Credit and Debt Consolidation | Small Step to Financial Freedom

“Financial freedom is a buzzword for our generation. It is the pursuit of literally millions of people. So what is it? Is it that elusive? Can anyone get it?” ~Chris Widener, a Motivational Guru

Though ‘elusive’, financial freedom is achievable by anyone committed in its pursuit. However, for the wishful thinker and daydreamer, this is nearly impossible to achieve. Because financial freedom does not only require the desire to earn it, but also the will to take the necessary steps, however painful, to achieve it. It begins in the mind, then channeled into a determination to take positive actions towards financial independence. As Dave Ramsey (Total Money Makeover) puts it aptly:

“Winning at money is 80 percent behavior and 20 percent head knowledge. Most of us know what to do, but we just don’t do it.”

One small yet difficult step to take is getting out of debt.

Unpaid bills, credit card debt, and other loans can be financially disastrous if they remain unsettled for a long time. It is very difficult and even discouraging to work just in order to pay for your outstanding debts and their annoying interests. The longer you delay your repayments, the more you incur interest and further ruin your credit standing. Consequently, bills will continue to pile up before you can even start paying the last one. Get out of this rut, as soon as possible.

One practical alternative is debt consolidation. This involves making a onetime loan enough to cover for all your outstanding debts. Debt consolidation loans are usually charge lower interest rates and offer a longer repayment scheme. This is hassle-free on your part because you will have to deal with a single lender. So with all your outstanding debts and loans covered, you can focus your effort on one single loan amortization. This is but a small step, but is one effective step towards financial freedom.
To hammer this point deeper, allow Chris Widener to amplify my point here:

Want financial freedom? The first thing you should do is to get out of debt. That is priority number one. One of the reasons I have financial freedom is that I have no debt other than my house payment. And I work hard to manage myself and our home to keep us that way. For years I drove an old junker car, and while I looked bad, I had financial freedom that others who were in debt didn’t have! There is an old proverb – The borrower is the servant of the lender. Who has freedom? The lender. Who doesn’t? The borrower. Develop a plan to get out of debt!

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Posted on 5/15/2009 1 comments

Obtain and Monitor Your Free Credit Report Regularly

While there is indeed a need to overhaul a majority of our financial institutions and the credit industry is still struggling to rise back, consumers nevertheless have the responsibility to obtain a copy and monitor their credit report on a regular basis.

Why do we need to monitor our credit report regularly?

First, our credit report states our financial health or status on record. Banks, loan agencies, various government agencies, and your employer can easily obtain a copy of your credit report and use it as a basis for any transaction. Even apartment landlords would even check this report and can make this a basis for accepting or rejecting you as a tenant.

Your credit report, in a sense, bespeaks of your financial credibility.

Second, your credit report is not absolute. Meaning, it could be prone from errors. If you are monitoring it on regularly, you can easily detect these errors and have them rectified immediately. Hence, you will not be surprised, in case of a negative score, if you were denied of a particular loan. More so, in cases of negative score, you will have a basis to work on an improvement of your credit rating.

Lastly, identity theft is commonplace. With more than half of our purchases and other transactions being done online, scrupulous and malicious individuals can easily intercept the data you sent, especially personal information. Thus, in most cases, errors that are reflected in your credit report may be attributed to identity theft.

Federal laws dictate that you have a right to obtain a copy of your credit report once a year free. Not only that, you can always check for a free credit report online. Better safe than sorry, as they say. So, check your credit report regularly.

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Posted on 5/15/2009 2 comments

Unsecured Loans in Desperate Times

“Desperate people, do desperate things.”

Have you heard that popular maxim? I am sure that most of you were caught in the same predicament, many times before or perhaps you are in one right now. Desperate times can force us to take desperate measures, especially during emergencies and calamities. These are the times where that extra money saved counts. Unfortunately, for some of us, we have not set aside that kind of money.

So, where do we turn to for help or immediate relief?

In a recession like this, most of our friends and relatives may also be suffering the same fate. So, where do we turn to when you exceeded already your card’s credit limit, and your savings account has already dried-up?

Unsecured personal loans from a refutable lending company can be your bailout. Although, in some cases, interest rates may be higher compared to other type of loans. Nevertheless, unsecured loans when carefully chosen among other offers will surely help. These can be availed immediately and without so much paperwork if you qualify.

But again, in my simple mind, you do not have to resort into more borrowing if you have carefully planned and managed your finances. I think, that’s the bottom line. Crisis or not, those who are prepared will not be shaken.

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Posted on 5/15/2009 1 comments

Personal Finance Management Basic | Getting the Right Information and Acting on it

"If you know how to spend less than you get, you have the philosopher's stone" - Benjamin Franklin

The trouble with most of us, who are struggling with our finances, is that, we know how to manage our finances, but we simply don’t. We know that spending less than what we earn is the right thing to do, but we live to ignore it. We are always satisfied with gratifying our desires when we spend more for things of no value and suffer the consequences later. To me, this seems like a self-inflicted money crisis.

We struggle through life trying to find answers to our financial dilemma, when in truth; those answers are just staring at you, waiting to be tapped.

For example, we know how important it is to set aside a portion of your income for emergency or health funds; that insurance premiums are actually investments for future needs; that there are many things that can wait like those we crave so much; that getting a mortgage more than what you can actually afford after based on your net pay (in this context, including all your personal obligations except the mortgage payment; etc. We seem to care less.

We no longer need raising financial management questions and answers shove on our face. What we need is to act on that information. There are literally thousands of finance management “how-to’s” articles, wikis, blogs, ebooks, and websites over the net; and you can even find a good article on an online dictionary or encyclopedia. But what we do on the information we get is actually what matters most.

As I have said, we do not need a new gospel on personal finance management, what we need is walking the talk, so to speak.

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Posted on 5/01/2009 4 comments