Good money saving habits have much to do with knowing when to act – when to push, and when to pull, when to give and when to take, etc.
It is important to be able to respond to the ups and downs of interest rates to the best of your ability. When interest rates go up, you need to be able to push your expenses down. When interest rates go down, you can allow your debt to rise. Essentially, you should try to use money when it is the “cheapest”. One of the best ways to play this game might be to consolidate your debt and use the resulting savings as effectively as possible.
The asset in which most of us keep our money (or more accurately, our debt) is in a house. While people sometimes feel that they cannot afford to buy a home, understand that renting is not saving. While renting, you are incapable of securing more money. Below you will find valuable tips about using home equity and debt consolidation as your savings strategy.
Transferring Credit Card BalancesThe average American family has an $8,000 credit card debt. Using debt consolidation to pay off credit cards is one of the most tempting, but misused, ways of tapping into home equity. On the other hand, getting a handle on credit is quite essential to maintaining effective savings.
A whopping 70% of people who use equity to pay off debt end up owing at least the same amount again within two years. In other words, it is easy to use your relief as a life vest instead of a swimming course. In the absence of a savings strategy, people waste the great potential of refinancing. If you are dealing only with credit cards and truthfully are unwilling or unable to change your spending habits, then there may be another way to manage your debt.
Look for zero-percent credit cards. Consumers have the potential to save hundreds of dollars by consolidating high-interest credit cards into to one zero-interest card. However, you must commit to saving. Always read the fine print. Most 0 % interest offers carry serious restrictions such as minimum balance transfers and time limits for the interest rate. Typically, most offers last six months. For many people, this can mean significant savings, but others try to move from one 0% card to another 0 % card at the end of the introductory period. While hopping from card to card may work, it also may put negative points on your credit.
Avoid PanickingRecent increases in the cost of buying a home have led some to advise that it is better to rent than to buy a home. The problem with this kind of “front page news” advice, however, is that the front page always changes. Do not let individual expert opinions change your long-term savings plan. You can be sure that when interest rates drop, investors will rush right back into the market.
Some aspects of home ownership never change. Managing debt through consolidation always is a smart strategy to get (and to keep) a home. With credit so easily available to so many people, consolidating debt just makes sense. No matter what any given expert says at any given moment, the simple, unchanging truth is that consolidating debt should always be a strategic part of pushing and pulling money to and from the piggy bank.
For more information on savings strategies, see part II of this article.
Understanding Credit Monitoring Services
You don't want to live in your parents' garage or risk not getting a loan when you most need it. Credit monitoring services can help prevent bad credit caused by identity theft, but are they worth the cost?
Credit Monitoring: How it can HelpCredit monitoring services can help minimize problems caused by identity theft and fraudulent use of your credit. Frequent credit monitoring can also be useful for rebuilding credit.
Credit Monitoring after BankruptcyRepairing your credit after filing bankruptcy can seem difficult, but it's possible. Credit monitoring is useful for cleaning up the wreckage, correcting inaccuracies, and preventing additional credit problems.
Your Credit Rights After Bankruptcy: Discharged Debts and Zero BalancesRebuilding your credit should be at the top of your priorities after filing for personal bankruptcy. During this process, keep a close eye on your credit report as items can often be reported incorrectly by the credit reporting agencies. In general, all discharged debts should be reported as zero balances after bankruptcy. Often they are reported incorrectly and can end up hurting your credit more than necessary. To avoid these mistakes, understand your credit rights as a consumer even under the stain of bankruptcy.
What Happens to Cosigners When You File For Bankruptcy?Bankruptcy is a very powerful financial tool that can affect the lives of those surrounding the debtor. Cosigners of debt should pay special attention as they are often not protected by someone else's bankruptcy.
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