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The Short Road To Getting A Loan

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As the economy always seems to be in a state of fluctuation, chances are, like almost every other American, you will need to take out a personal loan to fund an event or to consolidate your outstanding debt.

The question then becomes, how do you make this process as efficient and painless as possible? You don’t want to spend hours on end searching and comparing the many different options. It is in this capacity that a site such as consolidate.loan comes into play – they do the bulk of the work in locating a viable option for you. Below, we’ll see some of the things you can do to facilitate the process.

Are You Looking for a Personal Loan or an Auto Loan?

The above two are just examples; of course this process extends to all other kinds of loans. The point is to determine which one you’re looking for. The primary difference between the available types of loan is whether they are secured or unsecured debt. Your ability to obtain an unsecured loan is dependent on your credit history; if it isn’t very good when compared to the average borrower, then you may have many more options for secured loan and the collateral that’s often required.

Basically, then, an unsecured loan is based mostly on your credit score. A secured loan tends to be for people with low credit scores, and requires you to put up something of value – jewelry, car, home, boat, etc.

Order Your Credit Reports

order your credit reports

You need to know your credit score and elements of your credit history; these are what your lender will use to determine the interest rate of the loan he or she gives you. Generally, the interest rates you’ve been able to get for your multiple credit cards is a good indicator; but you still want to get your free (once a year) credit report so you can check for any discrepancies that can be fixed to improve your profile.

One of the primary benefits of pulling your credit report before applying for a consolidation or any other loan is this: if your application is denied, this is reported to credit agencies. The rejection has an adverse reaction to your score and can lower it some points. So, if you know you have bad credit, then it may be best not to go for an unsecured loan in the first place – wait a few months, improve your score by paying the bills on time, and try again later. Or, only pursue a secured loan where you will put up a collateral.

 


6 Reasons I Want to Cut Cable, Save Cash

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I’ll begin with addressing my own concern and letting you know that I have cable. I have U-Verse and wish that I didn’t. My cable bill in my previous house was $100+ for 3 cable boxes and internet as a bundle package. Yesterday, I searched for cable/internet packages for my new house-hack and was offered $165 for 4 tv boxes and internet. That’s more than my student loans, more than half of my car payment, and entirely, utterly ridiculous. I know that we can all also find tons we would do with our money if it weren’t tied up in a cable bill.

I have cable only because I am renting rooms in my home to other people and marketing housing that comes with Hulu Prime, rather than cable, would probably sound a bit odd to renters. If it weren’t for that reason, I would not enter a cable contract again. If you are considering ways to save larger amounts of money, here are my pros and cons about cable:

I need to save money

I don’t want to save money, I need to save it- which means that I need to make some sacrifices. The more intentional that I become about my finances, the more I understand the value of making larger monetary cuts. For example, cable can easily cost me, at the least, $1200 a year. I could significantly decrease my debt with $1200 a year, buy assets or make investments, or maybe even take a quality, week-long vacation abroad- all by eliminating cable. When I examine all of my expenses, cable gets chopped.

I don’t watch many channels

Confession: I think I watch what is considered bad TV. My TV is probably stuck on only a few stations, including Bravo TV for Real Housewives episodes, the Gameshow network for Family Feud, and FX since the American Horror Story season has started again. (Are there any other junk TV watchers out there 🙂 ). My TV screen pretty much never even sees any other stations. So I don’t need to pay for 250 channels, many of which are seldom viewed. Do you know about many channels you watch? If so, do you feel that the number of channels are worth the cost?

Don’t watch much live TV

I think that cable still has a major advantage over options such as HULU, Roku, and Amazon Stick because it offers consistent and quality live and local TV programs like the news and sports games. If you are a big sports fan, this may be something to consider and is what my boyfriend is still debating. Missing out on local programming does not bother me much because I opt out of watching the news and don’t need a play by play of sports games. My boyfriend has pulled up streaming for NFL games on our Amazon Stick, and I must admit that there was a noticeable difference in the quality. However, since I’m not the biggest sports fanatic, watching a sub-par football game without cable is worth the sacrifice.

Technology can frustrate me

If you substitute cable for an option like Amazon Stick, then you may spend some time programming the stick. My boyfriend programmed the amazon stick at his house and it took about 15 minutes. Although this is not necessarily a long time, the task seemed tedious and I did not want to do it. If technology like this can frustrate you as it can me, you may want to take this into consideration. (There are options of purchasing jail-broken Amazon sticks that already come programmed that I have seen on resale sites like Craigslist, but I cannot vouch for this as I have not done it).

Is is just me, or are HBO and STARZ pretty bad?

I recently stayed with someone who had HBO and Starz and browsed these channels for a few days. I think that HBO showed that yawn-worthy horror movie “The Boy” 4 out of the 5 days that I turned to it. I would turn to Starz once a week for the show “Power”, but that’s about it. I seldom saw programming on these stations that piqued my interest and simply didn’t think its worth the extra payment in a cable package. (Plus, I believe that most of the movies and programs shown on these stations are on Amazon stick anyway.)

Weighing the value of my entertainment and time

I recently had some spare time, and one of my goals was the finish a new season of a show that I started watching (and now I’ve gotten hooked on the Good Doctor and have given myself a new addiction, great!). I say this to illustrate that I enjoy laying on my couch and watching TV and value this relaxing time. However, I’ve recently given thought to how much more productive I would be if I substituted some of my TV watching for other time fillers.

As a teacher, I firmly believe that we should never stop learning. Since I’m serious about my financial goals, I want to time reading books about finance rather than watching TV every afternoon. Since I want to invest in more real estate, I could spend time going to conferences rather than binge Mr. Mercedes all weekend long. I thought about taking a cooking class at one point, and could put the money saved from cable into my cooking class. So I don’t believe that $1200 a year is worth all of the other things that I could be doing with money and do not want to pay that much for this form of entertainment.

My verdict

There are several reasons why someone may or may not choose to have cable, as well as many alternatives. The amazon stick is the alternative that I am familiar with and would chose if I could eliminate cable. This could result in a difference of a $1200 cable bill per year or a 1-time $100 purchase fee and the yearly cost of WiFi which could be about $360 a year ($30 a month). The cost of cable does not support my financial goals and I would eliminate it if I could, as I think that an alternative would be best for me. Does anyone use any cable alternatives? How do you like them and how do they save you money?

 


Lost Post

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Hi all,

Just popping in quickly. I published a post yesterday (10/10/17) titled, “Facing The Harsh Reality” that, sadly, has disappeared into the interwebs.

The issue was caused by a migration of servers and unfortunately my post was caught in the cross-fire. The big bummer is that there’s no way to recover the post and I don’t have it backed up anywhere. It took me a long time to write (and was pretty tough to publish to begin with), so I don’t know that I’ll be able to recreate it.

If, randomly, anyone has any copy of it (e.g., if you were subscribed and received an emailed version or for some reason took a screen shot or have any other electronic copy of it), please post a comment here so I can reach out to you! I’d love to re-publish it if I’m able but due to the server migration it’s been totally lost and I lack the time (and am feeling a little too defeated about it) to try to recreate it right now. Major frowny face!!!

~Ashley


Living for FREE, eliminating debt FAST

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The insane cost of living

How much of your budget is eaten up by your living expenses? Seriously, just consider how quickly we could pay off debt and achieve other financial goals without the costs of living expenses. For most of us, housing is the biggest expense that we have. My mortgage in 2018 was $846 (including my HOA fees) and my monthly salary was roughly $2900. Look at a staple budget using this income and my mortgage/ HOA fees.  

As you can see, this is ridiculous. I’ve highlighted where it shows that my mortgage was 55% of my expenses. This is extremely too large in proportion to my income. It was while paying this mortgage and housing expenses that I felt the most financially strained. My mortgage did since I originally purchased the house due to an increase in my taxes, but still, it just wasn’t the best financial play.

However, this is probably a frequent mistake and common narrative among many people, and especially first-time homeowners. While your housing may not be 55% like my money-munching townhouse, it is probably a significant portion of your income that could be trapping you in debt, preventing you from saving and investing your money, and keeping you from your financial goals. What is the percentage of your housing expense?

You can use this link to go to the budget template that I found or calculate it manually.

https://docs.google.com/spreadsheets/d/16lQqexwIMzMkq0tpwp2FGxURSET7VC5hQAwl-VI3H4w/edit#gid=0

Living vs. my life goals

I make a little under the median, regional income of $50,000 per year. Just one of the glorious teacher appreciation gifts. For the average person in this income range, paying typical expenses like housing cost, car payments, student loans, utilities, child care, and more, can easily leave $500 and less flexible money to spend. What this meant for me was that I was very restricted with my salary and had little money to pay off debt (this was actually around the time that I started missing some of my student loan payments), put toward savings, or find investments that made me money. This is not how I wanted to live. 

To achieve goals like debt reduction, investments, and savings, have you considered first tackling your larger expenses, which is probably housing? It is draining to me, to cut down on smaller expenses like occasional movie tickets and the like, which may take up 4% of my budget, if my 55% housing expense is still eating away at my income.

So here is what I did.

Get your housing expense paid… by someone else

Enter the term “house hacking.” I learned it on Bigger Pockets from Scott Trench and it is perhaps one of the top 5 most powerful financial concepts that I have learned thus far. House hacking is a way to drastically offset the cost of living. Essentially, the concept is that you purchase, or even rent, a home that is a multifamily property or one that can be rented out while you live in a unit. This can look different for people and families in varying cities and situations, but I believe that it is definitely possible for everyone and every family.

A family can buy a duplex or triplex and live in one unit and rent out the other(s). A single parent in a single-family house could rent out a spare room or even garage space to someone looking for storage. Or, in my case, someone could buy a condo and rent out the additional rooms.

Here is what I did. I found a condo with 4 beds and 4 baths for 126k. (Yeah, I know how crazy that sounds. It is economic, student-style housing, in a mid-range southern city that was a rare find). I applied for a loan through the State Employees Credit Union. For teachers and government employees, the SECU is one of your best friends! I got a conventional ARM loan at 5% interest and no mortgage insurance. This bring my monthly payment including taxes and my HOA fee to about $910 a month.

How much will I make?

My plan is to rent out each of the rooms at $530 including all utilities, which is an average to good cost for a single room in my area.

The following shows a breakdown of my expenses and income related to the condo (some are estimates).

ExpenseIncome
Mortgage & HOA Fees
$910
Housemate #1
$530
Cable and Internet (AT&T bundle with 4 boxes. I will not have cable in my room and will just use Amazon stick.)

$95
Housemate #2

$530
Energy (average from previous owners)

$140
Housemate 3

$550
Insurance

$35
Water (rough estimate)

$115
Vacancy/ Maintenance fund

$165
Total Expenses

$1460
Total Income

$1610

Leftover= $150. Y’all, I’m earning money just by living in my house!

My house goes from being a negative expense to an income generating machine! First the first time in my life, I feel able and prepared to reach my goal of financial independence.  How could you offset your living expense? What would you do with the saved money? 

Look at the extra $846 in my budget that I will put toward investing. If you can, consider significantly reducing your housing expense by either house hacking, or, if this is not possible, creating a shared-living experience. I hope you join me on my journey in my first house-hacking experience.


3 Hard-Earned Tips For Getting Out Of Debt

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If you told me a year ago that I’d be the budgeting queen, I would have laughed in your face. I was never one for crunching numbers. Like anyone who spends a lot of time working, when I was home, my free time was precious, and I didn’t want to waste it pouring over my finances.

I preferred the buy now and figure it out later method, but eventually my shopping habits caught up with me. I found all my extra cash was going into my credit cards’ minimum payments, so I didn’t really have any money to spend on the things that really mattered. Sure, I always had the latest iPhone and the hottest Louboutins, but I never had enough money for bigger investments or a fun vacation. I realized I wasn’t putting away any money for my future.

And with my money tied up the way it was? Well, sometimes unexpected household responsibilities threw me for a loop. I even had to take out a personal loan to cover the repairs I needed on my leaky fridge. Though I have that cash advance to thank for helping me cover this repair quickly and painlessly, it symbolized a turning point in my life — the fact that I needed help paying a bill less than $300 was an eye-opener.

I decided I needed to make a change. Spending without a budget buried me under a mountain of bills, so the only logical way to get me out of it was creating a budget and sticking to it!

I won’t lie to you, it wasn’t easy. I shed a few tears as I struggled to create a budget that worked, and a few more trying to follow it like it was The Law. But through trial and error I found something that worked. I’m debt free and finally building a little nest egg for my future. And today I want to share with you the 3 most important things I learned along the way, so I can save you some tears of your own.

  1. Be very specific and realistic

When you’re struggling under a ton of debt, your only thought is that you need to get out of it. I know mine was! But that’s not enough. When you set goals this vague, it’s easy to lose your sense of purpose and feel useless when you aren’t achieving such a huge accomplishment as paying off all your debt all at once.

You need measurable goals you can track with realistic deadlines. Think baby steps! I was ready to be out of debt right then and there, but I needed several months of careful budgeting to tackle just my first few bills. I realized once I could focus on these small accomplishments, the task of eliminating my debt wasn’t so daunting.

  1. Be honest with yourself

I know I was guilty of convincing myself that my regular trip to the hairdresser or my weekly Amazon order was absolutely necessary, but this was a flat-out lie. In reality, the only money I needed to spend was on my mortgage and car payments, utility bills, groceries, and debt payments.

Be honest with yourself and identify unnecessary purchases for what they are. You can cut your own hair or skip the online shopping cart. That monthly gym membership you pay for but never use? Cancel it. Weekly take-out? Start cooking at home.

  1. Tackle highest interest first

Since I had so much debt, I didn’t know where to start. After doing a little research, I prioritized those loans with the highest interest rates rather than the largest debt.

My credit cards and the payday loans from MoneyKey I used in emergencies had higher interest rates than my student loans, which I had locked in at a very low rate while I was a student. While compound interest was going to add to what I had to repay on my student loans, it wouldn’t accrue as quickly as the interest on these other debts. So I used the extra money I found after I cut out unnecessary purchases and used it to pay off these high interest loans as quickly as possible.

Since they were smaller than other debts, I found it easier to pay them off once I really committed to my budget. In no time at all, I was clearing bills. I had actual proof that what I was doing worked, and it gave me the motivation to continue limiting my spending and sticking with my budget.

That’s the feeling I want to share with you through these tips. Now, I’m not going to spend my money on the new iPhone X because I know that I don’t have the money for it. (Really, who does at this point?) But that’s okay. I’m also debt free thanks to my frugal ways, so I count that as a win for me!


Hope’s Monthly Budget – Fall and Winter, 2017

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This is my current monthly budget. A debt update is coming up next. I think most of this is self-explanatory, but I’ve added a few notes below.

Budget

Personal Expenses Business Expenses Summary
Allowance 400 Adobe 30 Total Personal 3634
Auto – Gas/Main 250 Cell Phones 286 Total Business 509
Auto/Rent Ins 315 Dropbox (annual – Oct) 8 Total Debt Payment 1920
Clothing (bi-annual) 150 Internet 77 Total Monthly Costs 6063
Electric 150 Microsoft (annual – Jan) 8
Groceries/Eating Out 600 Misc 100 Income
Gymnastics 350 Total Business 509 1099 3200
Health Ins 305 W-2 3462
Life Ins (annual – Dec) 21 Debt Payments
Rent 650 Car Payment 400 Total Income 6662
Spending 200 CC 100
Water/Gas/Trash 75 Computer Equipment 85 Savings Goals
Spanish 160 Other 500 Emergency Savings Goal 700
Amazon Prime (annual) 8 Self Lender (Christmas) 97 Couch
Student Loan 307
Summer Camp/Activities 375
Universal 56 Total Savings Goals 700
Total Personal 3634 Total Debt Payment 1920 Total Extra Income -101.0

Details

Monthly Expenses – These are our day to day living expenses. Many have some flex money built in, specifically gymnastics which typically runs $240 per month. I added the extra money to cover the competition costs that must be paid during competition season (Nov-Apr.) I don’t know how much they will be with our new gym, last year I paid $600 in meet fees. Spanish is new. I’ve hired a online tutor to work Princess and Gymnast 1 hour a week, this was our first week.

Business Expenses – I’ve added my regular business expenses including our cell phones, internet and so on because I thought my budget would look funny with out these important expenses. (These are associated with my contract work.)

Debt Payments – I have another post on this category coming this week. I am grateful that a lot of this debt is chosen – summer camps and activities, Universal and a Self Lender loan (a chosen debt in an attempt to help repair my credit) versus stupid decisions or debt hoisted upon me by other’s decisions.

Income – I continue to work three jobs regularly, and have recently picked up a couple of new smaller contracts so we will see how they work out. The kids are starting to ask when I will cut down on my work hours. But I am not there yet.

Savings Goals – My emergency savings is still my #1 goal. But I am starting to think of other “things” I would like, specifically a couch. I’ve put it on the budget as a holding place, but I am not actively pursuing it at this time. In my head, I’m thinking next summer for a couch.

Summary

I am in the negative as far as this budget goes. Reality is that I spend quite a bit less than this on a regular basis, but there are certainly months where it is more. I feel like this is a true representation of where my money goes on a monthly basis.

My FSA, vision and dental insurance and 401K deductions all come out of W-2 income. I have consulted with an accountant and for this year, I am in a good place tax wise due to the Adoption Tax Credit. I will have to adjust my tax rate for next year.


Free Museum Day

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It’s museum day 2017!

http://www.smithsonianmag.com/museumday/museum-day-live-2017/

We’re taking advantage by hitting the Tucson Children’s Museum for free! They also have a ton of exhibits set up outside with free books, snacks and treats, arts and crafts, science experiments and more!! Having a blast! Take advantage in your city, too!!

 


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