Ways to Avoid Paying Fees on Your Credit Cards

The last things you need when you’re trying to rebuild your credit are more fees on your credit cards, adding to your already too-high balances. What you need to do is learn some basic tips on how to avoid these fees and only pay for what you’re bought in the first place.

• Pay your bill on time – The easiest way to avoid late fees on your credit cards is to pay your bill on time, every time. If you do this 99% of the time, but forget once, a quick call to your credit card company can usually remove that fee because of your good track record.

• Read your credit card rules – While it’s not always easy to read the guidelines that come with your credit card, you will want to make sure that you aren’t going to have to pay any fees without knowing about them in the first place. Some cards require an annual fee, for example, which you may not realize you have to pay until it shows up on your bill. Be smart, read the rules first.

• Ask to move the due date – Most credit card companies are pretty lenient about moving your due date for bills, so long as you request ahead of time. Some credit cards have places on their websites to do this, or you might need to call the customer service number. In any case, this is a simpler option for most, though it will change the schedule of the charges that you put on the card.

• Use automatic bill pay – Most credit card companies allow you to submit your banking information to automatically pay the minimum payment on time each month. This allows you to always make your payments and avoid any fees for lateness. In the case of a late payment, this might be the credit card company’s fault and you will not usually have to pay a late fee.

• Always have enough money in the bank – By sending a check that isn’t going to cover the payment you’re making, you will be assessed an additional fee. Never send a check unless you know that you’re going to have the money.

• Pay over the phone – If you’ve forgotten to pay your credit card until the last minute, call the customer service number and make a payment that way.

When you pay your credit cards on time, you won’t have to deal with excess fees that simply turn into more interest that you need to pay. With these tips, you’ll certainly see fewer fees in your future.

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 Ways to Avoid Paying Fees on Your Credit Cards

What’s Your Strategy?

When you’re starting to take charge of your credit card debt, the advice that you read can be just as confusing as those papers that come with your credit card bills. However, there is no right or no wrong way to handle credit card debt, so long as you’re paying it down and not creating any more in the process. Here are some strategies that do work and why they might work for you.

1. Pay off the smaller balances first – When you pay off the smaller balances first, you will end up with fewer bills to face each month, which can really help you when you have a number of bills to pay. It will also help you to see instant results from your hard work and budgeting. Try listing out the smaller balances on a piece of paper and check them off as you pay them off.

2. Pay off the credit cards with the highest interest rates – Because these cards can be the ones that end up costing you the most money, doing your best to pay these down first can help to lessen the damage of those interest charges. Make a list of the interest rates for each of your cards and then tackle the ones with the higher rates first, putting as much money in those payments as possible. Or, you can start with just one credit card with a high payment, pay it down, and then move onto the next.

3. Consolidate your bills – Whether through a home equity loan or a debt consolidation service, you might also want to choose to ‘pay off’ your debt with one single payment and then make smaller payments on this loan each month for a time period. This can help your credit score as well as make you feel less stressed about the debt that you have as your interest rate isn’t going to change and you know exactly when your debt will be paid off.

4. Moving from one card to another – What works well for many people is the idea of putting the largest payment possible on a card until it’s paid off and then taking the money that you were using for that card’s payment and applying it to the payment for the next credit card balance. This helps you pay off the next card more quickly, and the next, and the next…

No matter what route you choose, paying off your credit cards isn’t an easy task. With diligence and time, you will start to see results and that’s adding up to a higher credit score for you.

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 What’s Your Strategy?

How to Make More Money to Pay Off Your Debt

When you want to rebuild your credit, you need to start making payments on your debts. However, when you aren’t making a lot of money at your current job, it can seem like the impossible advice. But when you’re in a tough financial situation that you need to get out of, you need to start taking drastic measures. When cutting back isn’t doing enough, you need to find ways to make more money.

• Get another job – Working part time at another job is a great way to start attacking your debt. Not only can this money go completely toward debt, but you will also be able to get ahead a little once the debt is down to a more manageable level. And you don’t have to keep a second job forever, just long enough to start paying down your higher bills.

• Sell things from home – There’s a huge market for selling things on auction sites and from a personal website. If you’re able to do so, why not see if you can sell your extra things for extra cash? You can also turn to consignment stores to sell items that you don’t need anymore.

• Ask for a raise – If you have not received a raise in a while from your current job, maybe it’s time to ask for one. If your performance has been exemplary and your loyalty to the company strong, you will want to go to your boss to ask for a raise. At worst, they will say no, but you might be surprised at the answer. Many times, employers will not notice the great work that an employee is doing, so they might not notice when a raise is due. However, you also don’t want to say that you need a raise to pay off debt.

• Look for another job – If you can, start applying at other jobs to replace your current position. If you truly feel that you can make more money elsewhere, you might want to try. If the job market in your area is slow, you may even want to consider taking a job elsewhere, provided they pay any relocation expenses.

• Provide childcare – If you work from your home or don’t have a job currently, you can easily provide childcare for friends or family. Of course, you will want to be paid for this work, but this is a low cost way to begin to increase the money that is going toward your debt. If you already have children, you might want to swap childcare services with other parents in order to reduce your childcare expenses.

Making additional money will help you attack your debt much more quickly than at your current rate. And while it might seem like a lot of work, it’s worth getting your credit rating back to average as quickly as possible. This kind of work can also turn into a better business opportunity for you, or simply a lesson in not overspending again.

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 How to Make More Money to Pay Off Your Debt

Creating Goals for Your Financial Success

Going on a trip without a road map is the surest way to get lost, so why don’t we apply the same logic to our financial goals? When it comes to rebuilding your credit, you need to have some sort of plan in place to help you get to where you want to go in terms of your credit score and overall debt balance. Here are some steps that you can take to create a plan for your success:

• Write down what you need to pay off – While this might be painful to calculate, it will help you to find out the exact number that you need to pay off. Into this total place anything that you need to pay off: credit card balances, loans, fees, etc.

• Estimate what you will pay each month towards this balance – try to come up with an amount of money that you will put toward your balance each month. This number may fluctuate, but it will give you an idea of how long your debt may take to pay off.

• Subtract this amount from the debt total over the course of the year – While interest rates may keep the overall debt amount from diminishing as quickly as this will seem, having an idea of how quickly your debt will go down is a great motivator.

• Look at the individual amounts to see which ones you want to pay off first – Create a system that will work for you. Some people like to pay off the smallest amount loans so that they’re out of the way, while others like to pay off the highest interest loans first. Create a plan of attack for your loans to have a measure of accomplishment with each new debt gone.

• Write out your financial dreams – When you stop to consider your life, what kinds of things are you unable to do because of your debt right now? Are you unable to buy a house? Are you unable to buy a new car? Write out all of the things that you want to do with your money and it will keep you on track towards paying off the debts that are standing in your way.

A good system of goal setting is generally referred to as SMART. This stands for Specific, Measurable, Attainable, Realistic, and Time Based.

You need to choose specific goals that you want to reach (i.e. pay off debt in three years), measurable (i.e. keep a chart of your goals and how you’ve paid them off each month), attainable (i.e. you probably don’t want to base your debt payments on winning the lottery), realistic (i.e. if you don’t make a lot of money, it’s not realistic to say that you will pay a lot of money toward your debt each month, and time based (i.e. create a time period for each debt).

Once you have these goals written out, be sure to refer to it often to see how your progress is going. While it might not seem like a lot at first, each payment you make is getting you closer to your goals and closer to a credit score that you can be proud of.

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Creating Goals for Your Financial Success

Creating a Financial System that Works

If you’ve gotten yourself into financial trouble, chances are good that you might not have a good financial system in place. And without a good system, bills can be lost, balances can be hard to add up, and a general state of confusion can become normal. Instead of adding to your money issues, start your credit rebuilding by creating a system that works for you. Here are some things that you will want to keep in mind:

• Create a calendar for bills that need to be paid – If you find that you are constantly making late payments or forgetting to pay your bills, you need to come up with a way to organize these bills when they come in. There are a number of ways to do this: have folders for each day of the month and place the bill in the calendar day that it needs to be send to the company; place sticky notes on the bills to remind you when they are due and place in order of due date; or write down on your list of things to do when bills need to be paid.

• Make folders for each creditor – Get file folders and begin to organize the papers you have for each creditor. This will allow you to easily access your past payments as well as see trends in your interest rates. You will also have the customer service numbers on hand should you need to talk to anyone.

• Online accounts don’t need paper backups – Because your filing system can quickly get out of hand when you have a lot of papers to file, remember that you don’t need to keep paper copies of online bills that you pay. These are stored in the servers and can be accessed anytime to be printed out.

• Keep your passwords in one secure place – When you do most of your bill payments online, you will want to keep a record of the passwords and log in names in a safe and secure place, one that is easily accessible, not easily found.

• Have one day upon which you handle bills – You might want to create one day a week where you handle all of your bills at the same time, or at least the ones that need to be paid that week. Sundays seem to be a good day for most people and it starts the week off on the right foot.

• Keep any tax records in one place – When it comes time for tax season, you will need to have your papers in order. If you’re not sure if you need to keep something, try to file it in a miscellaneous file and talk with your accountant or tax person to see if it needed to be kept.

• Remember that you can throw things away – You don’t need to keep every scrap of paper anymore. In fact, you can even scan any papers that you’re not sure about keeping and save those images to a CD instead of filing them away.

Creating a system that works for you is the key to staying on top of your credit rating. By simply thinking about where you need to improve and how you need to improve, you will be able to design a space that handles your finances without causing more confusion.

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 Creating a Financial System that Works

Negotiating with Creditors

If you’re like most people, you probably feel helpless against your debt. You feel like there’s nothing that you can do but pay and pay and pay until it’s finally gone. However, there are some steps that you can take with your creditors that can help you become debt-free more quickly than you might imagine. And while these steps might seem like a little work, they certainly add up to big savings for you.

The first thing you need to understand is that credit card companies are businesses just like anyone else. They need the customer in order to make money for themselves and be successful. In short, you have more power than you think you do. You can see this need to please customers in the number of low interest credit card applications that you’ve received in the mail or heard about. Credit card companies want you to use their services because it means that you may have to pay interest at one point or another, which makes money for them over the course of your relationship.

Knowing that you have more power in this relationship begins to show you several things. For one, you can talk to your credit card company to see how they can make your relationship work better. If they want your business, they will need to work with you and your needs. This might come in the form of lower interest rates or a reduction of fees. To begin this process, you will need to have a good standing with this credit card company, meaning no late payments and a long history. This will show the company that you are someone they want to hold onto. You want to research other credit card companies to see what kinds of interest rates they are offering to new customers because you will see that these companies are competitive with each other, and that only works to your advantage.

With this information, you will want to call your credit card company and ask if you can speak to someone about lowering your interest rate. You may not need to speak to anyone else besides the customer service representative, but it never hurts to be upfront about what you want the phone exchange to be about. Talk about how you’ve been a loyal customer and that you feel that your relationship with the credit card company deserves a lowered interest rate for a period of time.

If they offer you a lower interest rate, write it down as well as the name of the person who offered it, and if it’s satisfactory, that’s all you have to do. If they do not, talk about how you might want to switch your balance to another company (name them) that is offering lower interest rates. Of course, you will want to make good on this promise if your credit card company is not willing to help you out.

When you lower your interest rate, this adds up to fewer payments on your part as well as more of your money going toward the balance rather than lining the pockets of the credit card company.

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 Negotiating with Creditors

How to Buy Gifts When You’re Rebuilding Credit

If you’re trying to pay down some debts, the prospect of giving someone else a gift becomes a stressful thought. You want to give gifts as you always have, but you also want to save your money in order to boost your credit score. What you need to do is start to adjust your gift giving habits, rather than eliminating them. You simply need to look at gift giving a bit differently than you have in the past.

One of the first things you will want to do is make a list of all of the gift giving occasions for the year. This means birthdays, holidays, weddings, etc. Try to get a comprehensive list of these occasions so that you know what you need to budget for. With this list, you’re going to start buying gifts now in order to both have them ready for the occasions as well as buy them at lower prices.

A great strategy for buying gifts on a budget is to make sure that you’re always looking at the clearance racks when you’re out shopping for essential items. You might find a lovely picture frame or a collectible book that’s drastically marked down, but will be perfect for a certain occasion that is coming up. You may even want to buy multiples of things that are a good price as well as applicable to the occasion. For example, bookstores often have markdown racks of books that didn’t sell well or were over-ordered. These books are usually very inexpensive and make a great Christmas gift, stocking stuffer, or even birthday present.

This kind of buying means that you’ll be looking for gifts year round, which also saves you time and frustration during peak shopping times. By accumulating Christmas presents, for example, over the course of a year, you don’t have to scramble for gifts as the day comes closer, nor will you have to pay higher prices, geared toward ‘catching’ last minute shoppers. Of course, once Christmas is over and the post-Christmas sales have begun, you can start shopping for next year.

If you’re really looking to cut back on your spending during the holidays for other occasions, you may also want to talk with the people that you normally exchange gifts with. Consider selecting one person’s name for the year, instead of buying something for everyone. Or you can promise to take each other out for a dinner instead of buying an expensive gift. You may be surprised to find out that your friend or family member was trying to cut back on spending as well, so it works out for the both of you.

Another idea is to give to charitable causes, which is tax deductible for you, and a thoughtful gift for someone else. By contributing a small amount to a charity, you will help that organization, plus be able to donate the money in the recipient’s name. The amount is not important either, so long as you choose a cause that the recipient would be happy to support.

The truth is that most of us really don’t need anything when it comes to our birthday or another holiday. So receiving a smaller token is just as nice as something expensive and extravagant.

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 How to Buy Gifts When You’re Rebuilding Credit

Living Cheaply When You’re Rebuilding Your Credit

The fact of the matter is that when you’re trying to rebuild your credit, you’re going to need to make some changes in your life. This will mean that you need to adjust your current spending habits in order to start paying down the debts that you have, as well as start looking for ways to live within your means for the rest of your life. And while getting a better paying job can help, that’s not always possible in the short term. So, for long term financial health, here are some ways to reduce your expenses.

• Never buy anything for full price – Whenever you can, try to find items that are on sale or on the markdown racks. This will enable you to still buy the things that you need without paying as much as you might have before.

• Make a list – Sometimes it’s easier to spend more when we aren’t sure what we went to buy in the first place. Try to make a list of the items that you need from the store and then only buy these items. If you find that you ‘need’ something else once you are there, stop and ask yourself if it’s a need or simply something that you want to have. Chances are good that you really don’t need to buy it.

• Coupons can be fun – When you find coupons online or in your newspaper, you can significantly reduce the amount of money you spend. Try to make a game of it: see how much you can save on each shopping trip and then try to ‘beat’ yourself each time.

• Shop only once a week, if you can – When you get into the habit of shopping on only one day a week, you start to realize that your life doesn’t have to revolve around buying things. Try to make one day each week the day that you grocery shop, clothing shop, and do any other errands that need to be done. Remember that buying things isn’t about entertainment, but about getting things that you and your family need.

• Head to the thrift store – Contrary to popular belief, thrift stores can be an amazing place to find quality clothes at a fraction of the price. While you can’t have a clear idea in mind when you go there and you will want to spend some time looking through the racks, there are generally a lot of nice things that you can buy without having to pay a large amount for them.

• Give yourself an allowance – If you find you’re having troubles not spending anything extra, try to give yourself a small allowance each week that you can do anything with. For example, you might want to give yourself $25 a week to spend, in any way that you want. However, if you want something more costly, you will need to accrue your allowance until you have that amount.

Living cheaply doesn’t mean that you have to live without things that you want, but rather than you need to adjust the way you’ve been living. And in the end, that adds up to a bright financial future.

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 Living Cheaply When You’re Rebuilding Your Credit

Preventing Credit Damage

While a lot of people focus on dealing with credit issues once they’ve become significant, the truth is that it’s a lot easier to handle financial troubles before they even begin. With the new surge in identity theft and fraud, you need to make sure that you’re monitoring your financial records as well as handling the expenses you have in a timely manner – together, these steps will ensure a healthy financial future.

If you don’t have any credit issues now, you’re one of the lucky few. However, if you’re not protecting yourself from hackers and other thieves, you just might be on your way to more financial issues than you want. Here are some basic tips for keeping your credit score high and your safety intact:

• Know who you’re handling information out to – No matter where you are and what you’re doing; think about who you’re handling your credit card or debit card over to. This is especially the case when you’re trying to buy goods online and you can’t see the store or the store owner that you are dealing with. Try to only work with those that are reputable in nature and those that have security devices in place – Hacker Tested, VeriSign, etc.

• If you’re not comfortable with a transaction, don’t do it – Whenever you feel even a little uncomfortable with a financial transaction or something just doesn’t seem right, don’t follow through with it. Or, if you need to make the transaction, go and get cash.

• Protect your computer – Instead of learning the hard way about how easy it is for hackers to get into your computer, make sure that you have up to date virus software as well as firewalls in place. It might sound obsessive, but a Trojan virus can access your system quite easily, leaving the hacker with a clear view of your financial records, passwords, etc. If you’re unsure of how to protect your computer, take it to a computer repair shop or talk to your computer dealer.

If you’re just beginning to have credit issues, then you will want to start dealing with these problems earlier instead of later.

Here are some ways to minimize the damage of financial troubles:

• Take on another job – If you are living beyond your means, you need to begin to extend those means. If this means taking on an additional job in order to pay off debts, then this is what you should do. The extra time that you’re spending at this job will remind you of the money that you’ve spent and may cause you to rethink excessive spending in the future.

• Cut up your credit cards – It sounds harsh, but if you’re starting to use credit cards more than cash, cut them up and break that habit. While it might not seem like a big deal to have a $1000 balance on your credit card, paying this off only with the minimum payment will take you about three to five years (depending on the interest rate) and will end up costing you well over the original amount.

Credit damage doesn’t have to be a part of your life when you realize what you might be doing to contribute to it.

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Preventing Credit Damage

Rebuilding Your Credit On Your Own vs. Getting Help

If you’re struggling to pay off debts and boost your credit score, you’re not alone. More Americans than ever are dealing with financial troubles that are not only causing their financial health to suffer, but also their emotional health.

The good news is that there is help available, should you need to get advice on what to do and how to do it. But is it better to work on your credit on your own? Here are the two sides to this conundrum.

The best first step to take in rebuilding your credit is to try to cut back on your spending and put more money towards your current debts. This seems like simple advice, but that’s really all there is to making your debts smaller and smaller each month.

While you might need to break old habits and it might not be the most enjoyable time of your life, learning to live on what you make is a good lesson to learn, as well as pass onto your children or friends. You can take one of several approaches:

• Minimize your extraneous expenses and put that additional money toward your payments.
• Talk to your credit card companies to see if they will minimize your interest percentage.
• Switch your balances to a low interest card, but then truly work to pay that amount down.

With these steps, your debt will not be eliminated immediately, but with each payment you make, you are going to see progress and change in your life.

However, if you try these steps and still find that you are struggling, or you find that you just can not stick to your financial resolutions, you may want to seek the advice of a credit counseling service. Not only will they outline a plan that will work for you, but they will also be able to guide you through any rough spots you might encounter.

For example, if you happen to lose your job or have a financial crisis of some sort. Having someone that is watching over you can also be a benefit of using a credit counseling service, as you will have to report any troubles that you encounter along the way, as well as any missteps.

A credit counseling service will also:

• Talk to your credit card companies for you
• Arrange for one simple payment instead of several
• Monitor your progress and suggest adjustments to your financial plans
• Report your financial progress to credit reporting agencies

There really isn’t a right answer when it comes to rebuilding your credit – only the answer that works for you. When you’re faced with financial stress, you don’t have to do it on your own, but in the end, the steps you take will be your choice and need to be fueled by a sincere desire to change your life.

Whether you choose a credit counseling service or you try to do it on your own, you’re heading in the right direction – out of debt.

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Rebuilding Your Credit On Your Own vs. Getting Help