Debt Free Adventure Blog - Live Debt Free

The Best Resources to Help You Pay Off Debt

01.14.2021 by Harry // Leave a Comment

Many people spend a lot of their time and energy worrying about their debt.

Debt can be a scary thing, but if you plan ahead, and plan wisely, you can easily avoid large doses of worry and devote your energy to something far more exciting.

There are quite a few resources that you can access with ease and convenience that can help you with paying off your debt.

So what are you waiting for? Let’s go check it out!

Understand Your Debt

Before you can move further, one of the first things you should do is to stop and evaluate the type and amount of your debt.

There are various kinds of debt that either has to be paid back urgently or have a larger rate of interest that needs to be paid. Debts can range from mortgage loans, and student loans, to credit card debts, etc.

Different types of debt have different levels of payback urgency, thus before anything, it is wise to evaluate the urgency of payments due before planning your payment strategy.

Make Your Notes and Plan Ahead

After understanding the type of debt you have to pay back, you can move on to figuring out a solid plan of action that would help you clear your outstanding dues.

Don’t forget or underestimate the importance of good old fashioned planning in your notebook. Write down all the digits clearly and then build an appropriate plan to cater to your needs.

Remember, where a good plan can make your life so much easier, a poorly laid out plan has the potential to blow up in your face and make you end up paying much more than you should have.

Different people have different priorities when it comes to paying off their debt. These priorities depend largely on the individual differences, thus vary across each person.

If you have debt you need to figure out if you want to pay off the larger debts off first or the ones with the higher interest rates.

Here are several strategies that you can use:

Opt for Debt Consolidation: you can consolidate debt through things such as balance transfer cards and even personal loans. These are effective as they can help merge your existing debts into one to help make your repayments much easier.
Debt Snowball Technique: when it comes to devising a repayment strategy one of the techniques used is debt snowballing. This indicates making the use of a strategy where you start by the repayment of your smallest debts, and once you get those out of the way you can devote greater resources to paying back the larger debts.
Debt Avalanche Technique: this plan is one of the more aggressive plans, which if the planned right can help increase the speed of your debt repayments. For you to save money (and perhaps even time) you can opt to pay the debt which has the largest interest rate the first.

Meanwhile, you can pay the minimum amount for your other debts.

Once you pay off the debt with the highest rate, you can move on to the one with the second-highest interest rate, and so on.

Management Plan for Debt: if you feel as if your ability to pay off your debt is at a near standstill, it is always a great idea to opt for external help. Numerous agencies are non-profit and can help cut down interest rates and help you figure out a repayment plan.

These are some of the most commonly used strategies for planning debt repayments. Bear in mind that the best strategy is the one most perfectly suited to your financial situation.

Use the Right Resources

We have spoken in detail about planning and strategizing to have effective debt repayments. However, to increase the efficiency in the overall process it is a great idea to opt for various resources that can help you manage your debts, or even stay debt-free.

You can go ‘old school’ and stick with your notes on a journal as suggested previously, or go for the tech-savvy techniques such as new personal finance apps and computer software.

Use a Notebook

A notebook is one of the most traditional yet effective tools to use for keeping track of your debt. There are several aspects to making efficient use of a notebook.

As it is something that you can carry around and personalize with ease, a notebook can keep an excellent track of your budgeting plan as well as habits.

Here are some ways of how a notebook makes an excellent tool for personal financial management:

Keeping Strict Tabs on your Budget: you can jot join and account for every penny in your monthly expenses to make sure none is being spent wastefully or frivolously.
Making Grocery Lists: a great way to save money and redirect it towards your debt is to use your notebook to make more grocery lists.

These lists can help ensure that you don’t get tempted to buy unnecessary items from the supermarket every time you visit.

By sticking strictly to your grocery list you can help stay focused on your debt repayment goals.

Keep an eye on spending: a notebook is an effective method of organizing and keeping track of your spending habits. You can use it to note down daily instances of you spending your money. The fact that you are writing things down would be sufficient in making sure you don’t stray from your intention to avoid unnecessary expenses.

Notebooks have been used for managing debts for hundreds of years now, and they have been proved time and again for being invaluable resources for debt management.

Get a Debt Management App

It is always a great idea to ask for some support in terms of ideas and information when it comes to managing your debt.

With the wave of modernization and technological advances, there have been numerous apps designed to help you with your debt.

Personal finance technology ranges from tax calculators, spreadsheets for the budget, and now to the newer smartphone apps. The apps are effective tools that have a variety of different uses such as managing your extra money to others which suggest or personalize repayment strategies.

With the advent of the great technological age, there are plenty of app options available for both Android as well as iOS users.

Use a Software Program to Manage Debt

Amongst the new things available to users around the world, technology has seen the development of debt-reducing software that can easily aid in tracking debt.

Modern software has proven itself capable of organizing your financial information by using the information you have fed into it.

Now, you don’t have to worry about entering the correct information, the software program does everything for you. It is capable of tracking multiple debts, while also being able to calculate monthly payments along with the total payable interest.

Along with these modern software options, some traditional software programs are still far from obsolete. These include multipurpose programs such as Microsoft Excel spreadsheets.

Remember, your convenience and personal comfort matters over everything. You should only opt for the resources that you can use with efficiency to protect and secure your financial safety.

More Tips for Speedy Debt Repayments

Here are some other bits of advice to try out for faster debt repayment:

Make a budget for yourself and follow it
Try to pay more than the minimum balance for each repayment installment
Utilize option for balance transfers
Deactivate your credit card to reduce your spending
Put in the extra hours, or get a side job for the extra cash
Redirect work bonuses towards paying off your debt
Sell superfluous home items
Sell off the extra car at home (save money on fuel and maintenance)

By careful spending and dedicated saving, you can redirect extra cash towards repaying your debts much faster.

Conclusion

I hope this guide helped you figure out which resources are excellent for your financial obligations and debt repayment responsibilities.

Debt does not have to be something that is threatening as long as it is planned and managed mindfully and wisely. Making a month by month plan can help you plan your budget, savings, and even your repayment strategy.

Personal financial apps have come a long way, and continue to be a great support by helping you keep track of how much debt has been paid, how much is left, etc.

There are many resources available to the modern man to keep tabs on their finances to ensure that their debts don’t get out of hand.

I hope this guide helps you make informed decisions regarding the resources you can use for your debt management plans!

Photo credit: Wilfred Iven

7 Characteristics of Debt-Free Living | Traits and Habits to Know

01.12.2021 by Harry // Leave a Comment

It’s not often we come across someone who is truly debt-free. When it comes to things like mortgages, medical bills, student loans, credit cards, and car loans, Americans usually have at least one if not all four of these credit lines open.

Living debt-free is something that we all dream about. And, if you are in debt, know that it is possible to overcome and pull yourself out of it. How? Here are some characteristics and traits of people who live debt-free.

Set Goals

Another fantastic habit of people who live debt-free is they set goals. It is imperative to plan what you want your financial future to look like. If you don’t know what your goals are, you’ll never get to them.

Of course, an important goal for a debt-free person is to bring all your debt to zero.

It is also important to set clear goals after your debt is paid off. This could be setting up an emergency fund, saving for retirement or a vacation, or saving for a new home.

Goals will help you stay motivated and focused as new issues and problems arise in your life. This habit of setting goals goes hand-in-hand with a budget because creating clear goals and plans will help you work your budget correctly.

Make a Solid Budget

This is one of the most defining characteristics of people who live debt-free. Budgets are an incredibly important habit for knowing what bills you have to pay and knowing where your money goes each month. People with no debt set strict budgets and they follow them exactly.

Making a budget doesn’t mean that they are forcing themselves not to spend any money, it just means that they like to be in complete control of their finances. A budget doesn’t just account for bills, it also considers other expenses like entertainment and new clothes.

Budgets also help you afford to buy what you want when you want. By allowing yourself this, you won’t feel like you need to get a credit card and splurge on wants because you only budgeted for your needs.

Self-Control Is Everything: 7 Traits Typically Seen in People Who Practice Debt-Free Living

In most cases, a budget that works will account for every last cent of your income. Every dollar will have a purpose, making you feel more confident with your spending.

Non-Materialistic

In today’s society, it is so easy to get wrapped up in stuff and things because they are popular, and everyone has them. Another defining trait of debt-free people is the fact that they don’t care about new stuff, and they don’t care what people think about this mindset.

Paying for things like a large house or a fancy car can take up a massive portion of your budget each month, and people who live debt-free choose to pass up on those large monthly payments. They also understand the fact that with interest charges, you will end up paying more for the items than what they are worth.

Being materialistic means you are more interested in satisfying your wants at the moment than your monthly needs.

Non-materialistic people are the opposite, as they focus more on their needs than their wants. They know it is important to budget for things they want, but it is not their priority.

Not Afraid to Say “No”

It will be impossible to become debt-free if you are always saying “yes” to everybody and everything you come across. This could be a vacation, eating out at a restaurant, shopping, or spending irrational money without thinking it over first.

One of the most crucial things that people with this characteristic do before making any decisions is they ask themselves a serious question.

They sit back and think: if what they want NOW is more important than what they want MOST. This allows them to put the situation into perspective to make the best decision.

Thinking about this question gives you the ability to see that spontaneous spending is one of the biggest things holding you back from financial freedom. If you always say “yes” and buy anything you want whenever you want, you won’t be able to propel yourself forward financially.

Patient

People who are currently living debt-free knew when they started that it wasn’t going to happen overnight. Paying off all of your debt takes a lot of hard work and a lot of determination. You need to be extremely patient during the process of becoming debt-free.

Patient people also know how great they will feel when they reach the goals they have been working so hard for.

They understand that what they are working towards for their future is more important than what they want right now, and patience is a big part of what works for them.

Save Instead

It is ridiculously easy to get into the mindset of just buying something on your credit card. It is quite simple to pay on a purchase over several months, but this can create a dangerous pattern.

You have to pay interest on purchases you make on your credit card, so you will end up paying more money for your purchase than it is worth.

You are spending more money than you have AND you will pay more for it in the long run? There is an easier way to do things.

It can be hard to get yourself out of the cycle of constantly buying things on your credit cards, but with determination, you can do it. If you can’t afford to buy it with cash, then just don’t buy it. I know it’s easier said than done, but you can do it.

Focus on saving your money for things you want to buy instead of charging it to your credit card.

Before you know it, you will be able to buy that thing you want with cash and you won’t owe a single penny on it after you purchase it!

Make Sacrifices

Living sacrificially is an extremely common trait in completely debt-free people. They understand that reaching their financial goals will require sacrifices, and they are willing to make them.

They pass up on eating out, watch movies at home instead of going to the movie theater, and they stay in and skip the bar.

They also cut out unnecessary expenses that they are paying for but they don’t exactly need, such as cable. It saves you money to cut your cable and use streaming services instead.

Debt-free people also understand that these cuts are only temporary, and they will be able to afford them again one day.

Once you are out of debt, you will have room in your budget for all of the luxuries you had to cut out for the time being. You can continue to go out to eat with your friends and go see movies at the movie theater.

It will feel even better knowing that you can do so without putting yourself in financial distress.

Conclusion

If you want to become debt-free, consider following some of these habits and learning these traits. In the long run, you will be much happier, have more financial freedom, and be able to save properly for the things that you want.

Living debt-free might seem incredibly hard, maybe even impossible, but it doesn’t have to be. You will be surprised at how easy it is!

The Best Rates on Auto Loans in 2020

12.09.2020 by Harry //

The most important step when buying a car is figuring out how you are going to pay for it. More often than not, paying for a car in cash is not entirely possible.

For this reason, financing with an auto loan is the best move for most people. With an auto loan, you can pay for your purchase over time with a monthly payment that you can afford. See more in the link below:

How a Bad Credit Score Affects Your Auto Loan Rate

Before you sign a loan agreement with the first place that offers you financing, you should do some research and try to find the lowest interest rate that you can.

A lower interest rate will reduce your monthly payments and the total amount that you will end up paying for the car.

So, what are the best rates on auto loans in 2020, and how do you find them? Here is some important information that can help you out.

What to Consider Before Signing an Auto Loan?

The first thing you need to consider is your credit score. Are you able to qualify for a low interest rate? Are you even able to qualify for a loan at all?

Your credit score is the deciding factor lenders take into account when determining if they want to extend a loan offer to you.

You will need to make sure your credit score meets the minimum requirements of a lender.

Consider shopping around at a few lenders before making your decision. If you can, go through the approval process to get the most relevant quote and to see what your loan will look like.

Where Can I Find the Best Auto Loan Rate?

To save you some extensive research, this list will tell you the top credit union, national banks, and online lenders who can offer the best auto loan rates in 2020.

Best Overall

PenFed Credit Union

PenFed Credit Union offers surprisingly low rates. A 36-month new or refinanced loan will start as low as 2.14%. If you want to purchase a used car, the rate starts as low as 2.99% on a 36-month term.

They also offer a car buying service for their members, and if you choose to use it you will get a steep discount. The rates for the car buying service are as low as 1.39% for a new car and 2.24% for a used car.

To access a loan from this credit union, you will need to become a member, but the requirements to join are incredibly simple. Current and former military and their families automatically qualify in all 50 states and Puerto Rico. If you do not have any military affiliation, you will be allowed to join by making a one-time donation to the National Military Family Association or a $15 donation to Voices for America’s Troops.

Once you become a member, you can access auto loans as low as $500 up to $100,000. This is by far one of the widest range of loan amounts offered. Like most banks, you will need to have an excellent credit score to obtain the lowest rates.

Consumers Credit Union

Consumers Credit Union offers interest rates as low as 2.69% with autopay. If you are looking to purchase a new car and have a strong credit history and score, you will be able to qualify for the lowest interest rate possible at their credit union. The loan terms available range from 0 to 84 months. They do require a minimum credit score of 640.

To get the 2.69% rate listed above, there is one additional requirement you need to meet. You will need to set up autopay from a bank account in your name that is also at Consumers Credit Union.

To become a member, you must pay a one-time fee of $5. Once you meet this requirement, you will get a 0.50% discount on your interest rate. If you make automatic payments from another bank, your interest rate will be discounted by 0.25%.

Another great thing about this credit union is that they offer 100% financing for your car. This means that you may not have to pay any money for a down payment when you sign your loan agreement. You would only have to cover out-of-pocket expenses such as insurance and tags.

Best for Bad Credit

myAutoloan

If you have less than desirable credit, it may seem impossible to get an auto loan without having an insanely high interest rate. myAutoloan is actually a marketplace that makes it easy to compare multiple offers from different lenders based on your credit score and history.

This website gives you the ability to search multiple loan offers at once for lease buyout, private party, refinance, used, and new auto loans.

The best thing about this website is how efficient and quick it is. You fill out one form that only takes a few minutes to submit. After your application is complete, the system will automatically match you with up to four lenders.

Once you choose a lender, you will receive a certificate or a check for your purchase within 24 hours. The interest rate can be as low as 2.49%, and the minimum loan amount for purchase is $8,000 and $5,000 for a refinance.

Requirements will vary based on each lender that you will have access to during the online process, but typically you can be accepted with a credit score as low as 575 and still be considered eligible for a loan.

Keep in mind this service is only available in 48 states, so if you live in Alaska or Hawaii unfortunately this will not be an option for you.

Oportun

While you can’t always expect a low interest rate with bad credit, Oportun can save you from overpaying on your loan.

This online lender allows you to get an auto loan for a dealer purchase or a private party purchase. This is beneficial because buying from a private party is generally cheaper than buying from a dealership.

The minimum credit score to qualify for an Oportun loan is 500 as long as you make at least $2,000 a month. This is incredibly low compared to so many other lenders.

The loan amounts offered range from $5,000 to $35,000 so you can get almost any car you want. Oportun also does not require a hard pull on your credit, so checking them out won’t cause damage to your credit report.

The loan application is super quick and is completed completely online. In most cases, you will be given an instant decision on your application.

Capital One

Capital One is a great option for less than perfect credit. If you are more comfortable working with a more well-known bank, Capital One allows you to submit a request for a pre-qualification so you can find out if you qualify without having to take a hard hit on your credit report.

This can be done through the bank’s online service called Auto Navigator. If you get a prequalification from Capital One, it will be valid at 12,000 dealerships or more across the country. You will be able to find where you can use the offer on the Capital One website.

Best Online Experience

Carvana

Carvana is a lender and dealership that allows you to complete the car buying process, start to finish, from the comfort of your own home. Yes, the power of the internet.

There is no minimum credit score requirement, so it will be beneficial to those who have a fair credit score. To qualify, you must have an annual income of at least $10,000 and no current or active bankruptcies.

Per usual, borrowers with the best credit will get the lowest interest rate offers. The lowest interest rate offered by Carvana is 3.9%. They also offer a nifty tool on their website that allows you to get an estimate of what your monthly payment might be depending on the loan amount you are asking for and your credit.

Conclusion

Qualifying for an auto loan with a low interest rate can save you money on your monthly payments as well as the total amount that you will pay for your car. You should check out more than one lender before agreeing to sign a loan offer because it is always possible that someone else can offer you a better loan.

Check out each of the six lenders listed above to see if you will qualify for one of their loans. Whether you choose a credit union, big bank, or online bank, make sure you get the best rate you can find.