10 steps I used to get out of Debt

(This is a guest article by Sharon Marthers*)

There were times when I used to allow my heart to rule as far as my personal finances are concerned. I thought it was the coolest approach that I could ever have until I realized that it wasn't a good idea after all! Well, I had to admit that one doesn't get into a debt situation in a jiffy because it builds up gradually and seeps into one's finances in a clandestine manner. Guess what? It even took me a long time to get out of it!

So what did I do to get out of it anyway?

I came across billboards that offered me debt help and was requested to enroll for some kind of debt relief option in the process. They seemed they might be effective initially, until I found out that they might not be the same for all and sundry. So, I took some personal measures first, such as, evaluating my financial situation and then finding the particular debt relief option that would be suitable for me. In the midst of this storm, here are some measures I used in order to withstand the storm and come out of it:

1. Avoid borrowing money to get out of debt

It is not a very bright idea to take loan from Peter to pay off Harry. It could have added up to my existing debt burden. If taking a loan to consolidate all debts, it is always better to use collateral. In case of a collateral (secured loan), the rate of interest is also less and if you fail to make payments your collateral is taken away by the creditor. So, if at all you are availing another loan, try to take a secured one as you will always have the fear of losing your assets due to non payment.


2. Use cash and minimize credit card usage

Although you are using plastic money to shop around, sooner or later you have to pay that money. You cannot defer the payment for months. So, if you are using cash, it is better because you tend to shop around depending on availability of cash.


3. Attend to debts that have higher interest rates

You can wrap up your debts and get out of debt by following 2 methods. You can either make payments for the debts that attract a very interest rate. Alternatively, you can attend to debts that have lower outstanding balances. However, I opted for the former.


4. Pay more than the minimum monthly payments

You may have come across precepts urging you to make payment for the minimum balance every month. Undoubtedly, it is true but you should pay more than the minimum balance. By doing so, you not only make payments for the interest but your principal amount also reduces in due course.


5. Work out a budget and track expenses

Work out a budget and spend accordingly. Identify expenses that can be curtailed. The amount you save can either be used to pay off debts or you can make an emergency fund with it.


6. Check your credit report periodically

You are entitled to a free copy of your credit report every year from the 3 credit bureaus. Get hold of your credit report and check for irregularities. It may be that you have managed your finances very well but the same isn’t recorded in your credit report. Your report may have inaccurate information entered. If it so happens, get it rectified without delay.


7. Read TOS while accepting credit cards

Reports suggest that majority of the credit cardholders fail to manage their credit cards well because they are not aware of the terms and conditions when they accept the cards. When they are implemented, you fail to cope with the same.


8. Save for the rainy day

Save for the rainy day. It can bail you out of a financially stressful situation when you are in real need of it.


9. Don’t be extravagant

Avoid holiday “hangovers” and impulsive shopping. If you can defer buying an article, put it off for a later period.


10. Take professional guidance if required

Don’t hesitate to seek professional help if you are not being able to manage your finances well or you are likely to face financial crisis in near future. It is rightly said “Prevention is always better than cure”.

*About the author: Sharon Marthers is one of the financial writers associated with the Debt Consolidation Care Community. With her in-depth knowledge and vast experience, she has had a profound impact through writing and advising on all debt consolidation issues and has presented useful tips to get out of debt. Her remarkable guidance and support has improved the community into a global hub for the debt related situations.

*Image Credit: Photograph by gaspi *your guide [via Flickr Creative Commons]

10 things a freelancer must do to survive this economy

(This is a guest article by Jessie Hepzie*)

The season had been pretty rough throughout the last quarter of 2008 as well as in 2009. The economic meltdown has had its effects on every one including freelancers, yet this is the opportune moment for some, and they are really successful in acquiring great orders.
You should remember the life of a freelancer is not always a smooth one. With so many commitments and with uncertain income, the life of freelancers had always been in the rough seas. The following are the tactics that can make freelancers survive this economic crunch.

Look at the right place for your job:
Usually freelancers have a tough competition in forums and bidding sites. It’s high time you avoid those sources and look for various other options available throughout the internet. The best thing you could do is have an eye for corporate freelancing jobs. The recent freeze in recruitment programs and the downsizing of employee list in the corporate world is in reality a way open for freelancers. Companies in view of cost reduction are more than willing to hire freelancers to complete their ongoing projects. Associate yourself with these companies to get a regular income.

Diplomatic bargaining:
Whenever you are selected for a project do explain you skills, the current economical status, and diplomatically negotiate for a better compensation. This could boost your income and give you peace of mind. Never be aggressive because it can cost you your job. Diplomatic bargaining can also be very well applied when you are procuring material for your project. Compare vendors and prices and choose the best vendor that quotes the lowest price. You can also ask for discounts and offers and enlarge you margin.

Being punctual:
Once you take up orders do strictly adhere to deadlines. This will create a positive image and trust in you. Never take up more than you can chew and end up as failure. If your project is bit tedious, it is a wise idea to join hands with friends who can help you complete the project on time. Sharing a small amount in the revenue will reduce a great amount of stress involved in the job.

Maintain good relationship with your clients:
Maintaining good relationship with clients could gain you more projects and more money. The usual employer psychology is to provide the job to reliable employees rather than recruit a new one on trial basis. This is why maintaining good relationships will be an added advantage when it comes to gaining lucrative projects from previous employers.

Form a team:
Especially during the time of recession it is wise to form a team with like minded freelancers and share the work and revenue. This broadens your scope of getting projects and lessens your burden in handling large projects. Working together will also provide moral support and eliminate the loneliness thereby encouraging you to involve more in you job.

Learn new tips and tricks:
As a freelancer it is your duty to keep yourself updated with the latest trends in the field. Learning new tips and trick in your job should be a continuous process. Do not hesitate to spend a little in learning a new technique that could help you come out with flying colors in you future projects.

Be alert:
As a freelancer you should be alert with individual private employers. There are two possibilities that you can encounter with individuals contracting you for the first time. Cheats usually ask for some time to release your payment and never turn up once have you completed the project for them. It is always wise to get a partial payment in advance before you take up jobs for those you do not know. The other category is that people after testing your skills can provide you good amount and can force you into contracts that will benefit them a lot, while you will be stressed out unnecessarily. It is better to avoid both.

Be wise on expenditure:
When it comes to your personal expenditure, it is wise to reduce unwanted expenses. You should compare prices and get the best price for things you need. You can also reduce the expenses of eating out and other luxuries that could drain you purse especially at time of recession.

Start saving:
You should realize that there is no guarantee to your regular income and should start the habit of saving some money for the days when you won’t find jobs. There may be good income on few days while other days may be dry. So it is wise to limit your expenditure for the day with an eye for future. However, expending on investments is a clever option.

Positive attitude:
Remember nothing is permanent in this world and this financial crunch too will pass. Do look at poorer economies where people suffer the most and be thankful that you are in a better position. Comparing your state with those in poverty will boost your moral, whereas a comparison with better off people will lead to frustration.

*About the author: This article was contributed by Jessie Hepzie who maintians Oscommerce Templates.

*Image Credit: Photograph by lumaxart [via Flickr Creative Commons]

The World’s Richest Frugal People

(This is a guest article by Lewis Bennett*)

Wikipedia defines frugality as, “the acquiring of and resourceful use of economic goods and services in order to achieve lasting and more fulfilling goals.” A lot of people would use the word “cheap” but don’t say that about anyone on this list of some of the world’s wealthiest people because they also happen to be some of the most frugal.

• Despite having a net worth of $62 billion and being the world’s richest man, famously frugal investor Warren Buffett still lives in the same home he bought for nearly $31,500 some 50 years ago.



• John Caudwell used to ride his bike 14 miles to work everyday and cut his own hair because he didn’t want to be bothered going to the barber despite having amassed a fortune of over $2.2 billion. Caudwell also purchased all of his clothing off the rack at British retailer Marks & Spencer.



• Jim Walton, member of America’s richest family and Wal-Mart scion, reportedly drives a 14-year-old Dodge Dakota despite having a net worth of $16.4 billion.



• Retail Tycoon Frederik Meijer, worth $2 billion is known to drive cars with very high MPG and prefers to only stay in budget motels.



• Gene Burd, a 76-year-old journalism professor at the University of Texas has donated over a million dollars to financial foundations but walks 6 miles to work everyday, lives in a very tiny apartment, picks up pennies on the ground, and wears shoes that he found in the trash.



• Ingvar Kamprad built a $33 billion fortune after founding Ikea but the Swedish tycoon drives a 15-year-old Volvo, tries to avoid wearing suits, and flies coach. It’s also said (surprise, surprise) that Kamprad furnishes his home entirely with affordable Ikea furniture.



• Indian billionaire Azim Premji worth upwards of $17.1 billion drives a Toyota Corolla and stays in the company guesthouse rather than 5-star hotels when he’s traveling on business. At a lunch honoring his son’s wedding he even served the food on paper plates.



• We would be amiss to not mention some of the highest earning dead celebrities who are perhaps the most frugal of this list due to their inability to spend :) For example, top earning dead musician, Kurt Cobain made about $50 million last year. Elvis Presley made $42 million despite having died in 1977 and, in third place, Peanuts creator Charles M. Schulz earnings were about $35 million.

*About the author: This list was compiled by Lewis Bennett, writer for an Individual Voluntary Arrangement (IVA) site.

*Image Credit: Photograph by riptheskull [via Flickr Creative Commons]

10 Things to Consider Before Quitting Your Job to Start Your Own Business

(This is a guest article by Andrew Wang*)

Starting your own business is more often than not a stressful and risky proposition. These days, it is an unfortunate fact that most small businesses are doomed from the very start, for whatever reason. Recent statistics found that 7 out of 10 small enterprises close down within two years of opening, and a further 1 of the 10 will shut down within 5 years. There is however some hope, in the fact that 20 - 30% of businesses do find success somewhere down the track. In this article, I will give you 10 things to do before you quit your job and put all your effort in to a particular business idea. Getting these 10 things done properly will substantially assist you in your entrepreneurial endeavors - and may just be enough to keep your business afloat, through both the good times, and the bad.

1. Know The Lingo:


Don't quit your job until you know the lingo. By "lingo", I mean all the terms, information, and expertise that business owners are expected to have. You MUST know what your liability level is, should your finances take a turn for the worse. Learn about the stock market, how big business works, and how small business differs from mainstream corporate affairs. The internet is a great resource here - so use it, and gain the knowledge necessary to advance.


2. Research:


Don't quit your job until you have enough research behind you to prove that your business model can be successful. One of the biggest mistakes people make is that they get all excited about the prospect of owing a business, and hastily rush in to things. If you don't know the statistics, industry trends, and consumer behavior surrounding your area of business - how can you possibly sell your products or services?


3. Sort Out The Legal Aspects:


Don't quit your job until you know that your business is not going to give you legal issues. To be blatantly honest, legal issues cost money, waste time, and will very possibly lead to business failure if you get caught up in one. Know the rights, responsibilities, and obligations you will be taking on when you leave your job and focus on your own business.


4. Analyze The Marketplace:


Don't quit your job until you understand the marketplace and what your industry is really like. What quality and service standards are expected in this area of business? Are you able to provide that standard or higher? If not, take a serious look at your business plan, and try to determine if the idea as a whole will be appealing to the market.


5. Find An Accountant & An Attorney:


Don't quit your job until you have an attorney and an accountant. Trying to find a cost effective solution to accounting and legal aspects of your business will be like finding the holy grail of money making schemes. However, it is unfortunately a necessary step in any strong, forward looking business. Get these two sides of the business sorted early, and you will have a lifeline on hand, should it be needed in the future.


6. Read Past Success Stories:


Don't quit your job until you have a rough idea of how others succeeded before you. Remember - unless your business is highly unique, you're probably not the first person to have had the idea. Consult business journals, look on the internet to find related business stories, and see what key attributes and features defined failure from overall success.


7. Work Out Who Your Competitors Are:


Don't quit your job without doing a bit of background work. If your idea is to start a corner dairy or convenience store - is there really going to be enough demand out there to generate more profits than you are currently earning? Remember - what is the point in quitting your job to earn less than you were previously?


8. Get The Right Training:


Don't quit your job until you can confidently say that you are an expert in your area of business. Anything less than expert knowledge will leave gaps for other people to steal away your market. Just imagine a potential customer rings you and asks a somewhat complex, yet relevant question - which you are unable to answer. Put yourself in the other persons shoes, and imagine how you would react.


9. Determine The Real Demand For Your Product or Service:


Don't quit your job until you are 100 percent certain that people will buy or want your goods. See, there is a big difference between what your opinion of your own product / service is, and how the rest of the public feels. Just because you believe your product is a wonderful and useful thing, this doesn't mean that other consumers will. Quiz people as to whether they would be interested in your goods, find faults, make improvements, and when its time - take the best possible product to market.


10. Make A Sale Or Two:


Don't quit your job until you have solid proof you can run your business successfully. Have you made any efforts to sell the product in the past? A few sales would be preferable before you stop receiving your current income stream, and focus solely on generating income with your new business. By having a brief yet reliable sales history prior to dedicating all your time, you can prove to yourself and others that this is not just a spur of the moment decision, which you might live to regret.

That concludes our list of the 10 things to do before quitting your job. Of course, not all 10 things will be applicable to everyone, so to give a closing remark, I want you to think about one big thing. Be careful, logical, and practical. Creating and growing a business is not as easy as it's made out to be. Ensure have the skills, resources, and energy to get things off the ground, and who knows - you may be the next success story just waiting to happen.

*About the author: This article was contributed by Andrew Wang. Andrew lives in the Seattle area. He manages the blog Travel Reward Credit Card.

*Image Credit: Photograph by Ayres no graces [via Flickr Creative Commons]

Do Children Need To Know About Family Finances?

(This is a guest article by Trisha Wagner*)

Specifically should you talk to your children if you are experiencing a financial hardship? Just as each family is different each situation is unique and there is not one easy answer to this question. I have a three year old and while we ran to the store this weekend to pick up a new router for my new work at home job, I was faced with some difficult questions from my toddler (since this is my only child, I am still amazed at how hard it is to answer some of his questions). It made me think: how much do our kids have to know about our finances? Is it possible to give them too much or too little information? In my case, the answer is a bit simpler. There is only so much a three year old can wrap his head around. There is no need to go into budgets, the credit crunch or why mommy has to wait and see how her new job pans out before spending money that might be needed for other things. He simply doesn't care and doesn't have the ability to comprehend you can only have ONE thing and it can't cost more than ten dollars. I get that. But what if you have older children.....kids old enough to have the basic gist of how money works and how important it is in keeping the household running?

If the current economy has you on your toes when it comes to the family finances it is likely your kids already sense something is amiss. Before you start worrying about how or if you should discuss a financial hardship with them you must realize that a child of any age first needs to know that they are safe, secure and loved. In their world, those things are more important than money and it is your job as a parent to explain to them that regardless of what may be going on with the household budget they can feel confident in those three things.

That being said you definitely should consider having a family meeting to discuss what is going on with your children in an age appropriate way. Some children will feel more secure by being included and you will also have the opportunity to prepare them for any possible changes that may be in the cards due to the economy. However, there is no need to go overboard and burden your kids with too much adult information which they may not be able to process. In doing this you are simply adding to their fears and feelings of insecurity instead of easing them.

Since the economy is not likely to turn around just because we have crossed over into a new year, it will be important to keep the lines of communication open with your children. If you or your spouse have lost a job or anticipate significant changes in your life due to finances, consider having a regularly scheduled family meeting to briefly go over information and answer any questions your children might have.

Many families are facing tough times but most will be able to weather the storm. Make sure you take the steps necessary to ensure your kids don't worry needlessly or have increased negative effects due to too little or too much information.

*About the author: This article was contributed by Trisha Wagner. Trisha Wagner is a freelance writer for DestroyDebt.com, a debt community featuring debt forums. Trisha writes regularly on the topics of getting out of debt and personal finance.

*Image Credit: Photograph by lucias_clay [via Flickr Creative Commons]

How to Properly Pay Down Your Credit Cards

(This is a guest article by Elise Degrass*)

Even in an economic downturn, the widespread available of credit to consumers is staggering: nearly anyone can apply for, and receive, a credit card today. With the growing ease of use (you no longer have to even sign for many transactions) and the vast number of businesses which accept credit transactions, fiscal responsibility with credit cards can be as difficult as ever. Keeping disciplined in your spending, as well as your payments, will help you to stay out of debt in the long run.

As a first step, consider working through a complete review of all of your existing credit card debt. If you have multiple cards, a spreadsheet may be an effective way to keep track of all of the data, from minimum payment amounts to due dates and interest rates. Also, it's important to note any variability in interest payments,
especially if an introductory rate becomes much higher after a certain point. Once you have collected data on your debt burden, you can begin taking steps to pay down your credit cards.

Prioritize your payments on cards which have the highest interest rates, and make a plan to shift your spending to cards with lower rates. Figure out your monthly expenses and determine which you can pay off with cash to reduce further interest rate payments. Additionally, you may want to consider looking at your overall expenses to prioritize repayment of debts over unnecessary purchases, especially for vacations and other upscale expenses.

As part of a larger budgeting process, ensure that you can meet all of the minimum payments while planning to consolidate your debt into just a few cards in the long-run; having fewer cards will simplify the budgeting process, as well as making it easier to keep track of your purchases. Working with a debt counselor to devise a long run plan, as well as working with credit card companies to negotiate lower rates, will help you on the path to a debt-free future.

*About the author: This article was contributed by Elise Degrass. Elise is a new writer who currently is blogging about cell phones.

*Image Credit: Photograph by Andres Rueda [via Flickr Creative Commons]

Money Management Tips For Women

(This is a guest article by Trisha Wagner*)
As all women know, one size does not fit all. The same is true regarding financial advice. Every situation is unique and requires personal advice and not surprisingly the advice for women differs slightly from advice for men. Although women have made huge strides in the last century, regrettably we are sometimes considered fickle emotional creatures unable to handle the complex issues such as finance. In reality woman are more than capable of handling these issues both at home and in a corporate setting, nevertheless the fact remains a large percentage of women do not have control of over their own financial situations. The following tips can help get you back on track and in control of your finances as well as your future.

• Educate yourself. The more you know about finances and the investment process, the more likely you will feel confident dealing with personal finance issues. After generations of men having control of household budgets, saving, retirement and investments, women have assumed the role in many households. Unfortunately we don't have a long line of role models to look to for example and many women feel ill prepared and even resentful of being in charge of finances and count on a spouse or partner to make the right decisions. Take advantage of the information available on line, in books, community or college classes and even from other women to educate yourself on financial matters. The more knowledgeable you are- the more confident you will feel in your decisions.


• Pay yourself. As the New Year looms closer, consider a new approach to beef up your savings account. Consider paying yourself at the start of each day. Start with just one dollar a day and increase that amount by one dollar at the beginning of each month. Women are quite accomplished at finding ways to take care of everyone else's needs first. It might be the needs of their spouse, children, employer, friends and family; we find a way to make sure everyone is taken care of. Apply the same thought and determination towards providing for you financially.


• Pad your retirement account. Saving for retirement should begin the day you begin working, but in the real world people tend to start later. It is especially important for women who are more likely than men to enter and leave the work force while raising their families to begin saving for retirement early. You will also want to take advantage of the increased amount of money you are permitted to contribute to your 401k after the age of 50. By contributing the maximum amount allowable, you will ensure you have a comfortable nest egg to live off of in your golden years.


• Use credit wisely. Credit is a good thing. Irresponsible use of credit is a bad thing. Resist the urge to help others out by co-signing or loaning money to family and friends. Do not use money or possessions as a means to feel self worth. You will find happiness comes from living well, not spending more.

*About the author:Trisha Wagner is a freelance writer for DestroyDebt.com, a debt community featuring debt forums. Trisha writes regularly on the topics of getting out of debt and personal finance.

*Image Credit: Photograph by red5standingby [via Flickr Creative Commons] of Faile Lost In Glimmering Shadows show at Lilian Baylis school in Kennington.