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Posts Tagged ‘Credit cards’

If you’re going to have a credit card there are some great ways to use them which will actually save or make you money. Here are a couple of my favourites.

The first is taking out a card with a 0% rate and use that for your purchases for the amount of time the rate stays at 0%, only paying the minimum required each month. But, and this is the important part for everything you spend on the card put the same amount of money into a high interest savings account and then before the 0% rate runs out on the card you can pay it off in full with the savings and keep the interest you earned on them. A great idea but you need to be diligent about putting the money aside or youll end up paying interest which defeats the object.

Another way is using a cashback card and paying it off in full each month by direct debit. Cashback cards offer a rate, generally around 1%, of what you spend on the card and at the end of a month or year theyll give you the cash worth that percentage of your spend. The idea is that you dont pay them off in full meaning that the card company makes a lot more money from you in interest than its paying you but if you do pay them off in full youll be in profit

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Some people look at their credit card debt and wonder how their balances came to be so high when they have nothing to show for it.

Entertainment and new clothes are a sure-fire way to add large sums to your credit balance on a ‘buy now, worry later’ basis. The odd meal here and a new dress there doesn’t seem very large in comparison to purchasing a plasma TV, but these little indulgences can soon lead to the cost of a plasma TV and beyond….plasmatv

Some easy tips on how to avoid debt

Eating out has to be one of the most popular pastimes of the 21st century. People with hectic lives prefer the convenience of a meal that is already cooked rather than having to prepare a meal and wash up themselves. However, with a little careful planning, those costly meals can be replicated at home and a dishwasher will take the hassle out of washing up, thus saving you a fortune in hefty restaurant prices.

The same can be applied for lunch. Food which is prepared at home and used as a packed lunch is 50% less expensive than buying unhealthy options from a takeaway. Vending machines also add to your debt problems when a few drinks brought in from home will save this added expense.

Never go for named brands at the supermarket. In some cases, you will pay three times the cost of a generic brand, which is just as good. With brand named items, your money is contributing towards advertising costs rather than the quality of the goods.

Use store coupons wisely. Do not think of them as an excuse to buy junk food that you would normally avoid. Use your coupons to reduce the cost of your weekly shopping and put your savings towards reducing your bills and freeing yourself from debt.

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Debt and divorce

Besides the emotional turmoil which divorce entails, there is often the anguish of unforeseen financial matters such as debt and personal assets to contend with.

Urgency to make a fresh start can cause many individuals to make hasty decisions when going it alone and there are many bogus companies who will happily take advantage of their situation. If you are not careful, the result has been known to get quite serious – even to the extent of bankruptcy or getting an IVA (Individual voluntary arrangement)

Watch out for companies who promise to sort out your debts upon payment of a fee. Free debt advice is just as easily available; always look out for trusted companies that can offer a range of advice on IVA’s debt solutions and also bankruptcy and loans. Its also important to find debt advice that is unaffiliated and unbiased, that way you know they have your interest at heart.

In order to be able to cope with added debt, you need to obtain a clear indication of exactly how much more you need to find each month. You should also list the contact details of your creditors in order to pay them quickly and efficiently each month. Work out your new budget and ensure that your primary utility bills receive priority attention.

Does a joint bank account add to debt problems?

If you have a joint bank account, you should ask the bank to freeze it so as no-one can take out more than the other. Alternatively, you could ask the bank to make up a new arrangement where both signatures have to be used for any withdrawals. One last option would be to close the account completely and work out an amicable agreement for each of you to receive an agreed sum into your personal bank accounts.

If you have joint credit cards and you are the main account holder, you could ask the company concerned to cancel your ex-spouse’s right to use the cards.

These small steps can prevent your ex-spouse from running up further debt on your accounts whilst your divorce is pending

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