Google Analytics Alternative Credit Zeal - Repair & Improve Your Credit Score With Confidence: June 2017


Avoid Quick Fix Debt Elimination Scams

Debt Elimination ScamsConsumers that are looking to improve their credit and credit score often look for ways to get their existing debt under control. Managing and reducing existing consumer debt is certainly one way to help manage debt payments, credit reports and credit scores. Unfortunately, too many consumers in need of debt relief fall victim to debt elimination scams.

Debt elimination will help with an individual’s credit score over time. With lower monthly payments, a consumer can now better manage their payments and improve their payment history as well as reduce the amount of debt displayed in their credit report. These changes in debt payments and debt load will help improve a credit score. But, quick debt elimination programs are not the solution are usually just scams.

The Office of the Comptroller of the Currency has recently produced a press release informing consumers that the number of fraudulent schemes supposedly designed to “eliminate” debt is increasing. As the credit crisis continues and consumers remain overwhelmed with credit card debt, collection agency calls and even foreclosures it is no surprise that debt elimination marketing has increased as well. These fraudulent debt elimination schemes are being marketed to ordinary consumers, not just those in foreclosures or with poor credit histories. The new targets of the debt elimination scams include borrowers who are current on their payments.

There are number of potential significant consequences to using these fraudulent services. The scams are generally designed to defraud the consumer with fraudulent fees that can ranges from a few hundred dollars to a few thousand dollars. Since the debt elimination plan is established as a scam and will not eliminate or reduce the consumer’s debt the end result often includes a worse credit report and lower credit score. Furthermore, the creditors that may be contacted under a fraudulent pretense by debt elimination company may take additional legal action against the consumer to resolve the fraudulent attempt to eliminate the debt.

Some of the debt elimination scams do more harm to an individual’s credit report and credit score because the intention of the scam artist to steal the consumers identity. A potential result of participating in the illegal scheme is that the fraudsters acquire personal information and the engage in theft of a victim’s identity. Once the personal data and identification is obtained, they may be able to run up substantial new debts before the victim is aware of the theft and further damage the individual credit score.

The deceptive processes are pitched and revealed to the consumer or borrower to con the consumer into paying money to eliminate the debt. Some of the scams used by the fraudulent debt elimination companies may include the following processes and notices:

A phony arbitration award from an arbitrator not authorized under the debt agreement.

The use of a nonexistent “trust account” supposedly held in a person’s name at the United States Department of the Treasury or some other part of the federal government.

The substitution of a fictitious U.S. government debt instrument, which claims to be payable or authorized by the United States Department of the Treasury or a related person or entity, for the obligor’s original note or account at the creditor.

A notice to the creditor that the contract or note is illegal and, therefore, the borrower does not have to pay the debt and may even be entitled to a compensatory award.

A notice to the creditor that the creditor does not have authority to “lend its credit” to the obligor and has violated the law, and therefore, the borrower does not have to pay the debt and may even be entitled to a compensatory award.

The sample fraudulent processes listed were listed by the Office of the Comptroller of the Currency Special Supervision Division.

There may be a number of variations on the elimination debt scams. Consumers should always be careful of quick fixed to eliminate debt or fix a credit score or repair credit. If it sounds to be good to be true, it probably is. Investigate unsolicited offers carefully before going any further.

Family Budgeting Made Easy

Family Budgeting Made EasyDue to the current financial situation in the world, the fact that people are working fewer hours and the rising cost of inflation, a lot of people will find themselves needing help with budgeting. If you just lost your job the last thing you want to do is cut into any sort of savings you had, even though a lot of people think they are forced to do just that. 

To help you out, lets get right into how you can create a family budget without all of the hassle. Go ahead and pull out your monthly financial records. This would be your bank statement and checkbook or you can look online if you do online banking. Get a sheet of paper and write down a spot for your utilities, rent or mortgage, groceries, entertainment or whatever expenditures you happen to have. Now you will tally up your monthly expense total. Compare this to the amount of money that you bring in and see how much you have extra or how much you need to cut back. If you have extra then you are already doing a good job, but we could all still use some help tightening things up once in awhile.

Now you will go through each of the items listed in your monthly budget. Those are the expense categories that you just wrote down. As you go through each item on the list make a note on your paper of what you can do to save some money in this category. For your energy cost you could make sure you set your thermostat lower in the winter and higher in the summertime. You can keep the lights off if you aren’t in certain rooms and you can also buy certain light bulbs that do not use that much power and also last quite a bit longer. Do you eat out a lot? Could you make more food in the home? If you go through your expense list and examine each of them you can make some crucial decisions that will make sure you don’t have to eat up your savings. 

In fact, you could start adding extra to your savings. If you do not live by yourself then the only way to make this budget work is to get your family involved. If you have kids and they get to spend money by themselves then one thing you can do is to give them prepaid debit cards that you fill up once a month with an exact amount. This will help them learn how to spend their money the right way and it will save you from giving too much away in this area. You want to make sure that you have really got the point across that a family budget is only possible if you are working together as a team. This means that everyone has responsibilities such as turning their lights off as they leave the room and not leaving their cell phone chargers plugged in or even not being wasteful at the dinner table. You can even give everyone an area on your budget to keep up with and monitor. It is little steps like this that will help you save big when it is all added together. 

If your expenses exceed the amount of money you currently have to work with then you will want to make sure you start doing these things immediately. Also, you may want to look into other ways to make money such as online blogging, having that yard sale you’ve been putting off, or you might even have a hobby you could turn into a business. If you take these actions, really make a clear plan, and follow through each day you will have total control and success in this area of life. If you are a parent this is a great chance to work with your children for skills that are very much needed later on in life. Kids like helping find answers to problems so if you are working as a family you can try and make this a group effort from everyone. When everyone is invested in it then it will work out even better. Also, make sure you reward yourself and everyone involved when they do a good job. It isn’t any fun if you don’t ever get to celebrate your hard work and efforts.

Where Are You In Your Financial Lifecycle?

A financial lifecycle is a term that financial professionals use to describe where we are in our life and how it affects our financial situation. It’s a way of measuring where we are and where we should be in the next few years. Many of us tend to lag behind in the financial lifecycle, having the good habits that served us well in the previous stage of our financial lifecycle, but not having suitable skills for the stage we are at present and barely planning for the next stage. If you know where you are in the financial lifecycle you can then judge where you fall short and which skills you can learn.

1. The Early Years

The first part of your financial lifecycle is your childhood and early adult years. In these years you are mainly studying and the jobs that you can pick up tend to be part time, unskilled and poorly paid. They are more useful in teaching you what work is like rather than the spending money that they bring in. It is OK to be financially dependent on your parents; they don’t want you to drop out of education in order to get some quick money now. It is also OK to build up (some) long term debt as your education should in the end pay for this several times over.

2. The First Jobs

You then have the period of early earning. This is the period of the first few jobs, when although the pay is lower than it will be later in the career, costs are so much less as there are no spouses, children or homes to pay for. Salaries also rise rapidly. During this period a large chunk of student debt can be paid off, it is also a period when a new career can be tried out with little being lost. Starting a pension and getting on the housing ladder may not be the most fashionable things at this age but doing these things now will pay dividends later.

This period is also a time to start dabbling in investments as money lost now can easily be replaced, and so high risk investments can be considered. A big win now could be worth an enormous amount later while lost money can easily be replaced. All the time lessons, from both winning and losing investments will be learned that will pay off later.

Many people don’t fully use this exciting period. For a start they may put this period off by getting more and more college degrees with no idea of where they will be in the future. They may also still spend more than they earn, remaining dependent on their parents into their thirties or building up greater debt. More importantly there is not much desire to learn about saving or investing at this age, missing out on the best time to start a pension. 

This early stage continues on into the early stages of marriage. It is a period of relative affluence that should be enjoyed, but it is also a period where a good deal should be learned about investing and saving, as you will need those savings later.

3. The Young Family

Most people remember the early years of having a family as one where there never seemed to be any money. At this time one of the spouses often stops work for a few years, or sharply cut down their hours. The other spouse would see their pay rising slower than it had been previously, and there are sudden expenses. Children are never cheap.

In these times there needs to be a new frugality. Investment needs to be maintained, if for no other reason to keep in the habit. Debt will seem to get larger, but it should be a different type of debt from student debt, being for a larger house. Purchases will also be more practical and less glamorous. The sports car is replaced by a station wagon, and the flat in the fashionable area of town is replaced by a house in the suburbs. There is also a need to start (or continue) saving for college funds.

There is a desire to retain the old lifestyle which can mean that debts build up more easily. This is made possible by greater access to credit as the house is now a substantial asset and while the pay is not rising at the fast rate that it was, the pay rises have still compounded and so the money that is being earned is more than ever before. 

Debt to fund a lifestyle is the biggest problem at this stage. Unfortunately the lifestyle does take a hit when children come along. This is not easy when friends from school and colleagues at work are still enjoying exotic holidays and constant nights out.

4. A Growing Family

The next stage is when the children are growing up. The expenses start to seem less. The pay is still rising, and in fact many people are at the peak of their earning power at least in real terms (the pay may still keep on rising after this but for most people inflation starts eating away at the pay rises). The spouse who may not have been working can now restart a full time job.

The temptation here is to keep the savings at the same rate as before. The idea here is not to maintain the savings and investments that were made when you were, to all intents and purposes, quite poor but to expand them. Debts should no longer be treated in maintenance mode; this is no longer something that is excusable as it was when the children were very young. Credit card debts should be paid down quickly, and then the mortgage needs to be attacked and preferably paid off. The mortgage in particular will be more manageable as inflation will make the amount of the mortgage seem far lower. At the same time there should be a step up in payments to the investments that were being maintained over the early years of family building.

5. The Empty Nest

After the family has left, there is an empty nest period. The children are out of college and earning a living and even if they are at home they are paying their own way. It is OK to enjoy yourself at this time, as the disposable income will rocket. However this is not a long time. 

One of the things that should be done is to start de-risking investments. Losing a bundle at this stage is going to have far more long term effect than it will at any of the earlier stages as you will not have the time to make this money back. A cold hard look at investment accounts should be made and your investment portfolio should become far more boring. Also debts should finally be paid off (if they have not been already). This will be fairly easy, but just because it’s easy doesn’t mean it should be shunned. 

One of the shocks at this time, particularly if you put retirement off for a while to continue working, is that wages can often start falling. This is not just the case for lifestyle reasons, as part time working or a job close to home suddenly makes more sense, but for the very fact that employers want younger people who aren’t about to retire. 

6. Retirement

Finally there are the pension years when you are living off past earnings. This is a time to live off your past good habits. The disposable income will start to drop off, and inflation can be bitter during this time (even if the pension is index linked). However if you have saved up enough these are likely to be golden years.

This is a period where people tend to hold on to things that they don’t need to. The main example is the large family house. It is a good idea to downsize and to live off the money. At a later stage a reverse mortgage may be a good idea so that you can benefit from the equity in the house. Your children may not be ecstatic about the choice, but they have got a career and a home and should be in a saving habit. It is also time to put the investment portfolio into income generating assets; high risk fast growth companies aren’t much use now.

Everyone will hit different stages of the financial lifecycle at different ages. However your investment and spending needs do change throughout your life, and if you are not consciously recognizing you will be playing catch up as you use the good habits that you obtained in the last stage of your financial lifecycle but learning the habits that you need in the current stage only by your mistakes.

Make Better Financial Decisions And Take Care Of Yourself

If you want to make better financial decisions, one of the best things you can do is to take care of yourself. It’s not just about seeing a lower health insurance bill because you are in better health. Your physical and mental state can actually influence the decisions that you make — including your financial decisions.

Stress = Poor Spending Choices

When you’re stressed out, you’re far more likely to make poor spending choices. If you want to make better spending choices, then you need to make sure that you aren’t making them when in a state of stress and anxiety.
Often, shopping while stressed results in buying more than you expected. An unhealthy mental and physical state can mean that you are less disciplined, and more inclined to make impulse purchases. You’re also more vulnerable to your child’s whining and begging for specific things. How often, when you’re stressed out, do you snap, “Ok, fine!” just to get your child to stop pestering you. This applies to shopping as well.
And, of course, the biggest stress shopping issue is that of shopping therapy. Shopping can trigger better feelings and lead to increased spending as a way to address feelings of stress and anxiety. My husband uses online shopping as stress relief. When he feels over-stressed, he looks at eBay — and usually ends up buying something he had no intention of purchase, for more than he wanted to pay.
When you feel good, you are more disciplined, and less likely to make poor spending decisions. Take care of yourself, and you will feel less stress, and your spending decisions will be more informed and you’ll practice better discipline when it comes to saying “no” to the superfluous purchases.
It’s not just about the day-to-day shopping decisions. When you are stressed and afraid, you might not make wise choices about your insurance, how much you should be setting aside for retirement, or how you are investing. Fear and stress can really mess up your long-term investment plan. Try not to make any financial decision when you are feeling frazzled and uncertain.

Before You Make A Financial Choice

One of the best ways to avoid impulse purchases and make better money choices is to live a healthier lifestyle. At the very least, though, try not to make financial decisions — from spending to insurance to investing — while feeling at your worst. Here are some things to try before you go shopping, and before you head into a meeting where serious financial choices will be determined:
  • Sleep well: Tiredness reduces mental faculties and reasoning skills. A good night’s sleep can help your mental acuity and improve your decision-making capabilities, including financial decisions.
  • Exercise: Physical activity gets the blood flowing and the brain working. You’ll be alert, and have heightened reasoning skills. A little exercise before you tackle the tough choices of the day can really help you improve your decisions.
  • Eat a good meal: Make sure that you eat a good meal. Think about it: When you’re hungry while grocery shopping, you tend to spend more and even buy more junk food. But hunger also affects your ability to make other decisions. Eat a good meal, or have a healthy snack, before you start in on something. Consider nuts and berries as great “brain food” as well as healthy choices that can help your energy level.
  • Stay hydrated: Drink plenty of water and you’ll feel better in general. You’ll avoid the mental and physical fatigue that comes with dehydration, and you’ll be in a better place to resist poor decisions.
  • Take time for you: Refresh yourself with a relaxing activity that you enjoy. This can include reading, meditation, or even a power nap. Taking time out to do something that helps you feel good can increase feelings of contentment and boost your mental faculties.
Following healthy habits on a daily basis can help you maintain financial discipline, and think more clearly when confronted with money choices. At the very least, don’t go shopping when you’re tired and hungry. Just following that bit of advice can save you hundreds of dollars a year in terms of impulse purchases. But, if you can, work on improving your lifestyle so that most of your financial decisions are savvy.

8 Simple Steps To Financial Freedom

Financial FreedomYou can achieve financial freedom as long as you want it and work hard for it. Unless you are part of the 1%, your journey on the road to financial freedom will be a long one. In this article, I want to walk you to through a few steps which I think are critical to any financial improvement effort. This road map pulls together information and ideas that I have learned by studying other financial plans, and reading books. It includes information that I learned on my own financial journey, and I hope that you will be able to use this as the starting point for your own.

1. Set Your Mind to It

Improving your finances involves a lot of work and patience. You cannot turn things around and make things better overnight. So the first step is to recognize this and put all your attention and effort into doing something.

2. Set Up Goals and Milestones

Next, set up some rough financial goals. You wont have it exactly correct the first time, but that's okay. You can start with a wishlist of reasonable objectives for now and make them better later. Some of your goals may look something like this.

Start a budget

  • Lower my expenses by $100 a month in 3 months
  • Pay off my car loan by the end of the year
  • Start saving $50 a month
  • Do 3 things to better my finances each month
  • There is no correct way to do this. Just make a list of 3-5 things and you can just go from there.

3. Spend Less

Improving your finances is really as simple as the old cliche “spend less than you earn”. Once you can get your expenses and spending under control, everything else — e.g., paying down debt, building wealth, etc. — will be that much easier to accomplish. When it comes to improving your finances quickly, nothing beats cutting your expenses. To get going, here are plenty of ideas on how to cut expenses and save money.

4. Get Out of Debt

If you are in debt, the best thing you can do with the money you saved is to pay down your debt. Being in debt is like trying to win a race with one foot on the accelerator and another on the brake. Whether they are good debt or bad debt, they are costing you money and slowing you down.  As such, one of the early step toward achieving financial success is to get out of debt.

Here is a good primer on how to get out of debt and protect your credit score

5. Start an Emergency Fund and Have a Plan

Once you’re debt free (excluding your mortgage), it’s time to start building your wealth. But before you can do this, you need to have an emergency fund and a good emergency plan in place. This is your “Get Out Of Jail Free” card — always good to have one around. 

6. Earn More

You can only take it so far with cutting expenses, so the next step is looking at ways to earn more money — especially by building alternative income streams, diversifying your income sources, and becoming less reliant on your job. To get you started, here are some ideas on how to make more money.

7. Save and Invest

After you get all the basic stuff out of the way, now it’s time to get serious and work toward your short-term and long-term goals. 

8. Protect Your Finances Against Risks

Uncertainties and risks are your biggest enemies. They can throw you off track and destroy your progress. However, there are many ways to mitigate these risks and prepare for uncertainties. To protect yourself and your family against catastrophe.

Obviously, there are much more to achieving financial success, but I believe these are the 8 most essential things to work on.

Savings In America

Savings in America
We all know that we’re supposed to save. You have to save for retirement, emergencies, college, large purchases, etc. However, this doesn’t mean that everyone is saving or knows how much they should be saving. During the peak of the housing bubble, the savings rate for Americans dropped to an all time low of .9% meaning we were saving less than a penny for every dollar that we spent.

This lack of savings that we saw in 2005 seems to have caught up with us. The Employee Benefit Research Institute found that most Americans have less than $25,000 saved up for retirement. 27% of Americans even said they are not at all confident about retirement. The Harris Poll also found the 27% of Americans had no personal savings.
With the subsequent recession following the housing bubble, many Americans struggled to pay for the basics, let alone save anything. This has caused about one third to tap into their savings to cover basic expenses.
However, it’s not all bad. Due to the amount of mortgage foreclosures, banks have had to write off billions in loans that went bad. That means they were much less willing to extend loans or credit, forcing many people to stop living off of their credit cards. With no other option, this has caused many Americans to start saving and paying down their debt.
In fact, according to the Commerce Department, Americans are now saving about 6% of their disposable income. On top of that, Americans now have 7% less mortgage debt, 12% less in auto loans and 15% less in credit card debt. Even retirement savings were up, with the average 401(k) balance hitting a 10-year high. Talk about a massive overhaul!
Building up savings and paying down debt are key factors that can help the economy. Once consumers get to the point where they are comfortable with their savings, they will start spending again – boosting the economy. Of course, finding the right balance between saving and spending will also help to avoid another recession.
Recession or not, everyone should create a budget to see how much they can save and where their money is going. Look into your company’s 401(k) plan (if you haven’t already) and set up automatic deductions from your paycheck. Most companies will even match contributions, so you’re losing retirement money if you don’t take advantage of this.
Hopefully, this new outlook on saving becomes a trend rather than a fad. Only time will tell if consumers have actually learned anything from this experience or whether we will see another generation of Americans reach retirement with too little too late.
Do you think we will continue to save or fall back into spending?

Starting A Business With Bad Credit

Starting A Business With Bad CreditWhile having bad credit can make it more difficult to start a business, it doesn’t make it impossible. If you are truly dedicated to the idea of entrepreneurship, there are some ways to help you get the financing you’ll need for your business

First, reevaluate your funding plan. Studies show that credit card and bank loans account for only 25% of the total funds you’ll need. This means that 75% of the money you need won’t rely directly on your credit score, which is good news! However, that also means that you’ll have to convince a lot more people that your plan is solid to get funded, so make sure your business plan is polished.

To get the other 75% of funding, experts recommend that you start by asking your friends and family to invest in your business. It is reported that 50% of all business owners get financial help from friends and family. Your loved ones most likely won’t look into your credit score, so they might be easier to receive funding from.

However, don’t forget that this is still a loan, and they expect to be repaid. Talk with your potential donors about a repayment schedule and possible interest rates to make sure that you maintain good relationships with these investors. These relationships can be valuable to your start-up needs as well as your credit. If you choose to do so, you can hire a loan management company to help you report these personal loans to the Credit Bureau, which will help boost your credit over time (as long as you don’t default).

If you still need more funds, the Internet is a great resource to find private lenders. Sites like are great sources of capital for people with bad credit and they will also report your timely payments to the Credit Bureau. Take some time to compare different rates though to make sure you’re getting the best lending deal possible.
Depending of your type of business, you may also be eligible for state or federal government grants, so look into what’s available where you live.

Once you’ve received the initial financing, make sure to establish business credit that is not linked to your personal credit. Experian will calculate your business’s credit score based on credit obligation information from your company's suppliers and lenders, public records and the company's background information. If you can establish good credit with your business, you will be eligible for more and better loans if you apply as the business rather than an individual.

Useful links:

Pay Yourself First to Grow Your Savings Automatically!

Pay Yourself FirstOne of the best ways to avoid dipping your fingers into your savings (especially your emergency fund for non-emergencies) is to automate your savings accounts so that your money flows through your personal economy without much interference from you. When you automate your savings accounts, you can force yourself to practice financial discipline and work toward financial freedom.

Pay Yourself First

You can have money from your checking account automatically transferred into a savings account each month; however, you are probably better off having your paycheck deposited into your savings account, and then having the money you live on transferred into your checking account.

1. Set Up a Savings Account

Look for a good savings account, either in town, or online. Make sure the financial institution is FDIC insured. An online bank account can be a good choice, since it forces you to think things through before making a big purchase. Having your savings account at a different institution than your checking account can be helpful, creating another barrier to raiding your savings.

2. Set Up a Checking Account

After you have opened your savings account, build up a cushion in your checking account so that your finances can survive the lag associated with transfers between institutions.

3. Set Up the Direct Deposit

Once your checking account is squared away, go to the human resources office at your work and ask about having your paycheck deposited into your savings account. If you own your own business, have money automatically transferred from your business account into your savings account.

4. Set Up the Transfer From Savings to Checking

Once you have your direct deposit into your savings, automate further by setting up a recurring transfer so that some of the money automatically goes into your personal checking account.
For example:
If you are paid on the 1st and 15th of each month, and receive $1,500 a paycheck (after taxes, retirement, health premiums, etc.), you have that money automatically deposited into your savings account. Every 8th and 23rd of the month, you can set up an automatic transfer so that $1,200 goes into your personal checking account. This way, you live only on what is in your checking account, and you automatically bank $300 of each paycheck, leaving it in your savings.

Adjusting Your Savings System

You can, of course, adjust your savings system as needed. If you find that you have a great deal of money left over at the end of each month, you can adjust your automatic transfer so that you are keeping $400 of each account in savings. Or, if you find that you are cutting it too close for comfort, you can adjust so that your savings account is transferring more money to your personal checking.
Another thing you can do is automate your main savings account so that it sends money other places. You can have money sent to an investment account for an automatic transaction every three or four months, or send the money to other accounts for long term savings goals, short terms savings goals and even your emergency fund.
Check your main savings account every few months and consider whether you can do something else with that money to help it grow more efficiently, meeting more of your financial goals.

Things to Keep in Mind About Automated Savings

It is important to carefully consider your automated accounts. Carefully track deposits and withdrawals initially to make sure that lag doesn't result in an overdraft situation in one (or more) of your accounts. Allow plenty of time, and build up a cushion of cash before you automate your savings accounts.
Also, make sure you understand the transfer rules. You may be limited as to the number of transfers that can be made out of your account in a month. Organize your finances so that you are well within the prescribed limits.
Finally, be aware of account minimums. If you fall below an account minimum, you may not get the full benefit of the advertised yield, or you may have to pay fees. Make sure you understand the terms of the account before opening it. Once you are satisfied that the account will work for you, then you can begin automating your finances so that your savings accounts take priority.