Tag: Spending

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

How to Build a Photo Scanning and Digitizing Side Gig

by Phillip Warren

As simple as it sounds — and actually is — most people are overwhelmed by the thought of taking hundreds or even thousands of photos and organizing them into searchable, digital files.

Then there are the videos filmed on various versions of clunky cameras over the decades.

Perhaps the most daunting version of unorganized photographic memories are slides. Once the butt of so many jokes about boring dinner parties, now they are covered in dust with no hope of ever seeing the light of a projector again.

Well, anyone armed with a $229 scanner and a computer can make searchable digital files of photos and slides. To turn videos into digital files, it takes the original camera they were filmed with or a VCR, an $87 adapter and a computer.

Here’s how to make photo scanning and digitizing your new side hustle.

Five years ago, professional photo curator Sabrina Hughes decided she could make a business out of helping people organize their photos, videos and slides. Her company, PhotoXO, has a compelling slogan: “Show your photos the love they deserve.”

Her years as a photographer, plus a graduate degree in art history and experience as a curatorial assistant at the Museum of Fine Arts in St. Petersburg, Fla., combine to make her an astute photo archivist. But all of this expertise and experience is not required.

“There’s a certain point when I’m not doing anything you can’t figure out on your own,” she said. “A college student or really anyone could do this to make extra money.”

Hughes offers a self-paced online class called Disaster to Done for $297, which includes lifetime access to course materials. But she’s also sharing her tips with The Penny Hoarder.

Get the Right Equipment

  • Scanner. There are hundreds of scanners out there, but she prefers the Epson v600, which sells for $229.
  • Video adapter. Hughes uses the Elgato Video Capture for digitizing VHS tapes. It can be bought online for $87.
  • Storage. “When I first started out, I was giving everything back on hard drives,” Hughes said. “I was trying to get away from DVDs, since most computers don’t even play those anymore.” She then offered flash drives filled with the photos. Though they are also becoming less common, this is still probably the best tool for beginners. Hughes now uploads everything to her website, which offers permanent storage.
  • Software. Hughes uses Adobe Lightroom ($119), which enables her to label photos so they can be searched and has photo editing functions. Software isn’t required to organize unlabeled photos into folders, however.
A stack of old black and white photographs sits on a person's desk.

Develop and Perfect Your Process

The first step to starting your photo scanning business is setting aside a space in your home. It can be as small as a corner of your bedroom or a desktop if an actual office or spare room isn’t possible.

Next, create a storage system for clients’ photos and video tapes while your work is in progress. Of course clear boxes that stack are great, but they come with a cost. Cardboard shipping boxes work just as well. Place white adhesive labels on the ends with the name of the client and the date the work started. You can place new labels over these when one project is done and the next client’s photos go into the boxes.

To digitize photos and slides, scan each one with the scanner to upload it to your computer. Make files for certain years or topics such as “1970s beach trips” or “kids’ birthday parties.” Drag and drop the photos into the appropriate file.

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Deciding What to Charge

It’s smart to charge by the hour when you start out, and give an estimate of how long the project will take.

Determine ahead of time how many photos you can scan in an hour. If you are sorting and scanning, that may be harder to estimate, but it probably adds another 30 minutes onto each hour of scanning. Say you can scan 40 photos an hour, then it would take you five hours to digitize 200 photos that don’t require sorting.

A high schooler or college student might charge $30 to $50 an hour, or approximately $150 to $250 for 200 photos. Allow an extra hour for computer glitches, labeling files and calling the client with questions.

A woman looks off into the distance toward a window with an old photograph on a television screen behind her.

Hughes started out charging by the hour, but found clients were spending so much time “pre-organizing” their photos themselves to save money, it would take them six months or more before they were finally ready for her to start archiving. So she switched to a flat fee of $2,222 for unlimited archiving of slides, photos or videos. To do all three formats, she charges $7,777. She also offers small projects a-la-carte based on the amount of work.

How to Attract Clients

You might have to offer to digitize photos for one or two friends at no cost first to get an idea of how long the process takes and what you will charge.

Then spread the word on social media. Give an estimated price of how many photos you can do for a certain price. Ask your early clients to share something about how wonderful it feels to finally have photos organized and saved forever.

Digitized photos make a great Mother’s Day, Father’s Day or Christmas gift. Promote your business online and in emails during these times and throughout the year.

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.


Source: thepennyhoarder.com

How to Avoid Racking Up Debt During the Holidays

by Phillip Warren

The holidays bring a lot of excitement and cheer. But is also a time characterized by a lot of spending. Statistics show that holiday spending goes up every year in the last few years. Unfortunately, holiday expenditure can take a big chunk out of your credit card. It may feel great while the holidays last […]

The post How to Avoid Racking Up Debt During the Holidays appeared first on Credit Absolute.


Source: creditabsolute.com

Truth About Reward and Store Credit Cards

by Phillip Warren

On the surface, reward cards are a great way to make a few extra dollars or grab some air miles without increasing your spending or your debt. If you spend a lot of money at a particular shop, store cards will seem like an equally beneficial prospect. But these cards exist for a reason—they’re there to make more money for the providers and the retailers, not you.

Sure, reward/store cards have other benefits if you use them properly, but there are a host of disadvantages and hidden terms that you need to be aware of before signing on the dotted line. 

What are Store Cards?

Store cards are tied to specific stores and offered by chains of retailers. These cards work just like traditional cards and are often branded by networks like Visa and MasterCard. The difference is that they can only be used in the issuing stores and their rewards are tied to those stores.

In essence, they are store loyalty cards that come with a lien of credit attached. 

What are Reward Cards?

Reward cards are also tied to credit card networks, including American Express and Discover, as well as Visa and MasterCard. They award points every time they’re used for qualifying purchases and these points can then be swapped for air travel and other benefits. 

Some reward schemes award a specific amount of cash back, often fixed to 1% or 2% of purchases made on specific items, such as groceries or utility bills.

How Can Providers Offer These Rewards?

If a provider offers you cash back every time you spend money on your credit card, someone has to foot the bill. Many consumers assume that the credit card network covers the cost, and to an extent, they do. But it’s not quite as simple as that.

Every time you use your credit card to make a purchase, the retailer is charged a fee, often between 1% and 3% of the purchase. This is the network’s charge. With reward cards, this fee increases, and the extra money is used to fund the rewards program.

As a result, retailers are not exactly happy with these programs as they drive their costs up and reduce their profits. The only way around this, is to increase the cost of the product or, more likely, to reward customers who pay with cash/debit. Retailers are not allowed to add a surcharge for credit card use, but there’s nothing stopping them from choosing which cards they do and don’t accept.

Your local Mom & Pop enterprise isn’t being antiquated and old-fashioned by refusing credit cards. They just can’t cover the costs. 5% may not sound like a big deal, but for retailers with minimal buying power and the massive overheads of running a brick-and-mortar store, 5% can be a deal breaker.

Smaller retailers are fighting back against reward cards while bigger ones are embracing them by adopting their own store cards. With a store card, they have more say, more control, and they know that those small losses will be offset by the increased purchases.

Issues with Store Credit Cards

Store cards carry a big risk and have far few benefits than reward cards. The advantages of these cards are obvious: If you shop a lot in a particular place, you can save money via the cash back schemes. 

They can also help with emergency purchases, providing you clear the balance in full. But, while the benefits are obvious, the same can’t be said about the disadvantages.

Con 1: They Have High Interest Rates

The average credit card interest rate in the United States is around 16%. The average rate for store cards is over 20%. That 4% may not seem like much, but if you don’t repay your balance every month that interest will compound, grow, and cost you a small fortune. 

At 16% with a $10,000 balance and a 60-month repayment term, you’ll pay $243 a month and over $4,000 in total interest.

Increase that rate to 20% and your monthly payment grows by $20 while your total interest increases by nearly $1,500. The longer you leave it and the smaller your monthly payments are, the greater that difference will be.

For example, if you repay just $200 a month on that balance, the difference between 16% and 20% is 26 extra months and close to $5,000. Of course, store cards rarely offer such high limits, but this is just as example to show you how much of a difference even the slightest percentage increase can cause.

It’s worth keeping this in mind if you ever apply for a traditional rewards card. Getting rewards in return for a higher APR is great if you repay your balance in full every month and terrible if you don’t.

Con 2: They Have High Penalty Rates

If you miss a payment on your store credit card you could be hit with a penalty APR as high as 29.99%, as well as a late payment fee of $39. The rates are high to begin with, but these penalty rates are astronomical and will make a bad situation worse.

That’s not all, as some providers are known to be very unforgiven when it comes to missed and late payments. In some cases, your account will default even if you underpay just once and just by a few dollars. 

Con 3: They Have Low Credit Limits

Retailers are not lenders. They don’t have the time, funds or patience to chase debts and deal with collection agencies. As a result, they don’t offer high credit limits and generally you’ll get a fraction of what an unsecured credit card might provide you with.

This might not seem like much of an issue. After all, a smaller credit limit means you’re less likely to accumulate large amounts of debts. However, this has a massively negative impact on your credit score that few borrowers consider.

30% of your credit score is based on something known as a credit utilization ratio. This looks at the total available credit and compares it to the debt that you have accumulated. If you have several cards with a combined credit limit of $10,000 and a balance of $5,000, then your ratio is 50%, which is considered to be quite high.

If a store card is your only account and you spend $450 on a $500 limit, then you have a credit utilization ratio of 90%, which will reduce your score. Your credit report is also negatively affected by maxed-out credit cards, a feat that’s much easier to achieve when you have a low credit limit.

Con 4: There Are Better Options

It’s better to have one good reward card than multiple store cards. The former will provide you with far better interest rates and terms, while the latter will hit your credit report with several hard inquiries and new accounts. 

A rewards card will still benefit you when shopping at those stores and will also provide you with a wealth of other benefits.

Con 5: You May Spend More

Store cards are not designed to make your life easier and give you a few freebies. Regardless of what the store tells you, they’re not made to reward loyalty, they’re made to encourage spending. 

This doesn’t always work, and research suggests that many individuals use reward cards just like they would normal cards. But for a small minority, the idea of acquiring points is enough to convince them to spend more than they usually would.

Some good can be good debt, such as when it’s used to acquire an asset or something that won’t depreciate. But very rarely do we use credit cards for this purpose and generally, if you’re spending more on a store card it means you’re wasting more money on things you don’t need.

Con 6: You Can’t Use Them Anywhere Else

A store card can only be used in that particular store. This renders it redundant as an emergency card and also means you’re encouraged to shop in that one place. You don’t have a chance to shop around and find the cheapest price; you may spend more just to use your card and get the benefits, with those benefits rarely covering the additional money you spend.

What About Reward Cards?

Some reward cards have very high rates as these rates are used to offset the rewards program. However, this isn’t always the case, because, as discussed above, networks often charge retailers more to offset these purchases and therefore don’t always need to cover the costs themselves.

Some credit cards, such as the Discover It, offer solid reward schemes and would also be included on any list of the best non-reward credit cards. It’s a solid all-rounder and it’s not alone. However, many reward cards charge high annual fees and penalty rates, just like you’ll find with a store card.

It’s important to study the small print and make sure the card is viable. If you’re going to clear the balance every month, a slightly higher interest rate won’t hurt, especially if it comes with some generous rewards. But if there is any doubt and even the slightest chance that you won’t clear the balance, it’s always best to focus on a low-interest rate first.

Even the most generous 5% cash back reward card will not offset the losses occurred by paying a few more percentage points of interest.

Will Reward/Store Cards Affect my Credit Score?

Credit cards trigger hard inquiries, which can reduce your credit score by up to 5 points. This is true for every credit card that you apply for. Rate shopping can combine multiple inquiries into one if they are for the same type of credit, but this doesn’t apply to credit cards.

A new account will also impact your score. This impact is often minimal and if you keep up with your repayments then it will vanish in time. However, if you miss a payment, max-out your card or increase your credit utilization score, it could have a detrimental effect on your score and your finances.

Keep store cards to a minimum and only sign up if you’re 100% sure you’re getting a good deal that will benefit you in the short-term and the long-term.

Truth About Reward and Store Credit Cards is a post from Pocket Your Dollars.


Source: pocketyourdollars.com

Using Credit Cards During COVID-19

by Phillip Warren

Since we’re in the middle of a pandemic, we’re all trying to figure out the new normal. Whether you’re working from home, have a houseful of kids to keep busy or find yourself facing financial uncertainty, everyone has at least a little adjusting to do. While you’re taking stock of your life and what you need to adjust, it’s probably a good idea to take a look at your finances and credit card use, too.

Wondering how you should use your credit card? We’ve got some ideas for you on how you can use your credit card in the middle of a global emergency. 

How to Use Your Credit Card During a Pandemic

But before we get started, remember to take a hard look at your personal finances before following any financial information. Everyone’s situation is different—so what might work for you might not work for someone else, and vice versa.

1. Keep Online Shopping to a Minimum

If you’re working from home, the temptation to online shop can be all too real. But when you’re in the middle of a pandemic, you might need to put your money towards unexpected expenses. 

David Lord, General Manager of Credit.com, has some advice on preventing frivolous spending. “Try browsing, putting things in your cart and leaving them for the day,” Lord suggests. “If you take a look at your cart the next day, you’ll most likely find that 90% of the time you won’t remember the things you placed in your cart in the first place.”

If the temptation to online shop is too strong, Lord suggests buying something that’ll keep you occupied for a while, like a puzzle, a paint set or a yoga mat. That way, you’ll be too distracted to buy something else.

2. Try to Keep Your Credit in Good Shape

During a global emergency, it feels like everything’s up in the air. Because of that, it’s important to stay as on top of things as you can and prepare for the worst-case scenario. Having good credit is important in the best of times, but it can be even more so in the worst. 

Let’s say you find yourself with a bill that you can’t pay on your hands. If you need to take out a loan, you’d probably want a loan with the best interest rates possible. In order to qualify for those types of loans, you’ll need a good credit score. 

If you’re in a position to do so, try to keep your credit score healthy. Here’s some quick things you can do today:

  • Keep an eye on your credit score and credit report
  • Pay your bills on time—at least the minimum payment
  • Keep your credit utilization ratio at 30%

But if you find yourself in a financial situation where you can’t keep up with everything, you can prioritize. For example, going above 30% of your credit utilization ratio won’t impact your score as much as missing a payment. That’s because credit utilization makes up 30% of your credit score, while your payment history makes up 35% of your score. 

3. Utilize Cashback Rewards

Do you have a great rewards credit card on your hands? Now’s a great time to use them. While some credit cards might not be handy right now, like travel rewards cards, there are others that could be useful. If your card offers cashback on categories such as groceries, gas and everyday purchases, take advantage. You could use those rewards to help you cover essential purchases. 

4. Use Your Balance Transfer Credit Cards

If you already have significant debt or if you’ve recently taken on new debt, you might want to consider using a balance transfer credit card. A balance transfer credit card allows you to move your debt from one card to your balance transfer card, which typically has a lower promotional interest rate. These promotional interest rates can last from six to 18 months, and sometimes longer.

These are great options if you’re faced with new debt. If you’re struggling to pay the rent, groceries or medical bills, and your stimulus check can’t cover it all, you can use your balance transfer credit card. Just make sure to be careful. You still have to pay off your debt, so make sure to do so before the promotional balance transfer offer ends. If you can, try to make regular payments on your card, so you’re not faced with an overwhelming amount of debt when the promotional offer ends.

Be Mindful of Your Situation

Above all else, be mindful of your situation. What urgent bills do you have to pay? Do you have a loved one in the hospital? Have you or your significant other lost their job? Make goals based off of your situation, and use your credit card accordingly.

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If you’re looking for more information on coronavirus and your finances, check out our COVID-19 Financial Resource Guide. We update it frequently, to make the most up-to-date and useful information available to you. 

The post Using Credit Cards During COVID-19 appeared first on Credit.com.


Source: credit.com

Best credit cards for Airbnb

by Phillip Warren

Many of us are avoiding travel during the pandemic.

But if you have to shelter in place under quarantine once you get to your destination, wouldn’t you rather do it in an environment that at least seems more within your control?

If the choice is between a hotel where you must trust your experience to a faceless corporation or a local host you can talk to through homestay sites like Airbnb and Vrbo, the latter may be the better option for these times (provided you don’t violate their party guidelines).

Whatever option you choose, credit card issuers now reward homestays with points and cash back in the same way they’ve long doled out rewards for hotels and other travel expenses.

These are the best cards on the market for homestays like Airbnb.

See related: Strategies for planning 2021 travel

Wells Fargo Propel American Express® card: Best no-annual-fee, high rewards option
  • Chase Sapphire Reserve: Best introductory bonus
  • Bank of America® Premium Rewards® credit card: Best for bonus rewards
  • Capital One Venture Rewards Credit Card: Best flat-rate miles card
  • Amazon Prime Rewards Visa Signature card: Best for online shopping
  • Discover it® Miles: Best no-fee option
  • Wells Fargo Propel American Express® card: Best no-annual-fee, high rewards option

    The Wells Fargo Propel American Express card includes arguably one of the highest rates of return on points for some of the most popular redemption categories out there, including homestays like Airbnb and Vrbo.

    The greatest advantages of this card – besides earning 3 points per dollar spent on some popular spending categories – are that there’s no point limit or expiration, no annual fee and no rotating categories that you constantly have to remind yourself to activate. You get three times the points in the relevant categories all the time without restriction, with travel – including all homestays – and transit being one of those prominent categories.

    The card also charges no foreign currency conversion fee, so buying things abroad is less expensive. If that weren’t enough, here’s what you also get:

    ProudMoney.

    Chase Sapphire Reserve: Best introductory bonus

    Before the Wells Fargo Propel card debuted, Chase Sapphire Reserve was the go-to credit card option for Airbnb fans. It offers a 50,000-point introductory bonus when you spend $4,000 in your first three months of membership. Those points are worth up to $750 when you book travel through Chase Ultimate Rewards.

    Though equipped with fewer spending categories offering 3X points and carrying a large annual fee of $550, the benefits of the Chase Sapphire Reserve card are more specifically geared toward frequent travelers.

    At the same time, that large annual fee is offset by a $300 annual credit that will reimburse any travel expense – including Airbnb. And from June 1, 2020, to June 30, 2021, gas station and grocery store purchases count toward the travel credit.

    Add to that a $100 credit covering the application to Global Entry/TSA Precheck every four years and the annual fee is almost completely offset in the first year.

    Meanwhile, there are even more travel benefits:

    Bank of America® Premium Rewards® credit card: Best for bonus rewards

    While the points per dollar offered by Bank of America Premium Rewards credit card on travel and Airbnb are fewer than the credit cards above, the sign-up bonus and up to $200 in annual statement credits make it a decent option, even with less flexibility on what qualifies as a credit than the credit cards above.

    This card should absolutely move to the top of your list if you are already a Bank of America Preferred Rewards client. That designation automatically increases your return even higher than what the other credit cards above offer on travel and dining – you can get a rewards bonus of up to 75%.

    Combine that with a generous sign-up bonus and the Bank of America Premium Rewards is one of the most potent rewards cards for Preferred Rewards clients.

    The card includes:

    Travel loyalty programs offer extended perks in pandemic

    Capital One Venture Rewards Credit Card: Best flat-rate miles option

    The Capital One Venture Rewards Credit Card is remarkably similar to Bank of America’s Premium Rewards card, right down to the $95 annual fee, but without the additional benefits afforded to Bank of America Preferred Rewards clients.

    However, Capital One Venture Rewards offers 2 points per dollar spent on every purchase, not just travel and dining.

    Amazon Prime Rewards Visa Signature card: Best for online shopping

    You may be wondering why the Amazon Prime Rewards Visa Signature card is on a list highlighting the best credit cards for AirBnb, Vrbo and other homestays.

    Shouldn’t this card be limited to the “best credit cards for online shopping” list? Not when Amazon offers Airbnb gift cards and the Amazon Prime Rewards card gives you 5% cash back on Amazon.com purchases as long as you have a Prime membership, which essentially acts as the annual fee ($119).

    Just purchase an AirBnb gift card from Amazon with the card, and it’s as if you are getting 5% cash back for your AirBnb stay when you apply the gift card towards it. It’s the highest rate on this list, Amazon or not.

    You’ll receive the following additional benefits:

    See related: How to pay off Amazon purchases over time

    Discover it® Miles: Best no-fee option

    Though the points per dollar on this card are lower than any other credit card on the list, Discover it Miles gives you much more freedom in how you can manage your points and account.

    You can redeem miles in any amount, your miles don’t expire even if you close your account and 1% of your miles can be converted directly into cash for your bank account.

    Discover it Miles offers:

    creditcards.com

    Best Credit Cards for Bad Credit

    by Phillip Warren

    When it comes to excuses consumers give for their poor credit scores, banks and lenders have heard it all. 

    Maybe you lost your job and couldn’t pay your student loan payment for a few months. Or perhaps you thought you’d gotten a deferment but were too busy job hunting to find out for sure. 

    Maybe you thought you paid your credit card bill but it’s actually sitting on your kitchen counter waiting for the mail.

    Whatever the reason for your low credit score, one thing is for certain — lenders don’t care.

    In fact, banks and other lenders lean on your credit score and other factors to determine whether they should approve you for a credit card or a loan — and that’s about it. Your personal situation is never considered, nor should it be.

    It would be wonderful if credit card companies understood that “life happens” and made special exceptions to help people out, but that’s not the world we live in.  As most of us already know, that’s not typically how credit works. Credit cards are backed by banks, and banks have rules for a reason.

    Now, here’s the good news: Credit cards can help rebuild your credit, earn cash back for each dollar you spend, make travel easier, and serve as an emergency fund if you’re stuck paying a huge bill at the last minute. This is true even if you have poor credit, although the selection of credit cards you can qualify for may be somewhat limited. 

    Keep reading to learn about the best credit cards for bad credit, how they work, and how you can get approved.

    Best Cards for Bad Credit This Year

    Before you give up on building credit, you should check out all the credit cards that are available to consumers who need some help. Our list of the best credit cards for bad credit includes some of the top offers with the lowest fees and fair terms.

    • Total Visa®
    • Discover it® Secured
    • Credit One Bank® Visa® Credit Card
    • Secured Mastercard® from Capital One®
    • Milestone® Gold Mastercard®
    • Credit One Bank® Unsecured Visa® with Cash Back Rewards

    #1: Total Visa®

    The Total Visa® is one of the easiest credit cards to get approved for in today’s market, and it’s easy to use all over the world since it’s a true Visa credit card. However, this card does come with high rates and fees since it’s available to consumers with poor credit or a limited credit history.

    Processing your application will cost $89, which is extremely high when you consider the fact that most credit cards don’t charge an application fee. You’ll also pay an initial annual fee of $75 and a $48 annual fee for each year thereafter.

    Once you sign up, you’ll be able to pick your preferred card design and your credit card payments will be reported to all three credit reporting agencies — Experian, Equifax, and TransUnion. This is the main benefit of this card since your on-time payments can easily help boost your credit score over time. 

    For the most part, the Total Visa® is best for consumers who don’t mind paying a few fees to access an unsecured line of credit. Since this card doesn’t dole out rewards, however, there are few cardholder perks to look forward to. 

    • APR: 35.99% APR
    • Fees: Application fee and annual fee
    • Minimum Credit Score: Not specified
    • Rewards: No

    #2: Discover it® Secured

    While secured cards don’t offer an unsecured line of credit like unsecured credit cards do, they are extremely easy to qualify for. The Discover it® Secured may not be ideal for everyone, but it does offer a simple online application process and the ability to get approved with little to no credit history.

    Keep in mind, however, that secured cards do work differently than traditional credit cards. With a secured credit card, you’re required to put down a cash deposit upfront as collateral. However, you will get your cash deposit back when you close your account in good standing.

    Amazingly, the Discover it® Secured lets you earn rewards with no annual fee. You’ll start by earning 2% back on up to $1,000 spent each quarter in dining and gas. You’ll also earn an unlimited 1% back on everything else you buy.

    The Discover it® Secured doesn’t charge an application fee or an annual fee, although you’ll need to come up with the cash for your initial deposit upfront. For the most part, this card is best for consumers who have little to no credit and want to build their credit history while earning rewards.

    • APR: 24.74%
    • Fees: No annual fee or monthly fees
    • Minimum Credit Score: Not specified
    • Rewards: Yes

    #3: Credit One Bank® Visa® Credit Card

    The Credit One Bank® Visa® Credit Card is another credit card for bad credit that lets you earn rewards on your everyday spending. You’ll earn a flat 1% cash back for every dollar you spend with this credit card, and since it’s unsecured, you don’t have to put down a cash deposit to get started.

    Other benefits include the fact you can get pre-qualified for this card online without a hard inquiry on your credit report — and that you get a free copy of your Experian credit score on your online account management page.

    You may be required to pay an annual fee up to $95 for this card for the first year, but it depends on your creditworthiness. After that, your annual fee could be between $0 and $99.

    • APR: 19.99% to 25.99%
    • Fees: Annual fee up to $95 the first year depending on creditworthiness; after that $0 to $99
    • Minimum Credit Score: Not specified
    • Rewards: Yes

    #4: Secured Mastercard® from Capital One®

    The Secured Mastercard® from Capital One® is another secured credit card that extends a line of credit to consumers who can put down a cash deposit as collateral. This card is geared to people with bad credit or no credit history, so it’s easy to get approved for. One downside, however, is that your initial line of credit will likely be just $200 — and that doesn’t give you much to work with. 

    On the upside, this card doesn’t charge an annual fee or any application fees. That makes it a good option if you don’t want to pay any fees you won’t get back.

    You’ll also get access to 24/7 customer service, $0 fraud liability, and other cardholder perks.

    • APR: 26.49%
    • Fees: No ongoing fees
    • Minimum Credit Score: Not specified
    • Rewards: No

    #5: Milestone® Gold Mastercard®

    The Milestone® Gold Mastercard® is an unsecured credit card that lets you get pre-qualified online without a hard inquiry on your credit report. You won’t earn any rewards on your purchases, but you do get benefits like the ability to select your card’s design, chip and pin technology, and easy online account access.

    You will have to pay a one-time fee of $25 to open your account, and there’s an annual fee of $50 the first year and $99 for each year after that.

    • APR: 24.90%
    • Fees: Account opening fee and annual fees
    • Minimum Credit Score: Not specified
    • Rewards: No

    #6: Credit One Bank® Unsecured Visa® with Cash Back Rewards

    The Credit One Bank® Unsecured Visa® with Cash Back Rewards lets you earn 1% back on every purchase you make with no limits or exclusions. There’s no annual fee or application fee either, which makes this card a winner for consumers who don’t want to get hit with a lot of out-of-pocket costs.

    As a cardholder, you’ll get free access to your Experian credit score, zero fraud liability, and access to a mobile app that makes tracking your purchases and rewards a breeze. You can also get pre-qualified online without a hard inquiry on your credit report.

    • APR: 25.99%
    • Fees: No annual fee or application fee
    • Minimum Credit Score: Not specified
    • Rewards: Yes

    The Downside of Credit Cards with Bad Credit

    While your odds of getting approved for one of the credit cards for bad credit listed above are high, you should be aware that there are plenty of pitfalls to be aware of. Here are the major downsides you’ll find with these credit cards for bad credit and others comparable cards:

    • Higher fees: While someone with excellent credit can shop around for credit cards without any fees, this isn’t the case of you have bad credit. If your credit score is poor or you have a thin credit profile, you should expect to pay higher fees and more of them.
    • Higher interest rates: While some credit cards come with 0% interest for a limited time or lower interest rates overall, consumers with poor credit typically have to pay the highest interest rates available today. Some credit cards for bad credit even come with APRs as high as 35%.
    • No perks: Looking for cardholder benefits like cash back on purchases or points toward airfare or movie tickets? You’ll need to wait until your credit score climbs back into “good” or “great” territory. Even if you can find a card for applicants with bad credit that offers cash back, your rewards may not make up for the higher fees.
    • No balance transfers: If you’re looking for relief from other out-of-control credit card balances, look elsewhere. Credit cards for bad credit typically don’t offer balance transfers. If they do, the terms make them cost-prohibitive.
    • Low credit limits: Credit cards for bad credit tend to offer initial credit limits in the $300 to $500 range with the possibility of increasing to $2,000 after a year of on-time monthly payments. If you need to borrow a lot more than that, you’ll have to consider other options.
    • Security deposit requirement: Secured credit cards require you to put down a cash deposit to secure your line of credit. While this shouldn’t necessarily be a deal-breaker — and it may be required if you can’t get approved for an unsecured credit card — you’ll need to come up with a few hundred dollars before you apply.
    • Checking account requirement: Most new credit card accounts now require cardholders to pay bills online, which means you’ll need a checking account. If you’re mostly “unbanked,” you may need to open a traditional bank account before you apply.

    Benefits of Improving Your Credit Score

    People with bad credit often consider their personal finances a lost cause. The road to better credit can seem long and stressful, and it’s sometimes easier to give up then it is to try to fix credit mistakes you’ve made in the past.

    But, there are some real advantages that come with having at least “good” credit, which typically means any FICO score of 670 or above. Here are some of the real-life benefits better credit can mean for your life and your lifestyle:

    • Higher credit limits: The higher your credit score goes, the more money banks are typically willing to lend. With good credit, you’ll have a better chance at qualifying for a car loan, taking out a personal loan, or getting a credit card with a reasonable limit.
    • Lower interest rates: A higher credit score tells lenders you’re not as risky as a borrower —a sign that typically translates into lower interest rates. When you pay a lower APR each time you borrow, you can save huge amounts of money on interest over time.
    • Lower payments: Borrowing money with a lower interest rate typically means you can usually get lower payments all your loans, including a home loan or a car loan.
    • Ability to shop around: When you’re an ideal candidate for a loan, you can shop around to get the best deals on credit cards, mortgages, personal loans, and more.
    • Ability to help others: If your kid wants to buy a car but doesn’t have any credit history, better credit puts you in the position to help him or her out. If your credit is poor, you won’t be in the position to help anyone.
    • More options in life: Your credit score can also impact your ability to open a bank account or rent a new apartment. Since employers can request to see a modified version of your credit report before they hire you, excellent credit can also give you a leg up when it comes to beating out other candidates for a job. 

    In addition to the benefits listed above, most insurance companies now consider your credit score when you apply for coverage. For that reason, life, auto, and home insurance rates tend to be lower for people with higher credit scores.

    This may seem unfair, but you have to remember that research has shown people with high credit scores tend to file fewer insurance claims.

    How to Improve Your Credit: Slow and Steady

    When you have a low credit score, there are two ways to handle it. If you don’t mind the consequences of poor credit enough to do anything about it, you can wait a decade until the bad marks age off your credit report. Depending on when your creditors give up and write off your debt, you may not even need to wait that long.

    If you don’t like the idea of letting your credit decay while you wait it out, you can also try to fix your past credit mistakes. This typically means paying off debt — and especially delinquent debts — but it can also mean applying for new loan products that are geared to people who need to repair their credit.

    If you decide to take actionable steps to build credit fast, the credit cards on this page can help. They’ll give you an opportunity to show the credit bureaus that you’ve changed your ways.

    Before you take steps to improve your credit score, however, keep in mind all the different factors used to determine your standing in the first place. The FICO scoring method considers the following factors when assigning your score:

    • On-time payments: Paying all your bills on time, including credit cards, makes up 35% of your FICO score. For that reason, paying all your bills early or on time is absolutely essential.
    • Outstanding debts: How much you owe matters, which is why paying off your credit cards each month or as often as possible helps your score. According to myFICO.com, the amounts you owe in relation to your credit limits make up another 30% of your FICO score.
    • New credit: Apply for too many new cards or accounts at once can impact your score in a negative way. In fact, this determinant makes up another 10% of your FICO score.
    • Credit mix: Having a variety of open accounts impresses the credit bureau algorithm Gods. If all you have are personal loans right now, mixing in a credit card can help. If you already have four or five credit cards, it may be wise to back off a little.
    • Length of credit history: The length of your credit history also plays a role in your score. The longer your credit history, the better off you are.

    If you want to improve your credit score, consider all the factors above and how you can change your behavior to score higher in each category. It’s pretty easy to see how paying all your bills early or on time and paying off debt could make a big positive impact on your credit score when you consider that these two factors alone make up 65% of your FICO score.

    If you want a way to track your progress, also look into an app like Credit Karma, one of my favorite tools. This app lets you monitor your credit progress over time and even receive notifications when your score has changed. Best of all, it’s free.

    Should You Use a Credit Card to Rebuild Your Credit Score?

    If you’re on the fence about picking up a credit card for bad credit, your first step should be thinking over your goals. What exactly are you trying to accomplish?

    If you’re looking for spending power, the cards on this list probably won’t help. Some are secured cards, meaning you need a cash deposit to put down as collateral. Others offer low credit limits and high fees and interest rates, making them costly to use over the long-term.

    If you really want to start over from scratch and repair credit mistakes made in the past, on the other hand, one of these cards may be exactly what you need. If you’re determined to improve your score, they can speed things along.

    You may pay higher fees and interest rates along the way, but it’s important to remember that none of the cards on this list need to be your top card forever. Ideally, you’ll use a credit card for poor credit to rebuild your credit and boost your score. Once you’ve reached your goal, you can upgrade to a new card with better benefits and terms.

    The post Best Credit Cards for Bad Credit appeared first on Good Financial Cents®.


    Source: goodfinancialcents.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