Tag: Finance

5 steps to build credit to qualify for a car loan

Dear Erica,

My granddaughter just got a secured credit card with a $200 limit. She wants to finance a new car for $19,000 in a year or earlier. What does she have to do to obtain this? – Harry

Dear Harry,
You are kind to ask on your granddaughter’s behalf. The short answer is yes, she can get a car loan of that size, but only after she builds a reputation of being a responsible borrower. That takes time and effort. She also must prove to a lender that she can afford the monthly payments, which means she needs an income that is enough to cover all her expenses as well as a hefty car payment.

Here is the strategy for your granddaughter. As a (presumably) young adult, she needs to take control over her own financial life, starting today.

1. Charge in small, steady increments

It’s great that your granddaughter has a secured credit card because I would have recommended it! Now what she needs to do is use the card in a very specific way.

Credit reports need to list a steady stream of positive activity, so on a monthly basis, she needs to keep her credit utilization ratio as low as possible. For a credit line of $200, I’d recommend she spend a maximum of $60. That will prevent her score from getting dinged for using too much of her credit line.

A credit score can be calculated at any point of a billing cycle. If you owe too much, even if you plan on paying it off completely, points will be shaved off your scores. (FICO and VantageScore are the two most common scoring companies, and their scores range from 300 to 850.)

2. Pay on time

No matter what, get payments in by or before the due date.

The credit card issuer will then send that information to the credit reporting agencies, and it will be factored into her scores favorably. Consecutive on-time payments will result in a higher credit score, so as each month passes without a break in that payment history, her scores are sure to increase.

3. Delete the debt every month

With a credit card, you do have the option to pay partially – but don’t. Instead, your granddaughter should send the credit card issuer every penny of the balance.

Remember, she’s proving to a future car lender (as well as any other creditor, such as a landlord or business) that she’s financially smart and stable. By never carrying over a balance, she’s showing exactly that.

4. Keep a sharp eye on all credit activity and progress

Your granddaughter should check her online credit card statement at least weekly. Her credit card statement will indicate where she charged and how much she currently owes, and checking her statement gives her the opportunity to scale back charging if she’s close to the 30% credit utilization mark.

After using the secured card for about six months, your granddaughter can pull her credit reports from AnnualCreditReport.com. There are three credit reporting agencies (TransUnion, Equifax and Experian) and she’s entitled by law to get all three reports from those bureaus for free once per year. The bureaus are also offering free credit reports every week through April 2022 due to the COVID-19 pandemic.

She should read her credit reports to make sure they’re correct, and if she sees anything wrong, she should dispute it. She does not want to be turned down for her dream car over a mistake on her credit report.

5. Get a second credit card

After a year of following this credit-building plan, her scores should be on an upward trajectory. To really hike the numbers, though, your granddaughter should consider applying for an unsecured credit card and using it in the same fashion.

Your granddaughter should seek a credit card that fits her credit rating, so she won’t get denied. Applying for a credit card or loan will result in a hard inquiry on her credit reports, which will lower her credit score a bit temporarily, so she should only seek credit when she needs it. When your granddaughter has two credit accounts, she should use both as she has been using the one.

Eventually, your granddaughter’s credit scores should be in the mid-700s, and at that point, most lenders will consider her to be an appealing borrower. As long as her income is sufficient and secure, she is free to go vehicle shopping.

Just be aware that it’s also easy to bite off more car loan than you can handle financially. To reduce the amount borrowed as well as the monthly payments, make a large down payment. If she hasn’t yet started saving for that, she should do it now.

As your granddaughter’s credit stands now, she most likely won’t qualify for the best car loan rates if she can qualify for a loan at all. I would encourage her to follow the steps outlined above that will help her get the car she wants but know that it will take some time and patience to build a decent credit profile for her to qualify for a substantial car loan.

See related: Buying a car with no credit: 6 things to know

Source: creditcards.com

By Leon Hoffman July 13, 2021. Account Management, Elderly Care Tips Account management, build credit, Business, car, Cashing In Q&A columns, COVID-19, Credit, Credit Cards, credit report, credit score, Debt, Debt Management, down payment, Expert Q&A, Finance, Financial Wize, FinancialWize, Life, loan, Make, News, Saving, second, Shopping, will

Residual interest: What it is and how it works

You’ve been running a credit card balance for a few months, but finally, you have enough cash on hand to zero out the statement balance.

With great relief – and not a little pride – you pay it off. Thank goodness you’re done with that debt.

But wait: did you also pay the residual interest?

What is residual interest?

Residual interest is the interest that’s accrued on the unpaid credit card balance all this time that you’ve not been paying it. It’s also called trailing interest – because it trails into the next month.

The federal Consumer Financial Protection Bureau investigated residual interest charges on credit cards in 2015 as part of its biennial credit card report to Congress.

“We recognized, based on our research, that there is some confusion about this so-called ‘ghost charge,’ said Wei Zhang, the bureau’s credit card program manager. “People wanted to know, ‘What is this? Why is it happening?’”

The bureau did not find issuers doing anything illegal; however, they did discover that many details were buried in the fine print of credit card agreements. Card owners often were unaware of or did not fully understand what happened if they failed to pay their bill in full or how interest on the balance was calculated.

Before we get into those details any further, though, let’s start by explaining some terms:

Billing cycle – That’s the time between two bills. Many billing cycles are about a month long.
Closing date – That’s the date on which the billing cycle ends. When the closing date occurs, the card will post a statement balance. That’s the amount of purchases you charged during this billing cycle.
Grace period – This is the period of time between when the billing cycle closes and your payment is due. This can be a few weeks, or even up to a month.
Due date – This is the last possible day to make your payment without penalty. After this day, interest will start to accrue on the balance.

That interest that accrues? That’s residual interest.

See related: How to lower your credit card interest rate

How does residual interest work?

Here’s an example of how residual interest comes into play:

You have a credit card with a billing cycle that closes on the 15th of every month. On March 15, your statement balance is $1,200.
Your due date on the bill is April 14th. But when the date arrives, you can only afford to pay $900 – meaning you leave a balance of $300 on the credit card.
That $300 starts accruing interest the very next day. How much interest? Depends on your particular credit card. Let’s say, for this example, your card charges an APR of 22%.
To figure out how much that will be, divide the APR by the number of days in the year. So 22 divided by 365 – 0.0602%.
Multiply this by your current $300 balance, and you get 18.06 cents. That’s the amount of residual interest you will get charged on the balance each day.
By the time the next month’s due date rolls around, 30 days later, you will owe $5.41 in residual interest.

This is where things get tricky. Maybe you decided to clean up your financial act. You’ve only charged $200 this month, and now you can afford to pay off both the new balance and the $300 from last month. Everything’s squared away, right? Nope, not so fast. You still owe that $5.41. And if you don’t notice it and neglect to pay it, it will continue to accrue interest.

Or, you do pay the entire bill by sending a check in the mail. Interest may continue to accrue on the balance between the time you mail the check and the time the bank receives it and cashes it. Remember, once you enter the land of accruing interest, there is no more grace period.

“Because it accrues after the billing period closes, [residual interest] won’t appear on your current statement – meaning that this could be a surprise amount you discover in your next statement,” said Megumi Smisson, who discusses personal finance on her podcast Ms. Money Moves and her website, Money With Megumi. “Or, worst case, you think you’ve paid off your card, don’t check your next statement to make a payment, and incur a late fee and potentially damage your credit.”

See related: What happens when you miss a credit card payment?

Do all cards charge residual interest?

Residual interest is a common credit card feature. Supposedly, there are banks that don’t charge it, though those are increasingly hard to find.

“I’m not saying it’s impossible, but … [scoring a credit card that doesn’t charge residual interest] is kind of like finding the pot of gold at the end of the rainbow with a unicorn standing next to it,” said Bruce McClary, spokesman for the National Foundation for Credit Counseling in Washington, D.C.

There are many credit cards that offer 0% APR on new and transferred balances for a number of months. To find out how your card deals with leftover balances, look at the back of the statement. It probably won’t say “residual interest” in those words.

Scan instead for writing like “finance charges may be assessed even if we receive payment in full in the current billing cycle.” Other ways to get this information, and discover what the APR is for your card, are to look at your card’s terms and conditions, go to the card issuer’s website or call the issuer.

How to avoid residual interest

There’s no reason you should have to pay months’ worth of residual interest on your credit card for a balance that’s quickly resolved. Here’s how to make sure this isn’t a problem for you.

Pay your card in full each month. “The No. 1 rule, the best advice for avoiding residual interest altogether, is to pay off your purchases immediately,” McClary said.
First timer? See if you can get a break. There’s no harm in calling your credit card issuer and asking if you can get an extension on your payment deadline, so you can avoid late fees, finance charges and any residual interest on this one cycle. “You never know what you’ll get until you ask,” McClary said.
If that’s not possible, check your balance and pay it online. The credit card issuer should post real-time information about your leftover balance and any accruing interest.
Get confirmation from the card issuer. This is particularly important if you are paying your balance by mail, either from a paper statement or from what you see online. Interest on the balance continues to accrue until the moment the bank cashes your check. If the check is insufficient because it doesn’t include those extra few days of interest, interest will accrue on the unpaid balance. Instead, before you write the check, pick up the phone and ask the credit card issuer for the payoff balance. “That is the best, the most foolproof way to accurately know the balance that would pay off the account,” McClary said. He advises overestimating the day the payment will arrive by a day or two; the company will repay you any overpayment but will charge more interest if you fall short again.

See related: Should I pay off my credit card all at once?

Bottom line

Remember, if you’ve let a balance carry from one statement to the next, you don’t just have to pay off the balance on your statement. You may also owe residual interest that is not included in your current statement. Check your total online. Call the card issuer to double-check. You can also check your credit card agreement to find out about residual interest or minimum finance charges.

And after you’ve paid what you believe you owe, check again, to be sure.

“Don’t just anticipate ‘I’m off the hook’ next month,” Zhang said. “In many cases, you are probably not off the hook. Make sure there are not any residual balances next month.”

Source: creditcards.com

By Leon Hoffman June 10, 2021. Account Management, Elderly Care Tips Account management, Credit, Credit Cards, Debt, Fees, Finance, Financial Wize, FinancialWize, How To, Make, money, News, Personal Finance, will

GSCUÂ Mortgage Rates Reviews: Today’s Best Analysis

Granite State Credit Union (GSCU) provides members with a variety of mortgage products across the state of New Hampshire.

GSCU AT A GLANCE

Year Founded	1945
Coverage Area	New Hampshire
HQ Address	1415 Elm Street, Manchester, New Hampshire 03101
Phone Number	1-800-645-4728

GSCU COMPANY INFORMATION

Services the state of New Hampshire
Offers conventional loans, such as fixed- and adjustable-rate mortgages
Provides FHA and VA loans to qualifying individuals
Allows first-time homebuyers to make down payments of zero to three percent
Member of the NHCUL and CUNA
Allows borrowers to use gifted funds for the down payment and closing costs on certain loan products

Granite State Credit Union provides a variety of mortgage products to individuals across the state of New Hampshire. It offers traditional loans, such as fixed- and adjustable-rate mortgages, as well as government-assisted loans and options for individuals who cannot put 20 percent down on a new home.

GSCU Mortgage Facts

Services the state of New Hampshire
Offers conventional loans, such as fixed- and adjustable-rate mortgages
Provides FHA and VA loans to qualifying individuals
Allows first-time homebuyers to make down payments of zero to three percent
Member of the NHCUL and CUNA
Allows borrowers to use gifted funds for the down payment and closing costs on certain loan products

Overall

gscu mortgage rates review Granite State Credit Union provides a variety of mortgage products to individuals across the state of New Hampshire. It offers traditional loans, such as fixed- and adjustable-rate mortgages, as well as government-assisted loans and options for individuals who cannot put 20 percent down on a new home.

Current GSCU Mortgage Rates

GSCU Mortgage Products

Granite State Credit Union provides a variety of home mortgage products. Its offerings consist of traditional mortgages and government-assisted loans, as well as programs for first-time home-buyers and affordable home refinances.

Fixed-Rate Loans

Fixed-rate loans are the best choice for homebuyers who plan on staying in their home for an extended period. With fixed-rate loans, buyers can expect their principal and interest rates to remain the same throughout the loanâs lifetime. GSCU offers fixed-rate mortgages for lengths of 10, 15, 20, and 30 years.

Adjustable-Rate Loans

An adjustable-rate mortgage (ARM) provides borrowers with an interest rate that may vary throughout the loan term. Typically, these mortgages have a lower initial rate than fixed-rate loans, giving potential customers more financial freedom when looking for a new home.

After the initial period, the rates and payments associated with these mortgages may rise or fall to adjust to market prices. Typically, these costs will fluctuate on an annual basis.

Many companies, including GSCU, provide a cap that prevents these costs from getting too high from one year to the next. GSCU recommends these types of mortgages for home-buyers who do not plan on staying in the house for the loanâs full term. GSCU offers 1/1, 3/1, 5/1, and 7/1 ARMs.

First-Time Homebuyer Loans

GSCU offers excellent deals on mortgages for first-time buyers. The credit union gives borrowers the flexibility to choose a fixed- or adjustable-rate mortgage and even provides no and low down payment options to first-time buyers. The No Down Payment mortgage allows borrowers to take out a 5/1 ARM and pay zero percent down on the home.

The Low Down Payment Adjustable loan offers a 3 percent down payment with a 3/3 ARM and the option to refinance into a fixed mortgage if so desired. The Low Down Payment Fixed loan offers a 3 percent down payment and a 30-year fixed-rate mortgage. For Low Down Payment Adjustable and Fixed mortgages, borrowers can use gifted funds for the down payments and closing costs on their homes.

FHA Loans

Unlike some other credit unions, GSCU offers FHA loans to home-buyers who do not qualify for other loan programs. Borrowers may have a high debt-to-income ratio, low credit score, or the inability to put 20 percent down on the home. The Federal Housing Administration (FHA) created these types of home loans to grant buyers the opportunity to invest in property. GSCU allows 100 percent of the closing costs to be gifted.

VA Loans

GSCU allows veterans, military members, and their spouses to apply for VA loans. These types of mortgages are backed by the U.S. Department of Veterans Affairs (VA). Qualified individuals can make a low down payment on the home and keep up with affordable monthly payments.

HARP Loans

The Federal Housing Finance Agency (FHFA) introduced the Home Affordable Refinance Program (HARP) as part of their Making Home Affordableâ¢ initiative. HARP allows eligible homeowners to refinance their mortgages into a lower interest rate to keep their finances secure. HARP provides this opportunity for individuals who otherwise may not qualify for refinancing due to their declining home value.

GSCU Mortgage Customer Experience

Granite State Credit Union offers a variety of online resources that help current and prospective borrowers research home loan options. GSCU’s website contains several mortgage calculators, which assist home-buyers in determining how much they can take out on a home loan.

It also provides information about their different mortgage products, which helps borrowers figure out what type of home loan is right for them. GSCU has a Refer-a-Loan option, which incentivizes borrowers who refer a New Hampshire resident or business owner to procure a loan with the credit union.

In exchange for this referral, both parties can receive $25 for consumer loans or $50 for the mortgage and home equity loans.

GSCU Lender Reputation

Founded in 1945, Granite State Credit Union has provided affordable mortgage rates to New Hampshire residents for over 70 years. Its Nationwide Mortgage Licensing System ID number is 477276.

Since the credit union only services the states of New Hampshire, it does not have many online customer reviews. It is not accredited by the Better Business Bureau, and has no reviews on the site, but maintains an A+ rating.

GSCU Mortgage Qualifications

Although GSCU has flexible mortgage qualifications for individuals taking out FHA loans, its qualification requirements for individuals requesting other home loans are similar to mortgage industry standards.

First and foremost, the credit union prioritizes credit score when approving someone for a loan or for calculating their rates. FICO reports that the industry-standard credit score is 740. However, those with credit scores above 760 can expect the best mortgage rates.

Credit score	Quality	Ease of approval
760+	Excellent	Easy
700-759	Good	Somewhat easy
621-699	Fair	Moderate
620 and below	Poor	Somewhat difficult
No credit score	n/a	Difficult

Buyers should typically expect to put 20 percent down on the home, unless they qualify for a government-assisted loan. In some cases, buyers can anticipate paying as little as zero to three percent on their mortgage down payment.

With certain types of loans, such as first-time home-buyer, FHA, and VA loans, GSCU allows borrowers to use gifted funds to make down payments and pay closing costs. However, those taking out a traditional fixed- or adjustable-rate mortgage should anticipate paying these costs on their own.

History of GSCU

Granite State Credit Union (GSCU) was founded in 1945 in Manchester, New Hampshire. Founder John Edward Grace, who previously worked as a city bus driver, put down an initial deposit of $15.

With the work put forth by John and his wife, Betty, GSCU achieved notability and success before merging, in late 2003, with the Acorn Credit Union. GSCU is currently a member of the New Hampshire Credit Union League (NHCUL) and Credit Union National Association (CUNA). It offers a selection of home loan products, including fixed- and adjustable-rate, VA, FHA, HARP, and first-time home-buyer loans.

Bottom Line

If you live in New Hampshire, GSCU may be a great fit for you! With a variety of mortgage products, GSCU has something to offer for everyone. For more information, visit their website.

The post GSCUÂ Mortgage Rates Reviews: Today’s Best Analysis appeared first on Good Financial CentsÂ®.

Source: goodfinancialcents.com

By Leon Hoffman February 3, 2021. Home, Home Decor Credit, credit score, down payment, Finance, Financial Wize, FinancialWize, Home, home equity, interest rate, Interest Rates, Invest, loan, loans, Make, mortgage, Mortgage Rates, Products, property, refinance, refinancing, will

How to Make Better Financial Decisions

A key financial decision people struggle to make is how to allocate savings for multiple financial goals. Do you save for several goals at the same time or fund them one-by-one in a series of steps? Basically, there are two ways to approach financial goal-setting:

Concurrently: Saving for two or more financial goals at the same time.

Sequentially: Saving for one financial goal at a time in a series of steps.

Each method has its pros and cons. Here’s how to decide which method is best for you.

Sequential goal-setting

Pros

You can focus intensely on one goal at a time and feel a sense of completion when each goal is achieved. It’s also simpler to set up and manage single-goal savings than plans for multiple goals. You only need to set up and manage one account.

Cons

Compound interest is not retroactive. If it takes up to a decade to get around to long-term savings goals (e.g., funding a retirement savings plan), that’s time that interest is not earned.

Concurrent goal-setting

Pros

Compound interest is not delayed on savings for goals that come later in life. The earlier money is set aside, the longer it can grow. Based on the Rule of 72, you can double a sum of money in nine years with an 8 percent average return. The earliest years of savings toward long-term goals are the most powerful ones.

Cons

Funding multiple financial goals is more complex than single-tasking. Income needs to be earmarked separately for each goal and often placed in different accounts. In addition, it will probably take longer to complete any one goal because savings is being placed in multiple locations.

Research findings

Working with Wise Bread to recruit respondents, I conducted a study of financial goal-setting decisions with four colleagues that was recently published in the Journal of Personal Finance. The target audience was young adults with 69 percent of the sample under age 45. Four key financial decisions were explored: financial goals, homeownership, retirement planning, and student loans.

Results indicated that many respondents were sequencing financial priorities, instead of funding them simultaneously, and delaying homeownership and retirement savings. Three-word phrases like “once I have…,", “after I [action],” and “as soon as…,” were noted frequently, indicating a hesitancy to fund certain financial goals until achieving others.

The top three financial goals reported by 1,538 respondents were saving for something, buying something, and reducing debt. About a third (32 percent) of the sample had outstanding student loan balances at the time of data collection and student loan debt had a major impact on respondents’ financial decisions. About three-quarters of the sample said loan debt affected both housing choices and retirement savings.

Actionable steps

Based on the findings from the study mentioned above, here are five ways to make better financial decisions.

1. Consider concurrent financial planning

Rethink the practice of completing financial goals one at a time. Concurrent goal-setting will maximize the awesome power of compound interest and prevent the frequently-reported survey result of having the completion date for one goal determine the start date to save for others.

2. Increase positive financial actions

Do more of anything positive that you’re already doing to better your personal finances. For example, if you’re saving 3 percent of your income in a SEP-IRA (if self-employed) or 401(k) or 403(b) employer retirement savings plan, decide to increase savings to 4 percent or 5 percent.

3. Decrease negative financial habits

Decide to stop (or at least reduce) costly actions that are counterproductive to building financial security. Everyone has their own culprits. Key criteria for consideration are potential cost savings, health impacts, and personal enjoyment.

4. Save something for retirement

Almost 40 percent of the respondents were saving nothing for retirement, which is sobering. The actions that people take (or do not take) today affect their future selves. Any savings is better than no savings and even modest amounts like $100 a month add up over time.

5. Run some financial calculations

Use an online calculator to set financial goals and make plans to achieve them. Planning increases people’s sense of control over their finances and motivation to save. Useful tools are available from FINRA and Practical Money Skills.

What’s the best way to save money for financial goals? It depends. In the end, the most important thing is that you’re taking positive action. Weigh the pros and cons of concurrent and sequential goal-setting strategies and personal preferences, and follow a regular savings strategy that works for you. Every small step matters!

Like this article? Pin it!

Want to know how to allocate savings for your financial goals? We’ve got the tips on how to make financial decisions so you can be confident in your personal finance! | #moneymatters #personalfinance #moneytips

This article is from Barbara OâNeill of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5-Minute Finance: Create Financial Goals
How to Manage Your Money â No Budgeting Required
5 Money Moves to Make Before You Turn 40
10 of the Coolest Sayings About Saving
7 Apps That Make Budgeting Fun â No Really!

Source: feeds.killeraces.com

By Leon Hoffman February 3, 2021. Budgeting, Home Buying Tips, Money Management, Personal Finance 401(k), Budgeting, Buying, Compound Interest, Debt, Finance, Financial Goals, Financial Wize, FinancialWize, fun, Grow, How To, Life, loan, loans, Make, money, Money Management, money moves, Personal Finance, planning, Retirement, retirement planning, retirement savings, Save Money, Saving, saving money, savings, Security, setting goals, Student Loans, tips, will

50 Ideas To Help You Get Out of Debt!

The post 50 Ideas To Help You Get Out of Debt! appeared first on Penny Pinchin' Mom.

When it comes to trying to get out of debt, I’ve seen and heard it all. Â From the person who gets three jobs to the guy who sold his dream car – just to make it all happen. Â It got me to thinking – what are some of the craziest ideas out there to help you find your way out of debt?

find money to pay off debt

I decided to make a fun post about the craziest ideas people have tried just to try to get their debts paid off. Â The funniest thing is that these really do work! Â Who knows? Â Maybe one of these will inspire you too!

If you are struggling Â with paying off your debt, these folks may be able to help:
Call 866-948-5666.

50 IDEAS TO HELP YOU GET OUT OF DEBT

SELL ITEMS

Things are that – just things. Â They don’t define us, and they don’t always make us completely happy. Â My husband and I sold so many items when we were trying to get out of debt that we were able to raise more than $1,000. Â The thing is – I can’t even remember what we sold (which proves that they were things we obviously did not really need). Â Here are some unconventional ideas of things you can sell:

1. Hair. Â This may sound bizarre, but people will pay for long hair! Â Crafters often use it for making dolls, so they will pay to buy it. Â You will need to have at least 10″ or more to sell, and the price will vary greatly.Â You can visit eBay to learn more and get started.

2. Toilet paper / paper towel rolls. Â Have you been on Pinterest and seen the number of craft projects which require a paper towel or toilet paper tubes? Â They are all over the place!

You can get onto local sites such as Wallapop, Craigslist or even visit eBay and list your products for sale. Â It may sound crazy, but it actually can work.

3. Gift cards. Â If you get a gift card for any reason, be it a return or even a gift, you can turn around and sell the card. Â You won’t get quite face value for it, but you also can at least get paid cold hard cash.

They don’t have even to have the full value on them. Â For instance, if you had a $100 gift card to your favorite sporting goods store, but you only have used $26.48, you can still sell your card, and another person can use the remaining balance.

Visit Raise.com to learn more about placing your gift cards up for sale.

4. Daily Deal vouchers. Â Did you buy a deal on LivingSocial and haven’t yet redeemed the voucher, you can sell it.

5. Â Sell things you don’t need. Â Use eBay, Craigslist or LetGo to sell the stuff you do not need anymore. Â Go through your home and decide what you need and what you could sell to raise some quick funds to pay off your debt!

SIMPLE IDEAS

These are things that just make sense and most people think about…but you may not have thought of every one of them!

6. Â Budget. Â Of course, it seems this should go without saying, but it is not always obvious. If you don’t have a budget, you have no control of your money. Â Learn How to Create a Budget.

7. Coupons. Â Start using coupons to save as much as you possibly can at the grocery store. Â Then, use the amount you save to pay towards your debt! Read more about How to Use Coupons.

8. Change where you shop. Â If you live near an Aldi, start to buy groceries there. Â Skip the clothing store and find consignment stores to find gently used clothes. Â Read more about How to Shop at Aldi.

9.Â No more dinners out. Â This is a tough one, but it works. Â Best of all, its not something you will have to give up forever! Â Just think, if you spend $100 or more a month dining out that is more than $1,000 to pay towards your debt in just one year!

If you do have dinner out, skip the soft drinks and go for water instead, which is free! Â Make sure you also pass on the appetizers and consider splitting a larger entree to pay less.

10. Give up your hobbies. Â If you are an avid golfer, you might give that up for some time and use the monthly dues to pay towards debt.

11. Menu plan. Â By planning your meals, you not only know what you will have for dinner, but it also helps you plan your shopping trip. Â That ensures you have all you need on hand when you get ready to cook all of your meals – saving you from running to the store for that “one item,” which often leads to more. Â Read more about How to Create a Menu Plan.

12. Ask for rate reductions. Â Contact your creditors to see if they would lower your interest rate at all. This is not always something that works, but it is definitely worth a few calls to see if it won’t work for you.Â Learn the tricks to asking for a rate reduction.

13. Avoid paying monthly fees. Â If your bank charges monthly fees, ask them to waive them. Â If they will not, consider moving to another one which offers free banking. Â Even $5 a month is $60 a year that you are giving to them, just to have your account.

14. Keep the change. Â I always use cash. Â I don’t even pay with change. Â If the total is $6.42, I hand over $7 and keep the change. Â I roll all of this once a year and usually have quite a nice amount saved up. Â Best of all – I never miss it!

15. Â Overbudget. Â This is a fun way to get extra money. Â We may budget $300 for groceries every two weeks, but I will do what I can to keep my shopping way under this amount. Â Then, I take anything left over at the end of that two weeks and save it (you could use it towards your debt). It’s a fun way to challenge yourself to see how little you can spend!

16. Â Change insurance. Â Make some calls to find out of you can get a better rate on your auto and home (renter’s) insurance. Â You can sometimes find a better deal by bundling or even by increasing your deductibles a bit.

17. Â Skip the evening movies. Â If you love to visit the moviesÂ tryÂ the matinee instead! Â You can usually pay less by catching the afternoon show. Make sure you pass on the snacks too, as those can add up quickly!

18. Â Don’t buy books. Â Instead of buying books, visit the library or get free Kindle books. Â No need to buy them at all, when there are ways you can get them for free! Â Find out more ways to get free books.

EXTREME IDEAS

These are ideas which do not work for everyone, but have worked to help others get out of debt very quickly!

19. Stop retirement contributions. Â If you are in debt, you might want to take that 15% you were saving for retirement and throw it all towards your debt. Â As soon as you are debt free, you can start that contribution again (and maybe even do more than that to other accounts).

20. Cancel cable completely. If you really want to go drastic, you need to take all steps necessary to do so. Â Cable can run more than $100 (or even more than $150) per month. Â If you can cut out cable entirely, you might quickly free up $100 or more every single month!

21. Sell your car. Â If you are leasing a vehicle, that is a simple way to throw money away, as you will never own it. Â Turn in the vehicle and then take out a loan to purchase a much older car, where you will pay less per month. Â Best of all, you will own it in a few short years!

If you have an expensive vehicle, you can also sell that and then purchase an older car, which will reduce your monthly overhead (and possibly taxes and insurance).

22. Move. Â If you are renting or even if you own your home, consider downsizing to pay less each month. Â I know many people have opted to sell their home and use any income to pay towards debt, and then they rent until they are debt free. Â Then, they save to get the house of their dreams, which they can purchase debt free!

23. Â Turn off your home phone. Â This can run $30 or more a month. Â Just use your cell phone and cancel your home service.

24. Downgrade your cell phone. Â Try to reduce the data you use to see if you can’t lower your monthly payment on your cell phone. Â Stick with your home internet for most of your data usage, and you can use your phone less and less and rack up the savings.

25. Â Swap services. Â Instead of paying for babysitting, exchange time with another couple. Â You watch their kids for free, and they can do the same for you. Â You might be able to swap your tutoring for haircuts or your lawn mowing for handyman repairs.

26. Â Make gifts. Â Instead of buying people gifts for birthdays and holidays, consider making them yourself. Â You could even offer a “service” gift where you will babysit once a month for a year, etc. Â Find a way to give from the heart instead.

27. Â Budget bill your utilities. Â If you can, arrange for budget billing with your services. Â This can make it easier to include your budget and will avoid those swings in the summer or the winter when certain utilities may be more expensive.

28. Â Drop the gym or country club. Â If you have a membership of any sort, just cancel it. Â If you work out at the gym, try to find free videos you can follow at home or create your ownÂ workout plan. If you like to golf, go with a friend instead of paying for your membership.

29. Â No more coffee trips. Â Make your coffee at home each morning and cancel that run through the drive-thru.

30. Â Take your lunch. Â It is great to go out to lunch every day, but pack your lunch, and you’ll ensure you eat up leftovers.Â Not only will you waste less food, but you’ll also save a nice chunk of money every month.

31. Â Carpool. Â Take turns driving to work and save money on fuel and also wear and tear on your vehicle.

32. Â Set up no spend months. Â This is a tough one, but see if you can go a few weeks without spending anything more than you need to survive. Â That means no dining out. Â No entertainment. Â No clothes. Â Just food and fuel and that’s it!

MAKE MONEY

This is a bit different than working from home. Â These ideas help you make a bit more money just doing things you might already do – like search the internet, shop, etc. Â These sites will pay you money to do just that. Â Then, turn around and apply anything you make towards your savings.

33. Swagbucks.Â Use this site to get paid for doing searches and other things you normally do online! Â Click HERE to learn more about Swagbucks.

34. Sell crafts on Etsy. If you are good at crocheting, woodworking or anything at all, look at selling your wares on Etsy. It is a simple platform and the costs are very low, which allows you to keep most of what you make from each sale.

35. Rent a room in your home. Â If you have a walk-out basement, consider renting out the space to make more money. Â Just check with your local laws and homeowner’s association to ensure this is allowed before you jump in to start this one.

36. Sell stocks. Â If you have investments, considering selling them and using the proceeds to pay towards your debt.

37. Give music lessons. Â If you know an instrument or you can sing, consider selling your time to help teach others.

38. Tutor. Â Find your expertise and teach others. Â You never know who you might be able to help!

39. Start a blog. Â You may not get rich with your blog, but it can turn into a nice stream of income! Â Learn more about How to Start a Blog.

40. Â Visit garage sales and upcycle. Â Find items very inexpensive at a yard or garage sales. Â Put in some elbow grease, paint and creativity and turn them into something you can sell for a profit. Â Check out flea markets and farmer’s markets for larger items and for places where you can sell your items.

41. Â Find holiday work. Â When the holidays roll around, many stores hire employees for a short 6 – 8 week period. Â Sign up and put in some extra time after your regular job and make some extra cash you can use to pay down your debt.

42. Â Become a mystery shopper. Â This is a great way to get some things for free. Â This is not a way to get rich but is an excellent way to get some of the things you need for free (which allows you more money to pay towards your debt).

43. Become an eBay master. Â Purchase items on clearance or at deep discounts and then sell them for a profit on eBay. Â You can still offer prices which are less than in the store, but more than you paid.

44. Â Ask for a raise.Â Don’t be afraid to ask for one.Â Make sure you share the additional work or responsibilities you’ve taken on as a reason why.Â Or, if it has been a while since you last had a raise, you can mention that too. Â It never hurts to try.

45. Â Sell an eBook. Â If you are an expert in any field, or if you love to write, create a book you can sell on Amazon!

MENTAL

While there are things that you can physically do to save or to make money, you need to get your brain into the right mindset too.

46. Â Make your goal visible. Â If you want to get out of debt so you can afford to save for a vacation, tape a photo of the destination where you see it each day. Â It could be on your office wall, bathroom mirror or the refrigerator.

47. Â Learn toÂ be happy with less. Â Sure, a new TV might be fun to own. It could be enjoyable to go out to dinner. Â However, do you need those things? Â Probably not. Â Find a way to be happy spending time at home spending no money at all, and you’ll realize how much those things don’t matter.

48. Â Learn to say no. Â You may need to tell friends you can’t go out to dinner. Â It may mean telling the kids that they can’t get that treat at the grocery store. You may need to say to yourself that you do not need to grab that afternoon latte. Â Learning to say no can easily keep more money in your pocket.

49. Â Give more. Â This may seem crazy, but it actually works. Â When you give more of yourself to others, you feel better. Â Best of all, giving is not always financial. It can mean your time or even your prayers.

50. Surround yourself with the right people. If your friends encourage you to spend money, then you might want to distance yourself from them (at least until you can get better control over your finances and self-control). Â Find other people who think like you do so that they can encourage and build you up.

There you’ve got it. Â Fifty ways to help get you out of debt! Â Which are you getting ready to try?

ideas to help find money to pay off debt

The post 50 Ideas To Help You Get Out of Debt! appeared first on Penny Pinchin' Mom.

Source: pennypinchinmom.com

By Leon Hoffman February 3, 2021. Estate Planning Auto, Banking, Blog, budget, Buy, Buying, car, Coupons, Debt, Extra Money, Fees, Finance, Financial Wize, FinancialWize, fun, Get Out of Debt, Getting Out of Debt, Home, How To, Insurance, interest rate, investments, loan, Main, Make, Make Money, money, moving, paint, Pay Off Debt, Personal Finance, planning, Products, Purchase, Retirement, Save Money, Saving, Saving for Retirement, savings, Shopping, Spending, summer

4 Practical Ways to Leave College Debt-Free

The following is a guest post by Lisa Bigelow, a content writer for Bold.

When it comes to paying for college, the anxiety about how to leave college debt-free starts early. And for thousands of grads who are buckling under the weight of monthly student loan payments that can cost as much as a mortgage, that worry can last for as long as 25 years.

According to EducationData.org and The College Board, the cost of a private school undergraduate education can exceed $200,000 over four years. Think you can avoid a $100k+ price tag by staying in-state? Think againâmany public flagships can cost over $100,000 for residents seeking an undergraduate degree, including room and board. And with financial aid calculators returning eye-poppingly low awards, youâd better not get a second topping on your pizza.

In fact, youâd better hope that you can graduate on time.

The good news is that you can maintain financial health and get a great education at the same time. You wonât have to enroll as a full-time student and work 40 hours a week, eitherâeach of the methods suggested are attainable for anyone who makes it a priority to leave college debt-free.

Here are four practical ways you can leave college debt-free (and still get that second pizza topping).

1. Cut the upfront sticker price

Donât visit schools until you are certain you can afford them. Instead, prioritize the cost of attendance and how much you can afford to pay. Staying in-state is one easy way to do this. But if you have wanderlust and want to explore colleges outside state lines, an often-overlooked method of cutting the upfront cost is the regional tuition discount. Many US states participate in some form of tuition reciprocity or exchange programs. You can explore the full list of options at the National Association for Student Financial Aid Administrators website.

Letâs explore how this works. As a resident of a New England state, for example, you can study at another New England stateâs public university at a greatly reduced cost if your home stateâs public schools donât offer the degree you want. So, for example, if you live in Maine but want to go to film school, you can attend the University of Rhode Island and major in film using the regional tuition discount.

Some universities offer different types of regional discounts and scholarships that appear somewhat arbitrary. The University of Louisville (in Kentucky) includes Connecticut in its regional scholars program. And at the University of Nebraska, out-of-state admitted applicants are eligible for several thousand dollars in renewable scholarship money if they meet modest academic standards.

If you already have your heart set on an expensive school and youâre not likely to qualify for reciprocity, financial help, or merit aid, live at home and complete your first two years at your local community college.

Hereâs another fun fact: in some places, graduating from community college with a minimum GPA gives you automatic acceptance to the state flagship university.

2. Leverage dual enrollment and âtesting outâ

When you enroll in a four-year college itâs pretty likely that youâll spend the first two years completing general education requirements and taking electives. Why not further reduce the cost of your education by completing some of those credits at your local community college, or by testing out?

Community college per-credit tuition is usually much cheaper than at four-year colleges, so take advantage of the lower rate in high school and over the summer after youâre enrolled in your four-year college.

But beware: youâll probably need at least a C to transfer the credits, so read your institutionâs rules first. Also, plan to take general education and low-level elective classes, because youâll want to take courses in your major at your four-year school.

If youâve been given the opportunity to take Advanced Placement courses, study hard for your year-end exams. Many colleges will accept a score of 3 or higher for credit, although some require at least a 4 (and others none at all). Take four or five AP classes in high school, score well on the exams, and guess what? Youâve just saved yourself a semester of tuition.

3. Take advantage of financial aid opportunities

After taking steps one and two, you probably have a good idea of what the leftover expense will be if you want to leave college debt-free. Your next job is to figure out how to cut that total even more by using financial aid. There are four types to consider.

The first is called need-based aid. This is what youâll apply for when you complete your Free Application for Federal Student Aid. Known as the FAFSA, this is where youâll enter detailed financial information, and youâll need at least an hour the first time you complete this form. Hint: apply for aid as soon as the form opens in the fall. It is not a bottomless pot of money.

There is also medical-based financial aid. If you have a condition that could make employment difficult after graduating from college, you may be eligible, and qualifying is separate and apart from financial need and academic considerations.

The third type of aid relates to merit and is offered directly by colleges. Some schools automatically consider all accepted applicants for merit scholarships, which could relate to academics or community service or, in the case of recruited athletes, athletics. At other universities, youâll need to submit a separate scholarship application after youâve been admitted. Some merit awards are renewable for four years and others are only for one year.

If you didnât get need-based or merit-based aid then you still may qualify for a private scholarship. Some require essays, some donât, and some are offered by local community organizations such as rotary clubs, womenâs organizations, and the like. Donât turn your nose up at small-dollar awards, either, because they add up quickly and can cover budget-busting expenses such as travel and books.

4. Find easy money

Small-dollar awards really add up when you make finding easy money a priority. Consider using the following resources to help leave college debt-free:

Returns from micro-investing apps like Acorns
Tax return refunds
Browser add-ons that give you cashback for shopping online
Rewards credit cards (apply for a travel rewards credit card if youâre studying out of state)
Asking for money at the holidays and on your birthday
Working part-time by capitalizing on a special talent, such as tutoring, photography, or freelance writing

Leave College Debt-Free

Finally, if you have to take out a student loan, you may be able to have it forgiven if you agree to serve your community after graduation. The Peace Corps is one such way to serve, but if you have a specialized degree such as nursing, you can work in an underserved community and reap the rewards of loan forgiveness.

Lisa Bigelow writes for Bold and is an award-winning content creator, personal finance expert, and mom of three fantastic almost-adults. In addition to Credit.com, Lisa has contributed to The Tokenist, OnEntrepreneur, College Money Tips, Finovate, Finance Buzz, Life and Money by Citi, MagnifyMoney, Well + Good, Smarter With Gartner, and Popular Science. She lives with her family in Connecticut.

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By Leon Hoffman February 3, 2021. DIY, Student Loans Acorns, college, Credit, Education, employment, Family, Finance, financial aid, Financial Wize, FinancialWize, fun, guest post, Guides, Home, How To, Life, loan, Make, money, mortgage, News, Personal Finance, pizza, Rewards, Rewards Cards, School, second, Shopping, Student Loans, summer, tips, Travel

National Get Smart About Credit Day

Depending on the time period in which you were raised, many young children and adolescents had differing opinions (and ideals) about what credit was and how it should or shouldnât be utilized. While some were privileged enough to understand the complexities and importance of credit, others had to learn at the expense of their own mistakes along the way. No matter where you were or where you are currently, luckily there are always actionable steps that can be taken to clean up, improve, and get smart about your credit â letâs explore.Â

Become familiar with what can impact your creditÂ

There are five key components that are factored into your credit score.Â

Payment historyÂ

Your ability to make timely payments plays a huge role in your credit score. Lenders want to have the confidence that you as the borrower are capable of paying back any debts on time. If there is ever a situation that can impact your payment history, itâs best to notify your lender as soon as possible to avoid any negative remarks on your credit report.Â Â

Credit utilizationÂ

In order to determine your credit utilization rate, divide the amount of credit currently in use by the amount of credit you have available. For the best possible scores, keep this percentage under 30%. This shows creditors you have the ability to manage debt wisely. To optimize and improve your score, make it a goal to utilize less than 10% if possible.Â Â Â

Length of credit historyÂ Â

Lenders will take an account of all creditors and the length of time each account has been open. In order to improve this average, try your best not to close any accounts as this can have the potential to decrease your overall credit score.Â Â

Credit mixÂ Â

Car, student loan debt, mortgage, and credit cards are all varying types of revolving and installment loans. Lenders view this as favorable when youâre able to manage different types of credit. A good rule of thumb for using a credit card is charging a small amount each month and paying it off in full to avoid any interest payments. Not only does this impact your score positively, but it also creates good habits that donât require you to solely rely on credit cards for purchases. Â

New creditÂ

Any time you apply for credit, youâre giving lenders the right to obtain copies of your credit report from a credit bureau. Soft inquiries do not have an impact on your score, such as pulling your own credit report or a potential employer pulling your report as a part of the screening process. Applying for a new credit card, requesting a credit limit increase, financing a car, or purchasing a home are all examples of hard inquiries. For processes such as auto purchases, student loans, or mortgages these are typically treated as a single inquiry if done within a short scope of time such as thirty days. Be mindful of the number of inquiries outside of these scenarios â this mainly relates to retail store credit cards. Inquiries have a greater impact if you have a short credit history or a limited amount of active credit accounts.Â Â Â

Review your credit reports and dispute errors if necessaryÂ

Carve out some time to obtain a free credit report from one of the three credit bureaus (Experian, TransUnion or Equifax) to review. Familiarize yourself with everything that is listed. In the instance something doesnât appear correct, follow the proper protocols to dispute errors. Completing this exercise at least once a year after initially cleaning up any errors can help correct any mistakes, but also ensures accuracy. The credit reporting agency and the lender must be contacted in order to jumpstart the process of resolution. Even in the instance, there are no issues found, youâll have peace of mind knowing the due diligence has been done.Â Â

Communicate and be honest with all creditorsÂ

If you are experiencing any type of financial hardships due to unforeseen circumstances, make it a priority to communicate upfront with all creditors. Explaining your personal situation while proposing reasonable solutions may work in your favor. Refrain from avoiding creditors due to emotional reasons or negative thoughts; your pride cannot overshadow your personal needs. When discussing finances, most of us donât want to disclose any personal information â however, if this can result in bettering your personal finance journey and credit score simultaneously; thereâs no way to lose. Make your requests known and be proactive so the best solutions can be provided.Â Â

Create a plan and remain completely committedÂ

Commit to at least three goals that relate to improving your credit. This could simply start with paying all of your bills on time and regularly checking in with creditors to ensure good standing. If credit card spending is a challenge for you, commit to limiting your credit card usage while paying more than the minimum balance. Rally the assistance of your family and friends to serve as your accountability partners to make sure you achieve your goals. No matter the personal goals you decide to set, commit to staying the course. Often times our personal lack of patience leads us to believe that the hard work thatâs being put forth is in vain. If nothing else, commit to improving your credit for you and your familiesâ wellbeing.Â Â

Protect your hard work (and your credit)Â

Once your new credit score emerges and is here to stay, the first order of business is to celebrate â congratulations! Your hard work and dedication have indeed paid off. In order to make sure your credit score stays in tip-top shape, donât be too quick to take your foot off of the gas just yet! Be sure to stay informed about any tactics or strategies to keep your credit score in the best shape possible. Weâre all on our phones throughout the day, so make it a regular occurrence to do a quick internet search on ways to improve your credit score. Continually staying educated about various credit improvement opportunitiesÂ Â

The post National Get Smart About Credit Day appeared first on MintLife Blog.

Source: mint.intuit.com

By Leon Hoffman February 3, 2021. DIY Auto, car, Children, Credit, Credit Cards, Credit Info, credit report, credit score, Debt, Family, Finance, Financial Wize, FinancialWize, financing, Home, loan, loans, Make, mortgage, Personal Finance, Spending, Student Loans

6 Tips for Successfully Managing a Checking Account in College

Heading off to college is exciting. Really exciting. You finally have freedom! You’re out on your own for the very first time, managing your studies, managing your social life and… managing your finances.

Despite being a big part of your newfound independence, personal finance is a subject you probably won’t find on your course schedule. If you didn’t take a personal finance class in high school and never had money lessons from your parents, you may not know how to manage a checking account as a college student.

“College students have very different needs for their checking account than their parents or other adults,” says Tommy Martin, CEO of Clear Path Financial Planning and a finance blogger at TommyMartin.com. If you live in a different city during the school year than you do during winter and summer breaks, for example, you may be after a bank for which location doesn’t matter.

Ok, so how do I manage my checking account in college, you ask? First, don’t get overwhelmed. Learning how to manage money while in college and getting a handle on checking account basics is simpler than you might think (oh, and the skills will serve you for years to come). Second, you can kick off your checking account education with these tips for managing a checking account in college:

1. Compare checking accounts before signing up

While your college life may center around your school campus, you should consider venturing off-campus to pick the right checking account for your lifestyle.

“Students typically sign up with a bank that’s on campus or close to campus,” says Sahil Vakil, a financial planner and president of MYRA Wealth in New Jersey. However, the nearest bank might not be the one that best fits your needs, he adds.

Wondering how to manage money while in college? Be sure to compare checking accounts to find one that meets your needs while you're in school.

Instead of picking a bank based solely on proximity, consider all of your options, including banks with off-campus locations and online-only banks.

Martin agrees, saying that learning how to manage money while in college means considering all of your banking options rather than “automatically enrolling or choosing the official school bank just because it has the school logo on it.” There are other ways to show your school pride, after all.

2. Learn about checking account fees and rewards

Vakil and Martin both say a tip for managing a checking account in college is to consider an account’s fees before signing up. Costly fees can eat into your savings and spending money, which can be a blow for students who are not working full-time. When you are choosing a checking account in college, consider fees for:

Monthly maintenance (essentially keeping your account open)
Minimum balance (not maintaining one)
ATM usage
New checks
Wire transfers
Online bill pay
Replacement debit cards

Martin says a checking account with no minimum balance requirement or minimum number of transactions could be a good fit for students. “It allows them to focus on their education” instead of worrying about incurring penalties, he says. “Even a $5 fee on a checking account with $60 in it can be devastating.”

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Costly fees can eat into your savings and spending money, which can be a blow for students who are not working full-time.

Martin also suggests finding an account that has a large network of no-fee ATMs located across the country to better manage your checking account as a college student. “Especially if you’re going to a school in a different state, the local bank from home might wind up costing you a lot in terms of ATM fees,” he says. If your parents plan to wire you money, find an account that doesn’t charge incoming wire fees, Martin adds.

While fees should be a focus when you are learning how to manage money while in college, don’t forget about incentives. You may be able to find a checking account that actually helps you grow your balance by paying interest or offering a cash back rewards program.

“If you have to pay for books or supplies, at least you can get some cash back and use it for a free dinner,” Martin says. Discover Cashback Debit, for example, offers 1% cash back on up to $3,000 in debit card purchases each month.¹

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3. Track your checking account balance

Luckily, you don’t need to take Banking 101 to figure out your funds, and tech makes tracking your balance and account activity easier than ever. Most banks let you log in to your account online (don’t get distracted in class!), and with a bank’s mobile app you can transfer money to friends, pay bills, deposit checks and check your balanceâall while you’re on the go.

Knowing your balance at all times is a tip for managing a checking account in college because it can help you avoid overdrafts and insufficient funds fees. It can also help you forecast your income and expenses to ensure you’ll have enough money to cover future costs. Surpriseâthat’s budgeting!

There’s no one-size-fits-all budgeting program or system, though. You can go old-school and track your budget on a printed-out budget sheet, or you can go tech-savvy with a budgeting and spending app. “What’s best for you is the one you’re actually going to use,” Martin says.

If you learn how to manage money while in college and make a practice of maintaining your budget, the habit will follow you after graduation.

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âCollege students have very different needs for their checking account than their parents or other adults.â

– Tommy Martin, CEO of Clear Path Financial Planning and finance blogger

4. Secure your account

One of Vakil’s tips for managing a checking account in college is to make sure your account stays secure. Create a unique account name and password that you use only for your checking account, and never share your credentials.

Vakil says you can also enable two-factor authentication if your bank offers it and you’re looking for another way to improve the management of your checking account as a college student. “This additional layer of protection safeguards your sensitive financial data and strengthens the security of your account by requiring two methods of verifying your identity.”

For example, if you log in to your account from a new device, you may be sent a text message with a code that you’ll need to enter to access your account.

5. Keep an eye out for debit card holds

No matter where you bank, a merchant may place a hold on funds in your checking account when you use your debit card. Generally, a hold is placed for travel-related purchasesâsuch as at rental car companies, hotels and gas stationsâand used by merchants to protect against fraud and errors.

To manage a checking account as a college student, keep an eye out for debit card holds, especially while traveling.

“Holds on a debit card can make it tricky for you to manage your finances,” Vakil says. For example, “when you rent a car, the car rental company might put a $500 hold on your account. If the balance in your account was $550, now you can only use another $50.”

Being aware of holds can be particularly important if you are managing a checking account as a college student and tend to have a low account balance.

If a merchant will be placing a hold, it will generally post a sign to notify customers. The hold will typically be removed after the funds are transferred to the merchant from your financial institution, typically within three to four days.

Knowing when a hold will be placed, the amount of the hold and how much money you have in your checking account can help you manage your checking account as a college student by avoiding overdrafts and missed bill payments due to insufficient funds.

6. Don’t let one mistake throw you off track

If you can learn how to manage a checking account as a college student, and more generally, how to manage money while in college, you can lay the groundwork for a solid financial future. Checking account mistakes may occasionally happen (oops, I didn’t budget enough for that spring break trip), but don’t let them discourage you to the point of apathy. Instead, try to continually expand your knowledge and practice healthy financial habits.

¹Â ATM transactions, the purchase of money orders or other cash equivalents, cash over portions of point-of-sale transactions, Peer-to-Peer (P2P) payments (such as Apple Pay Cash), and loan payments or account funding made with your debit card are not eligible for cash back rewards. In addition, purchases made using third-party payment accounts (services such as Venmo^Â® and PayPal, who also provide P2P payments) may not be eligible for cash back rewards. Apple, the Apple logo and Apple Pay are trademarks of Apple Inc., registered in the U.S. and other countries. Venmo and PayPal are registered trademarks of PayPal, Inc.

The post 6 Tips for Successfully Managing a Checking Account in College appeared first on Discover Bank – Banking Topics Blog.

Source: discover.com

Accredited Asset Management Specialist (AAMS)

What is the AAMS certification? New financial advisors need something to help them stand out. Consequently, the AAMS does just that. Designed for newcomers to the financial advice business, the AAMS trains advisors to identify investment opportunities as well as help clients with other financial goals. It also gives more experienced advisors a fast and simple way to learn more about asset management and improve their credentials. Hereâs how it works.

AAMS Defined

An Accredited Asset Management Specialist (AAMS) can advise clients on college savings, taxes, and retirement savings. The course and tests for this certification are designed to ensure advisors can assist clients with their complete financial needs. It emphasizes evaluating the clientâs assets and making appropriate recommendations.

The AAMS certification is granted by the College for Financial Planning, a unit of the Kaplan Company. The college oversees a large number of financial certification programs, including the Certified Financial Planner designation, one of the most valued certifications in the field.

AAMS Certification Requirements

What is the AAMS certification?

To receive an AAMS, students first have to complete a 10-module education program provided by the College for Financial Planning. Then they have to pass an examination. Finally, they must agree to abide by a code of ethics and promise to continue their education.

The courses are online and can be delivered in self-study or instructor-led formats. Courses are open-enrollment, therefore students can begin at any time without waiting for the next session. The 10 modules cover the following material:

1.:The Asset Management Process

2. Risk, Return & Investment Performance

3. Asset Allocation & Selection

4. Investment Strategies

5. Taxation of Investments

6. Investing for Retirement

7. Deferred Compensation and Other Benefit Plans

8. Insurance Products for Investment Clients

9. Estate Planning for Investment Clients

10. Fiduciary, Ethical, and Regulatory Issues for Advisors

The College of Financial Planning provides everything necessary to study for and complete the modules and take the test. Students have access to the study materials and tests through an online portal.

Streaming video lectures, audio files, and interactive quizzes also can be found through the collegeâs site. Meanwhile, students can access live classes online and contact professors with questions and issues.

The AAMS Test

To get the AAMS certification, students have to pass just one test. However, they have to make their first attempt at the test within six months of enrollment and pass it within a year.

The fee for the first attempt at taking the test is included in the course tuition. There are no prerequisites for signing up to take the AAMS course.

Time and Money Requirement

Tuition for the AAMS courses is $1,300. This includes the fee for the first attempt at passing the certification exam. It also includes all needed course materials. Each additional attempt costs $100.

Students employed with certain financial services firms may be able to get tuition discounts. The college may also provide scholarships.

The College for Financial Planning recommends students plan to spend 80 hours to 100 hours on the course. Since the course is self-study, this amount of time is flexible.

To maintain AAMS certification students have to commit to completing 16 continuing education credits every two years. Also, continuing education has to cover one or more of the topics covered in the AAMS coursework.

AAMS certificate holders also have to agree to follow a professional standard of conduct. As a result, they have to maintain integrity, objectivity, competency, confidentiality and professionalism in providing financial services.

AAMS Certificate Holder Jobs

AAMS certificates are generally earned by entry-level workers in the financial advice business. Consequently, AAMS holders are typically trainees. In some cases, they may provide support services to more experienced and highly credentialed advisors.

The AAMS designation does not confer any special powers or privileges. Instead, itâs an optional credential that students may obtain to advance their careers and enhance their knowledge of financial advice.

Comparable Certifications

What is the AAMS certification?

In addition to the AAMS, the College for Financial Planning offers an Accredited Wealth Manager Advisor (AWMA) certificate. This is a somewhat more advanced designation. As a result, it requires a course equivalent to three graduate level college credits and requires 90 hours to 135 hours to complete.

Chartered Mutual Fund Counselor (CMFC) is sponsored by the Investment Company Institute along with the College of Financial Planning. It is similar to the AAMS certificate except it focuses on mutual fund assets.

Accredited Financial Counselor (AFC) is a general personal finance advice certificate from the Association for Financial Counseling and Planning Education. First, it requires 1,000 hours of financial counseling experience. Secondly, it demands three letters of reference. Finally, applicants must both complete coursework and pass an exam.

Bottom Line

The AAMS designation is usually for newly minted financial advisors, but even experienced pros can use it to bulk up their credentials. The courses and tests associated with the AAMS teach advisors how to evaluate assets and make recommendations.

While this certification doesnât give an advisor any real powers, itâs a sign that they can identify investment opportunities specific to their clients. Above all else, it can be a great relief to a client who has a child going to college or a retirement house on their wish list. As a result of obtaining an AAMS, and advisor can point them toward the right investments for their goals.

Investing Tips

If youâre looking to identify investment opportunities, consider using an AAMS as your advisor. Finding the right financial advisor that fits your needs doesnât have to be hard. SmartAssetâs free tool matches you with financial advisors in your area in 5 minutes. If youâre ready to be matched with local advisors that will help you achieve your financial goals, get started now.
An AAMS can help you with college savings, taxes, and retirement savings if you know what your goals are. However, if you are unsure how much you want to invest, what your risk tolerance is, or how inflation and capital gains tax will affect your investment, SmartAssetâs investing guide can help you take the first steps.

The post Accredited Asset Management Specialist (AAMS) appeared first on SmartAsset Blog.

Source: smartasset.com

Need Cash? 3 Ways To Tap Your Home Equityâand Which One’s Right for You

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You need to come up with some cash, fast. Maybe you have a leaky roof that desperately needs fixing or you need help paying for your kid’s first semester of college. But where do you turn?

If you’re a homeowner, you have options that involve tapping into your home equityâthe difference between what your home is worth and how much you owe on your mortgage.

There are three main ways to tap into home equity, but sorting through those options can be confusing. To help, we’ve boiled down what you need to know about some of the most common home financing optionsâcash-out refinance, home equity loan, and home equity line of creditâand how to determine which one is right for you.

1. Cash-out refinance

How it works:Â A cash-out refinance replaces your existing mortgage with a new loan that’s larger than what you currently oweâand puts the difference in your pocket. With a cash-out refinance, you’re able to receive some of your home’s equity as a lump sum of cash during the process.

“This only works if you have equity in your home, either through appreciation or paying down your mortgage,” says David Chapman, a real estate agent and professor in Oklahoma.

Pros:Â If you need cold, hard cash in your hands, a cash-out refinance can help you get it. You can use this money for whatever you wantâupgrades to your house, even a vacation. Another positive? If interest rates are lower than when you first got your loan, you’ll get to lock in lower interest rates than you’re paying now.

“Now is the time to look at a cash-out refinance due to the low interest rate environment,” says Michael Foguth, founder of Foguth Financial Group.

Cons:Â You’ll have to pay closing costs when you refinance, though some lenders will let you roll them into your mortgage. The costs can range from 2% to 5% of your loan amount. And, depending on the circumstances, if interest rates have gone up, you could end up with a higher interest rate than your existing mortgage.

Also, you’ll be starting over with a new loan and, unless you refinance into a different type of mortgage altogether, you’ll ultimately be extending the time it takes to pay off your home loan. Even if you get a better interest rate with your new loan, your monthly payment might be higher.

When to get a cash-out refi: A cash-out refinance makes the most sense if you’re able to get a lower interest rate on your new loan. (Experts typically say that at least a 1% drop makes refinancing worth it.)

This option also works well for home renovations, since (ideally) you’ll be increasing your home’s value even more with the updates. In essence, you’re using your home’s existing equity to help pay for even more equity growth.

While you could use your cash-out refinance to pay for anything, financial experts typically advise that you spend the money wisely, on something that you see as a good investment, rather than on something frivolous.

2. Home equity loan

How it works: Unlike a cash-out refi, which replaces your original loan, a home equity loan is a second additional mortgage that lets you tap into your home’s equity. You’ll get a lump sum to spend as you see fit, then you’ll repay the loan in monthly installments, just as you do with your first mortgage. The home equity loan is secured by your house, which means that if you stop making payments, your lender could foreclose on the home.

Pros:Â With a home equity loan, you get a huge chunk of cash all at once. A home equity loan lets you keep your existing mortgage, so you don’t have to start over from year one. Your interest rate is typically fixed, not adjustable, so you know exactly what your monthly payment will be over the life of the loan. And, another plus is your interest may be tax-deductible.

Cons: Compared with a cash-out refinance, a home equity loan will likely have a higher interest rate. Home equity loans also come with fees and closing costs (though your lender may opt to waive them). Another downside? You’re now on the hook for two mortgages.

When to get a home equity loan: A home equity loan makes more sense than a cash-out refi if you’re happy with your current home loan, but you still want to tap into your home equity, says Andrina Valdes, chief operating officer of Cornerstone Home Lending. It can also be handy for home renovations that add value, though of course you’re free to use it however you want.

“A home equity loan could be used in cases where you may already have a low mortgage interest rate and wouldnât necessarily benefit from a refinance,” says Valdes.

3. Home equity line of credit

How it works:Â A home equity line of credit, aka HELOC, is similar to a home equity loanâit’s a second mortgage that lets you pull out your home equity as cash. With a HELOC, however, instead of a lump sum amount, it works more like a credit card. You can borrow as much as you need whenever you need it (up to a limit), and you make payments only on what you actually use, not the total credit available.

Since it’s a second mortgage, your HELOC will be treated totally separately from your existing mortgage, just like a home equity loan.

“With a HELOC, the homeowner will need to make two payments each monthâtheir mortgage payment and the HELOC payment,” says Glenn Brunker, mortgage executive at Ally Home.

Pros: You borrow only what you need, so you may be less tempted to spend this money than a lump-sum home equity loan. You pay interest only once you start borrowing, but you can keep the line of credit open for many years, which means your HELOC can act as a safeguard for emergencies.

HELOCs typically have lower interest rates than home equity loans, and they typically have little or no closing costs. (Again, your lender might offer to waive these fees.) HELOCs are often easier to get because they’re subject to fewer lending rules and regulations than home equity loans.

Cons:Â HELOCs usually have adjustable interest rates, which means you can’t necessarily predict how much your monthly payment will be. Most HELOCs typically require the borrower to pay interest only during what’s known as the draw period, with principal payments kicking in later during the repayment period. If you don’t plan properly or you lose your job, you might be caught off guard by these higher payments down the road. As is the case with other second mortgages, your bank can foreclose on your house if you stop making payments.

“Once a HELOC transitions into the repayment period, the borrower is required to make both principal and interest payments,” says David Dye, CEO of GoldView Realty in Torrance, CA. “Many borrowers forget about this transition and are often startled by the sudden increase in minimum payments.”

When to get a HELOC: A HELOC makes the most sense if you want the flexibility and peace of mind of knowing you can easily access money in the future, says Mindy Jensen, a real estate agent in Colorado.

“A HELOC is great to have just in case,” says Jensen. “You have access to it, but are not committed to taking it or paying for money you don’t have an immediate need for.”

And compared with an actual credit card, a HELOC has a much lower interest rate, so it’s likely a cheaper financing option for you.

The post Need Cash? 3 Ways To Tap Your Home Equityâand Which One’s Right for You appeared first on Real Estate News & Insights | realtor.comÂ®.

Source: realtor.com

By Leon Hoffman February 2, 2021. Home Improvement, Refinance college, Credit, Fees, Finance, Financial Wize, FinancialWize, financing, Home, home equity line of credit, home equity loan, How To, interest rate, Interest Rates, investment, Life, loan, loans, Main, Make, money, mortgage, Original, Real Estate, refinance, second

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1. Cash-out refinance

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