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Some common myths and facts of zero percent financing


There are lots of 0% offers in the market, but that doesn’t mean they are good options. However, sometimes they really help but they’re not-so-lucrative as we all think.

Here are a few myths and facts of 0% deals that need to be known by all debtors who are opting for this to pay off their credit card debt.

Myth 1: Balance transfer cards don’t charge interest rates for the transfers

Fact: This is the first myth that is often believed by those who are financially unaware. The balance transfer cards don’t charge an interest on transfers only during the introductory period. All balance transfer cards come with an introductory period during which the interest rate remains 0%. However, after the introductory period is over, the interest rates go through a sudden hike. The introductory period typically lasts from 12 months to 18 months. Beyond the introductory period, the balance transfer card would charge the same interest rate as charged by other cards, or sometimes even more than that.

Myth 2: You can transfer any amount of balance into your new card

Fact: This is perhaps the biggest myth that most people believe about a balance transfer method. People think that no matter whatever amount of credit card debt they’ve incurred, they’ll be able to transfer the balance into a balance transfer card and get rid of interest rates temporarily. However, you must know that most credit card companies allow transfers that don’t surpass 80% of the credit limit of the new card that you’re going for. Thus, you must no longer believe in the myth that any amount of debt can be transferred to a balance transfer card.

Myth 3: The best balance transfer cards are those that have a 0% APR

Fact: Though it is true that the best balance transfer credit cards should come with a 0 % APR, yet there are a number of other factors that must be taken into consideration by the debtors while choosing the best cards. For those who’re new with the balance transfer method, you need to know a lot more factors about the entire process to strike the best deal.

Myth 4: Balance transfers are the key to getting out of credit card debt

Fact: While balance transfers can assist you in getting out of debt, this method shouldn’t be considered as the primary way of eliminating debt. Instead, you must see that the balance transfer method is just another road to financial freedom. You must initially try to manage your personal finances and eliminate your debt burden. If you don’t get desirable results, you may go for a balance transfer method.

Most people mistakenly believe that it’s difficult to get a balance transfer card in the market. However, if you want to choose a balance transfer method as to pay off your credit card debts, then you must shop around in order to get the best and the most affordable cards in the market. Avoid believing in the above-mentioned myths so that you can lead a safe financial life.

By carol on September 29th, 2015

College Grads: Are you ready to magnify your credit?


The college life is the best time to build a good credit score. This’ll help you to settle in the real world after you move out of your college. Are you a college novice? Are you struggling to make your credit score better? Look below for a solution to your problem.

What is a credit score?

A credit score is a number which shows a person’s creditworthiness. The cards you’ll qualify for are determined by your credit score. The FICO model is the most common formula, which determines your credit score. There are 5 main components of a FICO model, which calculate your credit score:

  • Payment history – 35%
  • Total outstanding debt – 30%
  • Length of credit history – 15%
  • Types of credit used – 10%
  • Recent credit inquiries – 10%

Why do you need a better credit score?

6 reasons for having a good credit score are:

  • To buy a house
  • To buy a car
  • To start a business
  • To get a job
  • To get low-interest rates
  • To get better utility services

How will you build a good credit score?

College life is just the starting point of your financial journey. Since you’re a college newcomer, it’s quite clear that you don’t have much credit history. Due to lack of credit history, your credit score is comparatively low. This is high time to put your effort and give a boost to your credit score. Practice the below-given suggestions to upgrade your credit.

1. A line of credit is a must – You’re a beginner, so you’ve to create your credit history first. For that, you need to open a credit card or a savings account. Just be attentive towards your line of credit. Don’t overdo it, otherwise your credit score will drop.

2. Maintain a low utilization rate – Credit utilization rate is the amount of your credit limit up to which you can spend per month. For instance, if you’ve got a credit limit of $500 and spend $50 in a month, your credit utilization rate will be 10%, which is a part of what determines your credit score. If you want to keep your credit score happy, then always keep your credit utilization ratio below 30%.

3. Make payments systematically – Timely bill payments and a good credit score go hand-in-hand. So, pay your bills on time and also pay the full amount if you want to build your credit. You must avoid your credit card to buy something you can’t pay off on time. Remember, late payments affect your credit negatively.

Can’t remember the due dates? Are you falling behind your payments? Follow these two simple tips to pay your bills on time:
* You can set up an automatic bill payment system through your bank’s website,
* You can also automate your payments by making arrangements with each creditor.

4. Don’t use a card when you’re in debt – If you are already in debt, then don’t use your cards for further purchase. Otherwise, this would increase your debt load. Your first priority is to pay off the remaining balance. Once you pay off your balances, don’t close your cards. This would lower your score as well as clear your credit history. The score in the “length of credit history” category of the FICO model also drops down, if you close your credit card account.

5. Blend the use of credit – Credit mix is yet another factor which determines your credit score. There are two kinds of credit:
* Open-end or revolving lines of credit – Credit cards are the revolving lines of credit.
* Closed-end or installment loans – Auto loans and mortgages fall under installment loans. These have fixed payment amounts and a fixed payoff date.
Using a mix of credit types shows your ability to handle both cards and loans. This again acts as a “credit booster.”

6. Check your credit report – Mistakes are common. Credit bureaus can also make mistakes. So, don’t let these mistakes ruin your score. Review your credit report at regular intervals and keep it error free. Visit to get your credit report for free.

Final suggestion

Maintaining and building a good credit score is not so easy. It requires some time and personal attention. College life is just the beginning of your financial career. If you follow the above suggestions, then you’ll definitely have a good credit score. So, start early and make your financial life successful.

By carol on September 24th, 2015

Creditworthiness: 4 Things you should never ignore

Mistakes on the credit report can cost you big in the future. Financial mistakes are dangerous, but that doesn’t mean there’s no way to get back stability in your financial life. There are some ways to repair your credit score to become creditworthy. With the help of little efforts and determination, you can build good credit in the future. So, start working on this field because it won’t happen overnight.

1. Get a free credit report

You should order the free copy of your credit report from the 3 major credit reporting agencies Equifax, Experian and TransUnion. Generally, their reports can be different from each other. Thus, you need to review what each credit bureau thinks about your personal financial state. This step is very important if you want to take further steps.

2. Review the report carefully

It has been seen that almost everyone gets errors in credit reports taken out from the three credit reporting agencies. Errors are normal as the credit bureaus update the report based on the information received from the creditors. It’s your responsibility to identify the errors and make the report error free.

3. Consider the double-D strategy- dispute and document

Having a bad credit score will create a problem for getting new lines of credit. So, you’ve to take some steps to make an error-free credit report. You must complete the dispute form that is provided with the credit report. Write a dispute letter to the credit bureaus. Make sure you keep the copies and documents of the letters, forms that you have sent to the three credit bureaus. Thus, you’ll be able to reduce future hassles (if arise). Don’t forget to collect the rectified copy from the credit bureau within a week.

4. Craft a budget to start afresh

Formulate a new budget, according to your income and spending plan. Make sure you cut off all kinds of unnecessary expenses this time. Thus, you’ll be able to reduce your debt burden.

5. Take a new card; add stability to your life

You can opt for a new credit card to get back stability in your personal financial life. Thus, you’ll be able to create an impression that you’re keen on repairing your credit. Make sure you’re making timely payments on your credit cards this time so that you don’t fall back on the payments again.

Final words

You may need to contact your creditors to remove mistakes from your report. Be sure you’ve done this in a right way. At the same time, take the above-mentioned steps to improve your credit score and stay creditworthy.

By carol on September 15th, 2015

Credit counseling agency: 7 Questions to ask while selecting

Credit counseling is a process by which the counselor educates and guides a debtor, to get back a debt free life and how to avoid debt in future. A credit counselor assesses your financial condition and recommends you a suitable plan. The credit counseling services are a great help for those who don’t know how to pay off their debts.

How to select a credit counseling agency

Before you contact any credit counseling agency, first analyze your own needs. When a customer has a problem in managing his/her finances, he/she takes the help from the credit counseling agency. You should check the legitimacy of the credit counseling agency. You should also be sure whether or not you’re satisfied with the answers the counselor provides you. Here are some of the questions which you should ask while selecting a credit counseling agency.

1. Is the agency associated with a national body?

Before contacting a credit counseling agency, you need to check whether or not the agency is affiliated with a national body.

2. What types of services are available?

Credit counseling agencies provide different services like planning a budget for those people who are in debt, counseling services for those who need help from them, etc.

3. Has the agency been accredited by an independent third party?

A third party checking signifies whether or not proper balances are provided to the customer by the credit counseling agencies to protect the customer.

4. How long may your counseling session last?

A counselor cannot assess your income, expenditure and debt in a very short time. Thus, a complete counseling session may last for at least an hour.

5. How can you protect your deposit money?

The agency should show written evidence that it is a good agency so that the customers don’t fall into any financial problem. So, it is essential to choose the right credit counseling agency.

6. What fees you have to pay for the services?

The credit counseling agencies do take some fees in return for the services they provide to the customer. But that fee is a very nominal amount against the services they provide.

7. How can you opt for a credit counseling session?

There are various credit counseling options available for you. Credit counseling can be done through phone or the Internet. Some agencies even provide face-to-face counseling to the customers so that they find it more convenient.

By carol on September 10th, 2015

8 Wobbly occasions to avert paying with your cards

What is the right time to swipe your cards? Many of you out there have thought of this question several times. Isn’t it? It’s a known fact that cards have made life faster, easier and more convenient. But, still there are certain occasions when using cash is a better alternative.

List of alarming situations: Avoid paying with credit and debit cards

Is it the correct situation to swipe? Has anyone of you thought of this question before making a purchase with your card? If not, then this is the time to rethink about it. Though cards are totally apt for making purchases, but there are certain circumstances when, they should be kept in the wallets. Check out the below circumstances, to know when you should avoid swiping your cards:

1. When hit by impulse-buying pangs – When you want to buy everything you see, then you shouldn’t use your credit or debit cards at all. This is the most risky situation to use your cards. It’s foolish of you to use your cards in your day-to-day small and insignificant purchases. One day, all those tiny purchases will add up and it’ll be difficult for you to keep track of them.

According to Kelsa Dickey, a Tempe, Arizona-based financial counselor, “If you use a credit card for day-to-day spending, it’s very easy to not pay attention to how much is going on there and accidentally overspend.”

2. When investing in major purchases – It’s quite enticing to pay for a major purchase, such as a car with your credit cards, especially if you get reward points. This is good, only for those who can repay their balance on time and also for those who’ve sufficient money to pay the high-interest rates. By chance, if you default on your payment and are lacking funds, then you’ll be charged with a handsome amount of late fees. So, it’s better to make your choice between a traditional loan (with a reasonable interest rate) and hard cash, if you want to avoid additional fees.

3. When you’re close to your credit limit – Don’t use your credit card for any kind of purchase, when you’re near your credit limit. This is an unsafe situation because you can pile up debt, if you cross your credit limit. Ask your credit card company to raise your limit or switch to a card with a low balance, if you don’t want to get into this difficult situation.

4. When you’re intoxicated – Sometimes it happens that, you’re not able to control your decisions when you’re drunk. Making any financial decision in that situation will backfire. So, it’s better to gain your senses back before making any major financial decision.

5. When you have debts – When you already have debts on your cards, then it’s sensible to not use it for any other purchases. This will make you more tangled into credit card debts.

6. When you’re traveling abroad – If you’re traveling abroad and using your credit cards for transactions, then remember, you need to pay a charge for foreign currency transactions. Do keep in mind that, the exchange rate fluctuations determine the amount you’ll have to pay. Instead, pick up a prepaid currency card to help you better.

7. When you bear multiple cards – When you’ve too many cards, then it’s important for you to keep a note of all its billing dates. It’s important to keep a note of the due dates of each card. Avoid using those cards which are closer to the due date. Instead, use those cards which are far off from the billing date. This’ll help you to get a higher credit period and make more sense to your finances.

8. When you don’t trust the person – Both credit and debit cards are crucial. Remember, your credit and debit cards are different. Unlike a credit card, a debit card is a direct key to your bank account. If a fraudster gets hold of your debit card account number, then you won’t be able to see your hard earned money anymore. All your money will disappear instantly. So, it’s advised that don’t hand over your credit and debit cards, if you don’t trust the person or device handling it.

Few shaky places to avoid swiping credit and debit cards

Identity thefts and security breaches are always in the news. This is the situation where you might think that – is it safe to use debit and credit cards anywhere? Yes, you can use your cards anywhere, but you have to be extra cautious. Always remember that your debit card is directly linked to your bank account. So, be very careful while making any purchase with that. Look below to know the 4 most common places where you should be alert before swiping your cards:

1. Gas stations – Gas stations are the most common places for the tricksters to attach skimmers (electronic devices that record your card number) to gas pumps or payment registers. It’s always suggested to use cash to pay at the gas stations.

2. Online retailers – Con artists are becoming expert at hacking retail websites and stealing consumers’ personal and payment information. Avoid debit cards for online transactions and keep your bank account safe during the fraud.

3. Unfamiliar ATMs – Nowadays, scammers are using a technique called the “wiretapping” to steal consumers’ personal information. In this technique, a criminal arrests your card data by inserting a device through a small hole in the ATM, which is then covered by a fake emblem. So, it’s always instructed to not use any unfamiliar ATMs, as you might not get to know if there is something unusual about the machine. Instead, use credit cards or withdraw some cash from your bank account.

4. Restaurants – This is another place where you should avoid using your cards. Waiters and waitresses have often been caught in the restaurant, passing credit cards through a skimmer for an illegitimate transaction. So, it’s always better not to give your card to a person whom you don’t trust. Again, hard cash is a better option here.

A final caution

Self-protection comes first. Protect yourself from financial frauds. Think twice before swiping your cards. Fraudsters are everywhere. So, be very cautious of when and where you’re swiping your cards. Try to use cash mostly to keep yourself away from the victimizers and to build a strong financial background. Use your cards in such a way which will help your money to grow.

By carol on September 1st, 2015

Solve poor credit score of millennials: Tips from genX and boomers


A credit score is vital. It showcases a person’s creditworthiness. It’s fundamental for every generation – boomers, gen-x, and millennials. It’s quite commonly seen that the millennials have poor credit scores as compared to the gen-x and the boomers.

According to a new study from Experian, millennials have the lowest average credit scores. Millennials (18-34 year olds) have an average score of 625, whereas, the gen-x (35-49) owns an average score of 650 and the boomers and the greatest generation (with a combined age between 50-87) have an average credit score of 709.

Michele Raneri, vice president of analytics and business development at Experian, while talking about millennials, said that “It’s important to keep in mind that credit scores are built on credit experiences.” A report released by the Experian reveals a statistically relevant sample of anonymous data from its consumer credit database.

Snapshot of credit characteristics by generation (including national averages)

GenerationY/ Millennials Generation X Baby boomers and the greatest generation National average
Average Vantage score 625 650 709 667
Average debt $52,120 $125,000 $87,438 $88,313
Average debt (excluding mortgages) $26,485 $26,670 $19,217 $23,089
Average estimated income $34,430 $50,400 $46,340 $46,790
Bankcard balances $3,403 $6,752 $5,603 $5,340
Bankcard utilization 43% 41% 25% 34%


Why do millennials have poor credit scores?

Millennials have the lowest average credit scores than the other two generations. This generation is a “go get generation.” They don’t think deeply. They are whimsical. These characteristics often earn them poor credit scores. Check out the bullets below to know why millennials have bad credit scores:

  • Frequent use of credit cards
  • Not paying bills on time
  • Keeping huge balance on credit cards
  • Not paying student loans
  • Excessive purchase
  • Piling up credit card debts
  • Not checking credit reports regularly
  • Applying for multiple credit cards
  • Closing old good credit accounts

Poor credit scores? Learn from the gen-x and the boomers

It has become a common notion that millennials are not good at handling their credit. On an average, they acquire poor credit rating as compared to the other two generations (GenX and boomers). Credit score can be improved at any time. However, millennials can learn the ways to improve credit score from the other generations. Here are the ways to improve credit scores:

  1. Pay bills on time – Payment history is an important factor which determines the credit score. Late payments ruin credit score. Whereas, timely payments will help the millennials build their credit.
  2. Check credit reports frequently – To improve credit scores, it’s important to check credit reports on a regular basis from the three credit bureaus – Equifax, TransUnion, and Experian. Checking credit report regularly doesn’t hurt the credit score. Rather, it’ll help millennials to find out the errors which are causing a downfall to their credit score.
  3. Use secured credit cards – Often millennials don’t get approval to open a credit account. In that case, a secured credit card is the best option to create a solid payment history, if payments are made on time.
  4. Keep low balances – Higher credit balances, if not paid on time, can cause a big damage to credit score. Keep balances under 10% of credit card limits to increase credit score.
  5. Don’t sign for joint credit products – Signing for joint credit products can be fascinating and dangerous at the same time. Signing a joint account or a lease for someone else, can cause a damage to the credit score, if the person fails to pay on time. Millennials should be cautious of what they are signing, especially if they are signing for someone else’s payment.
  6. Build an emergency fund – It can be a savings account. This can help stop unexpected expenses from a credit card in case of any emergency. Having no emergency fund will automatically put pressure on the credit cards in case of urgent needs. This can deteriorate credit scores. Build an emergency fund to avoid damage to credit scores in case of a crisis.
  7. Improve “credit utilization ratio” – Credit utilization ratio can be improved by increasing available credit or getting another credit card. A low credit utilization ratio results in a higher credit score and vice versa.
  8. Purchase small things on credit cards – Making small purchases on credit cards will help to pay off the balance before the due date. This keeps the credit utilization ratio low and establishes good payment history, which in turn improves credit score.
  9. Avoid applying for multiple credit cards at one time – Each time an application is made for a loan or a credit card, a hard inquiry is made, which negatively affects the credit score.
  10. Pay student loans on time – Millennials should start repaying their student loans as soon as they get their first job. Due payments, late payments and defaults have an adverse effect on credit score.
  11. Use credit cards to buy affordable things – Millennials should use their credit cards to buy things which they could afford. Buying an unaffordable thing with a credit card will automatically rack up credit card debt. In turn, this will damage the credit score.
  12. Avoid carrying a credit card balance – Carrying a balance on credit card automatically lowers the credit score. This also increases the possibility of missing out credit card payments.

The last lesson

To have a better credit score, it’s important for the millennials to take the responsibility of their financial life as early as possible. Understand the do’s and don’ts of maintaining a good credit score early. In case of any confusion, follow the above footsteps of the gen-x and the boomers to build an excellent credit score.

By carol on August 27th, 2015

Credit card fraud attorney: Why you should seek their help?


Credit card fraud has become popular with the massive usage of credit cards. There are various forms of credit card frauds that can affect the credit card holders such as: counterfeiting, using stolen credit cards and deceitfully obtaining credit cards through e-mails. Remember, it’s nothing but a term of theft, using a credit card or some other payment method for the purpose of obtaining goods fraudulently.

Credit card fraud is harmful, it may increase your financial obligation as well as create other legal repercussions. Depending on the seriousness of the allegations of the credit card fraud, you need to be represented by a criminal defense attorney who can assist you in combating such fraud.

5 Ways a credit card fraud attorney can help you

1. If you’re subject to credit card fraud or credit card abuse, then you need to contact the criminal defense attorney before a police or the prosecutors. In that case, an attorney can ensure that you don’t comment any kind of incriminating statements and protect your rights as well.

2. The attorney will understand how the credit card frauds work, how the police and the investigators carry on the investigations and what steps can be taken.

3. He will assist you in telling you what to say and what not to. In most cases, the policemen may connect you to some other crimes and if you have an attorney by your side, you can avoid falling into such situations.

4. The attorney will discover the actual facts that can strengthen your case. He will stand between you and the criminal justice system to protect your rights and to defend your action.

5. The attorney investigates into the matter and checks the authenticity of the claims of the police. He will review their reports and connects to the client.

Final words

Therefore, when you’ve been subject to a credit card fraud, you have to make sure that you take help from a criminal defense attorney so that you can achieve success and you don’t end up wasting your dollars on a fraud.

By carol on August 18th, 2015

Handy money management tips for college freshers


“College is fun as long as you don’t die,” – Tsugumi Ohba, Death Note, Vol 4: Love

We experience new amazing things in our college life. We make new friends, discover our passions, gain an education, secure our financial future and so on. In a nutshell, college life is a whole new world in itself. College years are one of the most crucial years in one’s life. So, it is very important for us to make the right decision at the right time to avoid further mistakes in our lives.

College life is more than having a good education and new friends. It gives us endless opportunities for our bright careers. Now, it’s up to us how we should use those opportunities to our advantage. The mistakes, which we often make in our college days can turn our finances down. So, it’s quite important for us to recognize those mistakes and keep track of our finances, in order to secure a strong financial future.

Are you making these money mistakes?

Are you a newbie at college? Then, find out the financial mistakes you should avoid in your college days.

1. Racking up credit card debts: Credit cards have become so ingrained in our daily life that we can’t even imagine a day without this plastic. For many of us, especially for college going guys and girls, it displays the symbol of their status. This showoff often overshadows the flaws behind overspending.Credit cards with high interest rates and unfavorable terms allow students to invest more money than they really have. Making every payment with credit cards will lead you into a debt trap.

2. Damaging credit score: Flaunting your credit card isn’t the end of the game. You also need to face the consequences of mishandling it. One wrong move would automatically ruin your credit score. Thus, missing out payments and overspending would make your credit score collapse.

3. The deficit of budgeting: Budgeting! Do I need to do this in my college life? Are you of the belief that economizing in your college days would make you look not so cool? Then, my dear, you are wrong. This is the most sweetest time when you can save for your future, as there is no mortgage to pay, kids to feed and other money headaches to solve.

4. Spending student loan money for unnecessary things: Student loan money is there to help you in your academics. Using that money to fund your vacation is not the right decision for you. Application of student loan money to buy unessential goods would only lead you to debt and nothing else. You might be thinking that paying off a student loan is so very easy. But, if you pile up more debts by useless spending, then repaying the loan gets more difficult as you might not get your dream job after you graduate. So, think twice before you spend your dollars.

5. Pursuing education from an expensive college: The name of your prestigious college written in your graduation certificate doesn’t lower your debts. The majority of students dream of getting educated at an expensive and prestigious college.

Does studying in an expensive college really matter? Well, it does matter to some extent, but not always. You can save the about $100,000 on your four-year degree, if you go for an inexpensive school. Another option would be to study in an inexpensive college for the first year or two and then take a transfer to a better college. By doing this, you are able to save both time and money, which would help you to complete the rest of your degree in peace.

6. Forgetting to apply for financial aid and scholarships: Often in the excitement of getting admission to a college, we forget to look for financial aid and scholarships. It’s very crucial for every student to apply for financial aid and scholarships on time. If you are a topper, then don’t forget to apply for college scholarships. Also, there are many types of scholarships available to students of different ability levels, based on a multitude of criteria. But, be aware of the financial aid scams.

Cool tips for freshers to manage money

College life isn’t just about having an education. It’s about having a strong financial, social and personal life. Here are some money management tips for college freshmen.

1. Financial Aid: If you want to grab financial aid, then you have to reapply for it every school year and sometimes each semester. Here are few handy tips to help you out.

* Use FinAid – It’s an incredible resource for financial aid, starting from scholarships to student loans.
* Take help of FAFSA – If you want to enroll yourself for financial aid, then you must submit your FAFSA (Free Application For Student Aid) each year you attend college. This is also very much required to get Federal Student Loans. Professional help is often needed for filling out the required forms on your FAFSA. For this work, Student Financial Aid Services is the best association.
* Apply for CSS/Financial Aid Profile – This application, from The College Board will grant you to apply for non-Federal financial aid.
* Repay financial aid – Paying back your college financial aid is very essential. Otherwise, you won’t be able to repay it within the given time. Get help from College Financial Aid Advisors.
* Use Cheap College Finder – Use “Cheap College Finder” for great inexpensive college options.

2. Student Loans: Every student has to deal with his/her student loans. Here are some vital tools for the students who are handling their student loans.

* Free Student Loan Debt eBook – This’ll help you to get student loan easily. You can also get suggestions on how to repay your loan quickly when you are out of your college.
* Student Loans.Gov – This is the Department of Education resource of the government which helps you to get student loans and keeps track of it.
* National Student Loan Data System – This website is maintained by the US Department of Education. If you are not sure about who owns your loan or where you have sent the payments, then check it here. This keeps track of all your student loan data.
* TransUnion – Check your credit score before applying for student loans. TransUnion offers a free credit check and resources to help you boost it.
* Simple Tuition – This is the easiest online student loan application and lender on the Internet.

3. Personal Finance: College life makes us independent and this is the time when we’ve to deal with our financial issues independently. Below are some easy tips to help out college freshmen manage their finances well.

* Avoid credit cards – Credit cards will make you spend more even if you don’t have hard cash.So, if your pocket is empty, then wait for sometime to buy your favorite stuff. This won’t allow you to rack up debt.
* Look for a cheaper lifestyle –Always remember, if you save today, then you’ll have a better future. To have a debt free and happy future, look for free stuff, cheap entertainment options and so on. Try to eat in the cafeteria of your college. The food may not be delicious, but it’s cheap.
* Save and invest – Save and invest some of your dollars to multiply your finances. Use the little money which you have to your advantage.
* Budget well – Only budgeting will help you to save your dollars properly and keep track of your financial whereabouts.
* Plan for the future – College life is the apt time to prepare for your future. If you plan your life ahead, then you’ll be able to save more in the long run.

A final tip

Having fun at college is fine. But, running out of your resources for having that fun is not acceptable. It’ll only ruin your dreams and drain your pocket. So, it’s advisable to plan and maintain your finances besides enjoying your college life. This will only rescue you from a debt trap. Lastly, enjoy your new life with these handy ideas.

By carol on August 13th, 2015

Credit counselors: Ready to help student debt victims


Credit counseling agencies are nowadays keeping their eye on student debt. Of late, credit counselors have been seen exploring new opportunities. Credit counselors are those pillars of our society who help people budget their money and pay bills. Today, they have been witnessed digging their way to the student loan arena as well.

A post by Herb Weisbaum, NBC News contributor reveals that, “Nearly 7 million Americans have fallen behind on their student loans, and millions more are barely able to make their payments each month.” To solve this, credit counselors are heading towards student loan debts. This they explained, as a symbol to help students.

Student loan debt on the rise

Student loan debt is a common phenomena in the west. A college graduation degree followed by joblessness, help the students to mount up debts. In America, the cost of higher education is rising at a lightening speed. Student debt has incremented drastically over the past several decades. Federal Reserve Bank of New York, states that at the end of 2014, student loan delinquencies have increased which pictures that Americans are lagging behind payments as education debt climbs.

The total volume of incipient student borrowing has incremented more than fourfold over the past 20 years. More students in higher education results to the aggregate increase in student debt. Studies unveiled that all other forms of debt, such as, credit cards and mortgage loans have been exhibiting lower delinquency rates. The result of an Experian’s study brought to light that, “in total, $1.2 trillion is bleeding students dry”.

Day-by-day, more students are being pushed into the dark fissure of student loan debt. As an explanation to this, Fed researchers wrote: “Student debt is not dischargeable in bankruptcy like other types of debt. Delinquent or defaulted student loans can stagnate borrowers’ credit reports”.

Fed’s data showed that until 2009, student loans were the minimal form of household debt. The recession has allegedly shuffled the borrowing habits of the Americans and made them borrow money for education. Probably this was not the situation ahead the great recession, which had knocked down US in the year 2007. Thereafter, the residents have managed to pay off their debts, except student debts. This made them land in a pool of student debts.

Conquer student debts with the help of credit counselors

Today, student debt tops the debt chart. The recession has made inroads for the student debt to walk through the lives of the people of US. As a result of this, debts other than the student debts were paid off, but the latter remained at the same place. Thus, people got more tangled into student debts.

The college graduation degree paves the way for a high paying job and a carefree lifestyle. But unfortunately, there are millions of Americans still battling with the burden of student debt. Following this situation, a brand new enterprise has originated, which offers a good deal to cope up with debt. They can be called the credit counselors or credit counseling agencies who try to reduce or even eliminate debt from regime-backed student loans.

Why credit counselors set out for student debt?

Studies revealed that, along with student loan debtors, the credit counseling agencies are also facing a strong financial crux. “According to the annual reports filed with the IRS, annual revenue for the 10 largest counseling agencies fell 11% in the 2013 fiscal year… That came after a 15% decline the year before.” Irrespective of the scenario, it’s arduous to cut down the expenses. Side-by-side, income fell and the pay for the organization’s top executives rose to 8%. Credit card default rate showed 2.52% at the end of 2014 and default rates on debt also showed low, which has made fewer people to step in the agencies for help.

Kevin Weeks of the FCAA said that, “Bankruptcies are trending down, foreclosures, credit card delinquencies are low… agencies are looking for opportunities to assist more consumer”. Both the credit counseling organizationsNFCC and FCAA are paving their way into the orbit of student loans. According to Week, “Member agencies charge student loan counseling fees of $149 to $299 for what is usually a series of consultations with the borrower”. It is true that, people can solve their debt problems, but there are certain areas where they need help. Credit counselors are mainly trying to get hold of those weak units where folks want their help. They are doing so because, somewhere or the other the colleges, lenders and the federal government all have a stake in the student loan system.

Every citizen has a right to good education and for that, they are taking out loans. In the USA, education loans or student loans are sky-high. Masses are still at a warfare with their student debts since they are unable to repay their loans due to lack of employment and good wages. Millions are there who default on their student loans. And, the credit counselors and their organizations are using this opportunity to fill their half-filled pockets as an emblem to help out the student clan from their agony of student loan debts.

By carol on August 4th, 2015

Balance transfer compliments credit score: Unwrap the truth


“Money is a good servant, but a bad master” – if you have money it will serve you and work for you well. But if you owe money to someone, that money will control you dreadfully. So if you treat your money carelessly, then you would get imprisoned in debt.

Are you messed up in a debt trap? Do you believe that ‘balance transfer’ method will help you manage your credit card debts well? Then, find out the answer to your queries here.

Balance Transfer – A brief insight

In simple words, a balance transfer method is the process of transferring of all outstanding balances from one credit card to a new credit card with low interest rates. Debts are a common phenomena in our lives. No one wants to pile up credit card debts. But, what will you do if you have racked up credit card debts? Well, in that case credit card balance transfer can prove to be an invaluable gem for managing credit card debts.

You might not be able to clear all your debts through a credit card balance transfer, but it does help to reduce some of your interests through its 0% or low interest programs. If you pick up a balance transfer card with an introductory 0% or low-rate promotion, then it would prevent your card from further financial charges. As for example – assume that you are carrying a balance of $10,000 on a card that charges 15% interest and your target is to pay it off in the next 12 months. If you transfer this balance to a card that’s offering 12 months at 0%, then you are able to save $831 in interest.

A walk by the seashore of balance transfer

Sinking into debt is like drowning in the sea. One way which saves you from drowning in the sea of debt is balance transfer. Are you struggling with credit card debts after spending too much during holidays? Then a balance transfer credit card would make you stand out of your plight. This would help you save money while you pay off your debts. The best balance transfer card is like a life saving drug when you are suffering from credit card debts.

Busy collecting huge amounts of debt? Decided to do a balance transfer? Then, here are some tips to enlighten you:

  • Promotional period: Validity of 0% interest account is less. Because, some credit card issuers run short promotional rate periods to attract new consumers. And once this period gets over, you may have to pay higher interest rate on the new balance. So, the next time you get such offers, be sure of its validity.
  • Transfer fees: Irrespective of whether you own a good credit or a bad credit, you will be charged a balance transfer fee. It is often 3% to 5% of the total amount you are transferring. With the help of a ‘no balance transfer fee credit card’, you can easily swap from a higher-interest credit card to a lower-interest account without having paid the additional percentage balance.
  • Impact on credit score: Transfer your balance to a card which has more credit limit as compared to your balance. Because, this lowers your credit utilization ratio, which increases your credit score. On the other hand, if you transfer your balance to a card which has less credit limit as compared to your balance, then it will lower your credit score. So, you should check the available credit line before transferring balances, as it will have an impact on your credit score.
  • Don’t purchase with balance transfer card: Since balance transfer credit cards offer 0% interest, many of you plan to make new purchases with that. But let me again remind you all that, these ‘0% interest’ offers last only for a certain duration. And once the introductory period is over, you will again rack up debt in your new balance transfer credit card. So, keep a watch at your card’s balance before making further purchases!
  • Change your spending habits: You are absolutely mistaken if you believe that you can spend as much as you wish after transferring the balance to a 0% interest card. Transferring your balances is not a certificate to misspend your dollars. So, you should step aside from balance transfer to prevent accumulation of debt on your new credit card.
  • Keep your original account open: Do not cancel your old card from which you transferred the balance. This might give a blow to your credit score. Just ensure that your card does not charge an annual fee.
  • Make a payoff plan: Balance transfer credit cards are not at all easy to manage. So you should plan it out strategically. That is, have a proper entry and exit plan. You can also take the help of ‘credit card payoff calculator’ to plan out your budget.

Do you think that balance transfer will improve your credit score?

First, let me tell you that a balance transfer does not harm your credit standing directly. Credit scoring companies don’t take into account it as a factor to evaluate their criteria for calculating your credit score. But you cannot deny the fact that, a balance transfer leads to a change in your financial profile. Read the points below to know how a balance transfer affects your score:

  • When balance transfer credit cards are used for overspending or avoiding payment, then your credit score will drop for sure. The time when you start spending more money and avoid the payments, you pile up debts which in turn affect your score negatively.
  • Your credit score gets a negative boost when you initially apply for several cards with low introductory rates.
  • The duration for which your credit accounts have been open covers 15% of your credit score. Therefore, the longer you keep your accounts open the better will be your score.
  • Whenever you apply for credit, a hard inquiry is made on your credit report. One hard inquiry will reduce few points from your credit score. But, multiple hard inquiries within a short span of time may cause significant damage to your credit score. So, do not apply for balance transfer credit cards frequently.
  • If you close your credit accounts, it will hurt your score. But when you keep your existing accounts open, the average age of your account remains high which boosts your score.
  • It is always suggested to transfer the balance to a card with more credit limit. If you do so, then this will keep your credit utilization ratio low which increases your credit score. Always remember that –
    Low Credit Utilization = High Credit Score
    High Credit Utilization = Low Credit Score
  • Last but not the least, whether you do a balance transfer or not, always make payments on time, which is vital for maintaining good credit score.

Final Decision

Don’t make frequent balance transfer as it would harm your score. Balance transfer to another credit card is good if you follow the tips and guidelines. Don’t let money make a hole in your pocket. If you pay off your balance on time and control your overspending nature, then you would be able to make your credit score happy.

I hope this piece of writing has helped you clear your doubts regarding balance transfer. Now, if you are thinking of doing a balance transfer, just do it with confidence. If you take help of these above guidelines, then I’m sure you will stand as a winner in case of balance transfer.

By carol on July 30th, 2015