When analyzing financing options or debt relief issues many people forget to include the tax implications of one strategy over another. Including tax implications in your scenarios can become very complicated, which is why it is always handy to have a computer program such as Quicken to help you crunch the numbers.

Here are a few simple guidelines to keep in mind. Continue reading →

Is consolidating credit card debt a good way to control your bills? You’ve see seen many credit card consolidation commercials and wondered if it is right for you.

Many debt experts believe that the the first step towards addressing the problem of credit card debt is to consolidate credit card debt.

But what is the best way to consolidate credit card debt? Do you just go with that attractive ad in the newspaper that says ‘…the lowest APR in the town is available here’?

There are always a number of offers available for you to choose from. The credit card suppliers keep coming with new and more attractive offers asking you to consolidate credit card debt with them. However, when you go lookingto consolidate credit card debt, you must be keenly looking for these 3 things (in terms of APR) – introductory APR, introductory APR period and the standard APR.

Let’s see how each one is important.

Introductory APR
Introductory APR is probably the most important thing to look for when you are looking to consolidate credit card debt. If you consolidate credit card debt to a card that has a low introductory APR e.g. 0%, the first thing you get is a breather/relief in terms of the rate at which your credit card debt has been growing. Based on how long that 0% APR period is (generally you will look to consolidate credit card debt with a credit card supplier who offers 0% initial APR), you will at least be able to temporarily break the growth rate of your credit card debt.

Standard APR
The longer the introductory period, the better.  But, you shouldn’t ignore the standard APR when you consolidate credit card debt. This is the interest rate that will be applied to your balance after the expiry of the introductory low APR period that was given to lure you to consolidate credit card debt with that credit card supplier. If the standard APR is too high and you know that you will not be able to clear off the entire credit card debt during the low APR period, that credit card is probably not the best for you to consolidate credit card debt to. However, if you think that you will be able to clear off the entire credit card debt during that period, you can make some compromises on the standard APR of the credit card to which you consolidate credit card debt.

Can I get out of credit card debt?

Yes, you can get out of credit card debt, anybody can. It’s not an easy road, but if you are determined to get out of credit card debt you surely can get out of it.

All you need to get out of credit card debt is determination and planning. Ask yourself this question:

• “What will I get if I am able to get out of credit card debt?”
• “What difference will it make”
• “What’s in it for me”
• “Is it really beneficial to get out of credit card debt”.

Use the answers to build your determination. Imagine a time when all the harassing mail and phone calls by creditors/collection agencies will be gone. This will help you to strengthening your determination and provide you with a reason on why you should endeavour to get out of credit card debt.

Think about the stress-free life after you get out of credit card debt. Try to link various reasons together and try to see the benefits through them. All these collectively will help in bolstering your determination and prevent it from getting weak at any point in time.

The second thing that you need to get out of credit card debt is proper planning.

Start by making a list of the credit cards that you currently posses and noting the debt and the APR for each of them. The sum total of all these various credit card debts, will give you the total credit card debt. You also need to check if you have been defaulting on payments on some of these credit cards (and hence incurring a late fee). You will need to avoid that and put it on the plan you have prepared to get out of credit card debt.

The next step in getting out of credit card debt is to check your current financial position and make an assessment of what you expect your future financial position to be. Next comes the research to check the various balance transfer offers available in the market; to see if one of these can prove beneficial to you.

Use all this information to calculate how much time you will require to get out of credit card debt and how you will distribute the debt payment across your various credit cards (ensuring that you payoff the debt that is hitting you the most and also ensuring that you don’t incur late fee on any credit card payments)

It’s common for many people to ignore their debt problems.  It’s as if the problem will simple go away if it is avoided.

Well, when it comes to your debt, ignorance is not bliss.  It’s time to shine some light on your financial situation and get your life back in order! Continue reading →

There are multiple ways to reduce your debt.

The most obvious one, is to simply pay down your debts. That’s easier said than done, isn’t it?

But there is one method that has been employed by many people in debt with great success. It is known as the Snowball Method a debt reduction method taught by Dave Ramsey.

Continue reading →

Are you looking to eliminate your unwanted debt? Maybe it’s time to seek the assistance of a credit counseling company.

Credit counseling companies can help you develop a plan to reduce your debt and get your financial life back on track, but you should practice some caution when choosing the right company to work with. While there are many reputable companies, there are just as many companies ready to take advantage of your situation.

Here are some basic things too look out for when choosing a credit counseling company.

Continue reading →

Looking for a way out of your credit card debt problem?

If so, you’re not alone. According to Federal Reserve, the average household in 2007 carried nearly $8,500 in credit card debt. Not only that, but each year roughly 2.0 to 2.5 million Americans seek the help of a credit counseling companies.

Here is a simple step by step plan to help you tackle your credit card debt problem.

Continue reading →