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How to Reduce Your Debt By 60% or More

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When overwhelmed with debt it is sometimes helpful to set a specific debt reduction percentage goal. If you have a specific figure in mind it makes your goal seem more realistic and achievable.  If you really want to make significant progress, set a goal to reduce your debt by as much as 60 percent in a set period of time.

Time to Pay Off Your Debt
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1. Call your creditor to attempt to negotiate the balance first. It’s rare, but creditors will sometimes agree to decrease the balance in order to make it more affordable for paying off. This is a measure most common for consumers who can prove financial hardship.

2. Sign up for a debt management plan with a reputable credit counseling service to cut down the balance. Debt management program providers can sometimes convince creditors to lower the balance owed. Then they sign you up for a payoff program with one payment per month. If you have multiple debt accounts, your creditors may refer you to a non-profit credit counseling service to discuss this option instead of a direct negotiation. Contact the National Foundation for Credit Counseling to more information.

3. Pay off some or all of your debt with your current savings, if you have any. In many cases, the interest cost on debt far exceeds the interest yield on a savings account. For instance, if you’re paying 12 percent per year on a debt account and earning 2 percent per year on a savings account, both with the same balance you’re essentially losing 10 percent per year. So if you have debt of $5,000 dollars and wish to shave off 60 percent, withdraw $3,000 dollars from your savings and apply it toward paying down the principal. Build up your savings again slowly but surely over the coming months with the money you save in debt interest payments.

4. Use an online amortization or debt payoff calculator to estimate the monthly payment required to shave off 60 percent of your debt in a set number of months. Put that extra amount toward additional principal on your account each month until you reach your goal. You may have to play with the figures when performing the online calculation to find a monthly payment amount you can manage.

Tips:

Some debt agreements may have a prepayment penalty, which means that you will have to pay an additional fee if you pay the balance off sooner than planned. Check with your lender in advance.

 

 

Is Living a Debt-Free Cash-Only Lifestyle Possible?

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Before the economic crisis of 2008, credit was doled out so freely that getting into debt was an accepted way of life. It was almost considered normal for a family to carry multiple credit cards with balances reaching into the thousands or to withdraw all of the equity from a home in exchange for regular interest-heavy payments.

Fifties
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But since credit became more difficult to secure an increasing number of consumers have had to learn how to live a cash-only lifestyle.

What does that mean? Simply put it means that if you can’t afford to pay cash for what you want to buy you cannot have it.

So if you don’t have $2,000 for a brand new 42-inch flat screen television you must enjoy it in the store and then go home to your trusty 27-inch. If you don’t have $15,000 sitting in a savings account to pay for the brand new car you want, you buy the beater for $800 that reliably transports you from point A to point B.

It means no loans. No credit cards. No “buy now pay later” deals. Cash-only is a serious lifestyle adjustment, but it is possible to live a fruitful life without relying on credit to get by?

Make Cuts

The first step to living a debt-free cash-only lifestyle is to revamp your budget. Your budget should allow you to pay your required bills and also have enough discretionary cash leftover to take care of your basic needs—that way you do not have to look to a loan or credit line to get by from week to week or month to month. If you take a close look at your budget, chances are that you’ll identify one or more places where you can make some cuts.

Use Envelopes

Once you have your budget in place you need a way to manage the cash that you’ll be spending throughout the week or month. The envelope system is a reliable method. Withdraw the cash you need for your other living expenses from your account (avoid using debit cards because it is too easy to overspend) and divide it up into individually labeled envelopes. For instance, use one envelope for groceries, one for entertainment and another for car expenses.

Saving Cash

If you do have a large purchase in mind, such as a car or television, you have to save cash for it. That is the name of the game when you live a cash-only lifestyle. You cannot always receive what you want immediately — you may have to wait and save.

Remember the good old days when you had to save up your allowance to buy that bike you wanted? Well you have to go back to that way of thinking. Credit was designed to give you immediate satisfaction but it also gives you long-term pain. When you save money toward your goal you may have to wait a while for the pleasure, but you get the long-term satisfaction of knowing that you bought it cash and no one can come after you for interest.

Cut Up Those Credit Offers

As you continue your cash-only lifestyle you may find that over time credit card companies will come calling with offers. That’s because they desperately want a piece of your income, which you’ve finally learned how to manage responsibly. Cut up those offers immediately and contact all three major credit bureaus to request to have your name removed from all of their marketing lists.

When you live a debt-free cash-only lifestyle you put yourself in a position of power. You are not a slave to interest and collections on the items you’ve purchased in order to live a normal lifestyle. You (and you alone) are in full control of your financial future.

5 Totally Sweet Things Cats Do When They Love You

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imageSo how do you know when your cat loves you? Here are five really sweet things that cats do when they adore you.

1) They try to bite (clean) you. When cats are very young they learn from their mothers how to clean themselves. The cleaning process involves biting the area gently and then licking. So when you see a cat doing that ( usually to your fingers) do not think he’s trying to hurt — he’s really trying to help you out with a bath! If it becomes annoying just gently stroke him on the head, thank him and move him out of your space.

2) They follow you around everywhere you go. I have had my share of “cat shadows” — they follow me everywhere that I go in the house from the bathroom to the kitchen to my work area, where they sit at my feet . When I’m outside doing yard work the cat tries to squeeze himself into the screen as if that will allow him to get to me. Cats do this when they have grown very attached to you and want to know where you are at all times.

3) They snuggle with you when you’re feeling down. Cats seem to have some type of sixth sense in knowing when you are feeling depressed or sad. They will come close to you and snuggle up to you when they sense that you’re sad.

4) They purr loudly when in your presence. A cat is very happy with you when he purrs very loudly. The purr is almost like a rumbling it’s so deep and intense.

5) They blink. When a cat blinks it is a sign that he is content and happy. If your cat stares at you and continually blinks slowly that is his way of saying I love you and I’m happy to have you in my life.

 

Written by: Lynn

Lynn Gilliard is a writer and author of life and dating advice books. Her latest work is Survive, Live or Thrive?

Managing Personal Finances: The Envelope Method

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For many people using debit cards on a daily basis has become the norm. A debit card is convenient, handy and keeps your cash safe. However, cards also tend to cause overspending.

How? Well, with cash when the last dollar is spent the shopping trip is over. With a credit or debit card you don’t really have anything to stop you from continuing to spend. Of course, you do have a limit (either your credit card limit or the amount in your bank account) but the temptation to spend outside of your personal spending budget is very strong.

One of the best ways to avoid overspending with cards is to use the envelope method of managing your personal finances.

What Is It?

The envelope method is just a simple and “old school” way of managing your money. Before credit and debit cards, people had to buy things using cash and checks. When you use envelopes you are reverting back to that mentality — simply withdraw cash when you get paid and divvy it up into envelopes labeled by spending category, such as food, entertainment, and gas. When the money in each envelope is spent, the spending stops. It forces you to be more fiscally responsible with your hard-earned money.

How to Do It

You can start using the envelope method starting today. First look at your budget to determine the different expenditure categories. Grab a stack of standard mailing envelopes and label one for each of those categories.

When your pay comes, take the total designated amount out of the bank and divide it up into each envelope according to your budget. Stash the envelopes away in a very safe place (think of it as a personal bank) and only go to that place when you need to make a “withdrawal” to take care of those needs.

Many people prefer to keep large amounts, such as rent and car payments in the account to pay online with an ACH draft or personal check. Also, try to find a bank that won’t charge you an expensive monthly maintenance fee for falling under a certain amount in your checking account.

Leave the Cards at Home

The next requirement of using the envelope method is that you make a personal commitment to leave all of your debit cards at home when you shop and run errands. Eliminate the temptation completely. The only time you may need your debit card is when you need to withdraw cash at an ATM for your envelopes.

Final Thought

The obvious downside of the envelope method is that you have to handle a lot of cash during the month. There is always a risk of losing the cash and you can’t trace or recover it the way you would trace an amount charged to a bank account. But if you are someone who has a problem with overspending with debit cards the benefit — better money management and decreased temptations to fall outside of your budget — should outweigh the potential downsides. Just keep a close eye on your money and only carry what you need for the day.

 

 

 

3 Tips for Parenting in the Age of Social Media

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Parenting in the new millennium has become more challenging for parents due to the rise in social media. Social media sites have become a large part of many of our everyday lives. The Pew Research Internet Project estimates that as of May 2013, 74 percent of adult women and 62 percent of men were users of social networking sites. The numbers are even higher for teens with an 81 percent social media usage rate according to the Pew Internet & American Life Project.

So as a parent you now have technology bursting at the seams. In addition to all of your other duties, you must now teach your children how to use and navigate social media sites with thought and care for their safety and well-being. They can access these sites from a cellular phone, iPad or laptop just about anywhere. Children don’t know it, but they may face real dangers by having the internet at their fingertips at all times. It is the parent’s responsibility to ensure their safety and educate them on these matters. Here are a few habits and rules that you should consider establishing with your children before allowing them to access any and all social media sites.

Set an Internet Access Curfew

For many school age children, the day begins at the crack of dawn. Your child requires a proper night’s rest in order to perform to his fullest ability while at school. Allowing your child to have internet access in his bedroom at all times of the day and night is a mistake. Your child must be taught early on that internet access is a privilege — not a right. Set a firm curfew when Internet access is shut down for the evening. You can just change the password on your router at a certain hour.

Parental Controls

As a parent, you should understand and utilize parental controls to monitor your child’s Internet activity while she is online. First, have a discussion with your child regarding what social media sites are acceptable to visit while using the internet. Let her know that parental controls are in place. Make it clear that any deviation from the rules you set at this meeting will not be tolerated and consequences will be implemented. When the child knows that you’re monitoring her internet usage, she’ll think twice about visiting certain sites and making certain comments online. Many cell phone companies also offer parental control features.

Discretion and Privacy

When you discuss Internet use with your child, take time to talk about appropriate behavior. Some young children and teens think that it’s perfectly fine to share every detail of their lives online, such as their whereabouts and private pictures of themselves hanging out at parties. They don’t realize that in many cases, your social media presence as a youngster cannot ever be erased from history. Explain the consequences of oversharing, including but not limited to:

1)      The possibility of challenges getting into college or finding work in the future if a hiring manager finds questionable social media activity.

2)      Strangers can easily save their pictures.

3)      People they don’t know (including marketers) can gather private information about them that could be used in many different ways for financial gain.

Parenting is a job that requires love, support, patience and diligence. Children should be taught to be aware of all risks to their safety and future, including those that present themselves on social media sites. They need to understand that giving the world full access to their everyday life is not the best idea. Implement these social media tips for parents and instill healthy Internet usage habits in your child starting today.

Sources:

pewinternet.org/fact-sheets/social-networking-fact-sheet/

marketingland.com/pew-the-average-teenager-has-425-4-facebook-friends-44847

4 Keys to Happiness

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Many people make the mistake of putting their happiness in the hands of others. They believe that significant others, family members and friends are responsible for making them happy. But if you rely on other people to make you happy, you’ll be devastated when they let you down or leave you. Focus on these four simple keys to happiness — all of which depend solely on you.

Live Up to Your Own Expectations
If you spend your life focused on what other people think of you, you are putting yourself at the mercy of those other people. Whenever you do not live up to their expectations, it instantly makes you unhappy. This happens a lot when children pursue careers only because it’s what their parents want.

Your goal should be to set and attempt to meet your own expectations based on what you value and care about. If you like to dance, then dance. If you like the way you dress, then dress that way. It is your prerogative.

Find a Place of Peace
In the hustle and bustle of life it is easy to get caught up in a negative atmosphere around negative or toxic people. Find a place where you can go to get away from that hectic atmosphere and find some peace—even if it is just for a short while each day. That respite might be a park nearby or a quiet coffee shop. You might even be able to escape the chaos of your everyday life through meditation in a quiet corner of your home. Make time for yourself.

Identify What You Love About Yourself
Self-love is a key component of a happy life. If you do not even love yourself, you won’t have much to be happy about—especially when others don’t openly show love to you. Also, you will portray your lack of love for yourself on the world, and it creates a vicious cycle of unhappy relationships, feelings and situations.

Force yourself to sit in the mirror each day and take a very long look at yourself. Search for and reflect on what makes you beautiful and unique—these traits aren’t just physical, but also related to your character or personality. Maybe you are witty or have a great laugh. Maybe your eyes are clear and bright. Maybe you have a great, confident walk that makes you look like a queen or king. Focus on those things. Do this exercise as often as possible until you identify those traits that make you awesome and unique. The beauty is there in each of us—it just might take some time to see it for yourself.

Forgive
When you hold onto anger and resentment it grows and grows, making you more and more unhappy with each thought. Have the courage to release whatever or whoever is making you upset. It’s okay to remember the offense so that you will not repeat the scenario in the future, but be bold enough to forgive the offender and move on to better pastures.

Start with these four simple tips to achieve genuine personal contentment. When you finally realize that you are totally in charge of your own destiny, happiness is not far behind.