Paying More For Your Credit Card,
By
Easy Tips
—
Friday, 27 July 2018
—
Credit Tips
2. Apply the average credit interest rate (17 per cent, according to financial data provider Canstar). 20, whichever is higher, per Canstar). What should I read next, Paying more for your credit card, This is part of a new daily series featuring charts which tell a story. If you know of some data that fits the bill, we'd love to hear about it.
And so on. Now, what about your expenses, Do you spend exactly the same amount of money each and every month, Sure, your mortgage or rent and your car payments are a set amount each month. But doesn't your utility bill go up and down depending on the weather, What about your phone bill,
How much will you spend on car repairs over the next 6 months, Can you predict such variable expenses with any accuracy, If you have lots of room in your budget, with money left over at the end of the month, then fluctuating income and expenses are probably not a major issue for you.
However, if you are struggling to make ends meet, living from one paycheck to the next, then an unexpected expense can destroy your monthly budget. People enter debt relief programs with the best of intentions. Take credit counseling, for example. You enter a program to get some help in bringing your credit card debts under control. 500 sounds good. You're humming along just fine for a few months, then wham! The water heater blows up.
800 for a new one. 500 payment to the agency this month, and part of next month's payment as well. Where does that leave you with the credit counseling program, Back on the street, that's where. You simply CANNOT miss payments into that type of plan and expect anything but failure. Or look at Chapter 13 bankruptcy, where the court requires you to pay a set monthly amount to your creditors over a 3-5 year period.
Even before the drastic new law went into effect, 2 out of every 3 people failed at Chapter 13 bankruptcy. It will get much worse under the new law, because the court will set your monthly budget for you, based on what the IRS says it should be for your state and county.
This is simply unrealistic, and once people realize how bad the new law is, they will run in the other direction from Chapter 13. (Forget about Chapter 7, where you wipe the debts away. Again, the big problem with most debt relief programs is lack of flexibility. If you could, then these plans might have a chance of working.
But such inflexible programs simply do not reflect the unpredictable nature of the average household budget. So is there any debt program that does provide this flexibility, Yes. It's called debt settlement, or debt negotiation. It's certainly not for everyone. Debt settlement is an alternative to bankruptcy. It's not for people who can pay their bills in full without hardship. But it can be a real blessing for those seeking relief from a crushing debt burden. The reason debt settlement is so flexible is simply because YOU control the cash.
You build up money in a separate savings account until you have enough to make a reasonable offer to one or more of your creditors. Like any debt program, debt settlement has its downside and its risks, but no other program provides this level of flexibility. Because the monthly payment is going into a negotiation fund that you set up and control, a bad month simply means you have less money to settle with.
If you can make it up later, that's great. If not, that's life. When you have enough to settle ONE account (usually between 35% and 50% of the balance owed), then you make an offer. If your creditor takes the deal, then you start building up funds to knock out the next debt, and so on.