Debt Management http://www.wisebread.com/taxonomy/term/7681/all en-US Save Money on Interest with the BankAmericard&reg; Credit Card http://www.wisebread.com/bankamericard-credit-card-review <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/bankamericard-credit-card-review" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_000019952359_Large.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>Simple credit cards such as the <a href="http://ct.wisebread.com/click.php?pg=150&amp;pid=16&amp;pp=0&amp;uv=sname1">BankAmericard&reg; credit card</a>, which do not provide all the extra bells and whistles like rewards and bonuses, are designed primarily to provide a low-interest opportunity for those who typically carry a balance from month to month. Transferring your balance to a card with a lower interest rate will save you money in interest fees. Plus, the BankAmericard&reg; credit card offers an introductory APR of 0% on qualifying balance transfers for 18 billing cycles. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">Best 0% Balance Transfer Credit Cards</a>)</p> <h2>How This Card Works</h2> <p>There is an introductory APR of 0% for balance transfers made within the first 60 days of opening your account. The intro APR will last 18 billing cycles, then the APR will be 11.24% - 21.24% Variable APR on purchases and balance transfers, according to your credit worthiness and the prime rate. There is no annual fee.</p> <h2>Other Benefits</h2> <p><strong>ShopSafe</strong>. Bank of America&reg; credit cards include ShopSafe, a feature designed to provide extra protection when you shop online. If you sign up for ShopSafe, you are issued a temporary credit card number, expiration date, and security code, for using when you shop online.</p> <p><strong>Museums on Us&reg;</strong>. Get free admission to 150+ participating museums, science centers, botanical gardens and more on the first full weekend of every month when you present your Bank of America credit card and a photo ID.</p> <h2>Costs</h2> <ul> <li>$0 Annual Fee</li> <li>11.24% - 21.24% Variable APR for purchases and balance transfers (0% Intro APR on balance transfers made within the first 60 days for 18 billing cycles)</li> <li>Up to 29.99% Penalty APR</li> <li>3% Balance Transfer Fee, or $10, whichever is greater</li> <li>3% Foreign Transaction Fee</li> <p><a target="_top" href="http://ct.wisebread.com/click.php?pg=150&amp;pid=16&amp;pp=0&amp;uv=sbutton2 "><img alt="" class="img-exempt" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a></p> <h2>Pros</h2> <p><strong>0% APR for balance transfers</strong>. If you need to transfer a balance from a card with a high APR, you can save money in interest by transferring to this card and paying it down within 18 billing cycles. This is one of the longest durations available for 0% interest rates on balance transfers, with many cards offering 12 months at the most.</p> <p><strong>Low APR</strong>. Although it is recommended that you pay your balance in full each month in order to avoid paying high amounts of interest on your purchases, if you typically carry balances from month to month, cards with low interest rates are the most economical.</p> <h2>Cons</h2> <p><strong>0% only on balance transfers</strong>. The introductory APR of 0% does not apply to purchases. Many credit cards offer an introductory APR of 0% for purchases also. This allows you to save money in interest if you need to make a large purchase when you open the account. (See also: <a href="http://www.wisebread.com/0-apr-credit-cards">Best 0% Intro APR Credit Cards</a>)</p> <p><strong>Balance transfer fee</strong>. Although this card offers one of the longest introductory APRs for transferring balances, you have to keep in mind that there is still a balance transfer fee. The balance transfer fee of $10 or 3% can be costly if you have a large balance to transfer. You should also consider whether or not you can pay the entire balance down within the 0% period, or you might end up paying more, instead of saving money. (See also: <a href="http://www.wisebread.com/5-best-credit-cards-with-no-balance-transfer-fees">Best Cards without Balance Transfer Fees</a>)</p> <p><strong>No rewards program</strong>. Low-interest credit cards generally do not offer rewards programs as the focus is on providing the lowest interest rate possible. However, if you consistently pay your balance in full each month, you are missing out on valuable rewards you could be earning with your purchases. The <a href="http://www.wisebread.com/get-more-cash-back-for-the-essentials-the-bankamericard-cash-rewards-card">BankAmericard Cash Rewards&trade; credit card</a> and <a href="http://www.wisebread.com/bankamericard-travel-rewards-more-rewards-for-more-travel">BankAmericard Travel Rewards&reg; credit card</a> offer cash and travel rewards respectively.&nbsp;</p> <p><strong>Foreign transaction fee</strong>. The foreign transaction fee of 3% can quickly add up if you use your card frequently for foreign purchases. If you travel abroad, the BankAmericard Travel Rewards&reg; credit card does not charge a foreign transaction fee, and is a better card for making foreign purchases. (See also:&nbsp;<a href="http://www.wisebread.com/smarter-security-and-no-foreign-transaction-fees-the-best-credit-cards-to-use-while-on-vacation">Best No Foreign Transaction Fee Cards</a>)</p> <h2>Who This Card Is Best For</h2> <p>The BankAmericard&reg; credit card is a simple and straightforward credit card, best for those who consistently carry balances from month to month. It is also best if the majority of your purchases are domestic, and if you can pay down a balance transferred from a credit card with a high APR.</p> <p style="text-align: center;"><a href="http://ct.wisebread.com/click.php?pg=150&amp;pid=16&amp;pp=0&amp;uv=send"><strong>Click here to learn more and apply for the BankAmericard&reg; Credit Card today!</strong></a></p> </ul> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christina-majaski">Christina Majaski</a> of <a href="http://www.wisebread.com/bankamericard-credit-card-review">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/retire-your-credit-card-debt-with-citi-simplicity-card">Retire Your Credit Card Debt With Citi Simplicity Card</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/high-credit-limit-and-low-apr-unity-visa-secured-credit-card">High Credit Limit and Low APR: UNITY&amp;reg; Visa Secured Credit Card</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The 5 Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-secured-credit-cards">The 5 Best Secured Credit Cards</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps">How to Rebuild Your Credit in 8 Simple Steps</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Debt Management Bank of America credit card review Wed, 10 Feb 2016 22:44:16 +0000 Christina Majaski 1645519 at http://www.wisebread.com Flashback Friday: 39 Inspiring Stories and Tips to Help You Beat Debt http://www.wisebread.com/flashback-friday-39-inspiring-stories-and-tips-to-help-you-beat-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/flashback-friday-39-inspiring-stories-and-tips-to-help-you-beat-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_happy_victory_000078187401.jpg" alt="Woman learning how to beat debt with tips and inspirational stories" title="" class="imagecache imagecache-250w" width="250" height="143" /></a> </div> </div> </div> <p>Having debt sucks. It weighs on you like a metaphorical stack of bricks piled high on each shoulder, pushing you closer to a pit of despair with every minimum-only payment made. Of course, having some debt is good for your credit, and helps to build a solid credit history, but most debt is just suffocating.</p> <p>Since we're all still in New Year's resolution mode and working hard to stay focused on achieving our goals this year, we've decided to round up our favorite pearls of wisdom relating to debt management. Hopefully, these debt management tips will keep you locked in on clearing that pesky debt from your life &mdash; and sparing your shoulders from more suffering.</p> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/couple-happy-snow-travel-178492223-small.jpg" width="605" height="340" alt="" /></p> <p><a href="http://www.wisebread.com/how-one-couple-paid-off-147k-of-debt-even-while-unemployed">How One Couple Paid Off $147k of Debt (Even While Unemployed)</a> &mdash; If you need an extra push to get you inspired, this true tale about a couple who got their finances in tip-top shape while unemployed will do the trick.</p> <p><a href="http://www.wisebread.com/5-inspiring-people-who-each-paid-off-over-100000-in-debt?ref=seealso">5 Inspiring People Who Each Paid Off Over $100,000 in Debt</a> &mdash; Here are five real-life stories of debt-fighting superheroes who conquered their debt demons and are currently living financially, happily ever after.</p> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/female-graduate-176844972-small_0.jpg" width="605" height="340" alt="" /></p> <p><a href="http://www.wisebread.com/how-one-college-graduate-paid-off-28000-in-three-years-on-a-30k-salary?ref=seealso">How One College Graduate Paid Off $28,000 in Three Years on a $30K Salary</a> &mdash; A common misconception about debt management is that you need to be wealthy in order to bring your accounts from red to black. That's simply not true, and this story of a college grad clearing over 25k in debt on a modest salary serves as proof.</p> <p><a href="http://www.wisebread.com/10-dark-side-motivations-to-get-you-out-of-debt?ref=seealso">10 Dark-Side Motivations to Get You Out of Debt</a> &mdash; Ever wonder how exactly you ended up in debt in the first place? These common debt traps could be the source. Here's how to avoid them forever.</p> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/couple_stressed_finances_000062304938.jpg" width="605" height="340" alt="" /></p> <p><a href="http://www.wisebread.com/do-this-if-you-have-too-much-credit-card-debt">Do This If You Have Too Much Credit Card Debt</a> &mdash; Credit card debt might be the most stressful kind of debt, because it's so easy to get into and so so hard to escape. But it is doable, and these tips will get you there.&nbsp;</p> <p><a href="http://www.wisebread.com/how-one-inspiring-saver-found-true-love-shook-off-debt-denial-and-paid-off-123000?ref=seealso">How One Inspiring Saver Found True Love, Shook Off Debt Denial, and Paid Off $123,000</a> &mdash; Paul Amato was a young dentist drowning in debt. Everything changed for him the moment he decided to face the problem head on and stay vigilant in paying it down. He even found love in the process.</p> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/modern-businesswoman-470761315-small.jpg" width="605" height="340" alt="" /></p> <p><a href="http://www.wisebread.com/how-one-young-entrepreneur-paid-off-40000-in-student-debt-by-age-24">How One Young Entrepreneur Paid Off $40,000 in Student Debt By Age 24</a> &mdash; The incredible journey of Michelle Schroeder and how she managed to clear 40k in student loan debt before she was even able to rent a car will truly inspire you. I mean, talk about impressive.</p> <p><a href="http://www.wisebread.com/15-great-things-you-could-do-if-you-just-got-rid-of-your-debt">15 Great Things You Could Do If You Just Got Rid of Your Debt</a> &mdash; Thinking about all the ways you could spend your time and extra cash sans debt is a powerful tool to keep you focused on your goal. Make a post-debt bucket list and keep on truckin'!</p> <p><em>What are some of the ways you've managed your debt? Share with us in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/chrissa-hardy">Chrissa Hardy</a> of <a href="http://www.wisebread.com/flashback-friday-39-inspiring-stories-and-tips-to-help-you-beat-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/flashback-friday-122-scrumptious-super-bowl-party-snack-ideas">Flashback Friday: 122 Scrumptious Super Bowl Party Snack Ideas</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/flashback-friday-119-amazing-meals-you-can-make-from-a-can">Flashback Friday: 119 Amazing Meals You Can Make From a Can</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/flashback-friday-wise-breads-88-best-food-hacks-ever">Flashback Friday: Wise Bread&#039;s 88 Best Food Hacks Ever</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/snowballs-or-avalanches-which-debt-reduction-strategy-is-best-for-you">Snowballs or Avalanches: Which Debt Reduction Strategy Is Best for You?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-fastest-method-to-eliminate-credit-card-debt">The Fastest Method to Eliminate Credit Card Debt</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management budgeting debt management fbf flashback friday money hacks Fri, 22 Jan 2016 18:00:04 +0000 Chrissa Hardy 1643287 at http://www.wisebread.com 7 Ways Being Debt Free Can Cost You http://www.wisebread.com/7-ways-being-debt-free-can-cost-you <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-ways-being-debt-free-can-cost-you" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/cloud_of_debt_000083150391.jpg" alt="Man learning ways being debt free can cost him" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Here at Wise Bread, we generally hate debt. Owing money to banks and credit card companies is usually a guaranteed way of never achieving the financial freedom you want. But there are cases when taking on some debt can be useful, especially as part of a long-term plan.</p> <p>Here are seven times when eschewing debt can be a bad financial move.</p> <h2>1. Market Returns May Be Higher Than Interest Rates</h2> <p>When interest rates are very low and the stock market is booming, you may be missing out on investment gains by choosing to live debt-free. For example, let's say you had $20,000 left on a mortgage with a 3.5% interest rate. If you had the cash, you <em>could</em> pay off your mortgage and avoid paying any additional interest. Or, you could put two-thirds of that money in the stock market and get a good return.</p> <p>There's a chance you'd end up with more cash in the long-run under the second scenario. This is why even super wealthy people are known to mortgage their homes. There is some risk here, especially if you don't have a fixed-rate mortgage.</p> <h2>2. Healthy Economies Rely on Debt</h2> <p>Whether we like it or not, we live in a consumer-driven economy. And one of the key ways for the economy to grow is through people spending. In an ideal world, spending can increase because people are earning more. But it's often credit card debt that fuels much of the growth.</p> <p>While too much personal debt can be a drag on the economy, some nations have found that high savings rates can make the economy sluggish. In fact, there are some nations &mdash; including Germany and China &mdash; that have sought to <em>encourage </em>more spending by their citizens. This is not an invitation to go on a spending spree, but it's worth noting that it helps to have some big spenders in our ranks.</p> <h2>3. You Might Miss Out on Opportunities</h2> <p>It's always best to try and achieve your goals without taking on debt, but sometimes there isn't much choice if you're cash poor and set on pursuing a dream. Taking on a manageable student loan to attend college could be seen as a better decision than not going at all. Borrowing to buy a car so you can make it to a well-paying job might be worth it. Taking out a loan to start a business is a common practice. If you're missing out on opportunities because you're averse to all debt, it may be worth loosening up. Just be careful not to dig yourself a hole you can't get out of.</p> <h2>4. Renting Stinks</h2> <p>There are some people who are so averse to risk that they refuse to even consider taking on a mortgage for a home. That's fine if you have the ability to pay for it all in cash, but very few of us can do that. Buying a home, even if you have to take on a 30-year mortgage, is generally a good long-term financial move, because you're building equity as you make payments. Owning a home is considered a great step on the path to wealth. Just be sure that the payments are easy for you to handle.</p> <h2>5. You Can't Build Credit</h2> <p>There's a weird paradox with credit, which is that you can't be approved for loans or credit cards until you've shown that you can pay back loans and make credit card payments. People who never borrow may have no debt, but they may also have very low credit scores because of a lack of credit history. This means that when they eventually do need a loan, they may end up with a high interest rate &mdash; if they are even approved at all.</p> <p>Credit card debt can be burdensome if you're not careful, but your credit score will rise if you keep at least a <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score">modest balance on a credit card</a> and make payments on time. If you pay your credit card balance in full each month, you can still avoid debt and build a credit history.</p> <h2>6. You've Depleted Your Emergency Fund</h2> <p>Let's say you have $12,000 left on a mortgage and $13,000 in the bank. You <em>could</em> pay off the mortgage and celebrate owning your home free and clear. But then you have just $1,000 left, which isn't really enough to cover an emergency. While it may be tempting to try to pay down debt as quickly as possible using any money you have, it's important to maintain a decent-sized emergency fund to handle any unexpected costs from &quot;life events.&quot;</p> <h2>7. Frugal Isn't Always Fun</h2> <p>When you're in your early 20s, it's tempting to go out with friends, travel, and take on new experiences. But when you're young, you're also probably broke. No one wants to be 22, living at home and unable to even go out for as much as a pizza with friends. There's an argument to be made that being <em>too </em>focused on avoiding debt will cost you some good life experiences. Taking on a small amount of debt could be okay when you're young, as long as you understand how it can impact your long-term goals and have a solid plan to be debt-free once you start earning more.</p> <p><em>When has taking on some debt improved your life &mdash; and your finances?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/7-ways-being-debt-free-can-cost-you">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The 5 Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps">How to Rebuild Your Credit in 8 Simple Steps</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-this-if-you-have-too-much-credit-card-debt">Do This If You Have Too Much Credit Card Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-comprehensive-guide-to-the-debt-snowball-method-0">A Comprehensive Guide to the Debt Snowball Method</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management credit score Economy emergency funds interest rates market returns Fri, 22 Jan 2016 14:00:04 +0000 Tim Lemke 1643167 at http://www.wisebread.com Beware of These Common Debt Consolidation Traps http://www.wisebread.com/beware-of-these-common-debt-consolidation-traps <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/beware-of-these-common-debt-consolidation-traps" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_concerned_paperwork_000082590043.jpg" alt="Man learning to beware of common debt consolidation traps" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You've vowed to eliminate your credit card debt, but your bills are too overwhelming. You're ready to consider a final option: debt consolidation.</p> <p>It's true that consolidating your debts can make it easier to eliminate them. But debt consolidation can come with its own financial traps. Because of these potential pitfalls, consumers should be wary before signing up for debt consolidation. Bruce McClary, vice president of external affairs and public relations for the Washington D.C.-based National Foundation for Credit Counseling, says that sometimes, it makes more sense to consider other options.</p> <p>&quot;Debt consolidation is not always the right choice,&quot; McClary explains. &quot;It is not a free service. And often, you can take care of your debt on your own, if you change your spending habits and take a more disciplined approach to paying off your existing debt.&quot; (See also:&nbsp;<a href="http://www.wisebread.com/5-tricks-to-consolidating-your-debt-and-saving-money">5 Tricks to Consolidating Your Debt and Saving Money</a>)</p> <p>Here are the most common debt consolidation traps to avoid.</p> <h2>1. A Sky-High Interest Rate</h2> <p>In debt consolidation, a company will combine your debts into one single monthly payment that you can afford. In theory, it's a low-stress way to tackle what would otherwise be overwhelming.</p> <p>But even if your monthly payment is lower, this doesn't mean that you won't be spending too much. Some debt consolidation companies charge high interest rates to go along with the new monthly payment plans they set up for their clients. Make sure you ask your debt consolidation company what interest rate they'll charge you. If it seems too high, look elsewhere.</p> <h2>2. High Fees</h2> <p>Debt consolidation isn't free. But some debt consolidation firms soak their clients with especially high fees, either in the form of monthly or upfront charges.</p> <p>Again, make sure you know exactly what fees your debt consolidation company plans to charge you. Request a list of these fees in writing so that there's no confusion. If the firm won't provide this information to you, don't work with it. You want to work with a company that is clear about how much it charges.</p> <h2>3. Consolidating the Wrong Debt</h2> <p>Some forms of debt are worse than others. Credit card debt with high interest rates, for instance, is the bad kind of debt. But debts with low interest rates, such as auto loans or student loans, are generally considered good debt.</p> <p>You might be tempted to consolidate all of your debts into a single monthly payment. But rolling low-interest-rate debts into your monthly payment might be a poor financial decision depending on the interest rate of your new debt consolidation loan.</p> <p>When taking out a debt consolidation loan, focus on your debts with the highest interest rates. Pay off your low-interest-rate debt on your own.</p> <h2>4. Running Up Your Debt Again</h2> <p>Taking out one debt consolidation loan is bad enough. But if you don't change your spending habits, you might find yourself facing overwhelming debt again, even after paying off a debt consolidation loan.</p> <p>Consolidating your debt is treating the results of your bad spending habits. This isn't the same as treating the reasons for your bad spending.</p> <p>Once you've entered debt consolidation, it's time to determine why you ran up your debt in the first place. Maybe you spend when you are anxious. Maybe you overspend in an effort to keep up with your neighbors. Maybe you've never learned how to make and stick to a budget. If you don't address the reasons behind your overspending, you run the real risk of piling up debt yet again.</p> <p><em>Have you tried debt consolidation to eliminate debt? Did it work?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/beware-of-these-common-debt-consolidation-traps">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The 5 Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-being-debt-free-can-cost-you">7 Ways Being Debt Free Can Cost You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-this-if-you-have-too-much-credit-card-debt">Do This If You Have Too Much Credit Card Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-comprehensive-guide-to-the-debt-snowball-method-0">A Comprehensive Guide to the Debt Snowball Method</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management consolidation fees interest rates spending habits traps Wed, 20 Jan 2016 14:00:03 +0000 Dan Rafter 1638728 at http://www.wisebread.com Ask These 4 Important Questions Before Signing Any Loan http://www.wisebread.com/ask-these-4-important-questions-before-signing-any-loan <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/ask-these-4-important-questions-before-signing-any-loan" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_with_papers_000021456485.jpg" alt="Woman asking important questions before signing any loan" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You're ready to apply for that big loan, whether it's a mortgage for a new house, student loans to pay for your college education, or a way to finance your first new car. But the debt you take on will be with you for years in the form of regular monthly payments. How can you be certain that you're ready for this financial commitment?</p> <p>Financial experts say it's normal to be nervous before taking on a new loan, no matter what it's for. Still, you can ease some anxiety by asking the right questions before taking on your new responsibility. What you learn might surprise you &mdash; and help you decide whether that loan is really what you need.&nbsp;</p> <h2>1. How Much Do I Really Need to Borrow?</h2> <p>Before applying for any new loan, determine how much you <em>really </em>need to spend. Many times, lenders might offer you the option to take out a larger loan than you actually need. If you're taking out a mortgage, for instance, you might be able to take out a loan for more than what the home is worth, and then use the extra dollars to pay for improvements to the property. (See also:&nbsp;<a href="http://www.wisebread.com/ask-yourself-these-5-questions-before-buying-a-home">Ask Yourself These 5 Questions Before Buying a Home</a>)</p> <p>But Andrew Josuweit, chief executive officer of Student Loan Hero, warns borrowers to only take out loans for what they really need.</p> <p>&quot;It can be tempting to take on a larger loan than necessary and have some extra play money,&quot; Josuweit said. &quot;But that extra play money will end up costing you down the line. The larger the loan, the more interest you will pay. Only borrow what you need to avoid paying thousands of dollars in additional interest charges.&quot;</p> <h2>2. Can I Afford My Monthly Payment?</h2> <p>This is the most important question of all: Can you afford to make your monthly payments after taking out a loan? If not, whatever you are borrowing money for will seem like a burden, not a pleasure.</p> <p>A rule of thumb for determining whether a monthly loan payment is in your budget is to calculate your gross monthly income &mdash; your income before taxes are taken out &mdash; and your total monthly housing expenses, including whatever your new loan payment will be. You'll want your housing expenses to total 36% or less of your gross monthly income.</p> <h2>3. How Much Will My Loan Cost Me on Closing Day?</h2> <p>It's also important to determine whether you can afford the closing costs associated with your actual loan. Some loans come with high upfront fees. David Hosterman, branch manager with Castle &amp; Cook Mortgage in Greenwood Village, Colorado, says this is especially true with a mortgage loan. Closing costs for such loans &mdash; everything from property taxes to underwriting fees &mdash; can run thousands of dollars. Can you come up with the money to pay for these, or will you have to roll these costs into your loan, increasing your monthly payment?</p> <p>&quot;Such items as taxes, insurance, and mortgage insurance can have a major impact on a customer's payment,&quot; Hosterman said. &quot;Customers need to make sure these items are explained to them and that the information is provided to them so they can have a clear picture as to what the total payment on the loan would be.&quot;</p> <h2>4. How Much Does This Loan Cost Each Year?</h2> <p>When shopping for loans, consumers too often focus on only the interest rate. This number is important, of course, but what's even more important is something called the annual percentage rate, or APR.</p> <p>This figure tells you how much your loan will cost &mdash; including fees &mdash; over the course of one year, and is a more accurate measure of how much you're really spending on your loan.</p> <p>&quot;APR is the holy grail of loan cost,&quot; said Priyanka Prakash, finance specialist at FitBiz Loans. &quot;You should never commit to a loan without knowing the APR.&quot;</p> <p>Anthony VanDyke, president of ALV Mortgage in Salt Lake City, gives a good example of how important APR is. Say you are taking out a 60-month auto loan for $10,000 and are offered either a loan with an interest rate of 5% and $500 in upfront fees, or one with an interest rate of 7% and no fees. Which loan is better?</p> <p>This isn't easy to discover without knowing the APR. But if you do know the APR, you'll know that the second loan, despite its higher interest rate, is actually cheaper over its lifespan. The first loan choice comes with an APR of 7.124%, while the second loan comes with an APR of just 7%.</p> <p>&quot;The loan with the highest interest rate is actually the cheapest loan option, but most people see the lower interest rate and unwisely choose option A,&quot; VanDyke said.</p> <p><em>Have you borrowed recently? What questions did you ask before signing the paperwork?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/ask-these-4-important-questions-before-signing-any-loan">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-it-ever-okay-to-cosign-a-loan">Is It Ever Okay to Cosign a Loan?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-times-when-its-okay-to-take-a-loan">6 Times When It&#039;s Okay to Take a Loan</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-loan-options-for-those-with-good-credit">5 Loan Options for Those With Good Credit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-paying-off-student-loans-early-can-boost-your-finances">7 Ways Paying Off Student Loans Early Can Boost Your Finances</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/stop-is-that-loan-too-big-for-your-wallet">Stop! Is That Loan Too Big For Your Wallet?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management affordability borrowing loans monthly payments questions to ask Mon, 18 Jan 2016 14:00:03 +0000 Dan Rafter 1638137 at http://www.wisebread.com Try These 6 Money-Saving Challenges Now http://www.wisebread.com/try-these-6-money-saving-challenges-now <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/try-these-6-money-saving-challenges-now" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_challenging_savings.jpg" alt="woman challenging herself to save big this year" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Do you have a major goal to spend less or save more in 2016? I'm sure many of us do. But if you're anything like me, you need a challenge to get the motivation going. Frank L. Smoll, Ph.D., writing in <em>Psychology Today</em> explains that <a href="https://www.psychologytoday.com/blog/coaching-and-parenting-young-athletes/201311/keys-effective-goal-setting">effective goal-setting in sports </a>is all about the ABCs:</p> <p>A: The goal should be Achievable.</p> <p>B: It should also be Believable.</p> <p>C: And you've got to be Committed to working on it.</p> <p>The same principles apply to any sort of goal you set out to reach. Looking for a place to start? Here are six money-saving challenges to get your own creative juices flowing.</p> <h2>1. No New Clothing</h2> <p>Clothing is a huge expense for a lot of us (pointing the finger at myself here). According to the Bureau of Labor Statistics, the average American household&nbsp;<a href="http://www.bls.gov/news.release/cesan.nr0.htm">spends over $1,700 on apparel</a> each year. That's a whole lot of sweaters and slacks. Why not try giving up this line item with a No New Clothing Challenge?</p> <p>Try digging in the back of your closet to assess all your options &mdash; then live with what you have. Still need to buy? You can always find steals on second-hand clothing (especially for kids!) at thrift shops or garage sales. You may also want to host a clothing swap or make a more minimalist wardrobe. (See also: <a href="http://www.wisebread.com/8-essential-pieces-for-your-capsule-wardrobe?ref=seealso">8 Essential Pieces for Your Capsule Wardrobe</a>)</p> <h2>2. Buy Nothing New Challenge</h2> <p>Beyond your fixed bills and a few necessities, do you think you could buy nothing new for a month? Maybe longer? Assya Barrette at <em>Alternet</em> went on a <a href="http://www.alternet.org/culture/i-bought-nothing-new-200-days-and-why-you-should-too">Buy Nothing New Challenge</a> for a whopping 200 days. (Wise Bread writer Max Wong <a href="http://www.wisebread.com/the-compact-mindfullness-and-frugality-through-buying-used">bought nothing new</a> for more than a year!) Outside of basic food, toiletries, and medicines, Barrette did acquire a few things borrowed or gently used.</p> <p>But the lesson was about way more than saving money. Throughout the process, she discovered that a lot of our material possessions just aren't necessary to live a full, happy life. Breaking the habit of mindless shopping is another benefit of this challenge. Start small and try this idea for a week, month, or &mdash; if you dare &mdash; even longer.</p> <h2>3. 52-Week Money Challenge</h2> <p>The concept is simple and likely familiar: You start by saving $1 in your first week, $2 in the second, and so on. By the end of the <a href="http://media1.onsugar.com/files/docs/52weekmoneychallenge.pdf">52-Week Money Challenge</a>, you enjoy a total savings of $1,378. Some of my friends have even done the challenge in reverse, starting with the $52 and counting down to zero.</p> <p>If you're not so disciplined with stashing savings, this challenge can be a great way to start an emergency fund or to put away cash for another purpose in your life. If structure scares you, you can also try dumping all your leftover change or dollar bills into a jar each night. At least it's a step in the right direction!</p> <h2>4. Debt-Free Challenge</h2> <p>Don't you get so jealous when you hear someone has paid off all of his or her debts? I know I do. Shift that energy into starting your own debt-free challenge. Many of my friends swear by Dave Ramsey's Debt Snowball Plan where you focus on one debt at a time (usually with the smallest balance first) and knock them out until they're all gone. Where exactly can you find extra cash to pay down the debt? Try selling your unused stuff on Craigslist, lowering your variable expenses and extras, and just plain saving. (See also: <a href="http://www.wisebread.com/pay-down-debt-and-get-cash-back-with-these-6-services?ref=seealso">Pay Down Debt and Get Cash Back With These 6 Services</a>)</p> <p>On the flip side, you could also work on not creating any <em>new </em>debt this year. Live within your means, skip tempting store card incentives, leave the credit cards at home, or save up for what you want and enjoy delaying gratification. It'll all be worth it when you look back at 2016 and bask in your smart spending.</p> <h2>5. Grocery Savings Challenge</h2> <p>Food is the big budget-suck in our home. Between regular grocery runs, takeout, and other edible incidentals, we spend a wad on what we eat. Check out this <a href="http://www.thekitchn.com/can-a-pantry-challenge-really-save-you-money-223065">Pantry Challenge</a> at The Kitchn. You'll dig deep into the cupboards and freezer drawers to use up what's hiding back there. Try this challenge for a week or a month, and repeat as often as you like. You can surely save hundreds this way over time and get better satisfaction that you're not letting anything spoil.</p> <p>Getting into the habit of regular meal planning helps lower your grocery bill as well. First, you'll know exactly what to buy at the store &mdash; nothing more. Second, you'll waste less food because everything has a plan. Start by finding some easy recipes you love, write out all the ingredients on your list (and try to get some to overlap from meal to meal), then stick to the plan. (See also: <a href="http://www.wisebread.com/how-to-eat-well-on-just-20-a-week-with-meal-plans?ref=seealso">Eat Well on Just $20 a Week</a>)</p> <h2>6. Create Your Own Challenge</h2> <p>Maybe you don't see your own spending vice on this list. That's okay. You can make your own challenge. Try setting and adhering to a budget if you haven't already. Get rid of cable and challenge yourself to free entertainment this year. Stop going out to eat or quit the gym and workout at home for free. There are so many ways you can save, so take some time to brainstorm a list, make a plan, and then get going.</p> <p><em>What are your money-saving goals for 2016?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-marcin">Ashley Marcin</a> of <a href="http://www.wisebread.com/try-these-6-money-saving-challenges-now">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-psychological-traps-preventing-you-from-saving-and-how-to-fix-them">4 Psychological Traps Preventing You From Saving — And How to Fix Them</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-tricks-to-beating-budget-burnout">5 Tricks to Beating Budget Burnout</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-live-on-12-000-a-year">How to live on $12,000 a year</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-allocate-your-cash-when-you-are-broke">How to Allocate Your Cash When You Are Broke</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-your-smartphone-saves-you-money">8 Ways Your Smartphone Saves You Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Debt Management money goals new year's resolutions saving money savings goals Mon, 18 Jan 2016 10:00:07 +0000 Ashley Marcin 1637556 at http://www.wisebread.com The 7 Best Credit Card Debt Elimination Strategies http://www.wisebread.com/the-7-best-credit-card-debt-elimination-strategies <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-7-best-credit-card-debt-elimination-strategies" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000064784921.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Burdened with thousands of dollars of consumer debt? Do you dread reading your credit card statements each month? There is hope. You can pay down your credit card debt fast. But first, you have to stop using your cards to make new purchases.</p> <p>And before you start paying off that debt, know this: You're far from alone. It can be difficult to track down just how much credit card debt the average cardholder is paying off, but in the spring of 2015, CardHub released a study showing that those households that carry a balance on their credit cards have an average debt of almost $7,200.</p> <p>How do you remove yourself from this statistic, and do it (fairly) quickly? Here are seven tools you can try.</p> <h2>1. Stop Charging</h2> <p>No debt repayment plan will work if you keep adding to your credit card balances. So make a vow to stop charging gas, groceries, or clothes. Buy only what you can afford to purchase in cash. Breaking the credit card habit can be challenging, but doing so will give your efforts to eliminate your consumer debt a huge boost.</p> <h2>2. Pay More Than the Minimum</h2> <p>You can't just pay the minimum monthly required payments on your credit cards if you want to eliminate your debt quickly. You'll simply be paying a ton of interest while whittling away at that debt.</p> <p>Here's an example. Say your credit card balance is $6,000, your card's interest rate is 18.9% percent, and your minimum required payment each month is 4% of your balance. If you only pay that minimum each month, it will take you 144 months &mdash; or 12 years &mdash; to pay off your debt, and that's only if you never make any additional charges with that card. While paying this debt off, you'll pay a total of about $9,750, or about $3,750 in total interest.</p> <p>The lesson here is obvious: No matter how you choose to tackle your debt, always pay more than the minimum each month.</p> <h2>3. Choose a Repayment Method</h2> <p>There are two good ways to approach paying off debt, and both can help you eliminate your credit card balances quickly.</p> <h3>Snowball Method</h3> <p>This is when you pay the minimum required monthly payment on all of your credit cards <em>except for one</em>. Use the majority of the money you have each month for paying down your debt on this last card. How you choose this card is up to you: Some consumers will pick the card with the lowest balance so that they can quickly pay it off. Others will choose the card with the highest interest rate so that they can eliminate their debt that grows the quickest each month.</p> <p>But once you pay off your targeted card, repeat the process: Pick another card to spend most of your debt-reducing dollars on and pay the minimum on the rest of them. If you stay at this long enough, you'll eventually eliminate all of your credit card debt.</p> <h3>Debt Ladder Method</h3> <p>In the debt ladder method, you'll list all your credit cards from the one with the highest interest rate to the one with the lowest. Then, much like with the snowball method, you'll spend most of your money each month paying down the card with the highest interest rate while paying the minimum required monthly payment on the rest of your cards.</p> <p>Once you pay off the card with the highest interest, you'll then move to the next card on your list, spending most of your money on that debt until it, too, is paid off.</p> <p>The difference between the snowball and debt ladder methods is subtle: With the debt ladder method, you'll always target the card with the highest interest rate. In the snowball method, you might do this, but you might also go after the cards with the lowest balance first so that you can more quickly snowball the dollars you have available for other accounts.</p> <h2>4. Take Out a Home Equity Loan</h2> <p>Do you own a home? Do you have equity in it? If so, you might consider taking out a home equity loan to pay off all or most of your high-interest-rate credit card debt.</p> <p>If your home is worth $250,000 and you owe $180,000 on your mortgage loan, you have $70,000 worth of equity. A mortgage lender might give you a home equity loan of, say, $50,000. You can then use that $50,000 to pay off credit card debt.</p> <p>The benefit of a home equity loan &mdash; or a home equity line of credit, which is similar but works more like a credit card than a standard loan &mdash; is that such loans come with lower interest rates. It makes sense to swap low-interest debt for high-interest credit card debt. But be sure to pay your home equity loan back on time. If you don't, you could lose your home.</p> <h2>5. Use Your Savings</h2> <p>It's important to have savings. Your savings account can act as an emergency fund, one that can help you cover the costs of unexpected expenses such as a furnace that suddenly conks out in the middle of winter.</p> <p>But if you have thousands of dollars in savings and are paying off thousands of dollars of credit card debt, it might make sense to use those savings to eliminate your high-interest debt. Think of it this way: Your credit card debt might have an interest rate of 19% or higher. The odds are that your savings account is paying you interest of less than 1%. It makes sense to get rid of that credit card debt that is growing so quickly each month. (See also: <a href="http://www.wisebread.com/when-to-use-savings-to-pay-off-debt?ref=seealso">When to Use Savings to Pay Off Debt</a>)</p> <p>Once you do erase your credit card debt, though, build your savings back up each month. You don't want to be without an emergency fund for too long.</p> <h2>6. Do a Balance Transfer to a 0% APR Card</h2> <p>A key factor in repaying your credit card debt expediently is your interest rate, since a lower rate reduces not only your minimum monthly payments, but also the total amount you'll repay on the debt. A common technique for obtaining a lower rate is transferring your credit card balances to a card with a 0% APR. There are a few caveats worth considering, however. (See also: <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?ref=seealso">When to Do a Balance Transfer to Pay Off Credit Card Debt</a>)</p> <p>First, most 0% APR credit card offers are for a limited period &mdash; say, six or 12 or 15 months. Therefore, you should only transfer the amount of balance that you expect to be able to repay in that amount of time. After the introductory 0% APR period expires, the interest rate on your new card &mdash; and any remaining transferred balance &mdash; will rise, leaving you again with a higher interest rate. So make it a priority to pay off all the transferred balance during the 0% APR period. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=seealso">Best 0% Balance Transfer Credit Cards</a>)</p> <p>Second, it's important to understand that balance transfers often come with a fee, usually expressed as a percentage of the amount transferred. (The <a href="http://www.wisebread.com/chase-slate-visa-review">Chase Slate</a> card is a rare one that has zero intro balance transfer fee as well as a 0% Intro APR.) So, any savings you achieve by transferring to a zero percent card should exceed the total of the fees. If you meet these two conditions, however, a balance transfer can help you reduce your repayment time significantly.</p> <h2>7. Get a Personal Loan With a Lower APR</h2> <p>Another means for lowering your interest rate involves paying off part or all of your balance using a personal loan with a lower APR than your card offers. A variety of lenders, ranging from your local credit union or bank to online lenders, such as LendingClub can potentially offer rates below your credit card's. (See also: <a href="http://www.wisebread.com/should-you-use-peer-to-peer-lending-to-pay-down-credit-card-debt?ref=seealso">Should You Use Peer-to-Peer Lending to Pay Down Credit Card Debt?</a>)</p> <p>However, it's again worth noting the terms of the loan. Are there any fees associated with a personal loan that might make it less economical? Can you afford the repayment schedule and terms (the higher your credit score, the better these will be)? If you can't, you may just be trading one type of debt for another. But if the personal loan's terms are favorable, you'll likely have an opportunity to repay your debt faster &mdash; and save significantly in the process.</p> <p><em>Did you retire a mountain of credit card debt? How'd you do it?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/the-7-best-credit-card-debt-elimination-strategies">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-you-can-t-stick-with-a-budget">Why You Can&#039;t Stick with a Budget</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-inspiring-people-who-each-paid-off-over-100000-in-debt">5 Inspiring People Who Each Paid Off Over $100,000 in Debt</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-fastest-method-to-eliminate-credit-card-debt">The Fastest Method to Eliminate Credit Card Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-tricks-to-save-money-with-credit-cards">10 Tricks to Save Money with Credit Cards</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Debt Management debt home equity loans minimum balance savings spending Thu, 17 Dec 2015 14:00:04 +0000 Dan Rafter 1622170 at http://www.wisebread.com 8 Surprising Ways to Pay Off Your Student Loans http://www.wisebread.com/8-surprising-ways-to-pay-off-your-student-loans <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-surprising-ways-to-pay-off-your-student-loans" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/student_loan_debt_000042931066.jpg" alt="Learning surprising ways to pay off student loans" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you went to college, chances are you have student loan debt. Personally, I'm on the 20-year payback plan, and while I'm comfortable with my payments now that two out of three loans are paid in full, the first seven to eight years post-college were extremely hard on my wallet. If you're in a similar situation, there may be some relief in your future. Consider these eight surprising ways to pay off your student loan debt a little faster. (See also: <a href="http://www.wisebread.com/should-you-refinance-your-student-loan?ref=seealso">Should You Refinance Your Student Loan?</a><strong>)</strong></p> <h2>1. Volunteer With SponsorChange.org</h2> <p>When I graduated college, I was 100% job focused. I had to find full-time employment right away to pay my rent, gas, food, bills, and of course, my student loans. The job search took up most of my time, and when I finally landed a position, that took up even more of my time. After making ends meet, I certainly didn't have much time to volunteer for activities I enjoyed or support causes I believed in.</p> <p>And that right there is what I love about&nbsp;<a href="http://www.sponsorchange.org">SponsorChange.org</a>. Their mission is to connect volunteers with social impact organizations that provide a $10 to $20 per hour stipend for participation in meaningful skill-based project opportunities. The concept is simple: Organizations list projects on the SponsorChange.org site to attract the talent they need. Volunteers &mdash; that's you &mdash; can find projects and build their skills doing something they love by earning money that will go directly toward student loans. It's a win-win for everybody, and you don't have to feel one bit guilty about it. (See also: <a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness?ref=seealso">8 Ways to Get Student Loan Debt Forgiveness</a>)</p> <h2>2. Find Student Employment Through Start Jobs</h2> <p>If you're still in school or even a recent grad, you'll want to check out<a href="http://www.startjobs.net"> Start Jobs</a>, an organization that connects students to paying jobs in the field they want to start a career. This allows them to gain the experience necessary to land that first big job right out of college, in turn either taking on less student debt or paying it down faster.</p> <p>&quot;Start Jobs was ranked by Inc.com as one of the best four websites for <a href="http://www.inc.com/samuel-edwards/great-job-sites-for-recent-college-graduates.html">college graduates seeking jobs</a>, listed alongside LinkedIn, Indeed, and CareerBuilder, and it's the only site specifically created for current students and recent graduates for the purpose of attacking the ever-expanding student debt crisis,&quot; according to Start Jobs Community Manager Bryce Hamlin.</p> <h2>3. Accept Help From Your Post-College Employer</h2> <p>The student loan crisis has gotten so bad in recent years that employers are now stepping up to help their workers pay down debt quicker. Price Waterhouse and Coopers, for instance, recently announced that it would help its junior employees (roughly 46,000 staffers) with paybacks starting next year. Eligible employees will receive $1,200 a year for up to six years for student loans. The money will be paid directly to the loan provider, though it will still count as income for employees.</p> <h2>4. Play Givling, an Online Trivia Game</h2> <p><a href="https://givling.com/givling/">Givling</a> is a pay-to-play online trivia game that is making crowdfunding interactive and fun. Three months after its launch this past spring, it paid off contestant <a href="http://www.businessinsider.com/this-student-had-his-32000-student-loan-paid-off-by-signing-up-for-an-online-trivia-game-and-he-didnt-even-play-2015-7">Kevin Foster's $31,625 loan</a> and it will pay off the next loan in the queue &mdash; which amounts to $97,000 &mdash; soon. The best part? You don't even have to play the game yourself. You have to sign up, of course, but participation in the trivia games isn't necessary to win.</p> <p>According to Business Insider, &quot;Separately, trivia gamers sign up and are randomly placed into teams of three. Team members answer true or false questions to rack up points. The highest-scoring funding team is eligible for a $4 million prize. In addition to the large $4 million prize, there are smaller daily prize amounts awarded.&quot;</p> <p>Givling costs $0.50 to play a round and an additional $0.30 for a transaction fee. Players also receive one free game a day.</p> <h2>5. Earn Supplemental Income Through Peer-to-Peer Services</h2> <p>Thanks to the &quot;sharing economy&quot; &mdash; which was largely established by the still-growing popularity of peer-to-peer services &mdash; you can make extra cash by renting out items you already own, like your home or car, or offering services like dog sitting.</p> <p>I've rented out a guest bedroom in my home to tourists for the past seven years on Airbnb, and I'm also listed as a dog sitter on DogVacay, in order to bring in extra income. I have a full-time job just like everyone else, and I still have time to manage both of these additional revenue streams. If you have mounting debt from student loans, these peer-to-peer service are a highly effective way of bringing in serious cash &mdash; if you're wholly committed to your endeavors' success &mdash; that you can put toward your payback.</p> <h2>6. Charge Part of the Balance to a No-Interest Credit Card</h2> <p>It's not the ideal solution to use a credit card to pay down other debts, but if the interest rate makes more sense on plastic than it does from you loan repayment terms, it might be a smart move to make a swipe. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">Best Credit Cards with 0% Intro Offers</a>)</p> <p>&quot;Using Great Lakes (a loan provider), we were able to call and make a one-time payment using a credit card,&quot; says Douglas Hutchings, who has student-loan debt. &quot;We had an offer for 0% interest for 12 months so we picked an amount that we were confident we could pay over 12 months and charged it to the card. Due to the size of the payment, we also scored a fair amount of credit card rewards points that we plan to use for a future vacation. Between saved interest and credit card points, we came out ahead by over $2,000 for about 60 minutes of 'work.'&quot;</p> <p>See also: <a href="http://www.wisebread.com/3-private-lenders-that-can-really-save-you-money-on-your-student-loans?ref=seealso">These Private Lenders Can Really Save You Money on Your Student Loans</a></p> <h2>7. Take Out a Loan From Your 401K</h2> <p>Like using a credit card to pay down your student-loan debt, tapping into your 401K shouldn't be the first place you go for extra cash for loan payments. But if it makes sense overall &mdash; in saved interest and other benefits &mdash; it's not an altogether terrible prospect to consider.</p> <p>&quot;One of the things I did to jump start the pay down of my substantial student loans was to take out a loan from my 401K, and put the total amount towards the principal on the student loan,&quot; says Eric Meerman, a portfolio manager at Palisades Hudson Financial Group. &quot;I then kept paying the same monthly amount on the student loan, in addition to paying back the loan to the 401K. While this is not always the best idea since you don't want to miss out on the market appreciation available to stock investments in your 401K, it worked out for me because the market was virtually flat over the term of the payback period.&quot;</p> <h2>8. Live at Home With Your Parents a Little Longer</h2> <p>If mom and dad will have you, live with them a little while longer after college. Chances are they won't charge rent &mdash; or at least not as much as you would pay on your own &mdash; and you'll get lots of free services (laundry, meals, and more), which will ultimately free up more of your income to pay down your student loan debt. I have a buddy who moved back home at age 26 after a few years on his own because his expenses became too much to handle. There's no shame in it, and many of us (myself included) have been there. (See also: <a href="http://www.wisebread.com/15-ways-to-pay-back-student-loans-faster?ref=seealso">15 Ways to Pay Back Student Loans Faster</a>)</p> <p><em>Do you have other interesting ideas on how to pay off student loans? I'd love to hear your thoughts in the comments below.</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/8-surprising-ways-to-pay-off-your-student-loans">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt">5 Sobering Facts About Student Loan Debt</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness">8 Ways to Get Student Loan Debt Forgiveness</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/which-student-loan-repayment-plan-saves-you-the-most">Which Student Loan Repayment Plan Saves You the Most?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-private-lenders-that-can-really-save-you-money-on-your-student-loans">3 Private Lenders That Can Really Save You Money on Your Student Loans</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cancel-student-loans-to-save-and-receive-an-interest-free-120-day-loan">Cancel Student Loans to Save — and Receive an Interest-Free 120-Day Loan</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management Education & Training payback student loans volunteering Fri, 11 Dec 2015 18:00:18 +0000 Mikey Rox 1619235 at http://www.wisebread.com 6 Ways to Keep Holiday Spending From Blowing Debt Repayment http://www.wisebread.com/6-ways-to-keep-holiday-spending-from-blowing-debt-repayment <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-ways-to-keep-holiday-spending-from-blowing-debt-repayment" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_money_christmas_gift_000027797353.jpg" alt="Woman learning to balance holiday spending and debt repayment" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The holidays can be stressful, and not just from family or too much junk food. Money is a huge factor, too. In fact, last year, people added an average of $986 to their debt over the holidays.</p> <p>Rather than increasing your debt this holiday season, you can instead balance your spending with your repayment plan. It takes a little work, some creativity, and some juggling, but it's completely within the realm of possibility.</p> <h2>1. Prioritize Minimum Payments</h2> <p>Before you plan any holiday spending, make sure you can at least make the minimum payments on any debt repayment you currently have going.</p> <p>Sure, you want to pay more than the minimum required amount on your debt, even during the holiday season. But you have to balance your priorities. If you value spending on gifts or other holiday items more than paying down debt right now, it's probably okay to take a single month and spend differently than usual. Just make sure that you are ready to get back to your normal payment plan in the next billing cycle.</p> <h2>2. Don't Add More Debt</h2> <p>After you've set aside money for at least the minimum required payments on your debt, make a firm commitment to do whatever you need to do to keep from adding to it over the holidays. That might mean making gifts yourself or buying less than you have in the past.</p> <h2>3. Write it Down</h2> <p>Decide how much you're going to <a href="http://www.wisebread.com/the-best-credit-card-shopping-bonuses">spend for the holidays</a> and how much you want to put towards debt repayment. Then write it down. If you are deciding with a partner, make sure <em>each</em> of you writes it down. Something about the act of putting a goal on paper makes it more real, so it feels like truth and not just possibility. Keep these numbers somewhere where you can look at them before you make any purchases or payments.</p> <h2>4. Plan Ahead</h2> <p>Plan out how much you want to spend on each gift. Price out items online first to ballpark amounts. This will help you figure out what is realistic, and you may find that you can't get everything you'd planned on. Having a plan will also help you feel like your goals are achievable, and not just wishful thinking.</p> <h2>5. Creative Gift Giving</h2> <p>If you choose to prioritize debt repayment, or you simply don't have enough money to cover your minimum payments and holiday gifts, get creative. Offer to spend some one-on-one time with someone close to you. Invite them over. Make hot beverages at home, and have a nice, deep conversation.</p> <p>You can also offer to help people. Give someone a housecleaning, do some yard work, offer an evening of babysitting, and more. They will be appreciative, and you will get to give a gift that won't cost very much at all. In fact, sometimes these sorts of gifts are more thoughtful than anything you can buy.</p> <h2>6. Make Gifts Meaningful, Not Massive</h2> <p>Even if you do choose to purchase gifts, go for something meaningful over something expensive. Despite what the commercials want us to believe, a new mobile phone isn't usually a special gift. Instead, choose a smaller gift that will bring to mind a special memory that you share with someone, or that shows how well you know them.</p> <p><em>How do you plan to balance holiday spending with debt repayment? And how will you choose gifting creatively this holiday season?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/sarah-winfrey">Sarah Winfrey</a> of <a href="http://www.wisebread.com/6-ways-to-keep-holiday-spending-from-blowing-debt-repayment">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/avoid-these-5-common-holiday-budget-pitfalls">Avoid These 5 Common Holiday Budget Pitfalls</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-your-financial-habits-just-bad">Are Your Financial Habits Just Bad?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-bounce-back-from-your-holiday-splurge">How to Bounce Back From Your Holiday Splurge</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-dark-side-motivations-to-get-you-out-of-debt">10 Dark-Side Motivations to Get You Out of Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-holiday-season-costs-everyone-always-forgets-about">13 Holiday-Season Costs Everyone Always Forgets About</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Debt Management balance bills gifts giving Holidays spending Thu, 10 Dec 2015 16:00:28 +0000 Sarah Winfrey 1618553 at http://www.wisebread.com Should You Refinance Your Student Loan? http://www.wisebread.com/should-you-refinance-your-student-loan <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/should-you-refinance-your-student-loan" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000060736594.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you're struggling to pay back your student loan debt, you're far from alone. Earlier this year, Edvisors reported that members of the class of 2015 graduated from college owing an average of more than $35,000 in student loans. That's the highest this average has been.</p> <p>You can refinance your existing student loans to ones with lower interest rates. This can help you manage this debt. If your interest rate is lower, your monthly payment will be lower, too. You'll also pay less over the life of your loans, thanks to the lower interest rates.</p> <p>But there may be costs, too. If you're refinancing federal student loans into private loans &mdash; those originated by private banks and financial institutions &mdash; you'll lose the protections and programs that government-sponsored student loans provide. And that can end up hurting you in the long run, even if you lower the interest rates and monthly payments on these loans. Federal loans offer loan forgiveness, deferment, and income-based repayment protections. Most private student loans don't come with these protections.</p> <h2>Loan Forgiveness</h2> <p>If you are employed full-time in an eligible public service or non-profit job and you've made at least 120 on-time payments on your federal student loan, the government will forgive the remainder of your student-loan debt.</p> <p>The Consumer Financial Protection Bureau says that one-fourth of U.S. workers can qualify either for loan forgiveness programs or income-based repayment plans. Consider whether you'd be eligible for loan forgiveness before refinancing with a private lender. (See also: <a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness?ref=seealso">8 Ways to Get Student Loan Debt Forgiveness</a>)</p> <h2>Deferment</h2> <p>Federal student loans also come with deferment options, which give you more time before you have to start paying them back.</p> <p>You normally have six months after graduation before you have to start paying on your student-loan debt. But under federal programs, you can apply for additional deferments if you are unemployed, facing economic hardships, or are serving in the U.S. Armed Forces.</p> <p>Some private loans do offer ways to pause payments as well, but be sure you understand all the terms before making the switch. (See also: <a href="http://www.wisebread.com/3-private-lenders-that-can-really-save-you-money-on-your-student-loans?ref=seealso">3 Private Lenders That Can Really Save Money On Your Student Loans</a>)</p> <h2>Income-Based Repayment</h2> <p>The income-based repayment plan that the government offers for federal student loans can provide immediate relief if you are employed but not earning a high salary. If you are a new borrower on or after July 1 of 2014 who has no balance on a previous federal student loan, your loan payments will be capped at a maximum of 10 percent of what the government calls your discretionary income, the difference between your income and 150 percent of the poverty guideline for your family size and the state in which you live.</p> <p>Those borrowers with especially low incomes might not have to make any student-loan payments at all.</p> <p>If you make these lower payments for 25 years, and you still haven't paid off your student-loan debt, the government will forgive the remainder of what you owe.</p> <p>For more information about these and other assistance programs &ndash; they are too complex to completely sum up in this story &ndash; visit the <a href="https://studentaid.ed.gov/sa/repay-loans/understand/plans/income-driven#eligibility">Department of Education</a>. (See also: <a href="http://www.wisebread.com/which-student-loan-repayment-plan-saves-you-the-most?ref=seealso">Which Student Loan Repayment Plan Saves You the Most?</a>)</p> <h2>Refinancing</h2> <p>If you are interested in <a href="http://www.wisebread.com/what-s-the-difference-between-student-loan-refinancing-and-consolidation">refinancing your federal student loans</a>, you will have to follow certain steps.</p> <p>As with any loan application, you'll need to prove that you can afford your new monthly payments, even though they'll be lower than your current ones. Usually that means providing lenders with proof of income as well as bank statements.</p> <p>You'll also need a good credit score if you want to qualify for interest rates that are low enough to make refinancing worthwhile. Your credit score will be low if you've missed or been late on payments or if you have run up loads of credit-card debt. You'll struggle to qualify for a refinance if your credit score is under 640 on the FICO scale.</p> <p>Here are some places to consider if you'd like to apply for a refinance.</p> <p><a href="http://sofi.com/wisebread">SoFi</a>: Fixed rates range from 3.50% APR to 7.24% APR and variable rates range from 1.90% APR to 5.20% APR. Loan terms are from five years to 20 years. SoFi offers additional resources and benefits, including unemployment protection and career support.</p> <p><a href="https://commonbond.co/choose-your-loan?referrer=b75172e7076c5472bed5baec5e28309c&amp;referred">CommonBond</a>: Fixed rates range from 3.50% APR to 6.74% APR and variable rates range from 1.95% APR to 4.97% APR. Loan terms start at five years and go up to 20 years. They also allow a temporary pause in payments if you lose your job. In addition to student loans for grads, they also offer refinancing for parents with PLUS loans, and even loans for getting your MBA.</p> <p><a href="https://www.meetearnest.com">Earnest</a>: Fixed rates start at 3.50% APR and variable rates start at 1.90% APR. Earnest allows a lot of flexibility for borrowers, even allowing them to change between fixed and variable rates at no charge. Earnest also looks at additional factors beyond the traditional credit scores and income &mdash; including education, employment history and other details to get a better picture of the borrower.</p> <p><a href="http://lendkey.7eer.net/c/27771/187810/3276">LendKey</a>: Fixed rates start at 3.25% APR and variable rates start at 1.93% APR. LendKey has no origination fees and their loans are funded by community lenders like credit unions and community banks.</p> <p><em>Have you refinanced a student loan?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/should-you-refinance-your-student-loan">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness">8 Ways to Get Student Loan Debt Forgiveness</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-paying-off-student-loans-early-can-boost-your-finances">7 Ways Paying Off Student Loans Early Can Boost Your Finances</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-one-college-graduate-paid-off-28000-in-three-years-on-a-30k-salary">How One College Graduate Paid Off $28,000 in Three Years on a $30K Salary</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-it-ever-okay-to-cosign-a-loan">Is It Ever Okay to Cosign a Loan?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-s-the-difference-between-student-loan-refinancing-and-consolidation">What’s the Difference Between Student Loan Refinancing and Consolidation?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management borrowing debt deferment education loan forgiveness refinance student loans Wed, 09 Dec 2015 14:00:23 +0000 Dan Rafter 1616782 at http://www.wisebread.com Do This If You Have Too Much Credit Card Debt http://www.wisebread.com/do-this-if-you-have-too-much-credit-card-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/do-this-if-you-have-too-much-credit-card-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_stressed_finances_000062304938.jpg" alt="Couple learning what to do with too much credit card debt" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Your credit cards are maxed out and you're feeling the pressure. You're stressed and need to make a change. You're not alone.</p> <p>According to 2015 debt statistics released by NerdWallet, the average U.S. household carries just over $16,000 of credit card debt, and that number continues to climb. Here's how to overcome the stress of having too much credit card debt &mdash; and finally get a grip on your finances.</p> <h2>1. Stop Adding to the Debt Mountain</h2> <p>The first step towards regaining control of your credit card is to stop adding to the debt mountain. Cut up your credit cards, hide them away, freeze them in water &mdash; in short, do whatever you can to stop increasing the balances. If you've been relying on credit to pay essential bills, it becomes extra important to prioritize spending. Consider negotiating payment plans with your utility company, re-financing (or downsizing) your home, or other means of bringing your essential costs within budget.</p> <p>The most important part about handling too much credit card debt is to stop the bleeding in the first place. Then you can take additional measures to regain control.</p> <h2>2. Negotiate a Lower Interest Rate</h2> <p>Now that you've stopped using your credit cards, it's time to request a lower interest rate. One quick phone call could help you save hundreds of dollars in interest payments over the life of your credit card balance.</p> <p>Not all credit card companies will be open to lowering your interest rate, but it never hurts to ask. Remind them of your good standing as a customer, how long you've been with them, and any other things that may set your account apart. You can use this as leverage to get the best rate possible.</p> <p>If you're still not able to secure a lower rate, consider whether transferring some or all of your balances to a new, lower-rate credit card (<a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">ideally one with 0% APR</a>) can help. Keep in mind that balance transfers carry a cost, so any interest rate savings would need to outweigh this fee.</p> <p>See also: (<a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt">When Should You Do A Balance Transfer to Pay Down Credit Card Debt?</a>)</p> <h2>3. Work Out a Payment Plan</h2> <p>If you negotiate a lower interest rate, and find that you still just can't pay the minimum payment every month, it's time to review other options. You can start by asking for a deferment on your payments, or negotiate a new payment plan with the credit card company. Most companies are more than happy to receive any payment at all versus having a non-paying account on their books.</p> <h2>4. Limit Discretionary Spending</h2> <p>You've stopped overspending, negotiated a lower interest rate and better payment plan, so now it's time to limit your discretionary spending. This will help you make larger payments each month, which means getting rid of your debt faster, and paying less interest.</p> <p>For extra motivation and discipline, consider joining spending challenges &mdash; these range from going on a 14-day spending diet, to a 60-day cash spending challenge, to a year-long shopping ban. The point is to start out with small spending habit changes, evaluate your budget along the way, and allocate any extra savings towards your debt.</p> <h2>5. Earn Extra Income Towards Debt</h2> <p>Ask anyone who's rid themselves of debt what their secret is, and they'll likely say it was earning extra money as a way of paying off their credit card debt faster. There's only so much you can do to limit your spending &mdash; but earning extra money is a higher gear toward debt reduction.</p> <p>Seek out opportunities that allow you to earn an extra bit of money. Yes, your time may be constrained. If so, set your specific dollar amount goals, and limit your extra work to that number. Allocate all the extra funds towards your credit cards, and soon you'll have made a significant dent in your debt.</p> <p><em>How do you stay in front of your credit card debt?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/carrie-smith">Carrie Smith</a> of <a href="http://www.wisebread.com/do-this-if-you-have-too-much-credit-card-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The 5 Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-being-debt-free-can-cost-you">7 Ways Being Debt Free Can Cost You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-fastest-method-to-eliminate-credit-card-debt">The Fastest Method to Eliminate Credit Card Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-comprehensive-guide-to-the-debt-snowball-method-0">A Comprehensive Guide to the Debt Snowball Method</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management downsizing interest rates overspending payment plans Thu, 03 Dec 2015 12:00:39 +0000 Carrie Smith 1617567 at http://www.wisebread.com 5 Sobering Facts About Student Loan Debt http://www.wisebread.com/5-sobering-facts-about-student-loan-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-sobering-facts-about-student-loan-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/college_graduate_debt_000028074368.jpg" alt="College grad learning sobering facts about student loan debt" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Student loans are a catch-22. Most of us rely on them to get a college degree, which can help us earn about a <a href="http://www.marketwatch.com/story/a-college-degree-is-worth-1-million-2015-05-07">million dollars more over our lifetimes</a> than those of us without college degrees. On the other hand, the debt we've accrued can impact our financial life decades after we've graduated.</p> <p>Currently, about 40 million American borrowers collectively owe $1.2 trillion in student debt. Some might say student debt is a fair trade given the income potential with a college degree, but there are some sobering facts about student loan debt that might surprise you. Here are five that could make you re-assess higher education loans.</p> <h2>1. Each Graduating Class Becomes More Indebted</h2> <p>It should come as no surprise that the level of student loan debt is rapidly rising. While in the 2003&ndash;2004 school year, only 2% of graduates <a href="http://trends.collegeboard.org/student-aid/figures-tables/cumulative-debt-bachelors-degree-recipients-sector-over-time">carried loan burdens</a> in excess of $40,000, by 2011&ndash;2012, that number exceeded 18%, according to the College Board. And it's likely getting worse.</p> <p>In 2014, the Wall Street Journal reported that the class of 2014 was the <a href="http://blogs.wsj.com/numbers/congatulations-to-class-of-2014-the-most-indebted-ever-1368/?mod=wsj_nview_latest&amp;mg=blogs-wsj&amp;url=http%253A%252F%252Fblogs.wsj.com%252Fnumbersguy%252Fcongatulations-to-class-of-2014-the-most-indebted-ever-1368%252F%253Fmod%25">most indebted class</a> ever, with an average student loan debt of $33,000. But they didn't hold the title long. Along came the class of 2015 to claim that dubious distinction with an average student loan debt of $35,000. The number will likely continue to increase from year to year, with many college students getting deeper in debt before they're able to purchase their first home.</p> <h2>2. Student Loan Repayment Can Take Longer Than Expected</h2> <p>The standard repayment plan with a federal student loan is 10 years for a bachelor's degree. But unfortunately, many graduates are unable to pay off their student debt in just one decade. On average, it takes about 20 years to <a href="http://www.usnews.com/news/blogs/data-mine/2014/10/07/student-loan-expectations-myth-vs-reality">repay student loan debt</a> for a bachelor's degree. And if you're on a income-sensitive federal loan repayment plan, such as Income Based Repayment or Pay As You Earn, you could also be paying for up to 25 years. (See also: <a href="http://www.wisebread.com/15-ways-to-pay-back-student-loans-faster?ref=seealso">15 Ways to Pay Back Student Loans Faster</a>)</p> <h2>3. There Is a High Default Rate</h2> <p>Perhaps you see yourself finding a job shortly after graduating and paying down your debt in no time. But life doesn't always go according to plan, and keeping up with student loan payments can be more difficult than expected. In 2012, about 35% of student loan borrowers were 90 or more days behind on their student loan payments.</p> <p>Different reasons play a role in student loan default. Some graduates are unable to find work, or they end up earning less than anticipated. According to the Bureau of Labor Statistics, about 260,000 people with a college or professional degree made at or below the <a href="http://www.bls.gov/cps/minwage2013.pdf">federal minimum wage</a> of $7.25 per hour in 2013. This undoubtedly is frustrating for graduates who spend tens of thousands of dollars for the opportunity to get ahead. (See also: <a href="http://www.wisebread.com/4-times-student-loan-refinancing-can-save-you-big?ref=seealso">4 Times Student Loan Refinancing Can Save You Big</a>)</p> <h2>4. Student Debt Can Keep You at Home Longer</h2> <p>Because of high student loan debt, moving into their own apartment or buying a home after graduation is out of reach for some grads. One survey found that 27% of those with student debt<a href="http://www.bloomberg.com/bw/articles/2012-09-06/student-loans-debt-for-life%23p1"> move back in with their parents</a> after graduation. If that wasn't bad enough, another survey found that the median net worth of young households without student debt is <a href="http://www.pewsocialtrends.org/2014/05/14/young-adults-student-debt-and-economic-well-being/">approximately seven times higher</a> than the net worth of those with student debt. This could explain why 40% of young borrowers delay major purchases like a house, and why approximately 14% of young borrowers delay marriage. (See also: <a href="http://www.wisebread.com/the-definitive-guide-to-pay-as-you-earn-a-great-student-loan-repayment-plan?ref=seealso">The Definitive Guide to the Pay As You Earn Federal Student Loan Repayment Plan</a>)</p> <h2>5. You Can't Run or Hide From Student Loan Debt</h2> <p>Student loan debt can haunt you forever. You might qualify for <a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness">federal student loan forgiveness</a> after 10 years if you work in public service, but typically this is one type of debt you can't escape.</p> <p>Federal loans can be discharged or canceled if you become permanently disabled or die. Some private lenders offer this provision, but not all. And if you think bankruptcy can remove the burden of student debt, you're in for a rude awakening.</p> <p>It doesn't matter if you didn't complete your education or if you can't find a job, private and federal lenders eventually want their money. You can apply for a deferment or forbearance, which temporarily lowers or suspends monthly payments in the event of hardship &mdash; but payments eventually resume.</p> <p>Student loans &mdash; like getting an education &mdash; are serious business. Avoid compromising your financial future by borrowing wisely.</p> <p><em>How heavy is your student loan burden?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness">8 Ways to Get Student Loan Debt Forgiveness</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/a-better-way-to-rank-americas-colleges">A Better Way to Rank America&#039;s Colleges</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/share-your-thoughts-consolidating-student-loans">Share Your Thoughts: Consolidating Student Loans</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/student-loans-how-to-make-post-college-decisions">Student Loans: How to Make Post-College Decisions</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-surprising-ways-to-pay-off-your-student-loans">8 Surprising Ways to Pay Off Your Student Loans</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management Education & Training college financial aid higher education repayment student loans Mon, 30 Nov 2015 18:00:46 +0000 Mikey Rox 1616761 at http://www.wisebread.com Is It Ever Okay to Cosign a Loan? http://www.wisebread.com/is-it-ever-okay-to-cosign-a-loan <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/is-it-ever-okay-to-cosign-a-loan" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_signing_documents_000029589200.jpg" alt="Man learning if it&#039;s ever okay to cosign a loan" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Cosigning a loan is, generally speaking, a bad idea. That's because you place your own credit at risk and could be responsible for the entire amount of the loan if the other party fails to pay. There are horror stories aplenty of people who cosigned loans for friends or family members &mdash; or even just acquaintances &mdash; and found themselves in debt and with their credit ruined.</p> <p>But there may be cases where placing your name on another person's loan is acceptable, provided that you're clear on the risks. It's not uncommon for parents to cosign loans for children as they look to get established, for instance. Ultimately, cosigning a loan is a personal choice, but it's important to be aware of the downsides.</p> <p>With those words of warning out of the way, here are some times when cosigning a loan may be okay:</p> <h2>1. If You Think of the Loan as a Gift</h2> <p>It's often said that if you lend a friend or relative $500, just treat the $500 as simply a gift. If you're comfortable giving the money away, then lending it is okay, because you won't worry about getting the cash back. Similarly, when cosigning a loan, operate under the assumption that you will be the one paying whatever is owed &mdash; because you might very well end up the person on the hook. If you're comfortable with this, then go ahead and cosign.</p> <h2>2. If It's for a Child's Education</h2> <p>Student loans can be hugely beneficial to a young person, and parents may feel compelled to help children obtain the necessary financing for higher education. You may feel it's worth the risk to help your child in this way, and you may not even mind helping your <a href="http://www.wisebread.com/how-to-financially-educate-your-children">child pay the loans back</a> later. (It may be better, however, to simply help them pay through a 529 plan or similar savings if you can.) If you feel strongly about a child's educational funding needs, cosigning a student loan can be wise &mdash; provided you believe the child understands the responsibility of repayment.</p> <h2>3. If You're Helping a Family Member Build Credit</h2> <p>When you're young, building credit can be a bit of a chicken or egg problem. You can't build credit until you show you're able to pay back loans, but it's hard to get a loan without a credit history. Cosigning a loan for a young person can help them gain financial independence over time.</p> <h2>4. If You're Helping a Loved One Buy a Car So They Can Work</h2> <p>It's often hard for young people to land a good job if they don't have reliable transportation. But they may not have the means or credit history to purchase a car. Cosigning a car loan for this person could make it easier to land that job and earn income of their own. Just make sure the car they buy is affordable; borrowers shouldn't assume monthly payments disproportionate to their income. And frankly, you shouldn't cosign a loan you can't afford, either.</p> <h2>5. To Help a Family Member Secure Safe Housing</h2> <p>I once had a friend who graduated from college and moved to a new city, but wasn't earning a lot of money right away. It was hard for her to secure an apartment in a safe neighborhood because she didn't have much income, credit history, or savings. Ultimately, her father was willing to cosign an apartment lease to ensure she could live in a nicer building. Her dad took a risk, but he rested easier knowing his daughter was comfortable in her new city.</p> <h2>6. If You Know You Won't Need a Loan for Yourself Anytime Soon</h2> <p>When you cosign a loan, you put your own credit score at risk. But this only matters if you plan to borrow money in the future. If you have plenty of money in the bank and own your home and car free and clear, a ding on your credit may not impact you very much. Just be sure you have an emergency fund in place to protect against job loss, disability, and other unexpected problems.</p> <h2>7. If You've Agreed With the Lender to Certain Protections</h2> <p>It is sometimes possible to negotiate certain conditions with a lender when cosigning. For instance, you can insist that you be notified immediately if there are any late payments. This gives you a chance to intervene before the tardiness shows up on your credit history. You may also be able to get the lender to agree that you will only be responsible for the principal of the loan.</p> <h2>8. If It's for a Short Term</h2> <p>There may be ways to remove yourself as a cosigner after a time. For instance, you could ask to have your name taken off when a borrower chooses to refinance a home loan. If you are a cosigner on a credit card, you could have the borrower apply for new credit cards under his or her name only, then close the old accounts. If you can, it makes sense to try and remove yourself as a cosigner after 12 months or so, when a borrower presumably has the credit to stand on their own.</p> <p><em>Have you ever cosigned a loan? How'd it go?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/is-it-ever-okay-to-cosign-a-loan">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-10"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-paying-off-student-loans-early-can-boost-your-finances">7 Ways Paying Off Student Loans Early Can Boost Your Finances</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ask-these-4-important-questions-before-signing-any-loan">Ask These 4 Important Questions Before Signing Any Loan</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/prioritize-these-5-bills-when-youre-short-on-cash">Prioritize These 5 Bills When You&#039;re Short on Cash</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-refinance-your-student-loan">Should You Refinance Your Student Loan?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-times-when-its-okay-to-take-a-loan">6 Times When It&#039;s Okay to Take a Loan</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management borrowing cosigning credit history giving money loans student loans Mon, 23 Nov 2015 18:00:03 +0000 Tim Lemke 1615573 at http://www.wisebread.com How to Pay Less Interest on Your Credit Card Debt http://www.wisebread.com/how-to-pay-less-interest-on-your-credit-card-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-pay-less-interest-on-your-credit-card-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000060969640.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you&rsquo;ve got credit card debt, it may be hard to see the light at the end of the tunnel. Each month your payments go to reducing the debt, but it also goes to interest. And if you&rsquo;re like most people with sky-high credit card debt, your interest rate is sky-high as well. If you can get approved, <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt">transferring your balance</a> to a credit card with a lower interest rate or one with a <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">0% Intro APR on balance transfers</a> can help. But if you can&rsquo;t do that, a personal loan might be the solution. (See also: <a href="http://www.wisebread.com/should-you-use-peer-to-peer-lending-to-pay-down-credit-card-debt?ref=seealso">Should You Use Peer-to-Peer Lending to Pay Down Credit Card Debt?</a>)</p> <h2>Using Personal Loans to Tackle Credit Card Debt</h2> <p>Banks and credit unions might be willing to approve you for a personal loan with a lower interest rate than those attached to your credit card debt. But there are some warnings here: It&rsquo;s not always easy to qualify for a personal loan if you&rsquo;re already struggling with high credit card bills.</p> <p>Secondly, if you don&rsquo;t change your spending habits, the odds are high that you&rsquo;ll run your credit card debt up again after taking out a personal loan to pay it off. Then, you&rsquo;ll be stuck with your new credit card debt <em>and</em> a personal loan to pay off.</p> <p>Make sure that if you are getting new credit to help pay down debt, you have created a plan for spending that doesn&rsquo;t include racking up new debt on your old credit cards.</p> <p>Personal loans can be a good alternative. They usually come with lower interest rates than credit cards, so it costs less over the long haul to pay these back. In essence, when you take out a personal loan, you&rsquo;ll be swapping credit card debt that comes with higher interest rates for the same amount of debt at more reasonable rates.</p> <p>You still have to pay your debt back &mdash; it just doesn&rsquo;t generate as much interest each month, which means you can get rid of your debt faster.</p> <h2>How to Find Personal Loans</h2> <p>If you think a personal loan might be a good fit for you, here are some places to start.</p> <p><a href="http://sofi.com/wisebreadPL">SoFi</a> has some of the lowest rates available for personal loans, starting at 5.50% for fixed and 4.05% for variable. There are no origination fees like many peer to peer loans and you can choose from three, five, or seven-year terms. They also provide unemployment protection which allows you to pause your payments while you&rsquo;re looking for a new job. <a href="http://sofi.com/wisebreadPL">Click here to learn more about SoFi personal loans</a>.</p> <p><a href="http://www.jdoqocy.com/click-2822544-12188828-1431034321000">Upstart</a> looks beyond your credit score and income when underwriting loans. They take into account the college you attended, area of study, academic performance, and even work history. This offers investors more information to decide to approve a loan and borrowers the opportunity to show more evidence of their ability to pay back the loan. APR starts as low as 4.66% but they only offer three-year terms.</p> <p><a href="http://www.dpbolvw.net/click-2822544-11789034-1427835327000">Avant</a> offers personal loans as low as $1,000 up to $35,000. Their APR starts on the high side, at around 9.95% for loans between 24&ndash;60 months. There are no origination fees.</p> <p><a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=26230639&amp;fot=9999&amp;foc=1" rel="nofollow">PersonalLoans.com</a> provides access to potential lenders for various types of loans, such as peer to peer loans, personal installment loans, and bank personal loans. They send your loan application to their affiliates and if approved, you can review the agreement and decide whether to accept.</p> <p><a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=22964539&amp;fot=9999&amp;foc=1" rel="nofollow">Prosper</a> is the original peer to peer loan site, with APRs starting at 5.99% for loans $2,000&ndash;$35,000. Their competitor is Lending Club so it might be helpful to compare rates between the two. Keep in mind that there are often origination fees associated with these types of loans.</p> <p><a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=22949027&amp;fot=9999&amp;foc=1" rel="nofollow">Lending Club</a> is a peer to peer marketplace that matches borrowers with investors. For some people with low credit scores, this may be the best option to get a personal loan, since some investors may be willing to take on higher risk loans than traditional banks. Keep in mind there are origination fees.</p> <p><a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=26228790&amp;fot=9999&amp;foc=1" rel="nofollow">CircleBack Lending</a> offers personal loans up to $35,000 with APR as low as 5.96%. Origination fees are between 0.99%&ndash;2.99%. The investor pool is a bit different than Lending Club and Prosper. They use institutional investors.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/how-to-pay-less-interest-on-your-credit-card-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The 5 Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/oops-i-maxed-out-my-credit-cards-now-what">Oops — I Maxed Out My Credit Cards. Now What?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps">How to Rebuild Your Credit in 8 Simple Steps</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-low-interest-rate-credit-cards">The Best Low Interest Rate Credit Cards</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Debt Management interest rates personal loans Thu, 19 Nov 2015 05:14:09 +0000 Dan Rafter 1615248 at http://www.wisebread.com What’s the Difference Between Student Loan Refinancing and Consolidation? http://www.wisebread.com/what-s-the-difference-between-student-loan-refinancing-and-consolidation <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-s-the-difference-between-student-loan-refinancing-and-consolidation" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_student_debt_000020737719.jpg" alt="Man learning about student loan refinancing and consolidation" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Higher education can open the door to better job prospects and a larger salary, but there&rsquo;s nothing cheap about earning a degree. According to the Institute for College Access and Success, in 2013, about seven in 10 graduates from public and nonprofit colleges had student loan debt with the average student <a href="http://ticas.org/posd/map-state-data">owing $28,400</a>.</p> <p>If you didn&rsquo;t attend college with a silver spoon in your mouth and had to apply for financial aid (like many students did, myself included), you might be bogged down with multiple loans. This can be a lot to keep up with, but fortunately there&rsquo;s an easier way to manage student loan debt and perhaps pay it off sooner. In fact, some post-grads have successfully managed their debt with student loan refinancing and consolidation.</p> <p>These terms are sometimes used interchangeably. But while they can serve a similar purpose, consolidation and refinancing are not the same.</p> <h2>What Is Student Loan Consolidation?</h2> <p>Consolidation is the process of combining or merging multiple loans into a single one. A student loan consolidation can combine all your federal loans into one loan at no cost. Some students pay for their entire college education with only one type of federal loan, but others receive funds from multiple federal loans. For example, you might have a Direct Unsubsidized Loan, a Direct PLUS loan, and perhaps another type of federal loan. This can become a headache at best, and it&rsquo;s easier to overlook a bill when you receive so many statements each month.</p> <p>Consolidation simplifies the way you manage your student loans. Combining your federal loans into a single loan means you&rsquo;ll only have one monthly statement, one due date, and one set of loan terms, which usually includes a low, fixed interest rate.</p> <p>Federal student loan consolidation is offered by the U.S. Department of Education and it&rsquo;s only for federal student loans &mdash; not private loans. So if you have a mix of federal educational loans and private educational loans, you cannot consolidate through the Department of Education.</p> <p>This doesn't mean you can&rsquo;t simplify and merge your federal and private loans into one loan. This is still an option, but instead of Federal consolidation, you have to refinance your loans through a private lender, such as a bank or credit union.</p> <h2>What Is Student Loan Refinancing?</h2> <p>Refinancing involves applying for a new loan (sometimes with a lower interest rate), and then using these funds to pay off existing loans. Refinancing is only available through private lenders. This is a smart move if you have multiple private loans with variable interest rates and you want a fixed interest rate, which can protect you from rate hikes in the future and potentially save you money.</p> <p>Since refinancing is through a private lender, you have to complete a loan application and go through the underwriting process, at which point a lender evaluates your credit history and income to determine if you&rsquo;re eligible. If you qualify, refinancing can help you get a lower interest rate, which can save you money over the life of the loan. A lower payment can create more cash flow, and you can use the savings to pay off other debts, move out of your parents&rsquo; house, or build your emergency fund. Refinancing also helps pay off student loan debt faster, especially if you're able to make higher payments. This is because more of your payments will go toward reducing the principal.</p> <p>Refinancing is the only way to combine your federal and private loans into a single loan. But it&rsquo;s important to note that refinancing a federal loan involves giving up some protections offered by government loans.</p> <p>For example, federal loans have provisions to help students manage their debt, such as income-based repayment. And if you experience economic hardship like the loss of a job, federal loans give the option of forbearance or deferment. Both options allow borrowers to stop making payments on a temporary basis. Some private lenders don't offer such perks. So while refinancing can simplify your financial life, make sure you have a strong financial foundation before switching federal loans to a private loan.</p> <p><a href="http://SoFi.com/wisebread">SoFi</a> is a popular lender offering student loan refinancing at competitive rates. They also offer career support and unemployment protection, where your payments can be paused while finding a new job. <a href="http://SoFi.com/wisebread"><strong>Click here to learn more about getting a student refinancing loan from SoFi</strong></a>.</p> <!--<p>Alternately, <a href="http://credible.evyy.net/c/27771/223380/3874?utm_source=WiseBread&amp;utm_medium=web&amp;utm_campaign=refi">Credible</a> is a marketplace platform that allows you to search and compare available loans and interest rates. Receive personalized offers from mulitple lenders. <a href="http://credible.evyy.net/c/27771/223380/3874?utm_source=WiseBread&amp;utm_medium=web&amp;utm_campaign=refi"><strong>Click here to learn more and get offers from available lenders.</strong></a></p>--><!--<p>Alternately, <a href="http://credible.evyy.net/c/27771/223380/3874?utm_source=WiseBread&amp;utm_medium=web&amp;utm_campaign=refi">Credible</a> is a marketplace platform that allows you to search and compare available loans and interest rates. Receive personalized offers from mulitple lenders. <a href="http://credible.evyy.net/c/27771/223380/3874?utm_source=WiseBread&amp;utm_medium=web&amp;utm_campaign=refi"><strong>Click here to learn more and get offers from available lenders.</strong></a></p>--><p><em>Did you refinance or consolidate your student loans? How did it improve your situation? I&rsquo;d love to hear about your experience in the comments section.</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/what-s-the-difference-between-student-loan-refinancing-and-consolidation">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-12"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-to-get-student-loan-debt-forgiveness">8 Ways to Get Student Loan Debt Forgiveness</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-paying-off-student-loans-early-can-boost-your-finances">7 Ways Paying Off Student Loans Early Can Boost Your Finances</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-sobering-facts-about-student-loan-debt">5 Sobering Facts About Student Loan Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-refinance-your-student-loan">Should You Refinance Your Student Loan?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-private-lenders-that-can-really-save-you-money-on-your-student-loans">3 Private Lenders That Can Really Save You Money on Your Student Loans</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management college consolidation education refinancing student loans Thu, 12 Nov 2015 00:18:15 +0000 Mikey Rox 1603032 at http://www.wisebread.com