Saturday, February 19th, 2011
Debt Consolidation is often the first thing that people consider when they experience debt problems. Consolidation debts is basically the process of taking out one large loan to pay off all your other debts, leaving you with only one payment to think about, which is usually a smaller amount that your combined debts were. So far, so good, but that is not the whole story.
Bear in mind that when you are in debt and you can’t afford to pay back money that you have borrowed or goods you have bought on credit, it is not necessarily the most sensible thing in the world to be thinking about borrowing even more money. If borrowing or spending more than you have is what got you into debt in the first place, it is frankly unlikely that doing more of the same will get you out of it.
There are circumstances in which a debt consolidation loan may improve your situation, but these are far less common than most people suppose. The danger is that people are attracted by the simplicity of a single payment, and the lower monthly payment. It is important to look beyond that to the total amount you will be paying back, compared to your existing debts. The reason the monthly payment is less is usually because the new loan is spread over a much longer period. When you add up how much you are paying back in total over the longer period, you will often find that the consolidation loan is actually costing you far more than your old debts.
The circumstances in which a debt consolidation loan might be a useful thing to do are if your old debts are at a particularly high rate of interest and the interest rates on the new loan will be much lower. If you do take out a new consolidation loan, don’t be tempted to automatically cover all your debts with it. You should list all your debts in order of the rate of interest you are paying on them, and only use the loan to cover the ones that are at a higher rate than you will be paying for the consolidation loan.
Just as there are certain circumstances when a consolidation loan may be useful there are also circumstances when alarm bells should ring and you should avoid them. The times when you should definitely avoid taking out a debt consolidation loan are if you have taken one out previously and it has not solved your problems, or if you plan to use it to pay off credit card debts so that you can carry on using the cards again. In these circumstances the debt consolidation loan is almost certain to simply add to your problems.
The only truly effective way to deal with debt problems is to negotiate with your creditors to agree repayment terms that you can afford. Help and advice with this is available, but not from companies with an interest in selling you a consolidation loan or other commercial debt solution.
By: K D Garrow
Tags: Bear In Mind, Circumstances, Conso, Consolidate Debt, Consolidate Debts, Consolidate Your Debts, Debt Consolidation Loan, Debt Consolidation Work, Debt Loan, Debt Problems, Interest Rates, Money, People, Rate Of Interest, Reason, Simplicity, Single Payment, Story Bear
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Monday, July 12th, 2010
Has your plan to build wealth been hindered because of your debt? Would reducing your debt help you to better focus on building and maintaining your wealth? Most people focus on reducing debt and then building wealth. I will show you how to do both at the same time. Debt reduction is never easy. If it were, everyone would be debt-free. Debt reduction gives you time and money freedom. As a favor to your family, friends and your future, resolve to become debt-free once and for all.
Start with writing down the goal of being free from debt. This critical component often gets overlooked because of its simplicity. Until you write down your goal it is just a dream. The moment you write down your goal it comes alive. Just like a baby you have to feed this goal. The feeding begins with believing that your goal of debt freedom will be reached. I make it a point to verbally state my goals twice a day, in the morning and just before going to bed. This helps fuel my belief system.
While I am sleep I often dream of ways to reach my goals easier than I ever thought before. I awake the next morning rushing to write down what I have just dreamt so I can take full advantage of the situation.
Most people get caught up in not having a plan to reduce their debt. If you do not know how to go about reducing your debt, do not worry about that right now, just decide that you will do what is necessary to get your debt down. Keep this goal in front of you and you will start to attract the people, ideas and resources needed to reach your goal. When I teach people to build wealth through commodity trading; one of the first ideas I introduce them to, is having a goal of making enough profits to pay at least one bill each month. Imagine if you made enough supplemental money to pay one of your bills each month. This frees of money from your paycheck to begin paying down your debt.
Once you have paid off one bill use that same money and apply it towards paying off another bill. While you are paying off your bills increase your goals in your commodity trading by using strategies to pay two, three or four bills each month with your profits.
Now you are paying down debt while increasing your profits through commodity trading. This is where it really gets fun because as you pay down your debt using profits from trading; you can use money from your paycheck that you no longer have to use for bills, to take a vacation or whatever else you want as long as you do not finance it. Make sure you can pay cash for it. This gets you in the habit of paying cash for what you desire. Believe me this will feel so good!
Experts tell us that many diseases in the body come from financial stress! Imagine if your money worries were laid to rest. You would get sick less because the stress and discomfort of money woes would not be around any longer. Decide now to trade your way out of debt.
In previous articles I discussed a specific wealth building strategy to earn over $5,000. The strategy earned $6,400 to be exact if you followed my recommendation to the letter. I said to invest in Gold on its way to 850.
I said to use profits to pick up a second contract at 834. The use of this multiplying technique is how fortunes are made very quickly. This provides for debt reduction as well. If you recall I said to exit Gold completely once it reached 849 because many people would be trying to exit once it reached 850. To date Gold has not yet reached 850 and taken out the all-time high. Gold went from 800 to 849.50 per ounce.
By: David D. Wells
Tags: Belief System, Bil, Building Wealth, Commodity Trading, Critical Component, Debt Freedom, Family Friends, Focus, Free Debt Reduction, Money Freedom, Next Morning, Paycheck, People, Profits, Reducing Debt, Resolve, Simplicity, Sleep, Supplemental Money, Time And Money
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