples of work and positive feedback. My move into writing was much more like this!

I think “job replacement income” is a useful target for new freelancers to keep in mind. That can vary vastly from individual to individual. Obviously replacing and exceeding a corporate-level income takes much more than freelancing as an alternative to a part-time, entry-level job. That said, people with senior-level experience command much higher freelance rates.

Related content: 20 Of The Best Entry Level Work From Home Jobs

 

4. What do you like about being a freelancer?

Not having a boss!

The difference in lifestyle is massive when you work for yourself. This is always brought home to me when I'm making plans with friends and family, and people say “I'll see if I can get the time off.”

This makes me shudder, because it's SO alien to me now. The example I always use is that I never have to ask anybody before I can tell my children I'll be at their sports day or nativity play.

When you have what I call a “traditional job,” you DO have the security of healthcare, and perhaps things like holiday and sick pay. But you give up a tremendous amount of freedom in return. Freelancing is profoundly different, and it's rare to find people who've given it a go that would ever choose to go back to full-time employment.

So that's a huge thing for me, but there are other huge benefits too. I love the fact I can pivot into different things, which always allows me to keep things fresh.

About four times a year I reassess my priorities and lay out new goals for the short, medium and long term. They might involve starting a new blog, writing another book, learning a new marketable skill. For somebody like me who relishes variety, I love having total control of this.

 

5. How can a person find their first freelancing job?

There are SO many ways to find freelance jobs. I have an article listing 50 different options!

However, they broadly split into two categories that I call “real world” and “online world.”

It's always worth starting out by thinking of your real life networks. As I've said, many freelancers do their first self-employed work for people who already know them. I'd advise people to think about any contacts who've already seen the kind of work they're capable of. These are “warm leads” that are well worth perusing.

It makes sense to think about personal contacts as well as business contacts, too. Plenty of freelancers find clients who are their “wife's best friend's brother” or something like that!

Remaining in the “real world,” there are also options like local business groups and networking events – although they are obviously far less accessible at the present time.

Moving to the online world, the freelance job boards are the place to be. They can be intimidating places initially, and it's crucial to learn how to use them and how to avoid scammers and low paying clients. But there are plenty of great clients out there, including many household name companies who use those boards to hire freelancers.

Often, a quick one-off $50 job can evolve into a long and lucrative client relationship. My wife and I both have clients who we first met on the freelance boards years ago. We still work with them now.

There's no one-size-fits-all answer to where to find the first client, but there are options for everybody.

 

setting rates when learning how to become a freelancer

6. How does a freelancer decide what to set their rates at?

This is a question I'm asked a LOT! The answer leads to lots more questions, and I think many of my readers are disappointed when I don't just give them an answer of “$x per hour” or “$x per article!”

It's a subject I cover in my Freelance Kickstarter course, and I'm happy to share a slide from that particular lesson here. The factors to consider include tangible things like the “market rates” for specific types of work, and how each client's geographical location could impact how much they expect to pay.

But there's much more to consider beyond that: How much does the gig align with your long-term goals? Will the job produce a great example of work that will help you win more clients in the future? Is this a job that could lead to on-going, long-term work?

I guess a simpler answer is that your rate needs to be fair and competitive, and sufficient to make it worth your while to do the job. However, the rate for each job really needs to be assessed on a case-by-case basis.

The reality is that there are millions of freelancers out there charging vastly different rates, often for very similar services. There's a bit of an art to working out where you sit on the pricing spectrum, but it's an art you can learn, and it gets easier with experience.

 

7. What steps does a person need to take to make money as a freelancer?

The first and most important is working out what it is you actually want to do. That may seem obvious, but my inbox is full of emails from people asking what they should do, without telling me what they're capable of and what kind of work would make them happy.

I will attempt to lay it out in a fairly simple series of steps:

  1. Work out what skills you have and what market there is for them.
  2. Look at who else is providing those services, what they charge, and what you can provide that will make you stand out and appeal to clients.
  3. Identify any gaps in your knowledge and experience, and work to fill them. This could mean doing some training, or doing some voluntary jobs to bulk out your portfolio.
  4. Establish a personal brand. This isn't as big a deal as it sounds, but does mean having a solid resumé and LinkedIn profile, and sometimes some other ways to demonstrate your expertise.
  5. Learn how the freelance job boards work. Even if you have a rich personal network to draw on, it's wise to understand the wider world of freelancing.
  6. Put yourself out there, and start pitching and applying for things.
  7. Make sure you provide perfect work and delight your clients, so that they want to work with you again and recommend you to others.

Repeating and refining these steps is the essence of becoming a successful freelancer.

 

8. How much does it cost to start this type of business and how much on a monthly basis to maintain it?

Freelancing is generally a low-cost venture, but that's not to say it's free. Depending on what you do, you may need specialist equipment and / or software. And if you're switching from an employed position, you may have to buy things like this yourself for the first time.

A good computer is a must, as it's often the key tool of your trade. You may also need to budget for things like insurance, possibly including healthcare cover if you are somewhere like the US where this isn't covered by tax payments.

When it comes to monthly costs, the main things I pay for include software subscriptions and insurance policies. Thankfully these tend to build over time and no individual thing is particularly expensive. You can start out as an online freelancer without even having a personal website, and add things like that once you gain some momentum.

I also recommend budgeting for ongoing training and learning. Thankfully there are all kinds of ways to learn online inexpensively. Companies have training budgets, but when you're a freelancer, keeping your skills on point is on you.

 

9. What kind of training is needed to become a freelancer?

I'd say the training splits into two: learning about freelancing itself, and building skills around the specific work you want to do.

Courses like my own Freelance Kickstarter cover the first part. Freelancing is a skill in itself, and we've covered some of the important areas in this interview already. Stuff like setting rates isn't immediately obvious, so learning from those who have been there and done it already is very valuable.

When it comes to skills-specific training it depends what work you're doing. Let's say somebody wanted to work as a freelance social media manager. Not that long ago it would have been all about Twitter and Facebook. Nowadays Pinterest is a much bigger deal for many people, and TikTok is emerging as the latest trend.

So as that freelancer, you need to decide what you're going to focus on. Do you want to be the “go-to guru” for TikTok, or be more of a generalist with social media in general?

It's wonderful to have the choice.

 

10. Are there any other tips that you have for someone who wants to become a freelancer?

I have many!

The one I repeat over and over is that you have to eventually go for it and make the jump. I see a lot of people who never get past the “thinking about it” phase. Meanwhile the go-getters have taken the leap of faith and started to build success.

Moving to freelancing is one of those things where there may never be a perfect time to do it. Those who keep waiting for that time to arrive can easily find themselves looking back ten years later with the same commute and the same job.

Another thing I'm like a broken record about is the importance of “paying your dues.” There are often plenty of less-than-ideal gigs to finish successfully before you arrive at the amazing ones.

I wrote about some really dull topics in my early days of freelance writing, for example. But I had to wade through that stuff to build my reputation. It all felt thoroughly worth it a few years later when I was being well paid for travel articles and restaurant reviews!

You learn something from every job along the way: How to handle clients, renegotiate rates, refine your skills, and get work done more efficiently so that you're boosting the value of your time. Freelancing isn't supposed to be easy but it's almost always challenging, interesting and rewarding.

And let's face it, many people don't feel that way about their jobs.

 

11. What can a person learn from your course? Can you tell us about some of the people who have successfully taken your course?

OK, so Freelance Kickstarter expands on all of the topics I've touched on here, and many others. It's intended to remove confusion, and that feeling of overwhelm that often descends when researching this stuff online. It helps new freelancers make a clear plan for getting started. As the strapline goes, the idea is that people “stop wasting time, and start making money!”

I never intended to create a course, but after running the HomeWorkingClub website for several years, it became clear there was a space for something like this. I make it very clear that it's not some kind of “get rich quick” scheme.

To be brutally honest, I don't want students who are looking for shortcuts. There is real hard work involved in being a successful freelancer, but it's a more than viable option for those willing to do what's required.

The course starts with the basics of working out what you can do and want to do, and presents LOTS of different options. It then moves on to auditing your skills and experience, building your brand, and working out your own personal goals. I particularly like that section because it helps people learn the exact process I use myself every few months to keep things moving forward.

The next lessons cover finding clients, and there's a big module on learning how to use freelance job boards like Upwork. Once people have completed this, they will know how to uncover the good and genuine jobs, and how to side-step the time-drains and scams.

Students also learn about setting rates, and all the other practicalities of running a freelance business, from getting the tech right to taking undisturbed holidays! We also cover side gigs, and long-term slow-burn projects like blogs and self-published books.

I provide personal support on the course, and people can ask me all the questions they need as they go along. There are also regular exclusive podcasts with extra advice and news of industry developments and new opportunities.

In terms of people who have already taken the course, I recently published a case study from a lady called Lyn. She now has “more work than she can handle” as a freelance writer working via Upwork. Two things that have particularly pleased me about her situation is that she's cherry-picking projects that interest her, and that she's been able to do exactly what I suggest in increasing her rates as she builds experience and reputation.

I've also had great feedback from people at a much earlier stage. I've kept the course price low so that people can use it to help decide if freelancing is for them – just dipping their toes in for the first time.

As one student said, the course is “ideal if you are considering going freelance and don't know where or when to start, or even if freelancing is for you.”

Several of the testimonials so far have aligned perfectly with the original objective, which was – essentially – to help people see the wood for the trees in an environment than can seem very daunting to begin with.

I set out to create the course I wish I'd had! I've made more than my fair share of mistakes in over 16 years of freelancing. The people taking Freelance Kickstarter should hopefully be able to avoid the same ones!

Click here to learn more about Freelance Kickstarter.

 Are you interested in learning how to become a freelancer?

The post How To Become a Freelancer and Make a Full-Time Income appeared first on Making Sense Of Cents.


Source: makingsenseofcents.com

Should You Refinance Your Student Loans?

by Phillip Warren

Due to financial consequences of COVID-19 — and the broader impact on our economy — now is an excellent time to consider refinancing most loans you have. This can include mortgage debt you have that may be converted to a new loan with a lower interest rate, as well as auto loans, personal loans, and more.

Refinancing student loans can also make sense if you’re willing to transition student loans you currently have into a new loan with a private lender. Make sure to take time to compare rates to see how you could save money on interest, potentially pay down student loans faster, or even both if you took the steps to refinance.

Get Started and Compare Rates Now

Still, it’s important to keep a close eye on policies and changes from the federal government that have already taken place, as well as changes that might come to fruition in the next weeks or months. Currently, all federal student loans are locked in at a 0% APR and payments are suspended during that time. This change started on March 13, 2020 and lasts for 60 days, so borrowers with federal loans can skip payments and avoid interest charges until the middle of May 2020.

It’s hard to say what will happen after that, but it’s smart to start figuring out your next steps and determining if student loan refinancing makes sense for your situation. Note that, in addition to lower interest rates than you can get with federal student loans, many private student lenders offer signup bonuses as well. With the help of a lower rate and an initial bonus, you could end up far “ahead” by refinancing in a financial sense.

Still, there are definitely some negatives to consider when it comes to refinancing your student loans, and we’ll go over those disadvantages below.

Should You Refinance Now?

Do you have student loan debt at a higher APR than you want to pay?

  • If no: You shouldn’t refinance.
  • If yes: Go to next question.

Do you have good credit or a cosigner? 

  • If no: You shouldn’t refinance.
  • If yes:  Go to next question.

Do you have federal student loans?

  • If no: You can consider refinancing
  • If yes: Go to next question

Are you willing to give up federal protections like deferment, forbearance, and income-driven repayment plans?

  • If no: You shouldn’t refinance
  • If yes: Consider refinancing your loans.

Reasons to Refinance

There are many reasons student borrowers ultimately refinance their student loans, although they can vary from person to person. Here are the main situations where it can make sense to refinance along with the benefits you can expect to receive:

  • Secure a lower monthly payment on your student loans.
    You may want to consider refinancing your student loans if your ultimate goal is reducing your monthly payment so it fits in better with your budget and your goals. A lower interest rate could help you lower your payment each month, but so could extending your repayment timeline.
  • Save money on interest over the long haul.
    If you plan to refinance your loans into a similar repayment timeline with a lower APR, you will definitely save money on interest over the life of your loan.
  • Change up your repayment timeline.
    Most private lenders let you refinance your student loans into a new loan product that lasts 5 to 20 years. If you want to expedite your loan repayment or extend your repayment timeline, private lenders offer that option.
  • Pay down debt faster.
    Also, keep in mind that reducing your interest rate or repayment timeline can help you get out of student loan debt considerably faster. If you’re someone who wants to get out of debt as soon as you can, this is one of the best reasons to refinance with a private lender.

Why You Might Not Want to Refinance Right Now

While the reasons to refinance above are good ones, there are plenty of reasons you may want to pause on your refinancing plans. Here are the most common:

  • You want to wait and see if the federal government will offer 0% APR or forbearance beyond May 2020 due to COVID-19.
    The federal government has only extended forbearance through the middle of May right now, but they might lengthen the timeline of this benefit if you wait it out. Since this perk only applies to federal student loans, you would likely want to keep those loans at 0% APR for as long as the federal government allows.
  • You may want to take advantage of income-driven repayment plans.
    Income-driven repayment plans like Pay As You Earn (PAYE) and Income-Based Repayment let you pay a percentage of your discretionary income each month then have your loans forgiven after 20 to 25 years. These plans only apply to federal student loans, so you shouldn’t refinance with a private lender if you are hoping to sign up.
  • You’re worried you won’t be able to keep up with your student loan payments due to your job or economic conditions.
    Federal student loans come with deferment and forbearance that can buy you time if you’re struggling to make the payments on your student loans. With that in mind, you may not want to give up these protections if you’re unsure about your future and how your finances might be.
  • Your credit score is low and you don’t have a cosigner.
    Finally, you should probably stick with federal student loans if your credit score is poor and you don’t have a cosigner. Federal student loans come with fairly low rates and most don’t require a credit check, so they’re a great deal if your credit is imperfect.

Important Things to Note

Before you move forward with student loan refinancing, there are some details you should know and understand. Here are our top tips and some important factors to keep in mind.

Compare Rates and Loan Terms

Because student loan refinancing is such a competitive industry, shopping around for loans based on their rates and terms can help you find out which lenders are offering the most lucrative refinancing options for someone with your credit profile and income.

We suggest using Credible to shop for student loan refinancing since this loan platform lets you compare offers from multiple lenders in one place. You can even get prequalified for student loan refinancing and “check your rate” without a hard inquiry on your credit score.

Check for Signup Bonuses

Some student loan refinancing companies let you score a bonus of $100 to $750 just for clicking through a specific link to start the process. This money is free money if you’re able to take advantage, and you can still qualify for low rates and fair loan terms that can help you get ahead.

We definitely suggest checking with lenders that offer bonuses provided you can also score the most competitive rates and terms.

Consider Your Personal Eligibility

Also keep your personal eligibility in mind, including factors beyond your credit score. Most applicants who are turned down for student loan refinancing are turned away based on their debt-to-income ratio and not their credit score. Generally speaking, this means they owe too much money on all their debts when you compare their liabilities to their income.

Credible also notes that adding a creditworthy cosigner can improve your chances of prequalifying for a loan. They also state that “many lenders offer cosigner release once borrowers have made a minimum number of on-time payments and can demonstrate they are ready to assume full responsibility for repayment of the loan on their own.”

It’s Not “All or Nothing”

Also, remember that you don’t have to refinance all of your student loans. You can just refinance the loans at the highest interest rates, or any particular loans you believe could benefit from a different repayment term.

4 Steps to Refinance Your Student Loans

Once you’re ready to pull the trigger, there are four simple steps involved in refinancing your student loans.

Step 1: Gather all your loan information.

Before you start the refinancing process, it helps to have all your loan information, including your student loan pay stubs, in one place. This can help you determine the total amount you want to refinance as well as the interest rates and payments you currently have on your loans.

Step 2: Compare lenders and the rates they offer.

From there, take the time to compare lenders in terms of the rates they can offer. You can use this tool to get the process started.

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Step 3: Choose the best loan offer you can qualify for.

Once you’ve filled out basic information, you can choose among multiple loan offers. Make sure to check for signup bonus offers as well as interest rates, loan repayment terms, and interest rates you can qualify for.

Step 4: Complete your loan application.

Once you decide on a lender that offers the best rates and terms, you can move forward with your full student loan refinancing application. Your student loan company will ask for more personal information and details on your existing student loans, which they will combine into your new loan with a new repayment term and monthly payment.

The Bottom Line

Whether it makes sense to refinance your student loans is a huge question that only you can answer after careful thought and consideration. Make sure you weigh all the pros and cons, including what you may be giving up if you’re refinancing federal loans with a private lender.

Refinancing your student loans can make sense if you have a plan to pay them off, but this strategy works best if you create a debt repayment plan you can stick with for the long-term.

The post Should You Refinance Your Student Loans? appeared first on Good Financial Cents®.


Source: goodfinancialcents.com

How to Get Out Of Debt Fast When You Don’t Have Much Money

by Phillip Warren

The post How to Get Out Of Debt Fast When You Don’t Have Much Money appeared first on Penny Pinchin' Mom.

How do you get out of debt when you are broke? After all, if you had the money,  you would not be in debt in the first place.  Right?

I hear this from people, just like you.  It is often not how much money you make, but the debt payoff plan you are using that is not working.  It is possible to get out of debt with no money; you just need to learn how.

get out of debt

There are plenty of inspiring stories of people sharing how they got out of debt, despite not making much money. In fact, you may feel you relate.  But yet, you don’t think you can do it. For whatever reason, you think you can’t get out of debt as they did.  It is impossible.

Or is it?

My husband and I were living on one income when we decided it was time to get out of debt.  It took us nearly 2 1/2 years but were able to pay off more than $37,000 in debt.  There are countless other stories of our readers who have paid off similar amounts in even less time.

I am here to tell you that you CAN (and should) get out of debt – no matter how little money you may make!!

 

HOW CAN YOU GET OUT OF DEBT WITH NO MONEY?

I am going to share the steps anyone can follow to learn how to get out of debt – no matter your income level.  If you struggle to make ends meet, you already know how to make the most of a dollar, and I’ll give you additional tips so that you can pay down that debt.

I have asked this on Facebook all of the time, and some of the comments include:

“There is no way I can do this. Not with my medical bills.”

“Sure, that only works or some people – not me.”

Many of you may be thinking similar things, and I completely understand that way of thinking. I was there myself and know that it seems like an unattainable goal.  That is why you are reading this right now – to find out how to make this dream a reality.

Debt is NOT a Good Thing.

If you are in debt, it could be because of your own decisions or even those you can’t control (such as health, job loss, etc.).  No matter how it happened, you need to get rid of it. Period.

The reason you need to eliminate your debt is that it genuinely is holding you back. How can you move forward financially with this obstacle standing in your way?  If you found that you needed to buy a new car, you would find a way, correct?  For most, that would probably mean an additional monthly payment – but you would do it because you needed to.  You need to look at debt the same way:

“Getting out of debt is not a desire – it is a need.”

MY STORY

I remember in 2009 when my husband and I thought there was no way we could get ever get out from under our debt.  It was an impossible dream. At that time, I was not working at that time, and so we had one income and two young children to feed.  I initially thought that there was no way at all that we could do this.  It was just not possible.

We started by looking at our finances (oh – they were awful).  Our goal was to live a great life.  We could have kept on and kept just getting by, but that was not how we wanted to live. Just “getting by” was no longer an option.

Knowing our kids would be watching us, we knew the importance of being a good role model for them.  We wanted them to learn how to handle money by following our example.

We both agreed that not having debt was pivotal in having a positive financial future. We wanted this not only for ourselves but also for our children as well. It was also essential for our marriage.  We needed to remove anything that could potentially cause stress – money, and finances being a big one.  Our relationship was good, but we knew we could even make it better.

To begin our journey, we read Dave Ramsey’s Total Money Makeover. We followed much of his advice but figured out some things that worked for us as well. Being debt free is a fantastic feeling that no one can describe.  You have to live it.

 

THE FIRST STEP TO GET OUT OF DEBT

The very first step to getting out of debt is to decide you want to do it.  That was the change both my husband, and I made.  Once we were ready and committed to getting out of debt, we began our journey.

You might be saying that you can’t do that though.  I’m here to say that you can – when you really, truly want to make it happen.

Getting out of debt doesn’t require you to be rich. Anyone can do it.  Even if you have a low income or don’t have much money. Like I said above, knowing that you want to make the changes and pay off your debt is only one small part.  The more significant issue is how in the world you actually can do this.

 

1. Face YOUR Reality

According to CNN Money, the average American family made around $59,000 in 2017. While that is the average, it is also true that many Americans make much less than this.

With a lower income, it is even more critical that you have no debt at all. After all, you are already stretching every dollar to cover your bills. You don’t need additional payments causing more financial stress.

Unless you win the lottery, a wealthy relative leaves you a small fortune, or you find a better job, you know your income won’t change.  That is the truth. You can’t change that.

However, what you can and must do is take the steps you can to work yourself out from under the mountain of debt you may be facing. You need to first create a budget, determine how much debt you have and then the steps to pay it off, no matter how much money you make.

 

2. Fully Commit

If you are not 100% ready to make changes, then you are destined for failure. It may be blunt, but it is true. If you can’t “go all in” and fully commit to making whatever difficult changes necessary (trust me, it will be challenging), then you need to stop reading right now.

If you are ready to make this lifestyle change, then read on. You’ve already made huge strides to make changes in your life.

 

3. Create (and use) a Budget and Debt Snowball Form

Knowing where your money goes is paramount to getting out of debt, no matter how much you make. Without your budget, you can’t even consider getting out of debt.

If you have never created a budget, it can be overwhelming.  But, it will also be eye-opening.  In addition to your budget, you should create a debt snowball, start using the envelope system and take better control of your money.  By doing this, you will get a better picture of your debts and how you can tackle them.

Look at paying off debt like a football team.  Each part of your finances is involved in the game:

Home Team – This is you and your family
Visiting Team – These are your debts and expenses
Your End Zone – This is where you will be debt free
PlayBook – Budget and debt snowball forms
Football – Your money
Refs and Penalties – Unexpected instances which set you back in reaching your goals

You would never expect a team to run onto the field and play the game without having the proper plays in mind. The same is true for you;  If every one of the members of your family has a different idea as to how to get your money down the field to pay off your debts, you will never make it there.

Instead, you design smart plays and work together to get there.  You work to get your money past all of the expenses you need to dodge.  There may be setbacks, and you may have to move back before you can get forward.  However, with hard work, you will get there.  You will get onto the scoreboard – and end up claiming victory!

 

4. Find extra money

Before you jump in to try to pay off your debts, you need to have savings.  The reason is that if an emergency comes up, you need to pay for it – in cash.  You do not want to run to your credit card to cover the expense.  It is best to have at least $1,000 in the bank before you get started.

So, before you jump in to pay off those debts, you listed above, make sure you’ve got money in the bank to cover your unforeseen expenses by creating an emergency fund.

Once you have that done, then you are going to have to find a way to squeeze everything you can out of every cent.  For some, it may mean no longer dining out.  For others, it could be shutting off cable television.  Where there is a will, there will always be a way to make this happen.  You just have to do what you can!

I share this true story in our budget post, but I’m putting it here again for you!  My husband and I gave up dining out. No joke. We ate dinner out very infrequently.

While I look back and think it might have been once every couple of weeks, I asked my husband recently, and he said that we were lucky to eat out once a month! It was painful, but now that we’ve cut down out all of our debts, we have income freed up so we can have dinner out more frequently (if we so desire).

For even more inspiration and ideas, you may have to find some radical ways you can get cash to help you get out of debt.  Do whatever it takes (legally and within reason, of course), to help you get out of debt.

Read More:  60 Creative Ways to Save or Make Money

 

5. Find ways to get more money (i.e. side hustle and selling items)

To be honest, if you are struggling to make ends meet on a low income, you won’t be able to just cut enough out of your budget to pay off your debt.  Like my mom use to say – “You can’t get blood out of a turnip” – which means if it isn’t there-there is nothing you can do about it.

That is the truth, and I’m not trying to lie to you. I am realistic and know that if you are making barely enough to cover your expenses, you won’t have any extra money for your debt.  I get that.

You can’t save enough money on your budget to eliminate your debt.  Well, I guess you could, but that is going to take a very, very, VERY long time.  So, what do you do when you’ve saved all you can and still can’t pay off your debts?  Well, you just have to get creative.

For some this may mean finding items you no longer need, which you can sell to raise money.  When we did this step, we had the same issue.  We could not cut anything more from our budget.

For us, this meant selling items we no longer needed. We did a large cleanout and got rid of furniture and other things we were holding onto, just in case we needed them. By doing this, we were able to come up with several thousand dollars — 100% of which went immediately towards our debt.

If that isn’t an option, you might want to consider getting a second job or side business to bring in income to indeed help you get out of debt.  We also did this. I started my website.  Now, let me be Frank in saying that this is not a great way to make money.  Most blogs make little to nothing in the first couple of years.  I was lucky, and we did pretty well, and I was able to bring a bit more each year – all of which helped us to pay off our debts.

It may not be a blog, but perhaps babysitting, or cleaning houses, raking leaves, shoveling snow — there are all sorts of ways that you can make money.

Read More:  Unique Ways to Make Money From Home

It is not the income that is holding most people back, it is the understanding and knowing even where to start.  You might have to scale back on various spending aspects of your life, but when you get to scream from the rooftops — WE’RE DEBT FREE!!!! — it will be worth it all.  I promise you!!!

 

get out of debt

The post How to Get Out Of Debt Fast When You Don’t Have Much Money appeared first on Penny Pinchin' Mom.


Source: pennypinchinmom.com

5 Frugal Ways to Celebrate Your Debt Successes

by Phillip Warren

5 Frugal Ways to Celebrate Your Debt Successes

One of the lessons I’ve learned as I continue to work my way out of debt is that you need to treat yourself and celebrate your little successes along the way so you can avoid debt fatigue down the road. Celebrating small milestones, like getting another $1,000 knocked off your debt total, starting to put money aside for retirement or paying off a credit card balance, is important for both your sanity and your family’s sanity.

Find out now: How much money do I need to save for retirement?

I don’t have kids, but several of my personal finance blogger friends do, and they have talked about how kids don’t always understand how they can contribute to the family financial goals since they don’t earn any money. Plus, sometimes kids don’t understand why there is a sudden need to cut back on expenses they have come to know as normal- things like going out to eat or having a night out at the movies with friends. Allowing yourself and your family to celebrate your financial wins as you work your way out of debt will help them understand that while your family is now living on a different budget, it’s still okay to enjoy the present.

With that in mind, here are five frugal ways you can celebrate your financial successes, so you don’t erase all your progress!

1. Go out for Dessert

As a kid, whenever we’d go out for dessert after a home-cooked meal, it felt like a real fancy treat. Now I know that this was mom and dad’s way of having a celebration without spending a lot of money on paying for a whole meal.

2. Rent a Movie

5 Frugal Ways to Celebrate Your Debt Successes

This may not seem like a treat if you rent movies all the time, but if you are living on a very strict budget and don’t often rent movies, this could be a treat for you and your family. Make it the full experience – popcorn, candy, etc. Renting a movie and making popcorn at home is a fun way to celebrate, and it’s still a lot cheaper than going to the theater.

12 Affordable Ways to Have Fun on a Tight Budget

3. Hit a Matinee

Wait, didn’t I just say to avoid the theater to save money? Yes, but sometimes movie theaters offer cheaper matinee movies earlier in the day. Often showings before noon can be as little as half price. This is a more budget-friendly way to enjoy a new movie.

4. Buy a Book or Magazine

One of the first things that got cut from my budget when I started focusing on financial goals was my magazine subscription. Most of the time I don’t miss it as I have plenty of things to keep me busy, but sometimes it’s nice to somewhat mindlessly flip through a magazine in the evenings. Buying yourself a new book – maybe one of these investing books – or magazine is a fairly cheap way to entertain yourself and if it’s a rare occasion, it can serve as a reward too.

Frugal Summer Fun for Adults

5. Go on a Day Trip

5 Frugal Ways to Celebrate Your Debt Successes

If you aren’t traveling too far, the most expensive part of the trip is usually the overnight accommodations. By taking a day trip instead to the beach or somewhere else, you can get out of town and away from the norm without having to shell out for an expensive hotel room.

What other frugal ways can you think of to celebrate your debt successes?

Photo credit: Â©iStock.com/andresr, Â©iStock.com/sdominick, Â©iStock.com/AleksandarNakic

The post 5 Frugal Ways to Celebrate Your Debt Successes appeared first on SmartAsset Blog.


Source: smartasset.com

Does Paying the Minimum Hurt Your Credit Score

by Phillip Warren

Credit card bills can be confusing. If everything was straightforward and clear, credit card debt wouldn’t be such a big issue. But it’s not clear, and debt is a massive issue for millions of consumers. 

One of the most confusing aspects is the minimum payment, with few consumers understanding how this works, how much damage (if any) it does to their credit score, and why it’s important to pay more than the minimum.

We’ll address all of those things and more in this guide, looking at how minimum credit card payments can impact your FICO score and your credit report.

What is a Credit Card Minimum Payment?

The minimum payment is the lowest amount you need to pay during any given month. It’s often fixed as a fraction of your total balance and includes fees and interest.  

If you fail to make this minimum payment, you may be hit with late fees and if you still haven’t paid after 30 days, your creditor will report your activity to the major credit bureaus and your credit score will take a hit.

When this happens, you could lose up to 100 points and gain a derogatory mark that remains on your credit report for up to 7 years. Making minimum payments will not result in a derogatory mark, but it can indirectly affect your credit score and we’ll discuss that a little later.

Firstly, it’s important to understand why you’re being asked to pay a minimum amount and how you can avoid it.

How Much is a Minimum Credit Card Payment?

Prior to 2004, monthly payments could be as low as 2% of the balance. This caused all kinds of problems as most of your monthly payment is interest and will, therefore, inflate every month so that every time you reduce the balance it grows back. 

Regulators forced a change when they realized that some users were being locked into a cycle of credit card debt, one that could see them repaying thousands more than the balance and taking many years to repay in full.

These days, a minimum payment must be at least 1% of the balance plus all interest and fees that have accumulated during that month, ensuring the balance decreases by at least 1% if only the minimum payment is met.

Do I Need to Make the Minimum Payment?

If you have a rolling balance, you need to make the minimum monthly payment to avoid derogatory marks. If you fail to do so and keep missing those payments, your account will eventually default and cause all kinds of issues.

However, you can avoid the minimum payment by clearing your balance in full.

Let’s assume that you have a brand-new credit card and you spend $2,000 in the first billing cycle. In the next cycle, you will be required to pay this balance in full. However, you will also be offered a minimum payment, which will likely be anywhere from $30 to $100. If this is all that you pay, the issuer will start charging you interest on your balance and your problems will begin.

If you spend $2,000 in the next billing cycle, you have just doubled your debt (minus whatever principal the minimum payment cleared) and your problems.

This is a cycle that many consumers get locked into. They do what they can to pay off their balance in full, but then they have a difficult month and that minimum payment begins to look very tempting. They convince themselves that one month won’t hurt and they’ll repay the balance in full next month, but by that point they’ve spent more, it has grown more, and they just don’t have the funds.

To avoid falling into this trap, try the following tips:

  • Only Spend What You Have: A credit card should be used to spend money you have now or will have in the future. Don’t spend in the hope you’ll somehow come into some money before the billing period ends and the credit card balance rolls over.
  • Get an Introductory Interest Rate: Many credit card issuers offer a 0% intro APR for a fixed period of time, allowing you to accumulate debt without interest. This can help if you need to make some essential purchases, but it’s important not to abuse this as you’ll still need to clear the full balance before the intro period ends.
  • Use a Balance Transfer: If you’re in too deep and the intro rate is coming to an end, consider a balance transfer credit card. These cards allow you to move your full balance from one card (or cards) to another, taking advantage of yet another 0% APR and essentially extending the one you have.
  • Pay the Minimum: If you can’t pay the balance in full, make sure you at least pay the minimum. A missed payment or late payment can incur fees and may hurt your credit score. 

Why Pay More Than the Minimum?

You may have heard experts recommending that you pay more than the minimum every month, but why? If you’re locked into a cycle of credit card debt, it can seem counterproductive. After all, if you have a debt of $10,000 that’s costing you $400 a month, what’s the point of taking an extra $100 out of your budget?

Your interest and fees are covered by your minimum payment and account for a sizeable percentage of that minimum payment. By adding just 50% more, you could be doubling and even tripling the amount of the principal that you repay every month.

What’s more, your interest accumulates every single day and this interest compounds. Imagine, for instance, that you have a balance of $10,000 today and with interest, this grows to $10,040. The next day, the interest will be calculated based on that $10,040 figure, which means it could grow to $10,081, which will then become the new balance for the next day. 

This continues every single day, and the larger your balance is, the more interest will compound and the greater the amount will be due over the term. By paying more than your minimum payment when you can, you’re reducing the balance and slowing things down.

Does Paying the Minimum Hurt My Credit Score?

Paying the minimum amount every month ensures you are doing the bare minimum to avoid hurting your credit history or accumulating fees. However, it can indirectly reduce your score via your credit utilization ratio.

Your credit utilization ratio is a score that compares the credit limit of all available credit cards to the total debt on those cards. It accounts for 30% of your credit score and is, therefore, a very important aspect of the credit scoring process.

The more credit card debt you accumulate, the lower your credit utilization rate will be and the more your score will be impacted. If you only pay the minimum, this rate will become stagnant and may take years to improve. By increasing the payment amount, however, you can bring that ratio down and improve your credit score.

You can calculate your credit utilization score by adding together the total amount of credit limits and debts and then comparing the latter to the former. A combined credit limit of $10,000 and a balance of $5,000, for instance, would equate to a 50% ratio, which is on the high side.

Can Credit Card Fees Hurt My Credit Score?

As with interest charges, credit card fees will not directly reduce your score but may have an indirect effect. Cash advance fees, for instance, can be substantial, with many credit card companies (including Capital One) charging 3% with a $10 minimum charge. This means that every time you withdraw cash, you’re paying at least $10, even if you’re only withdrawing $10.

What many consumers don’t realize is that these fees are also charged every time you buy casino chips or pay for some other form of gambling, and every time you purchase money orders and other cash products. 

Along with foreign transaction fees and penalty fees, these can increase your balance and your minimum payment, making it harder to make on time payments and thus increasing the risk of a late payment.

Does Paying the Minimum Hurt Your Credit Score is a post from Pocket Your Dollars.


Source: pocketyourdollars.com

Giving Gift Cards This Holiday Season? Go Electronic

by Phillip Warren

A recent Bankrate report indicates that electronic gift cards are probably a better choice when you are giving to members of the younger generation.

The post Giving Gift Cards This Holiday Season? Go Electronic appeared first on Bible Money Matters and was written by Miranda Marquit. Copyright © Bible Money Matters - please visit biblemoneymatters.com for more great content.


Source: biblemoneymatters.com

How I Paid Off $40,000 In Student Loans in 7 Months

by Phillip Warren

Want to learn how to pay off student loans? With my student loan repayment plan, I was able to pay off $40,000 in student loan debt in 7 months!Want to learn how to pay off student loans? With my student loan repayment plan, I was able to pay off $40,000 in student loan debt in 7 months! One of the best ways to save money is to finally get rid of those pesky loans that are hurting your financial situation.

Learning how to pay off student loans can lead to many positives, such as:

  • You may finally feel less financial stress.
  • You may be able to use that money towards something more important, such as saving for retirement.
  • Getting rid of your student loans may allow you to pursue other goals in life, such as traveling more or looking for a better job.

I know these things are true because learning how to pay off my student loans is one of the best decisions that I've ever made.

No, it wasn't easy to pay off my student loans that quickly, but it was definitely worth it. No longer having those monthly payments hanging over my head is a HUGE relief, and it allowed me to eventually leave my day job and travel full-time.

Related posts on how to pay off student loans:

  • 6 Ways I Saved Money On College Costs
  • How Blogging Paid Off My Student Loans
  • The Benefits Of Paying Off Student Loan Debt Early
  • 30+ Ways To Save Money Each Month
  • 12 Work From Home Jobs That Can Earn You $1,000+ Each Month
  • How Do Student Loans Work?

How to pay off student loans and create a great student loan repayment plan:

 

Total how much student loan debt you have.

The very first thing that I recommend you do if you want to learn how to pay off student loans is to add up the total amount of student loans that you have.

When you total your student loans, do not just estimate how much student loan debt you have.

You should actually pull up each student loan and tally everything, down to the penny. By doing so, you will have a much more realistic view of exactly how much you're dealing with.

Plus, the average person has no idea how much student loan debt they have! Usually, they have far more than they originally thought.

 

Understand your student loans better.

There are many people who simply do not understand their student loans. There are many things to research so that you can create the best student loan repayment plan, and this will also help you understand your loans and interest rates.

You should understand:

  • Your interest rate. Some student loans have fixed interest rates, whereas others might have variable rates. You'll want to figure out what the interest rate on your loans are because that may impact the student loan repayment plan you decide on. For example, you might choose to pay off your student loans that have the highest interest rates first so that you can pay less money over time.
  • What a monthly payment means. Many people believe that a monthly payment is all that you have to pay, are allowed to pay, or that by paying just the minimum monthly payment you won't owe any interest. These three things are so incorrect! Even if you pay the minimum monthly payment, you will most likely still owe interest charges (unless your interest rate is 0% – but that is very unlikely with student loans).
  • Student loan reimbursements. Some employers will give you money to put towards your student loans, but you should always do your research when it comes to this area. Some employers require that you work for them for a certain amount of time, you have great grades, good attendance, and they might have other requirements as well. There are many employers out there who will pay your student loans back (fully or partially), so definitely look into this option.
  • Auto-payment plans. For most student loans, you can probably auto-pay them and receive a discount. Always look into this as you may be able to lower your interest rate by 0.25% on each of your student loans.

I recommend that you check out Personal Capital (a free service) if you are interested in gaining control of your financial situation. Personal Capital allows you to aggregate your financial accounts so that you can easily see your financial situation, your cash flow, detailed graphs, and more. You can also connect accounts, such as your mortgage, bank accounts, credit card accounts, investment accounts, retirement accounts, and more. Plus, it's FREE.

 

Determine if refinancing your student loans is right for you.

Student loan refinancing is when you apply for a new loan that is then used to pay off your other student loans. This may be a good option if your credit history or credit score is better than when you originally took out your student loans.

By refinancing your student loans, you may qualify for better repayment terms, a lower interest rate, and more. This is great because it may help you pay off your student loans quicker.

The positives of refinancing student loans include:

  • One monthly payment to simplify your finances.
  • Lower monthly payments.
  • Lower interest rates, and more.

Some companies, like Credible, allow you to refinance your federal student loans as well as your private student loans into one. On average, refinancing can save you thousands of dollars on your loan, which is amazing!

However, before refinancing a federal student loan, you will want to think about different federal benefits that you may be giving up. You may give up income-based repayment plans and loan forgiveness for those who have certain public service jobs (such as jobs at public schools, the military, Peace Corps, and more). By refinancing federal student loans, you are giving up any future option to these.

Read further at: Consolidating And Refinancing Student Loans – What You Should Know.

Related tip on how to pay off student loans: I highly recommend Credible for student loan refinancing. They are the top student loan refinancing company and have great customer service! You can significantly lower the interest rate on your student loans which may help you shave thousands off your student loan bill over time. Through Credible, you may be able to refinance your student loans at a rate as low as 2.14%! Plus, it's free to apply and Credible is giving Making Sense of Cents readers a $100 bonus when they refinance.

 

Reduce your interest rate for your student loan repayment plan.

As I stated earlier, if you automatically pay your student loans each month or consolidate them, then sometimes you can get an interest rate reduction.

With Sallie Mae, I believe the reduction is 0.25%.

That may not seem significant, but it is something! Remember, every little bit counts when it comes to having a good student loan repayment plan.

 

Create the best budget.

If you don't have one already, then you should create a budget immediately. This will help you learn how to pay off student loans as you'll learn how to manage your money better.

Budgets are great, because they keep you mindful of your income and expenses. With a budget, you will know exactly how much you can spend in a category each month, how much you have to work with, what spending areas need to be evaluated, among other things.

Learn more at How To Create a Budget That Works.

 

Look for more ways to earn money.

Making extra money can allow you to pay off your students loans quickly because there is no limit to how much money you can make.

Finding ways to make extra money is how I was able to pay off my student loans so quickly!

And trust me, you probably do have time in your day to make extra money.

Just think about it: The average person watches 35 hours of TV a week and spends around 15 hours a week on social media. If you could use that time better and make more money with those extra hours, you'll be able to pay off your student loans in no time!

Here are some ways to make more money so that you can learn how to pay off student loans:

  • Start a blog. Blogging is how I make a living and just a few years ago I never thought it would be possible. I earn around $100,000 a month through blogging. You can create your own blog here with my easy-to-use tutorial. You can start your blog for as low as $2.95 per month, plus you get a free domain if you sign-up through my tutorial.
  • Start a business. There are many business ideas that you could start in order to make extra money.
  • Sell your stuff. There are many things you can do to make money by selling items. We all have extra things laying around that can be sold, or you can even search for items that can be bought and resold for a profit.
  • Rent an extra room in your home. If you have extra space in your house, then you may want to rent it out. Read A Complete Guide To Renting A Room For Extra Money.
  • Answer surveys. Survey companies I recommend include Swagbucks, Survey Junkie, Pinecone Research, Opinion Outpost, Prize Rebel, and Harris Poll Online. They're free to join and free to use! You get paid to answer surveys and to test products. It's best to sign up for as many as you can as that way you can receive the most surveys and make the most money.
  • Become an Uber or Lyft driver. Driving others around in your spare time can be a great money maker. Read more about this in my post – How To Become An Uber Or Lyft Driver. Click here to join Uber and start making money ASAP.
  • Find a part-time job. There are many part-time jobs that you may be able to find. You can find a job on sites such as Snagajob, Craigslist (yes, I've found a legitimate job through there before), Monster, and so on.

Related articles that will help you learn how to pay off student loans:

  • 75+ Ways To Make Extra Money
  • 8 Things To Sell To Make Money
  • 10 Ways To Make Money Online From The Comfort of Your Home
  • 10 Things I've Done To Make Extra Money
  • Ways To Make An Extra $1,000 A Month

 

How to pay off your student loans – Find ways to reduce your expenses.

The next step is to cut your budget so that you can have a faster student loan repayment plan. Even though you may have a budget, you should go through it line by line and see what you really do not need to be spending money on.

There's probably something that you're wasting your money on.

Until you write it down in your budget, you may not realize how much money you are wasting on things you don't need. And, remember, it's never too late to start trimming your budget and to put your money towards important things like paying off student loans!

Even if all you can cut is $100 each month, that is better than nothing. That's $1,200 a year right there!

Some expenses you may be able to cut include:

  • Lower your cell phone bill. Instead of paying the $150 or more that you currently spend on your cell phone bill, there are companies out there like Republic Wireless that offer cell phone service starting at $15. YES, I SAID $15! If you use my Republic Wireless affiliate link, you can change your life and start saving thousands of dollars a year on your cell phone service. If you are interested in hearing more, I created a full review on Republic Wireless. I've been using them for over a year and they are great.
  • ATM fees. You don't need to pay ATM fees, but for some reason so many people do!
  • Sign up for a website like Ebates where you can earn CASH BACK for spending how you normally would online. The service is free too! Plus, when you sign up through my link, you also receive a free $10 cash back!
  • Pay bills on time. This way you can avoid late fees.
  • Shop around for insurance. This includes health insurance, car insurance, life insurance, home insurance, and so on. Insurance pricing can vary significantly from one company to the next. The last time we were shopping for car insurance, we found that our old company wanted something like $205 to insure one car for one month, whereas the company we have now charges $50 a month for the same exact coverage. INSANE!
  • Save money on food. I recently joined $5 Meal Plan in order to help me eat at home more and cut my food spending. It's only $5 a month (the first four weeks are free) and they send meal plans straight to you along with the exact shopping list you need in order to create the meals. Each meal costs around $2 or less per person. This allows you to save time because you won't have to meal plan anymore, and it will save you money as well!
  • Fuel savings. Combine your car trips, drive more efficiently, get a fuel efficient car, etc.
  • Trade in your car for a cheaper one. For us, we are car people. Cars are one of our splurges. However, if you only have a nice car to keep up with the Joneses, then you might want to get rid of it and get something that makes more sense.
  • Live in a cheaper home. I'm not saying that you need to live in a box, but if you live in a McMansion, then you may want to think about a smaller home. This way you can save money on utility bills and your mortgage payment.
  • Learn to have more frugal fun. We don't spend anywhere near the same amount of money on entertainment as we used to. There are plenty of ways to have frugal fun.
  • Look for coupon codes. I search for coupon codes for everything. Today, I have two for you. I have a $20 Airbnb coupon code and a free taxi ride with Uber. Both are great services that I have personally used.

 

See if your employer will reimburse your student loan debt.

Some companies will pay your student loans quickly if you work for them. I even know of someone who receives a $2 bonus for each hour that she works to put towards her student loans.

$2 may not seem like a lot, but if you work full-time, then that's over $300 a month. $300 a month for student loans is a good amount! And, because it's free money, it can all be put towards paying off your student loans quickly.

 

Create a plan to pay off your student loans.

After you have completed the steps above, you'll want to put it all together and create a plan.

Without a plan, you would just be all over the place, making it difficult to reach your goal of learning how to pay off student loans.

You should create a plan that details the steps you need in order to pay off your student loans, what will happen as you reach each step, when and how you will track your progress, and more.

Being detailed with your plan will help you reach your goal and become successful.

 

Stay motivated with your student loan repayment plan.

Finding motivation can be a hard task for anyone. Motivation is important because it can help you keep your eye on the goal even when you want to quit. Motivation will help you continue to work hard towards your goal, even when it seems impossible. Motivation is what keeps you going so that you do not quit.

Yes, student loan repayment can seem very stressful when you think about it. Many people owe thousands and thousands in student loans.

And, no matter how young or old you are, learning how to pay off student loans can seem difficult or even near impossible. However, think about your goal and how good life will be once all of your student loan debt is gone.

Please try to not let your student loans get you down. Think positively and attack that debt so that you can pay off your student loans fast!

Trust me, once you finally pay off those pesky student loans, you'll be happier than ever!

Related post on how to pay off student loans: 8 Ways To Get Motivated And Reach Your Goals

 

Pay more than the minimum if you want to learn how to pay off student loans!

The point of what I've written above is to help you pay off your student loans. However, you can always go a little bit further and pay off your student loans more quickly.

The key to speeding up your student loan repayment process is that you will need to pay more than the minimum each month.

It may sound hard, but it really doesn't have to be. Whatever extra you can afford, you should think about putting it towards your student loans. You may be able to shave years off your student loans!

What other ways can a person learn how to pay off student loans? What's your student loan repayment plan?

The post How I Paid Off $40,000 In Student Loans in 7 Months appeared first on Making Sense Of Cents.


Source: makingsenseofcents.com

My House Failed Its First Real Estate Inspection—Here’s What I Did To Get Through Escrow

by Phillip Warren
Mikolette/Getty Images

When I was buying my first house, everything seemed too good to be true—at least at the start of the process. I found a home within a couple of weeks, the price was fabulously low, it was in a cute lake community with a style I loved, and funding came through quickly and easily. I even received a first-time home buyer’s bonus for tax time. Plus, I didn’t need much of a down payment.

But it turned out too good to be true. My smooth path to homeownership suddenly became rocky when the inspection report came back with a big fat failure on it. I immediately panicked. What did it mean? Was I still able to buy the house? And if I did, was it going to fall apart?

After a few calls with my real estate agent (who, at that point, had become more of a home-buying therapist), I learned that a bad inspection isn’t that rare. In fact, my new home wasn’t in as bad of shape as I initially feared. We were able to make some repairs and, after a second inspection, the house was appraised and the sale was able to go through.

During the process, though, I learned a lot more than I ever expected about home inspections. Whether you’re a first-time or repeat home buyer, here’s my advice for getting the house you want after a shaky home inspection.

Houses don’t really pass or fail

Though my home inspection appeared to be a failure, homes aren’t actually graded on a pass/fail system.

“There is no such thing as a failed inspection,” said Karen Kostiw, an agent with Warburg Realty in New York. “The inspection just points out small and potentially larger issues that you may not be aware of.”

Sure, some houses can sail through the process and others may fare poorly, but it’s not a “You can never buy this” situation if there are problems with the property.

For me, my mortgage hinged on a solid inspection—so the initial results meant I wouldn’t get the loan unless things were fixed. That being said, if I had enough cash on hand or wanted to try a different mortgage lender, I could have continued with the purchase even with a negative inspection report.

So if the house you’re set on buying ends up having issues, don’t panic. You still have options.

Most inspection issues are small

It’s important to remember every home inspection report will come back with something, according to Kate Ziegler, a real estate agent with Arborview Realty in Boston. My inspection report had noted about 40 fixes. But a lot of times, the problems aren’t as bad as you think.

Keep in mind that the inspector’s job is to call out any trouble spot. Also, all issues noted in the report aren’t equal: Some problems flagged by an inspector can wait.

“The inspector will find defects—sometimes many defects—but that does not mean buyers are not purchasing a good home,” Kostiw says. “The small leak might mean a bolt needs to be tightened, or the dishwasher is not working because the waterline was switched off by accident. These are easy fixes. However, when buyers see a laundry list of items, it can seem as if the home is falling down. This is most often not the case.”

Red flags do exist

Ziegler and Kostiw agree that though most repairs are easy fixes, some items should give you pause if you see them on your report.

Structural problems, antique electrical systems, old windows, unexplained water damage, evidence of termites or wood rot, a bad roof, asbestos, mold, radon, and lead paint are all red flags that can show up during a home inspection. If fixing these problems is impossible or way beyond the means your budget, you may want to reconsider your purchase.

“Whether or not inspection items warrant backing out entirely depends quite a bit on any individual buyer’s experience and bandwidth, as well as personal risk tolerances and financial situation,” Ziegler says. “It’s true that houses don’t stay in good repair on their own. They require maintenance and care, just like your houseplants and your sourdough starter!”

Don’t try to fix things yourself

Unless a repair is something truly minor like caulking a bathroom tub or putting a cabinet door back on its hinges, don’t try to fix anything on your own. You could make things worse or even injure yourself. Hire licensed contractors that you’ve vetted to handle any problems. And try not to leave it all up to the seller—they’re not going to be living in the home. You will be.

“Motivations in this case are not aligned,” Ziegler says. “The seller wants to spend as little as possible to meet their contractual obligations, but [a] buyer should be more concerned with the quality of the repair.”

Work the costs into the sale

At first I worried I would have to pay to fix everything that was wrong with my house. But it’s important to know you can work the cost of repairs—and how long it should take to make them—into the sale.

Say you can’t afford to fix the busted water heater but the seller can. You can raise the offer price by that cost, or you can trade off: The seller fixes one thing, and you fix another. In my case, I only had to add a banister to one stairwell. The sellers were particularly motivated to unload the home so they handled everything else.

Hopefully by the end of this process, every issue will be fixed and you’ll be ready to purchase your home. And you’ll be able to move in with a clear head, knowing everything is really as good as it seems.

The post My House Failed Its First Real Estate Inspection—Here’s What I Did To Get Through Escrow appeared first on Real Estate News & Insights | realtor.com®.


Source: realtor.com

A Guide To Everything You Need To Know About Home Ownership Costs [Free Download]

by Phillip Warren

Along with the excitement of purchasing a new home, comes the additional costs that you will be expected to pay as a homeowner. Apart from covering the mortgage of your home, you’ll have additional expenses – such as home insurance – that you will be expected to cover. If you’re looking to budget for a home purchase, it’s important that you consider these costs as they can add up to thousands of dollars each year.

To help you make educated decisions when budgeting, we’ve compiled a list of the major home ownership costs in one free, downloadable guide. Get the Home Ownership Costs to Consider guide here.

Home Insurance

Home insurance policies help protect against serious damage and destruction, like fires, leaks, floods, or break-ins. It also protects a homeowner from personal liability. Some banks may offer home insurance products, although you can typically purchase a home insurance policy through a home insurance agent or broker. 

Tip: You may get better rates if you use a broker or agent. It’s also important to keep in mind that policies typically renew on an annual basis.

Condo Fees

The cost of maintenance fees should be taken into account when you’re buying a condo. This recurring cost is in addition to your mortgage and impacts how much home you can afford. 

Your mandatory monthly fee will vary by your building and square footage. It typically covers:

  • Utilities (such as water and garbage collection)
  • Building insurance
  • Maintenance of common areas (such as the gym, pool, front desk, hallways, landscaping)
  • Building reserve fund (covers emergencies and long-term maintenance projects such as a new roof or elevators repairs)

What Are Status Certificates?

If you’re looking to purchase a condo, you’ll want to look into obtaining a status certificate so that you have as much information about the building and your unit as possible before buying. A status certificate provides valuable information about the condo corporation and its financial

situation. It includes details on the budget, legal issues, the reserve fund, maintenance fees, and any fee increases expected in the future. 

Tip: You’ll want to carefully review your status certificate with your lawyer before making a purchase.

Property Tax

Property taxes are paid annually by homeowners to their municipality. These taxes are ongoing and are separate from your mortgage. Your annual property tax can often be paid in installments.

Tip: It’s important to remember that this cost is not due at closing, but is a recurring cost.

How Are Property Taxes Calculated?

Your property tax rate will vary depending on the value of your property as assessed by your provincial assessment authority. This is then multiplied by a rate that falls between 0.5% to 2.5%.

How Do You Pay Property Taxes?

You can pay your property taxes either through your mortgage provider or directly to your municipality. 

Your Utility Bills

When you purchase a home, you’ll have to set up or transfer your utility bills to your new home. If you live in a condo, these costs may be included in your monthly maintenance fee. Your utility bill will include:

  • Hydro (electricity)
  • Heat
  • Water and Garbage
  • Internet, Phone, Cable

For the full details on the home buyer’s journey including examples, advice, pictures and sample calculations, download a copy of our free Home Ownership Costs to Consider Guide here.

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Source: zoocasa.com