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If you’ve been following my blog for a while you probably don’t need me to tell you about the effects debt can have on your life. With its vice-like grip, debt can restrict what you do with your life in the present, and it can sabotage your chances of financial freedom in the future.

Thankfully, there is light at the end of the tunnel. By making changes in your life, it is possible to climb out of the debt pit. It’s better than the alternative, and that is staying in debt forever. But that is what will happen if you don’t heed the following? Here are three common reasons people stay in debt.

They continually live above their means

Despite their limited budget, some people treat themselves to things they can’t afford. They compare themselves to others, and decide if ‘they can have it then so can I.’ They socialise with friends, choosing to do those things that cost a lot of money instead of socialising frugally. They do all of these things and then rely on credit cards and bank loans to keep to this expensive lifestyle. And so the debt grows.

Are you one of these people? If so, curb the temptation to spend, be happy with who you are and what you have, and start to live a lifestyle that corresponds with your income.

 

They are scared to make important life changes

Sometimes, large steps need to be taken to lower or eliminate the debt in our life. And that is where fear sets in. For example, some people are afraid to change their job, despite not earning enough in their current position. Some people are afraid to move home, even though their current property is overwhelming them with high expenses. And some people are afraid to admit they have a problem, so rather than speaking to friends, family or debt professionals, they continue to struggle onwards.

Are you one of these people? If so, consider the possibility of another job, and talk to a careers counsellor if you need support and advice. If you are living in a property that is eating up your finances, find ways to reduce your bills, or consider downsizing, using the advice of The Advisory to sell your home quickly. And if you are afraid to speak to others about your debt problem, think of the alternative. Sure, you might have to swallow your pride, especially where friends and family are concerned, but isn’t that better than struggling alone?

 

They don’t consider the future

The future isn’t a long way; it’s tomorrow. But many people don’t think far enough ahead and plan for their futures, and that is problematic. For starters, there is the ‘live for today’ mentality that dictates the way people spend their money. Some people neglect to put money into savings or an emergency fund, and that can create more debt when a disaster arises, and money is needed to recover. And some people resign themselves to their financial position, instead of taking some of the steps we discussed earlier to improve their future.

Ar you one of these people? If so, plan for tomorrow. Budget your money, and think about your future goals. Open a savings account and begin an emergency fund to protect your financial future. And don’t submit to the way your financial life is now. Speak to a debt charity, and let them help you climb out of the debt pit and into a better life.

 

 

Saving for retirement is so important because you want to be able to enjoy those years without constantly worrying about money. But saving for retirement is difficult, especially if you’re not earning that much and you’ve got debts to deal with. People often make mistakes along the way which come back to bite them when they’re older. If you’re starting to think about saving for retirement (and you should be!) make sure that you’re avoiding these basic mistakes.

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Trying To Pay Off Debt Before Starting a Pension

A lot of people make this mistake because it seems quite logical. Pay off all of your debt and then you can start putting that money into your retirement fund instead. However, it can take a long time to pay down your debt and then it might be too late to start saving for retirement which means you’re going to struggle. Instead, you should be paying off debt and saving for retirement at the same time. You won’t be able to pay a huge amount into a pension fund while you’re still clearing your debts but it’s more important to start early with small amounts rather than leave it late and make bigger contributions. This is because of the compound interest that you’ll get on the money. In basic terms, compound interest is the interest that you get on your interest. It sounds confusing but it isn’t really. Say you’ve got £10 in an account with a 10 percent interest rate. The following year, you’ll have £11. That’s the initial £10 plus £1 interest. The following year, you’ll have £12.10; that’s your £11 with another £1.10 interest on top. Those are basic numbers to serve as an example but over time, you’ll get a snowball effect so even small contributions now will have a big impact.

Not Seeking Advice

If you aren’t a financial expert, you don’t always know where the best place to put your money is. There are a lot of different ways to save for retirement and the best ones for you depend on your personal circumstances. If you put your money in the wrong place, you might not be seeing the best returns on it so always speak with independent financial advisors before you start your retirement savings plan. If you don’t do this at the beginning, you might end up with money tied up that you can’t move for a certain period of time, even if it isn’t in the best place for you.

Selling Your Home

A lot of people think that selling their house and then renting a smaller place so they can live off the rest of the capital is a good strategy. In some cases, it might be, but most of the time it isn’t. First off, that money isn’t going to go as far as you think it will, especially if you have big plans like travel when you retire. You’ve also got to consider that the value of your house might drop so if you’re not saving and you’re banking on getting a good price, it could backfire on you. By that time, it’ll be too late.

 

The best way to make sure that you’re secure in retirement is to start as early as possible and make sure that you seek good advice.

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Quite often it can feel like you’re just spending more money than you’re making, but you simply don’t know on what and you never really have anything to show for it. This is cycle that a lot of people are in and although it feels impossible at times to get out of, you definitely can get out of it just by implementing some simple things, so in this post, we’re going to share with you some of the ways that you can reduce your monthly outgoings so that you’ll hopefully have a little left over at the end of the month to spend as you wish or put into savings for the future.

Make a budget:

A lot of people shy away from making a budget because they think it’s too complicated, but actually a budget is just a simple way for you to track what comes in each month and what goes out. You can use a notepad to do this or a spreadsheet – there’s really no right or wrong, but it’s just about staying on top of things so you can see where your money is going and so you know what you have and don’t get any nasty surprises you weren’t expecting.

Look at small things you can cut back on:

Although the small things many of us buy throughout the month – those things like the coffee on the way to work or the impulse buy at the checkout don’t seem like much at the time, usually since it’s maybe only a few dollars here and there, those things soon add up at the end of the month and if you were to sit down and add it all up, you’d see just how high a number it can be. So making a list of all the things you really don’t need throughout the month and then trying to make some cuts there could be a great first step to reducing your outgoings and leaving you with something left over.

Sell your car:

Although it may seem like quite an extreme measure, a car is definitely a big expense, so if you’re able to sell it, then this could definitely free up a big chunk of your monthly outgoings. If you’re not able to sell it, then a good way to make sure it’s not going to cost you a really big chunk of change anytime soon is by getting it regularly maintained and checked at your Nearest Vauxhall Body Repair Shop.

Take public transport:

If you still need to keep your car, then you can still save money on the running costs by not using it as much – you could take public transport to work, for example, which is definitely a lot cheaper than driving and will help when it comes to reducing your monthly outgoings.

Try to get your bills reduced:

Many people don’t actually know that this is an option, but if you speak to your providers such as your electricity, internet and even mobile phone companies, many of them will be more than happy to change the plan you’re on and allow you to save money. You just have to ask.

If this is your very first investment property or if you’re still considering making the investment, you’re probably looking for some much-needed tips. There are, after all, a lot of nightmare stories about landlords who need to take their tenants to court in order to evict them – and there are many tenants who won’t take care of your property at all.

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In fact, they might make it quite unliveable and even cost you a small fortune if you don’t pay attention to who you’re renting it out to. Here is a quick guide to getting it right when investing in property you’d like to rent out as well as how you can boost its value slightly.

There are many roads to becoming a bit richer and one of the fastest routes are through real estate.

 

First: Find the best area

Good areas attract good tenants – or, at least, so they say. Investing in a great area is alpha omega when buying property but it’s not always that easy; the apartments tend to be a bit pricier, first of all, and you might find yourself in a situation where you’re unable to afford the best apartments in the best areas.

A way around this is to settle for something smaller or even a bit shabbier in order to land an apartment in a good street. Now you’ll at least secured that the area is right and you can start to focus on fixing the apartment up slightly.

You could do this yourself, if you’re able to, but keep in mind that this is a project that will last for a couple of months or even a year.

While it will certainly be worth it and you’ll end up with a great-looking apartment in a fancy area, hiring someone to do it for you will certainly enable you to rent it out a bit quicker. Have a look at these long term loans from Evolution Money, for example, and you should be able to get there a bit faster. It’s the kind of loan that will make you slightly richer as soon as it’s paid off.

 

Next: Find the best tenant

The person you choose to stay in your investment property is, of course, the one who will either make your real estate journey a dream or a nightmare. If you’re not using a real estate agent to find the best kind of tenant for your property, it’s a good idea to read up on all the red flags before you approve someone.

While you should remember to always do a thorough credit check to make sure that they’re reliable and financially stable, it’s also a good idea to ask for references from previous landlords. If they can provide you with this, their credit score is great, and they give you a decent first-impressions, you will usually avoid those rent worries in the future.

They might not be able to provide references from previous landlords, though, and this is where you need to use your gut-feeling when meeting them. A well-groomed, polite, and friendly person who shows up on time is quite likely to take care of your property as well so use your good instincts and give them a chance if they seem proper.

 

When you have found a property in a good area, you’re a bit more likely to attract good tenants as well, though. Look for somewhere that is close to schools or kindergartens, and you might be able to secure a stable and financially healthy couple. They’ll make your property into a home, after all, and will probably stay there for a few years as well.

 

There is no denying that loans, of all nature, are very popular. They can help people who find themselves in a bit of a short-term financial emergency, as well as those who want to make a big purchase. However, loans aren’t for everyone, and with there being so many different types loans to choose from, it’s important to act with caution. You should never agree to a loan contract until you are 100 per cent satisfied. Therefore, read on to discover some questions to ask yourself first.

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Will a loan resolve your financial situation fully or fully assist with your predicament?

A should not be taken out if you are simply trying to ease a long-term financial problem. This will only make the situation worse. You also need to make sure the loan is right for your situation. Equity release can be ideal for those who are older and need a consistent sum of money coming in every month, for example.

 

Can you borrow money off family or friends?

It is unlikely that your family or friends are going to charge you interest, so this is an option to consider first. Of course, some people do not want to divulge their financial worries to people close to them, and so this may not be a route you want to go down. However, it is definitely something worth thinking about.

 

After considering these two questions, you will probably have a good idea as to whether a loan is right for your financial situation. So, now let’s make sure the loan itself is right for you…

 

Can you repay the loan as per the repayment schedule?

You need to be able to repay the loan amount in full on the dates stated. Therefore, make sure you can comfortably afford every loan repayment. Don’t accept something if you are unsure. If you cannot repay the loan, you will face higher rates of interest, which will only make the problem worse.

 

Does the loan provider charge you for making early repayment fees?

Some loan companies will charge you for making repayments before the scheduled date. You should avoid such lenders. You also need to make sure there are no other hidden fees when looking for any type of loan. Read the contract in full. It is there for a reason.

 

If you ask yourself all of the questions that have been discussed above, you will have a good understanding as to whether a loan is right for you or not. You should also be able to determine whether the specific loan you are considering is right. If you are unsure, do not agree to it. You need to be 100 per cent certain.

We can all be a little guilty of living in the here, and now and not thinking about our future too much. While we are encouraged to live in the present, there is no harm in thinking about the future and making plans or considerations for this period of your life. But what is it you should be thinking about? Here are some of the things you can start planning for right now, that will benefit you in the future.

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The funeral costs?

One of the first things you may want to think about, and perhaps one that might not be that great to, is the cost of funerals. We don’t give it much thought because let’s be honest here, we don’t want to imagine a time in our lives where we are not around to see our loved ones. But, should this happen, and at some stage it will, it might be assuring to you that you know this cost is covered for in advance. There are funeral homes that have policies in place that can help you pay in to fund your funeral in advance. Taking the stress away from loved ones at a time where they will feel at their most vulnerable.

How will you fund your current lifestyle?

You may be quite happy with how you live your life right now. Not worrying about how much your food shopping bill is each week. Going out on the weekends and seeing friends and family. However, you have a wage that is likely paying for all those things, so what happens when you retire and that wage goes away? It is important for you to realise that you need to have some provisions in place. This might be equity in your property that you have built up, a pension that you have paid into regularly or savings that you have slowly grown over the years. Taking action now can help you continue to live the life you want to lead in retirement.

What might you do with your spare time?

Retirement can seem like a huge amount of time for you to do whatever it is you want to do, but what exactly will that be? Thinking about how you may spend your retirement years now gives you something to work towards. You may have a bucket list you want to start ticking off. Seeing places and having cultural experiences. It could be a hobby you want to start up, to live in a certain place, or simply to be able to slow down and enjoy life.

Where you will live?

Finally, you will at some point need to think about the logistics of retirement and where you might want to live. This helps you to make plans now such as buying the right property,investing in the forever home, and knowing where and what area you want to spend those days. Being supported by friends and family and being close by to the things you love will be important to you.

 

Let’s hope this has you thinking about those later years in life so that you can enjoy every aspect of what is on offer to you.

These days, one of the best ways of making extra money is by making an investment in something for a profitable return. As the year draws to a close, you may be contemplating making investments in the new year so that you can earn more from there on out. The problem you might be facing is what to invest your money in, so we’ve come up with some smart investments that you should consider making in 2019 – check it out.

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Peer to peer lending

A great way of putting your hard earned cash to good use is by lending it out. This might sound a little back handed, but P2P lending platforms such as lending club allow you to safely lend your money out to people in small amounts. This works well for you because of the repayment interest that’s added onto it, so you’ll be getting more money back than you actually gave out in the first place. Of course, the platform you use will take a cut, but you’ll still be earning money by doing practically nothing.

Properties

Investing your money into property will always be a good investment. This is because no matter what, people will always need somewhere to live, and with the ever growing population, you’re bound to make a significant amount of money from investing in property. To really earn the big bucks, it might be worth spending a little more on a place such as Ocean by Meriton so that you’re able to rent it out for more money than you would say, buying a property in a small neighbourhood. Basically, spending more = earning more in the property world.

Business

Perhaps you’ve had a business idea tucked under your belt for a little while but never acted on it? Now is a better time than ever to launch your business, especially if you’re able to invest money into it to give it the best start possible.

Alternatively, maybe you know of a business that you truly believe in, but that needs a little helping hand? Investing your money into helping a business grow will certainly help bring in the cash rewards when that business kicks off.

Cryptocurrency

Finally, one of the most popular things to invest in right now is cryptocurrency, and that’s because it’s one of the easiest forms of currency to use in this day and age. Keeping an eye on exchange rates is fairly easy, and you’ll soon pick up a knack for it. If you want to know more about it, check out this comprehensive guide on how to invest in cryptocurrency to make sure that you’ve got all of the information you need.

What will you invest your money into this year?

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There are a lot of things that many of us consider to be a central part of being a successful adult. Being able to find a job and live independently are some of the biggest and earliest milestones that we’re expected to hit. However, the most important milestone, for a lot of people at least, is the moment that you’re able to buy your own home. Being a homeowner is one of those things that many people consider to be one of the major signifiers that you’re finally a real adult and that you’ve entered the real world. However, that raises the question: how important is buying a house really? After all, it’s becoming more and more difficult to do in the modern world, so how necessary is it to 21st-century adults? With that in mind, here’s the age old question: to buy or not to buy.

Thinking long-term

When people think about finding a home that they can live in for a long time, buying is likely to be the most obvious choice a lot of the time. After all, rental is generally seen as something of a short-term option. Now, there’s nothing wrong with this, after all, sometimes you’re only looking for somewhere to live for 6 months or a year at a time. However, places like Glamour Apartments are actually a great place to look for some long-term rental options. Sure, buying is still the most long-term option out there, but it’s certainly not the only one.   

Making an investment

One way in which buying a home is entirely superior to renting is in terms of being able to actually make an investment in your future. When you’re renting, you can basically think as your rent as the money that you pay for the privilege of having a roof over your head. However, when you’re paying off a mortgage, you’re building equity and investing in your ability to buy another home in the future. Not only that but it doesn’t matter how long you rent for, you’re always going to be paying rent. At least with a mortgage, you have the potential to pay it off one day.

Flexibility

One major drawback of buying a home is that it’s a serious commitment. After all, with all of the expense and complexity involved in buying a home, it’s hardly something that you’re going to be able to do every couple of years. If you’re the kind of person who wants to be able to move around a lot then there’s a good chance that renting is the far superior option for you.

 

Of course, the truth of the matter is that, as with just about any other major aspect of your life, it’s going to come down to personal preference and circumstance nine times out of ten. You can hear all of the advice in the world but in the end, you have to make the decision that makes the most sense for your life and who you are as a person.

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There are a lot of important metrics to consider when it comes to your money. The number on your statement is one of the most crucial, but there are plenty of others which come along with it. A lot of people are aware of their credit rating, having a good idea of what it is, but most don’t really know what goes into this mysterious number. To help you out with this, this post will be exploring some of the factors which are considered when deciding where you sit in this area. Some people have much better ratings than others, but they are all built in the same way.

Current Debt

Most people have some sort of debt against their name, whether it’s in the form of credit cards or a mortgage. This plays into your credit rating as one of the main factors, with those who have loads of loans in their name finding it harder to improve their score than those with very little debt. There are loads of companies out there who can help you to reduce this part of your life, providing you with tips, advice, and products which will make debt easier to manage.

Late Repayments

When you owe money to someone, there will usually be an agreement in place which dictates how much you have to pay them back, along with a specific date for each repayment. If you fail to meet these requirements, your credit rating will take a noticeable hit. To avoid this, you should always factor your loans into your budget as the first area to think about, as they are much more important than your luxuries.

Credit Searches

When you apply for a loan or other financial service, you will often have to go through background checks. Other lenders can always see when these checks have been made, effectively lowering your score. Avoiding this is one of the most common answers you’ll find when trying to figure out how to build credit. A lot of people ignore this, though, making their own lives much harder.

Types Of Debt

Finally, as the last area to consider, there are several different types of debt available to most people. Some are better than others, and this is more than just their interest rates, as some will impact your credit in different ways to others. A mortgage, for example, won’t be a negative mark on your checks. Several credit cards, though, will be seen as bad money management, as this is something worth avoiding.

 

Hopefully, this post will inspire you to start working harder on the time which goes into your credit rating. It can be hard to improve this part of life when you don’t know what makes it up, and a lot of people find themselves struggling with this for a very long time. Of course, though, even if you need some help, you should be able to do this for yourself, and you will start to notice the benefits very quickly.

 

Nobody plans on getting into debt but it happens to a lot of us. Once you’re in debt, it’s so hard to get out of so you want to avoid it where possible. In some cases, people get into debt because they’re reckless with their spending and they start borrowing money for things they don’t need. They don’t realise they’re doing it at the time and before they know it, it’s too late. If you’re going to avoid getting into debt in the first place, you need to know the most common reasons that it happens to people.

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Unexpected Bills

This is one of the easiest ways to land yourself in financial trouble. If you get hit with a bill out of nowhere and you don’t have the money to pay it back, you might end up borrowing money to cover it. But that should be a last resort option. First off, you should be putting money into an emergency fund every month so when this does happen, you have the money there to pay that bill right away. Even if you don’t have an emergency fund, you shouldn’t resort to borrowing right away. The first thing you should do is challenge the bill because there’s always the chance that it might be wrong. If it is correct and you owe the money, ask them for an extension so you’ve got a bit of time to get the money together. A lot of companies are more accommodating than you think.

 

Low Earnings

If you don’t earn enough to cover all of your monthly bills, borrowing money is inevitable. But that doesn’t help the situation because you’re just adding another payment onto the pile. That’s how you become reliant on credit cards to get by and get stuck in a cycle of debt. If you’re going to avoid getting into debt then you need to find a way to earn more money. Getting a new job or asking for a raise is the obvious choice but that’s not always possible. If you’re struggling to get by, there are plenty of quick ways to make money on the side. If you can spend your evenings earning a little extra cash by filling out surveys online or driving a cab, you can avoid having to borrow money and getting yourself into debt. However, this is only a short term solution while you find a better way to earn more cash.

 

Holidays

Christmas is a time for friends and family but it also involves spending a lot of money. Sometimes, people go overboard and end up spending way more than they need to during the holidays. But the money isn’t the most important thing and you can still have a great time without maxing out your credit cards. Why not consider having a debt free Christmas this year instead? Your friends and family will still be grateful to you either way, you don’t have to spend loads of money on them to show them that you care.

 

Now that you’re aware of how people get into debt in the first place, you can avoid it a lot easier.