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[update] On July 6, 2009, my wife’s student loan fell victim to The Last Payment Strangler. Unfortunately, Mr. S.L Debt didn’t see it coming because he thought he had at least another year left of $302 monthly payments. However, The Last Payment Strangler was help by an influx of Cash Steroids from real estate and online sales and choke the living $#%@ out of Mr. S.L. Debt and his wife Mrs. American Express.
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The percentage of people who are getting behind and defaulting on the repayments of their student loans has been steadily increasing over recent years. It can be very difficult when you finally graduate and find that you owe thousands of dollars in student loan debt and the job that you have isn’t paying quite enough to cover all your living expenses and the payments required on your loan.
Many students get into difficulty paying back their loans and they begin their working career with bad credit due to defaulting on their loan. You don’t want this to happen and you will need to factor into your budget the repayments of the loan.
While payment is due once you graduate or stop with your education there is often a grace period of 6 to 9 months after that date, depending on the type of loan that you have. The first thing you will need to do if you are having problems paying is to determine what type of loan you have and what options are available to you.
This grace period will give you time to find a job to help make the payments.
With some loans you will begin to make interest payments immediately whereas others will allow you to pay the interest over the term of the repayments or at the end of the repayment of the actual loan.
This is why it is important for you to find out what type of loan you have and what options are available to you to help with your financial planning and make sure that you don’t default on the loan repayments.
If you do default on the loan there are various consequences that you need to be aware of. The full amount of the debt could be called up for repayment in total or it could be turned over to a debt collection agency.
You could incur additional late fees and collection fees and your credit history will be damaged.
There are many more areas that will impact on your life so it is wise to work through any issue with your lending advisor and do so with the assistance of the budget that you will have already prepared. They might be able to arrange a consolidation of debt that you help you pay off your loans at a lower interest rate thereby reducing your overall payments that need to be made each month.
Once you have calculated precisely how much money you owe then it is time to create a budget that will help you to use your income more efficiently by covering all your necessary expenditure and working towards the elimination of your debt.
A budget can be prepared in a book or more effectively online using a program such as Excel.
Now when you prepare your budget you need to take into account everything that you can think of relating to income and expenditure and this budget will need to be updated on a regular basis as more things come to mind when there are changes in your financial position.
This is why it makes it a lot easier to use a program such as Excel where totals can be added quickly and you will be able to see in a matter of seconds which direction you are going in and whether the steps that you have made have resulted in positive changes towards your financial well-being.
Where you are unsure about specific parts of the budget such as how much money you spend per week on food and other essential items, you will have to make an estimate initially until you are able to take notes the next time you go to the shops and see precisely how much you spend.
Once you get some of these figures you will be able to determine whether you are overspending in particular areas and what you can do about reducing such expense. Your food shopping is one area where you can save a considerable amount of money because most people don’t have any strict limits on their food spending.
Once again changes can only be made if you know precisely what you’ve been doing in the past and where you can make the changes in the future.
It might mean that you have to completely change the types of foods that you are buying and often the benefit of doing this is you improve your health along the way by buying food that is better for you.
Budgeting is your way to gain control over your finances once again. In fact it is the only way for you to gain control. It is a lot easier than you might expect and once you begin to use a budget you will wonder how you ever managed your finances in the past without having a budget.
There are many factors that you need to consider before borrowing from friends and family.
How To Happily Live Without Friends
First and foremost you need to discuss, with whoever you are borrowing from, your financial situation so they can make a decision whether or not to lend you money based on whether they are comfortable that you can repay them.
There is no quicker way to lose friends or cause family strife than to get in a situation where you have borrowed money from them and cannot pay it back when they need it.
It is also recommended that you only borrow money from people who have excess funds that they have invested elsewhere and where you can pay them interest for the use of those funds so that they aren’t losing out on the deal.
In situations like this you will be able to borrow money at a lower rate than you could get from any of the financial lending institutions and the person lending you the money could also get a better return than they would get by investing their money in those same institutions or at the bank.
So it is quite possible it could be beneficial to both parties in the deal but once again I need to stress the importance of total disclosure of your financial position as they need to know that to determine whether they are happy that you are a safe investment or not.
Friends or family should not feel obliged to lend you money no matter how bad your financial position is because it could put them in a similar situation.
It is better fair you to leave the risk with financial lending institutions if you have any doubts whatsoever of paying back the money borrowed from those close to you.
Some people are only too willing to take advantage of the opportunity to earn a little more interest and if that’s the case then well and good – they have decided that you are a worthwhile investment. Let them have a look at all your books and your budget and possibly even get them to help you work through your budget and to sort out a plan of repayment for their loan to you.
There are pro’s and con’s for borrowing against your home and they all need to be taken into consideration before you proceed with any additional borrowing.
On the one hand the money you can borrow on your home will be of a lower interest rate than most other forms of loans and this can help you [...]
Along with credit cards automobile debt is one area that gets a lot of people in financial strife.
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Most people don’t realize that one of the most profitable parts of the car dealership business is in the financing of the motor vehicles. There is often more money to [...]
