Archive for: August 2013

Plastic Free? 6 Ways to Build Your Credit History


Realistically, just about everyone needs to borrow money at some point. But as you probably already know, lenders examine your credit history in order to determine your creditworthiness. But what if you don’t have a history for them to examine?


The most common way to establish your credit history is by using a credit card. But recently, more people (especially young ones) are moving away from plastic. In fact, recent data from FICO found that 16 percent of 18 to 29-year-olds don’t have a credit card at all—an increase of nine percent from 2005. So while it’s great that these consumers are avoiding debt, they can’t use their credit card habits to build—or improve—their credit history.


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7 Important Tips to Increase Credit Score

increase credit score

Have you already done your best to improve your credit score but still nothing happened? If this is the case, don’t lost hope. There are still some steps that you could try. Hence, there is still a big difference between a credit score of 550 and a 780. The following tips will surely help you increase credit score:

Ø Request a copy of credit report – The Fair Credit Reporting Act require the three agencies Experian, Equifax and TransUnion to give a free credit report each year. For this reason, it is important to check credit report because the reports of the three egencies may differ. More so, it is one step for the consumer to keep track of all their financial activities.

Ø Make a move to improve credit score – Loan company will always refer their loan approval on your credit score. So, if you really have plans of taking loans in the near future, make sure to improve your credit scores first. Do it by paying bills online, keeping debt below 35 percent of the available credit, paying off debt and disputing errors on credit report.

Ø Read and understand the guidelines and policies of the credit card contract – Oftentimes, people don’t bother to read the terms and conditions of the credit contract. They are just surprise of the total bills that they need to pay because of penalties, interest rates and other fees. You should be aware with all the terms and condition so you will know how to handle your payment method.

Ø Read and examine monthly statements carefully – Even if reading monthly statement is so easy, it is still advisable to examine it carefully. There might be some fees reflected in the report that are not present in the previous bills. If there is something that doesn’t make sense, do not hesitate to call your credit card company.

Ø Make sure to pay down or pay off credit card balance – As much as possible, avoid making new charges by not paying full the previous bills. This is a common mistake of many consumers. They are too focus on paying the minimum amount and just leave the balance unattended. In the end, when all the balance is added, it will sum up to one big amount. So better paid everything and do not leave any balance.

Ø Choose credit cards that match your spending habits – Your spending habits will tell you which credit card is best for you. Always consider the payment terms and the date of your salary to avoid penalties in the credit card company.

Ø Think twice before canceling any cards – Canceling your cards will throw up red flag and impact on your credit score. Since it will give negative impact, make sure to think twice before canceling it. You can always cancel your card but your credit score will suffer.

Credit scores will never be a problem if you just know how to deal with it. Try the above tips and you will surely enjoy your good credit score.

Retirement Myth #1: Accumulation Is The Main Thing

(Photo credit: 401(K) 2013)


For years, Wall Street has been telling us the same thing: Save and invest as much as you can for retirement by trying to obtain as high a return as possible.

With bond returns sagging in a slow growth economy, this advice isn’t particularly helpful.

Most of us are still spooked by stock-market volatility, insider trading, hedge fund shenanigans, bank derivatives and poor regulation. Now we have to worry about a skittish bond market and the end of the Federal Reserve’s monetary easing policies — throwing yet another monkey wrench into the works.


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Do You Know Your Rights When it Comes to Debt Collection?


One of the most difficult financial issues that many people have to deal with is debt. Not only can debt weigh you down when it comes to money, but it also causes stress in other ways. And once your debt is turned over to collections, it can become especially burdensome and stressful. Dealing with debt collectors is one of the top consumer complaints.


However, it’s important to realize that you do have rights when it comes to debt collection practices. The fact that the FTC has just fined one debt collector $3.2 million for harassing behaviors underscores that you do have rights, and you can see that they are enforced.


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5 Things to Avoid Before You File Bankruptcy & Improve Credit Scores


Man holding printout from calculator.

Filing for bankruptcy is already a formidable task, so you’ll want to do everything you can to avoid shooting yourself in the foot and making the process that much harder and it doesn’t improve credit scores. Unfortunately, some actions that seem perfectly reasonable, and even prudent, can actually land you in even more trouble. In worst-case scenarios, the court can dismiss your case, leaving you responsible for paying your debts.


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4 Steps To Finding Financial Improvement & Credit Repair


The two worst years of my financial life were 2007 to 2009. Before 2007, our income was low, but our expenses were low, too. We didn’t save much, but we didn’t spend more than we earned, either.

Then we saw our dream house. And we bought it while we still owned our first house. For two years, we had two mortgages. Suddenly, even though our income was slowly increasing, our expenses had skyrocketed. We cut our expenses as much as we could considered credit repair, but you can only cut them so much when you bought a fixer-upper with squirrel holes in the siding, leaking toilets that threatened to fall through the rotten bathroom floors, and desperately needing a new roof.


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7 Reasons Your Credit Card Was Declined and What You Can Do About It


“I’m sorry, your card didn’t go through.”


Many of us have been there. Whether you’re buying dinner for your co-workers, drinks for a date, or just a cartload of groceries, no one wants to hear that their credit card was declined.


It happened to me at a hardware store. I came to buy plants and decided to make copies of my keys too. I paid for the keys at the service desk and then dragged a flatbed cart full of plants to the checkout at the garden center, where I was told, “Ma’am! Your credit card got declined!” Embarrassing? Absolutely.

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Mortgage Rates: When to Refinance a Mortgage

refinance a mortgage

For a little history, prior to the big 2008 housing crash, the Federal Reserve had started quickly slashing the federal funds effective rate. The rate went from 6.25% all the way down to 0.5%. This rate is directly tied to the rate that banks charge their prime customers (the prime rate), by adding ~3%. Prime rate is directly correlated to mortgage rates. This led to banks cutting 15 and 30 year mortgage rates down to all-time historical lows of around 3% and 4%, respectively.

We’ve since seen a bit of bounce back over the last few months in mortgage rates, but they are still close to historical lows, at about 3.38% (15-year) and 4.48% (30-year). And all else being equal, refinance rates are about the same as regular mortgage rates on home purchases.


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5 Mistakes You Make When Managing Your Debt

managing your debt


Not all debt is created equal. With that being said, there is no one-size-fits-all approach to managing your debt and avoiding excessive interest, fees and other penalties that could result if not handled properly.

Here are five mistakes consumers commonly make with their debt (and ways to avoid them).

1. Depleting Your Emergency Fund


2. Having No Plan Of Action


3. Getting Caught in the Minimum-Payment Plan


4. Robbing Peter to Pay Pal


5. Ignoring Statements and Credit Reports


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Declare Your Independence from Credit Card Debt

credit-card debt

If you’re carrying credit card debt, you know it’s a financial anchor that’s holding you back from truly enjoying your life. With interest rates averaging about 13 percent to 16 percent, there is no reasonable way to get ahead — or even stay afloat — financially unless you get those cards paid off.
So in honor of the Fourth of July, take this opportunity to declare your independence from your credit card debt.

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