What do you think about debt consolidation?
I heard going through one of those debt consolidation companies is as bad as declaring bankruptcy. Is that true? Rather, it is best to deal with?
Please do not consolidate. It is not free, lower their payments by increasing the amount of time until the debt free, and you will succeed in your credit score. Or negotiate their debt until after her not to pay for a time to add another hit to your credit score, which is almost as bad as bankruptcy. Student loans are the only debt they can garnish your wages for lack payment, without the court first. Just list on a piece of paper or a spreadsheet and follow the plan. If the work of the plan, the plan of work for you. A. A garage sale and sell anything you no longer need or want. B. Get a temporary part-time work, if you have one, get another. Here is a plan that can help. If you work the plan, the plan of work for you: 1. Make a budget. Make the budget a week before you get paid. A budget is not a punishment! It is a tool that freed from having to worry about money again. Put everything in your budget. Above all the bills year, semester, quarterly or vehicle registration insurance, etc. Give every dollar that is going to bring home the name of where it goes. Add an emergency fund "category in your budget and save $ 25 up until you have 1000-1250 dollars. Your emergency fund will help keep you from getting into new debt because of an emergency. If possible, establish a direct transfer a savings account for your emergency fund. In this way it moves automatically and you do not even have to worry about it. You have to cut expenses and live with less than wins. 2.First catch up with you all the debts and make no further delay in payments. Stop using your credit cards immediately. Do not take more debt. cards Credit is like quicksand only the death is much slower. Make a list of all your debts in order of higher interest rate to lowest interest. Use money cash only for your spending from now. 3.Pay the minimum in all its debts and then put your extra money to pay the highest interest first. After obtaining a worthwhile, put the money paid on debt # 1 (the minimum payment and extra payment) towards debt # 2. That will pay debt # 2 off faster. When it is paid, it becomes three payments of card # 3 and that one will be repaid fairly quickly. As an example: To start: Debt # 1 (plus interest): + payment minimum additional payment of debt # 2 (average interest): minimum payment Debt # 3 (lowest interest): minimum payment Debt # 1: # debt 2: minimum payment Debt # 1 + minimum payment Debt # 2 + extra payment of debts paid # 3: minimum payment Debt # 1: pay debt # 2: paid Debt # 3: The minimum payment card # 1 + minimum payment Debt # 2 + minimum payment Debt # 3 + additional fees. In this way, will bear fruit, time, and pay no interest. It will also help rebuild your credit because you no longer have any late payments. This works no matter how many different debts you may have. 4. After receiving all your debts paid off, add to your emergency fund until you have 6-12 months of income saved. Put that in emergency funds in a money market fund in a liquid or Bank of America there is no risk CD so if you need the money can be done without penalty. 5a. When you have your emergency fund in place, add a category for "fun" budget. Save for a holiday, vacation, a large screen, or dinners out, whatever goal you want. Remember to enjoy your life. 5b. When you have your emergency fund in place, start saving for retirement. Join the 401 (k) plan at work and contribute the maximum. Your employer probably matches at least part of their contribution, why give to free money? Open a Roth IRA and contribute the maximum on a monthly basis. If you start saving for retirement now, you probably will retire a millionaire. 5c. When your emergency fund in place, start saving for your next vehicle. Only buy cars, or other things that depreciate, with cash. Save up to car better. Thus earning interest instead of paying the interest. You can do it and is not as difficult as you think. Just follow the plan.
Suze Orman’s Debt Consolidation Tips
