Money Management
A Parent’s Guide to Setting a Successful Budget for a College Student
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The post A Parent’s Guide to Setting a Successful Budget for a College Student appeared first on Penny Pinchin' Mom.

 You are getting ready to send your child off to college. Before you start helping them pack their belongings, there is one thing you need to do. You need to help them create a budget. You need to teach them how to manage their money so they can learn the tools they’ll use long after ... Read More about A Parent’s Guide to Setting a Successful Budget for a College Student

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Smart Moves to Make with Your Tax Refund
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The post Smart Moves to Make with Your Tax Refund appeared first on Penny Pinchin' Mom.

It is tax season! You know the goal is not to get much of a refund. However, a refund is always better than paying in! But when that money shows in your account don’t go and blow it on what you want!  Make some smart moves with your refund. Pay off debt If you have ... Read More about Smart Moves to Make with Your Tax Refund

The post Smart Moves to Make with Your Tax Refund appeared first on Penny Pinchin' Mom.

Is Costco Membership Worth it for Gas Alone?
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The post Is Costco Membership Worth it for Gas Alone? appeared first on Penny Pinchin' Mom.

I grew up in Kansas, but have lived in San Diego for the past four years. Instinctively, I knew gas prices would be more expensive in California. No matter, I thought. My Costco membership card might just dampen the blow from gasoline costs. But I had my doubts. Is a Costco membership worth it for ... Read More about Is Costco Membership Worth it for Gas Alone?

The post Is Costco Membership Worth it for Gas Alone? appeared first on Penny Pinchin' Mom.

How Knowing Your Happiness Style Can Help Your Marriage
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It's important to discover your own personal happiness style so you can fill your life with activities that make you, as an individual, happy.

The post How Knowing Your Happiness Style Can Help Your Marriage appeared first on Bible Money Matters and was written by Melissa. Copyright © Bible Money Matters - please visit biblemoneymatters.com for more great content.

How to Pay Off Credit Card Debt Faster
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I've received several questions from Money Girl podcast listeners about paying off credit card debt. It's a fundamental goal because carrying card balances come with high interest, a waste of your financial resources. Instead of paying money to card companies, it's time to use it to build wealth for yourself.

7 Strategies to Pay Off Credit Card Debt Faster

1. Stop making new card charges

If you're carrying card balances from month-to-month, it's essential to understand what it costs you. As interest accrues, it can double or triple the original cost of a charged item, depending on how long it takes you to pay off.

The first step to improving any area of your life is to acknowledge your mistakes, and financing a lifestyle you can't afford using a credit card is a biggie. So, stop making new charges until you take control of your cards and can pay them off in full each month.

As interest accrues, it can double or triple the original cost of a charged item, depending on how long it takes you to pay off.

Yes, reining in your card spending will probably require sacrifices. Consider ways to earn extra income, such as starting a side gig, finding a better-paying job, or selling your unused stuff. Also, look for ways to cut costs by downsizing your home, vehicle, memberships, or unnecessary expenses.

2. Consider your big financial picture

Before you decide to pay off credit card debt aggressively, look at the "big picture" of your financial life. Consider any other debts or obligations you should prioritize, such as a tax delinquency, legal judgment, or unpaid child support. The next debts to pay off are those already in default or turned over to a collection agency.

In many cases, not having a cash reserve is why people get into credit card debt in the first place.

Assuming you don't have any debts in default, focus your attention on your emergency fund ... or lack of one! I recommend maintaining a minimum of six months' worth of your living expenses on hand. In many cases, not having a cash reserve is why people get into credit card debt in the first place.

3. Make more than the minimum payment

Many people who can pay more than their monthly minimum card payment don't do it. The problem is that minimums go mostly toward interest and don't reduce your balance significantly.

For example, let's assume your card charges 15% APR, you have a $5,000 balance, and you never make another purchase on the card. If your minimum payment is 4% of your card balance, it will take you 10½ years to pay off. And here's the worst part—you'd have paid almost $2,400 in interest!

4. Target debts with the highest interest rates first

Make a list of all your debts, including credit cards, lines of credit, and loans. Include your balances owed and interest rates charged. Then rank your liabilities in order of highest to lowest interest rate.

Getting rid of the highest interest debts first saves you the most.

Remember that the higher a debt's interest rate, the more it costs you in interest per dollar of debt. So, getting rid of the highest interest debts first saves you the most. Then you can use the savings to pay more on your next highest interest debt and so on.

If you have several credit cards, evaluate them the same way—tackle them in order of highest to lowest interest rate to get the most bang for your buck. And if a credit card isn't the most expensive debt you have, make it a lower priority.

In general, debts that come with a tax deduction such as mortgages, home equity lines of credit, and student loans, should be paid off last. Not only do those types of debt have relatively low interest rates, but when some or all of the interest is tax-deductible, they cost you even less on an after-tax basis.

5. Use your assets to pay off cards

If you have assets such as savings and non-retirement investments that you could use to pay down high-interest credit cards, it may make sense. Just remember that you still need a healthy cash reserve, such as six months' worth of living expenses.

If you don't have any or enough emergency money saved, don't dip into your savings to pay off credit card debt. Also, consider what you could sell—such as unused sporting goods, jewelry, or a vehicle—to raise cash and increase your financial cushion.

6. Consider using a balance transfer card

If you can’t pay off credit card debt using existing assets, consider optimizing it by moving it from higher- to lower-interest options. That won’t make your debt disappear, but it will reduce the amount of interest you pay.

Balance transfers won’t make your debt disappear, but they will reduce the amount of interest you pay.

Using a balance transfer credit card is a common way to optimize debt temporarily. You receive a promotional offer during a set period if you move debt to the account. By transferring higher-interest debt to a lower- or zero-interest card, you save money and use it to pay down the balance faster.

7. Consolidate your high-rate balances

I received a question from Sarah F., who says, “I love your podcast and turn to it for a lot of my financial questions. I have credit card debt and am wondering if it’s a good idea to get a personal loan to pay it down, or is that a scam?”

And Rachel K. says, "I love listening to your podcasts and am focused on becoming more financially fit this year. I have a couple of credit cards with high interest rates. Would it be wise for me to consolidate them to a lower interest rate? If so, will it hurt my credit?" 

Depending on the terms you’re offered, using a personal loan can be an excellent way to reduce interest and get out of debt faster.

Thanks to Sarah and Rachel for your questions. Consolidating credit card debt using a personal loan is not a scam but a legitimate way to shift debt to a lower interest rate.

Having an additional loan added to your credit history helps you build credit if you make payments on time. It also works in your favor by reducing your credit utilization ratio when you reduce your credit card debt.

If you qualify for a low-rate personal loan, here are some benefits you get from debt consolidation:

  • Cutting your interest expense
  • Getting a fixed rate and term (such as 6% APR for 60 months with monthly payments of $600)
  • Having one monthly debt payment
  • Building credit

A couple of downsides of using a personal loan to consolidate debt include:

  • Being tempted to continue making credit card charges
  • Having potentially higher monthly loan payments (compared to minimum credit card payments)

While it may seem counterintuitive to use new debt to get out of old debt, it all comes down to the interest rate. Depending on the terms you’re offered, using a personal loan can be an excellent way to reduce interest and get out of debt faster.

What should you do after paying off a credit card?

Credit cards come with many benefits, such as purchase protection, convenience, and rewards. Don't forget that they're also powerful tools for building credit when used responsibly. If maintaining good credit is one of your goals, I recommend that you keep a paid-off card open instead of canceling it.

You don't need to carry a balance from month to month or pay interest on a credit card to build excellent credit.

To maintain or improve your credit, you must have credit accounts open in your name, and you must use them regularly. Making small purchases charges from time to time that you pay off in full and on time is enough to add positive data to your credit reports. You don't need to carry a balance from month to month or pay interest on a credit card to build excellent credit.

To learn more about building credit and getting out of debt, check out Laura’s best-selling online classes:

  • Build Better Credit—The Ultimate Credit Score Repair Guide
  • Get Out of Debt Fast—A Proven Plan to Stay Debt-Free Forever
How To Invest In REIT – Are REITs good investments?
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Are REITs good investments? How much money do you need to invest in REITs? How do I start investing in REITs? These are all questions that will be answered today.
How This Former Zookeeper Paid Off Over $40,000 In Debt
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Hey! Today, I have a great debt payoff story to share from Steffa Mantilla. She paid off $40,000 in debt so that she could be a stay at home mom and start a business. Enjoy! My husband CJ and I have been married for over a decade.  You’d think with all that time married would […]

The post How This Former Zookeeper Paid Off Over $40,000 In Debt appeared first on Making Sense Of Cents.

Pizza Delivery is for Millionaires
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My son and I are having a beautiful Saturday night here at home. The sun is setting over the mountains outside my bedroom window and I’ve just finished baking a pizza which I am about to serve up for his dinner. Although our day has been very simple, there has been an underlying magic within […]
How to Reassess Your Finances After Unexpected Job Loss
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Going through life you can always expect the unexpected. Here are 5 ways to reassess your finances to put you on your best path forward.

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The post How to Reassess Your Finances After Unexpected Job Loss appeared first on MintLife Blog.

Mint Money Audit 6-Month Check-In: How Did Michelle Allocate Her Windfall?
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In March I offered some financial advice to Michelle, a Mint user who was struggling with debt, a lack of retirement savings and a bit of family financial drama amongst her siblings. Michelle was anticipating a cash bonus from her...

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The post Mint Money Audit 6-Month Check-In: How Did Michelle Allocate Her Windfall? appeared first on MintLife Blog.