Hank Coleman, Author at Getting Out of Debt Q&A

Top 3 Ways To Create Financial Stability In Your Life

Financial stability is a terrifying phrase because it’s something we all aspire to, even if we don’t quite understand how to get there. The phrase calls to mind thoughts of sacrifice, eating ramen, and living paycheck to paycheck while you save every spare penny, but it’s neither that complicated nor that scary.

You can become financially stable without giving up your lifestyle or sacrificing all your luxuries – and although you may give up some of them, you won’t miss them once you find yourself on stable ground.

How To Create Financial Stability In Your Life

Tackle Your Debt First

Paying off credit cards, student loans, and other forms of debt takes a lot of money. Those monthly payments are sometimes insane and it can feel like you’ll never dig your way out of debt. Don’t fall for that. Instead, grit your teeth and prepare to make some tough choices. If you have credit card debt, focus on paying off the card with the highest interest rate first – that’s even more important than taking on the card with the highest limit. Focus on paying off one card at a time. You can even use the snowball method for debt.

You can also look into consolidating your debt. This isn’t the best choice for everyone and it may not work for you, but there’s no reason not to consider it. Consolidating all of your bills into a single, smaller payment may help you get a handle on your debt. It can also help you get back on your feet financially.

Don’t Skip Out on Insurance

You need to insure everything. That might seem counterintuitive since insurance plans cost money, but do you know what costs more? Replacing your furniture, appliances, and mementos if something happens to your house, and replacing your computer, your phone, or your car when they’re damaged.

Take the time to do your research, however. Whether you’re insuring your home, your expensive jewelry, or your new phone, check out different options, read an Assurant review, look into other providers, and pick the best policy for your needs.

Why Scotland Is Far Ahead in Debt Consolidations

by Hank Coleman

There comes a time when money troubles affect all of us, but unfortunately it can all too quickly spiral out of control if you’re not careful. If you have more than one credit card or several different loan agreements in place then keeping track of everything can fast become a nightmare, leaving people wondering how exactly they should be handling their finances in the correct way.

Debt consolidation is one solution that can often help those who have their borrowing all over the place, and when it comes to this method you’ll find that Scotland is a country that takes a lot of stress out of money matters.

That’s because Scotland allows its citizens to take out something called a Scottish Trust Deed when they’re struggling with multiple repayment arrangements. This is a legally binding arrangement between an individual and their creditors, where unaffordable payments are transferred into a single affordable monthly payment. This legal agreement can only be carried out through a licensed Insolvency Practitioner, who then acts as the trustee for your arrangement.

The big advantage to using a Scottish Trust Deed is that you’ll be protected from your creditors. They won’t be able to take legal action against you for not making repayments, and you can also enjoy peace of mind that your home and car are protected against being repossessed.

The repayments are also based on your circumstances, so you will only have to pay what you can reasonably afford. The pressure of unwanted phone calls with creditors is also removed as a trustee will take care of everything for you.

Is it Ever Appropriate to Invest While in Debt?

by Hank Coleman

Should you invest while still in debt? When should you start investing? You may want to start investing despite still being in debt.

Is it ever appropriate to invest while in debt? The presence of the word “ever” in that question should be a hint that the answer is “yes”. If you figured that already, then good for you and right you are.

Is it Ever Appropriate to Invest While in Debt?

But it’s a “yes” with qualifications. Investing while in debt should be the exception to the rule. There are, however, a number of exceptions, some of which we’ll talk about here.

Investments that can be engaged in with skill, like binary options trades through Banc de Binary, are one such exception. These are trades that can be completed in seconds, which have the potential to multiply invested amounts several times over.

For those skilled at this method of trading, it’s a great way to make money, and can be used to gain the funds necessary for total debt cancellation. It’s also a risky proposition and one that should only be taken part in with money that won’t be missed if the investments don’t pan out. But for people who enjoy past paced and fun investment models, this can be a great one to add to your repertoire.

Most of the argument against investing while in debt comes results from a simple concept: debt tends to add up much faster than wealth. Investors hope for 7-9% annual returns from mutual funds and other stock market gains. But high interest credit card debt can accumulate at 25% annually – sometimes even more!

The math is simple. You won’t make money if you’re taking on debt faster than you’re growing wealth. If you have high interest consumer debt, there is almost no good reason to invest until it is paid off.

Don’t Make These Mistakes Marrying Someone With Student Loan Debt!

by Hank Coleman

Student loan debt is something of an elephant in the room for couples nowadays, because it’s not fun or easy admitting just how big the burden is and discussing finances sometimes causes anxiety for both people involved. If you have a small student loan to pay back or you’ve paid off your schooling altogether, it can be tricky navigating issues like marriage when your partner has a significantly higher student loan debt burden.

However, many personal finance experts agree that debt shouldn’t be a make or break issue for a loving relationship.

Mistakes to Avoid with Student Loans and Marriage

While some couples decide to avoid marriage altogether, there are many ways to make student loans and marriage work. And, student loans and marriage can work as long as you avoid the following mistakes:

1) Not Disclosing Finances to Each Other

Lack of communication when it comes to finances can be disastrous for a relationship. It’s not the loans that become the issue; it’s the lack of transparency about the amount and the couple’s approach to paying them off in a timely manner.

To avoid miscommunication or arguing about money before and after marriage, it’s important to lay everything out on the table and organize your finances before the wedding. This may take a few hours or a few weeks; it doesn’t matter how long it takes you as long as you remain open and honest with each other and tackle every detail.

A common problem for the partner with the higher student loan debt load is not knowing exactly how much they have, how much they’ll have to pay, and how they’ll pay it off. The uncertainty can cause stress and resentment for the partner with little to no student loan debt, unless you both have a solid plan for paying it off. Consider these questions during the organizational phase of your engagement:

How much money is owed altogether (both partners)?
How will you pay this money off? Are there income-based repayment plans available to you?
Does one partner make more money and is willing and able to help pay down more of the principal on the student loans?
What are your monthly living expenses together? How much can you both afford to put towards student loan payments each month?
What resources are available if you think you might default on a student loan? If default is inevitable, how can you protect the person in the relationship who has less debt?

2) Having a Lavish Wedding

Did you know the average cost of a wedding is over $31,000? That’s a crazy amount, especially when you do a cost-benefit analysis and realize how much of your student loans you could have paid off with that money. Obviously weddings should be special occasions that will create life-long memories, but you don’t need an expensive wedding to attain those goals.

The Relationship Between Millennials and Credit

by Hank Coleman

Here is a great infographic from the folks at Avant.com discussing the relationship between millennials and credit. Why is their credit score below average? Here’s an interesting look at some of the details between millennials and credit. The Relationship Between Millennials and Credit Where Millennials stack up against the U.S. Credit Score Average U.S. Credit … Read more