Goodbye credit cards and loan payments

In just a few days we will say goodbye credit cards. Brass bands won't be playing in the background and the credit card company probably won't send a thank you note but I'll be doing a happy dance.

Our final payment on our finally credit card is less than $100. I had hoped to pay it off last month but my typing fingers couldn't quite get over the finish line. Comforting me is that we were able to get rid of a huge chunk of that debt and payoff a loan in March.

Choosing which to payoff wasn't easy. Paying one debt in full meant being about $150 short on the other. My goal of saying goodbye to the credit cards was within reach. I was ready to shout hooray but that's not what happened.

The numbers were clear. Paying off the loan early would save us more financially. We would still put a good sized payment on the last of our credit cards but we wouldn't quite wipe off the balance. An unexpected ghostwriting gig made me feel better by lowering the balance some more.

Our largest bills still lie ahead but I feel like we've rounded a curve. Even though I'm looking at a huge car repair, medicals and other big debts, a weight has been lifted from my shoulders. It's as though I'm breathing in fresh air for once and it feels really good.

(P.S. We've been saving for the car repair along with paying so much on the credit cards a getting rid of the loan. :- )

Getting help with bills

People who are drowning in debt sometimes need help with bill. Utilities, rent and other major expenses come due whether you have a job or not. Being in a bad financial position can happen for lots of reasons. Every email I get confirms that bad debts can happen to good people. Illness, the economy, fire, natural disaster or an accident can each put a family in jeopardy.

When you are in a crisis, it can be tough to find help. Almost every community has places that can help with some bills. The key to getting the help is to know where to start looking.

I am writing this article from the perspective of a nonprofit director who has helped people who were in crisis. Every community has a slightly different system and every agency requires different qualifications. This article is a general starting point for people who need help with bills.

If you are looking for help with bills, there are a couple of things to know.

Forget about asking for help with credit card payments or other types of revolving credit. Organizations that offer bill assistance will only help with emergency funding for necessities as funds are available. That credit card bill may be high on your list but it won't make the cut for their list.

Workers usually want to help but funds may not be available.

You may need to have proof of income, rent receipts and identification for every person living in the household and identification for yourself. The paperwork varies so calling an agency ahead of time can save you time and frustration. 

Utility assistance
Call your utility company to see what they will do. They may have programs that can help with bills. If not, the workers can usually suggest places that are in your community where you can look.

United Way
This organization does not typically provide assistance. However; they can be a good referral source and can often direct you to the right agency.

Help agencies
General help agencies in your community may be able to help with bills. A pantry may be able to provide you with a box of food. Obviously, this won't directly help with rent or utilities. What a food box can do is free up funds that can be used in other areas.

Churches
If you go to church, then start there. Talk with your pastor about your situation and see if your church can help. At the very least, your pastor can support you through the process and may be able to make referrals or fax agencies that can help.

Toys
Getting help with the bills at Christmas can mean that you need toys. There are people who can help. Your child's guidance counselor, pastor, day care or agency may be able to get you on an Angel Tree list. Be reasonable with your expectations. Families who are adopted from these trees are typically adopted by a small group of people like you and me. Leave the iPads, iPods and Xbox off of your child's Christmas list.

Think outside the box
Agencies run out of money too. Don't wait until you are in crisis to start getting help with bills. Being proactive can help you make a few dollars here and there. Taking cookies to work and asking for donations, eBay, holding a yard sale, collecting aluminum cans, raking leaves or shoveling snow off of driveways can help. It may not solve all of your problems but it may help buy some time.

Modest Needs
This organization may be able to help with small grants. They are not an emergency funding source and they do ask for documentation. If you are getting help with bills from any source, you almost always have to provide information.

Goodbye bookstore credit card account

We are down one more bill. I said goodbye to my bookstore credit card account. This one was a toughie for lots of reasons. The credit account was to a bookstore that I adore. Not only is it a local place to buy books and talk with staff but, it is also one of my favorite places to pick up gifts. I closed my eyes, handed over my debit card and signed on the dotted line. That was it. I was out the door before I could change my mind (or find something else to buy).

Temptation wasn't finished with me. I was surfing when the ad to open a credit card account at a major online bookseller smacked me in the face. It's hard to tell you how strong the temptation was to open the account. Sitting on my hands is one of the lessons that I'm learning as we dig through the debt pit.

My tactic was to close the computer and take a walk. This gave me time to think things through. Paying off the credit card account at the other bookstore gave me another measure of freedom. Did I really want to exchange that freedom for another ball-and-chain load of debt?

You should have heard the argument in my head. Then again no, you shouldn't have. Reasoning won out in the end but it was a very close call.

My thinking is that if I could find the willpower to limit my Black Friday shopping, then I could say goodbye to the bookstore credit card account and leave it closed. There is no point in opening another account and struggling to pay it off. It's time to say "enough is enough" and walk away. It's a small victory but it feels good. I think that I'll leave it that way.

Reducing my Black Friday spending

This year, I am limiting my Black Friday shopping to the bare bones experience. Black Friday is one of my favorite times of year. I have fond memories of going shopping with my daughters and having a breakfast snack of Cracker Jacks. A store named Proffit's gave tons of the stuff away on Black Friday. The prize in each box ranged from some really cool items to deep coupons.

It was also a day for spending money. Granted, everything we purchased was either on sale, bought with a coupon or I used a combination of coupon and sales when possible (sound familiar). We were always sucked into the shopping frenzy and blew our budget.

Things are a little different this time around. Every time I think about overspending I take a minute and evaluate where we are financially (see blog post). It's giving me more confidence to leave the debit card behind. I'm still going to go out to enjoy the Black Friday crowds a little wiser than in previous years and it's giving me more confidence.

Credit card consolidation is the surefire way to boost your score – Is this true?

These days, with the record breaking statistics of the people going bankrupt, an increasingly large number of people are desperately looking for ways to eliminate their debt burden. If you’re over your head in credit card debt and you don’t know what to do in order to repay your debt obligations, you should hire a financial planner so that you may get out of debt with ease. The financial planner will ask you to take help of a credit card debt settlement or a credit card consolidation firm so that you can combine your debts and repay them without burning a hole in your wallet. But the question that is asked by most debtors is whether or not this will hurt their credit score in the long run. The answer is in the negative as the debtor ends up repaying the entire amount but in small and affordable monthly payments. Read on to know the effects of credit card consolidation on your credit score.

Cherokee Mountain trail

What happens when you take the decision of repaying through consolidation?

Just as you take the decision of enrolling yourself in a debt consolidation program or take out a consolidation loan, secured or unsecured, this is reported to the credit bureaus and they come to know that you’re not paying as agreed with your credit card company. This slightly hurts your credit score but the extent is something that can be easily avoided. There will be a temporary drip in your credit score for a certain period of time but as soon as you start making the payments on time, your credit score will be increased.

How to make payments through a credit card consolidation option

Whenever you enroll yourself within a credit card debt consolidation plan, you have to repay your entire debt in single affordable monthly payments. If you take out a loan, you’ll get lower interest rates than what you were paying and if you sign up with a program, your debt consultant will negotiate with your creditors in order to lower the interest rates. Then as the rates are lowered and terms are made favorable, you have to start making monthly payments to repay the entire debt amount. Just make sure that the payments are reported to your creditors so that it may boost your credit score.

Before you take resort to any of the credit card consolidation options, you should determine which one suits your needs in the best possible manner. Manage your finances to make the entire process successful as failure to make the monthly payments on time may discontinue the entire agreement and also trash your credit score.

This article has been posted by guest blogger Allen Smith. Follow him on Twitter today.

A loan consolidation would hurt my debt plan

Lately loan applications have been flooding my mailbox. It was nice of the USPS carrier to bring two more offers today. One of these raised the possibility of a loan consolidation and the other was from one of those payday loan companies.

According to the letters, these folks are willing to lend me thousands if I'll just sign on the dotted line. The advertisements make one monthly payment sound good. I was forced into a student loan consolidation a couple of months ago. After looking at my debt it doesn't sense for me to reach for a consolidation on anything else.

Anytime something sounds too good to be true it usually is. The same adage can apply to a loan consolidation. These companies are in the business of making money and they do a good job. That is the only way that they can make these finance offers.

Here's why it's not a good idea for me right now.

The author's piggy bank.

Other than student loans and taxes we only have three pieces of debt that accrue interest. Two of these will be gone next month. We boosted our withholding to hopefully take care of the taxes. (I'll know in April.) In the meantime we've worked out manageable payments to the IRS. 

The rest of the debt is interest free medical bills.

It is tempting to roll the medicals into a loan consolidation but that would really cost us in the long run. It would mean having to pay interest on the debt that I'm trying to get out of. The loan consolidation payments would be based on rolling of medical bills together with credit card debt. 

Rolling non-interest bearing debt into a consolidation that would accrue interest doesn't make sense. Therefore I'll pass on these opportunities just as I did on a credit card offer a few months ago. 

Hopefully the USPS carrier will continue to bring the loan consolidation offers to my door. They're all going into the trash but the lending company offers do have one bright side. The mailings are helping provide jobs to the postal workers.  

Two more bills down and paid off

We have two more bills down and paid off. Getting control of our finances it pretty darned hard. I think it will be worth it though. The breathing space is a relief.

If this is your first visiting this blog let me explain what we're doing. My family and I are average. There's nothing special about us. Like most families we struggle to make ends meet.

It became apparent a few months ago that extra income was going to be needed to help pay off our bills. The challenge was to find something to work around our often chaotic schedules.

Then I found an online website to write for. Recently, it became the Yahoo Contributor Network. The extra money has been a huge help in paying of credit card bills and other debt. In searching for other companies I found Examiner and Factoidz.

The amount of money that I make from writing online isn't huge but it's helped me pay off $200 worth of bills this month and a couple of months ago it helped me buy a new netbook.

The hard part has been rolling the former payments onto other bills to pay them off more quickly. Look for another blog post about that in the future.

My online writing bought my netbook

Many thanks to help from readers who bring traffic to this blog and some extra writing work! I'm happy to say that the newest debt has been retired! Yippee! The new Asus EEE PC is now mine.

It's a really good feeling to have this paid off. No one likes to have unexpected expenses. When my old netbook passed away suddenly the problem looked like another impossible debt. Now, it's another debt that has been laid to rest.

We had to use our credit to get the computer. That meant making some hard choices on how to pay the credit card off. Extra writing means sacrificing family time. Plus, unless it was for the blog or work my family ate inexpensive meals at home instead of eating out. These choices aren't anyone's idea of fun.

My daughter came home from college last weekend. It would have been nice to have spent extra time shopping before coming home instead of working to pay off the credit card. Instead of buying things, we meandered through Shenandoah National Park and stood on the Appalachian Trail.

I'm learning that managing debt means making a trade off. Yes, paying off the credit card is important. Should it come at the expense of family time? Or, is there a way to balance extra work hours with family time? I'm learning that not only is it possible to balance both but it can be freeing to do so.

One of my choices involved choosing a netbook. Passing up on the super cool Asus made me feel like a failure for a few days. Instead of being happy about the new purchase I was unhappy that it wasn't my dream model.

That feeling changed when the Asus netbook arrived. It does what it needs to do without a hitch. Once the updates were loaded it was ready to go. That helped make me feel better.

What helped me feel better the most is knowing that a bill for the Asus netbook isn't coming at the end of the month. No netbook means no income. Not having one wasn't an option so we had to use credit. Paying off the credit card quickly was the only real alternative.

That's where the extra writing came into play. Boy, am I ever grateful for that and for those of you who visit my blogs. Take care now. Good luck paying off your credit card debt too. I know you can do it! :)