canstockphoto28074279Divorce is challenging for a number of reasons. The legal part of the divorce can be stressful since it concentrate mainly on how the assets and debts will be split up. Divorce isn’t just emotionally draining. It can also get quite expensive.

 

There are ways you can avoid stress by learning the basics of debt and divorce:

 

1. Get familiar with the laws in your state. Since the rules vary from state to state, find out who will be responsible for paying off the debts. In some states, the name on the debt is the one that’s required for making the payments while both parties are reliable in other places. Regardless of whose name is on the account, you may still be responsible.

Speak with a divorce attorney to learn more about the laws in your state.

 

2. Joint credit cards are equivalent to joint debt. If both of your names are on the credit card, you’re also responsible for paying off the debt. If your spouse charged $10,000 without your knowledge, the credit card company will potentially hold you equally responsible for the debt.

After the separation, all credit card purchases and cash advances are the sole responsibility of the person that made the transactions. The time period of the separation occur depends on the laws in your state.

 

3. Cancel all joint accounts during the divorce proceedings. You don’t want to be held responsible for your soon to be ex spouse taking out a large cash advance or mounting credit card debt. Make sure that you’ll have enough money in your account and check your credit rating before cancelling the credit card account.

 

4. The court ruling may not protect you from creditors. If your name is on the account, the court’s decision doesn’t matter to the creditors. If there’s a credit card, mortgage, car loan or any other debt, you are still liable. This can negatively affect your credit if your ex fail to pay it off.

 

You can also face a lawsuit for the debt. If this describes your situation, you have the option to sue your ex for failing to honor the agreement. This can be very stressful for both parties. If you feel that you’re not responsible for paying the debt, allow the courts make a decision on the matter.

 

5. Pay off outstanding debts. Paying off all of your debts or converting joint accounts to individual accounts will make the divorce process easier and less stressful. If this isn’t possible, keep a close watch on your joint accounts and get a copy of the documentation of your finances.

 

6. Consider the mortgage payments. The banks unlikely will remove either of your names from the mortgage.  The more people that’s responsible for the mortgage payments, the happier it will make the lender. It’s probably best for you to sell the home and split the proceeds. If either one of you decide to keep the home, you have the option to refinance the home to remove the other party from the loan.

This is usually the largest debt that’s created by married couples and is also chaotic during divorce proceedings. The parent with physical custody of the children will typically get possession of the home.

Refinancing is a possible solution if one of you have sufficient income and a good credit rating and there is enough equity in the home.

Selling the property is the best choice to pay off the mortgage in most cases. This will allow both parties to be free of debt and rebuild their life.

 

7. Think twice about signing a quitclaim deed.  It allows one party to give up all claims of the property. Many people make the mistake of thinking they are no longer responsible for making the payments if they sign it. You will lose any equity and use of the property and still be responsible for the mortgage payments.

Divorce can be emotionally and financially draining. The way debts are handled during the divorce process depends on the laws in your state. A good divorce attorney can help you to make sure that your finances are intact and make it easier to transition to the single life without emptying your bank account.

 

canstockphoto21350556Credit counseling services are often receiving mixed reviews. There are many reputable services out there. You should take precaution since there are also credit counseling companies with a bad reputation. Credit counseling is now required before filing for bankruptcy If you’re looking for help dealing with your outstanding debt, be aware of the advantages and pitfalls of using a credit counseling company.

Pros of Credit Counseling

1. Credit counseling services make it easier to negotiate with creditors. Some creditors are willing to discuss payment plans with credit counselors. You may get a better deal and more breathing room by using a credit counseling service.

2. Make it possible to consolidate your payments. Many firms will allow you to consolidate your debt into a single payment each month. You will be making a payment to the credit counseling company. Remember, the credit counseling firm must make all of the individual payments on your behalf.

3. It can make it easier to get a new line of credit. One of the benefits to getting credit counseling is new credit will be secured for you. They will actually work to have your credit card applications approved.

4. Put a stop to harassing calls. The bill collectors will leave you alone once you’re on a repayment plan. You can easily do this yourself by making a request in writing.

Finding a reputable and honest credit counseling service can be helpful for getting out of debt. There are many advantages to using a well-qualified credit counselor. But there are also some disadvantages to watch out for.

Cons of Credit Counseling

1. The creditors may not receive your payments. There are numerous complaints filed each year of credit counseling companies failing to send the payments to the creditors.

2. They may not deliver on their promises. Some companies will use tactics to get their hands on your money by false advertisements that’s too good to be true. After the credit counseling company get their portion, your situation may remain the same.

3. It can possibly affect on your credit rating. There is one method that can make your credit worse. The credit counselor may suggest for you to stop making payments on your debt and put the payments into an account instead.

Your counselor would approach by suggesting to pay off the debt at a reduce amount once a large lump sum is accumulated. Your credit will suffer due to nonpayment during this process. Make sure that you choose a reputable credit counseling firm since the money in the account is under their control.

As you can see, the potential drawbacks are serious. It’s very important to do your own research to find a reputable credit counseling service. Many consumers are led to believe that a service with a non-profit status is reputable. You should remember that a non-profit is a company isn’t about earning a profit.

You’ll be able to find a counseling service in your area that you can visit in person. Checking with the Attorney General and Better Business Bureau is an effective way to see if there are any complaints or legal action taken against the company. Doing an online search can also help you find complaints and negative reviews from consumers.

Ask about the fees and the services that they offer. Also find out how many of their employees are paid a salary. Are they compensated for signing their customers up for certain services? Make sure you receive it in writing since verbal promises can be conveniently forgotten and hard to prove.

Credit counseling can be beneficial or challenging to your goal of eliminating debt. Find a reputable credit counseling firm by doing your own research thoroughly. Following these tips will move you in the right direction.

7 Characteristics of Successful Savers

canstockphoto15497150Do you consider yourself to be a good saver? Very few people often save enough money to maintain a reasonable level of financial security .Many seniors are forced to work well into their retirement years. Adopting great saving habits can make building your savings considerably easier. Making a few small changes may be all you need to have a bright financially abundant future.
Saving money will be a slow process at first and may require many years for you to see impressive results. Nevertheless, your habits dramatically influence your results over time.

You will become a successful saver by adopting these habits:
1. Successful savers pay themselves first. It is natural for our instincts to steer us in unproductive directions. Many people feel compelled to pay all of their bills first before saving their money. It would be nice to avoid the mental burden of bills and other financial obligations. However, there’s hardly anything left at the end of the month to put toward your savings. Make a habit of saving a certain percentage of every dollar that you earn or receive each pay period.

Start out with 2% of your income if that’s all you can afford right now. Make an effort to increase the amount over time. Avoid spending this money at all costs!

2. Automatically save their money. It’s much easier and more convenient to simply have the money from your paycheck direct deposited into your bank account before you have the opportunity to spend it. There are many employers that are willing to split your paycheck and send a portion to a separate account on your behalf. This is one of the easiest ways for you to save money.
3. Learn to control their spending habits. The less money that you spend, the easier it will be for you to save. Review your spending pattern over the last month and determine if all of your money was well spent. Don’t be down on yourself if it wasn’t. Start monitoring your spending each month. Once you get the hang of it, you’ll be amazed about how much money you have accumulated.
It is reasonable for you to expect an annual return of 10% on your long-term investments. For every $100 that you spend today would be worth nearly $750 in 20 years only if it had been invested. Spending $100 when you’re at the age of 20 can cost you nearly $8,850 once you reach 65 years of age.
You should always shop with a grocery list. We’ve all gone to the store for a couple of items and came home with far more than expected. Before you leave home write out a list of what you need and stick to it.

4. Avoid getting into debt. Trying to save while in debt is similar to climbing a mountain and never reaching the top. Consumer debt is an obstacle that will make it difficult to achieve any financial goal. Anytime you’re unable to pay cash for any purchase, you simply can’t afford it.

Avoid accumulating any unnecessary debt unless it’s for an emergency or something that’s very important that needs to be paid for immediately.

5 .Set goals. Saving money is a lot easier if you have a clear picture of the reason. In other words “What is your why?” For example, saving enough money to enjoy a comfortable retirement or sending your child to college can help maintain your focus.

6. Stay on top of their finances. Most savers are aware of how much money is in their accounts and the amount of money they’ve saved and spent each month. They also keep a close watch on all of their income and expenses.

7.Take responsibility for their finances. They always pay their bills on time, stay out of debt and have an emergency fund for the future. They also take responsibility for all aspects of their financial life instead of blaming others.

As you can see, it’s possible to save enough money to secure your future. Creating good saving habits will enhance your results. By making a few minor adjustments, you can watch your savings grow a lot sooner than you’ve imagined. Start creating a budget and savings plan today!

4 Ways to Get Through a Financial Emergency

canstockphoto6226763How do you get through a Financial Emergency? Just when you think you are on top of your finances and things are going smoothly, disaster strikes. It could be something as minor as getting a flat tire on your way to work or something big such as job loss or a medical emergency. If you plan ahead, you’ll get through it, even if you are going through hard times.

The purpose of creating a budget is to save money for the unexpected. Most financial gurus agree that everyone should have an emergency fund that will cover their expenses for at least six months. Even if you are doing well with your savings, it doesn’t mean that you should stop adding money to it.

Here are some tips on how to get through a Financial Emergency whether you think you are prepared or are in deep debt:

 

Review Your Budget

Although, you may have enough money in your emergency fund to pay for car repairs, you will still need to prepare yourself in case anything else happens. What if you or your loved ones are faced with a medical emergency that your insurance company won’t cover or what would you do if you were laid off from your job today? You will need to find ways to readjust your budget.

Reducing the amount of money that you spend on your cable bill is a great way to save money. If your contract has expired with your current provider, you can ask for a smaller plan or eliminate the service all together. You can also contact your cellular phone and internet service provider and ask for cheaper plans or find another company that has better deals.

Canceling magazine or newspaper subscriptions can also save you some money. There is a good chance that there are free online newspapers and websites where you will find the same information for free.

 

Earn Extra Money

If you are currently without a job, there are still ways you can earn some extra cash. You can provide a cleaning service, wash cars or provide a dog walking service for your neighbors. If you would like to make money in your pajamas, there are easy ways you can make money online. If you have items in your home that’s no longer in use, sell it on eBay. There is a good chance that someone is looking for that item as long as it’s in good condition.

You can even use your skills to make money as a freelancer. Check out places such as taskrabbit, fiverr, eLance and oDesk.

 

What if you don’t have enough money to cover the expenses?

Negotiate the Payments

If you are faced with high credit card bills or are behind on your mortgage, contact the company as soon as possible. Ask if there is a way that you can pay a lower monthly payment until your financial situation improve. Most companies will work with you, especially if you have a good history of making your payments on time.

If you had a medical emergency that’s not covered by your health insurance company, contact the financial department of the medical facility and ask if there is a way you can pay in monthly installments until it’s paid off. However, if the payment is more than you can afford, find out if there is a way you can send a lower amount.

 

Ask for Help

If you are going through hard times, swallow your pride and ask for help. Find out if there are charities in your area that donate food and clothing. If you have a disability, visit the Social Security Administration to sign up for SSI and food stamps. This will help out with your household expenses until you are able to get back on your feet.

 

These are a few ways to get you through a Financial Emergency. It may seem impossible at first, but if you follow these tips, you will become debt free before you know it.

canstockphoto0826150Many people have fallen into the trap of consumerism in order to compete with their friends, neighbors, coworkers and even complete strangers. They often purchase material things such as luxury vehicles and expensive clothes based on the status symbol. Even though there are many items they can pay for without going into debt, they choose to purchase things that are beyond their means just because of the image that it presents. This behavior is the reason many people go into debt or file for bankruptcy in some cases.

Whenever you are watching television, have you noticed the car commercials promoting their luxury brand vehicles. They create ads that position these vehicles as being the best choice for people that are successful. These ads are working their magic since these vehicles are filling up school parking lots where parents and teachers are impressed of what their peers are driving. This is post-elementary peer pressure at its best.

 

This type of pressure has taken over so much that it often lead many people to get of thousands of dollars in debt. Here are five steps you can take to get rid of the Keeping Up With The Joneses Mindset.

1. Enjoy doing activities that will bring your family true happiness. There are many things that you can do to have fun together that’s inexpensive or you don’t have to spend money at all in some cases. Instead of taking an expensive vacation why not do things locally? You can go to local attractions such as the carnival, petting zoo or the beach. Some of these places give customer discounts on certain days.

2. Don’t Make Impulse Purhases. Think of how much impact the purchase will have on your finances. It doesn’t matter whether you are making minor or major purchases. Create a written plan on the beginning and end date that you would like to clear off your debt. Make your payments bi-weekly or on a monthly basis. Before you go shopping, determine what you will need to buy and always make your purchase in cash. Sticking to this strategy will double or even triple your savings.

3. Be grateful for what you have. Appreciate the things that you have in your life instead of what you don’t have. You may think that you want to drive a new sports car or get a big house. Would it really make you happy to struggle to pay for these things? The only winner in the end are the banks.

4. Take a deeper look at your home and career. Instead of getting yourself into debt by moving into a new house, make improvements to your existing home. This is a lot better than paying for a mortgage and it will also increase its value. If you are thinking about changing careers you can start a side business until you are able to make enough money to quit your day job.

5. Hang out with people who are responsible with their finances. Be very selective when it comes to the people that you bring in your family’s life. If your friends are wreckless with their finances then you should take shopping trips separately. Don’t feel guilty for turning them down whenever you’re asked to go to the mall. It will take time to resist your old habits and keep negative influences at a minimum.

Apprecitiating time with your family, being grateful for the things you have,  improving your existing home and career, staying in control of your spending habits and  having friends around that’s responsible when it comes to their finances are five steps you can take to get rid of the keeping up with the joneses mindset. These things will add real value in your life.

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