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Credit Card Debt can be Harmful to Your Health

Credit Card Debt

Credit Card Debt can be Harmful to Your Health

Did you know that credit card debt can be harmful to your health? While it’s difficult to imagine anyone creating harm for themselves when using their credit cards, this should give you pause if that next purchase adds to a severely overweight credit card balance. In that respect, knowing how to pay off Credit Card Debt is no different than going on a life-extending diet.

How to Pay Off Credit Card Debt Early

Interstate Mentality

Do you have an interstate mentality regarding your finances? On an actual freeway or interstate, you can see hundreds of cars ahead of you on the road. Your path is blocked, and your vehicle is moving slowly, if at all. Beware, the roadblocks you have set up in your mind tend to be less noticeable. Nobody is setting out an orange cone with blinking lights telling you to merge your credit card debt.

An interstate mentality takes place when you try to juggle payments on seven credit cards, transfer money from one bank account to another, free up expenses on one credit card so you can charge more on it while you make a payment for another card, and wait for a paycheck to cover checks you just wrote.

If you have a lot of different things going on financially, you have to stop to take a breath. Decide what is most important about paying down your debt. Credit card debt can be harmful to your health. Just like losing excess weight, you want to make your financial life sleek and slim.

Control Your Spending Habits

Slow down and make conscious choices. “I won’t charge my credit card, I’ll skip going out to dinner this week.” “Maybe I don’t need
three new outfits, and I should balance my checkbook.”  OR… “Take a breath and focus.” (It’s good to remind yourself to slow down.) Learn effective tactics for dropping debt effectively, controlling spending. Don’t let credit card debt be harmful to your health! In fact, when you pay off your debt early, you reap the reward of less financial stress while enjoying more financial freedom!

 

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Six Best Financial Goals to be Financially Smart 

The Money Nerve blog
Guest-blogger Patricia Sanders

Six Best Financial Goals

to be Financially Smart

2018 has already arrived. Now is the time for you to set some serious financial goals and chalk out the strategies for achieving your success.

Didn’t get any time to make a list of new financial goals for the year 2018?

Don’t worry. We have compiled a list of six best financial goals to be financially smart – that will help you to improve your wallet and your life in 2018!

1. Pay off your debts

Decide how much debt you wish to get rid of in 2018. The best option is to get out of debt completely. But it may not be possible depending on your income and debt amount. So set an amount you can pay off in 2018 with strategic planning. Figure out how much extra you want to put towards your debt every month and then try to reach it. You can follow a debt repayment plan to speed up your repayments. Smart investments help to accelerate your savings. Likewise, unpaid debts eat up your savings. Late fees, compounding interests, fines, finance charges, penalties, etc. increase your outstanding balance, and you end up paying more in the long run. So, make it your goal to get rid of debt in 2018.

2. Review your investment plans

Investments should be made with particular goals in mind. They should help you attain your financial goals in 2018. Have a look at where your investments are now and evaluate your progress.

Here are a few tips to review your investment plans:
(i) Calculate your actual return to know if you’re on the right financial track. Once you get the number, compare it to your expected return. Find out if you have made any financial progress in the last few years.
(ii) Compare each individual holding to a benchmark. This comparison would help you discover portions of your portfolio that need adjustment. Monitor those parts of your portfolio every month.
(iii) Analyze your overall asset allocation to identify the areas where you need to make changes. For instance, sell those investments that are not meeting your expectations. If you don’t have proper information or tools to review your investment mix, then it’s best to consult a qualified and experienced CPA financial adviser. He can make an in-depth analysis of your portfolio and help you make the required changes.

3. Stick to your budget every month

Budgeting is vital for proper allocation of funds and resources. It helps you know the amount designated for each expenditure line. A budget also assists you to determine the maximum amount to be spent on a particular item. If your goal is to invest in the stock market in 2018, then budgeting can help you a lot. Your budget gives you a better idea of how much you can invest or save in a particular month. Remember, if you can stick to your budget, then you’re financial goals will be reached more effectively.

4. Invest more in your retirement plans

Do you have a 401(k) plan? If not, open an account today. How much are you contributing to your 401(k) plan every month? Is it enough? Are you getting the maximum employer match? If not, then find out if there is a “catch up” opportunity this year. Increase your IRA contribution if you haven’t reached the maximum limit for the current financial year. Take full advantage of the new year’s opportunity for building your nest-egg.

5. Choose the right 529 plan

The right 529 plan can help to accelerate college savings. Research and choose the right 529 plan in 2018 by the following factors:

(i) State tax benefits
(ii) Investment choice
(iii) Fees and costs
(iv) How much you have to invest initially

A good way to kick-start your college savings is to invest a set amount each year. Consider the daily expenses you need to take care of and select a plan that has a minimum investment.

6. Create a long-term financial plan

Where do you see yourself after five years? Do you see yourself
living with your children in a nice house? Do you see yourself leading a peaceful life? The answers to these questions help you create a long-term financial plan.

Outline your timetable:
● When you’re planning to buy a new apartment
● When you’re planning to switch job
● When you’re planning for retirement
● How you’re planning to build wealth
● What type of investments you’re interested in
● How you’re planning to invest your money
● When your kids will go to college

A long-term financial plan can help you make the right financial decision not only in 2018 but also in the next few years. Try implementing these six best financial goals into your life. Note: Don’t compare your long-term financial plan with others since it won’t be beneficial for you. Your long-term financial plan will be different from your best friend’s, especially if he is married and you’re single. I hope you understand my point.

Summing It Up

Remember, you have to work hard and make plans to achieve your financial goals. Believe in yourself, set a strategic course of action, and start making positive changes using these six best financial goals to get your money matters organized. Best of luck! Patricia

About our Guest Blogger: Patricia Sanders is a financial writer and a blogger as well. She has been associated with DebtConsolidationCare for a long time. She writes regularly for wiki.debtcc.com on a variety of topics and also contributes valuable posts to different financial communities, blogs, and websites. Connect with Patricia on Facebook and Twitter.

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Raise Your Credit Score

Raise Your Credit Score

Raise your credit score for better interest rates and easy lending from banks and financial institutions.
If you have never checked on your credit score, it is now easier than ever to see how you rate when lenders are looking at your financial record. Your credit score is based on your financial history in your credit record with all activity, both good and bad, influencing your score.

Three easy tips for maintaining or raising your credit score:

Pay off debt

Okay, I understand! That sounds much easier to say, but you can do it! I advise my clients to look at all of their credit card balances and pick the smallest debt. Changing your habits with small steps and small wins will increase your confidence and give you a chance to pat yourself on the back for a successful step toward financial health. Pay off the smallest debt and then tackle the next lowest bill. It is so gratifying to know one account has been paid off and with each paycheck, you whittle down more debt without intense emotional pain.

Keep low balances on bank-issued credit cards and revolving credit cards

According to Nerd Wallet, in 2016, the average U.S. household had nearly $17,000 in credit card debt. You are not alone. But you can reduce that debt. Pick one of your accounts and be sure to pay more than the minimum balance each month. Get one card down to a reasonable amount and then lower the balance on another card.
Not able to pay more than the minimum? It might be time to put those credit cards on ice. Literally! Take all but one of your credit cards, throw them in a container, fill it up with water and DEEP FREEZE those plastic cards. Now you can make payments on the cards each month and get that balance down.

Don’t open an excessive number of credit cards you don’t really need, in an attempt to increase your available credit.

If you have recently established credit, opening up four or five new accounts within two-three years could hurt your credit score, because you don’t have enough of a “track record” for the loan companies to make an educated decision as to your ability to manage your finances. In comparison, when a person has a few credit cards for eleven to fifteen years and later opens several new accounts, it may not have an adverse effect. What is more important than a lot of credit cards is the ability to make payments on time and demonstrate self-discipline in spending activity.

Don’t close several unused credit cards at the same time attempting to raise your credit score.

Positive credit scores are enhanced by a long credit history, so even if your account is not active, keeping an old card in your credit history gives you longevity and counts for about 15% of a FICO score.
A closed account will fall off your credit report sooner than an open one. In most cases, negative credit information will remain on your credit files for seven years from the time the debt first became delinquent. Here’s the good news: Positive credit information can stay on record indefinitely; however, closed accounts in good standing often drop off the credit report within ten years.
You can check your three credit reports for free once a year. 

Here’s a timely bonus that will raise your credit score this year.

Beginning September 15, 2017, the three credit reporting companies will phase in a host of changes that will lower the number of “mixed files,” which often had a negative impact on credit reports of people with similar names, and will update procedural changes aimed at improving the accuracy of these reports.
Find more tips for investing in you!

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GO the DISTANCE

Change your mindsetAsk yourself where you would like to be in one year or five years. Would you like to be free of credit card debt? Would you like to have traveled the world? Would you like to have put away money in a retirement account? Would you like to change your spending habits? Would you like to see 50,000 dollars in savings?

Once you know where you would like to be, state your goal. A year from now, I’d like to stop using credit cards. In five years, I’d like to be credit card debt free. A year from now, I want to go to school for additional training. In five years, I’d like to be in another career or own my own company.

Quiet the censor in your mind and just let your imagination travel where it likes. After allowing yourself this quiet time every day, you may be surprised to see where your imagination takes you! Take advantage of planning ahead then every three months or so, sit down and adjust your budget. You can still get to where you want to go, you are just allowing yourself to keep it real and tweak the plan, as needed.

Finances will always be a part of your life—not something you can ever move past. Confront your financial fears and set aside an hour per week to update your records. If you use computer software, download your bank statement and expenses. Balance your checkbook. Keeping up with your money each week for a small amount of time will help you stay on track for your bigger goals.

Make an effort to spend responsibly. Make a list of all bills you get each month, and then check them off your list as you pay them. That way, if you didn’t receive a bill, you still realize it has to be paid. Spreadsheets are a great way to keep track of expenditures. Once a year, list your assets and debts to get a sense of your net worth. Now you have a true road map of where you have been and can move more efficiently toward your current financial destination!