This economy has many in financial ruin. Many individuals have lost their jobs, and the unemployment rate stands at well over 8%. For those that are lucky to still have a job, wages are stagnant. Because of this and the remnants of the mortgage crisis, many individuals are having a difficult time staying current with their bills. In addition, the ballooning costs of medical care and the astounding number of consumers without insurance only makes matters worse. If you find yourself getting behind in your payments and not seeing a way out, whether due to a loss of a job or emergency medical expenses, it’s easy to lose hope. This post addresses some approaches you might consider if you’ve found yourself in a situation where you are past due on your balances and need to find a way to dig yourself out.

There are a couple options for people that are in significant financial trouble.

1. Do Nothing: This is certainly an option but hope is not a strategy. By not engaging in the issue and remaining in denial of your financial insolvency, you are just waiting to be sued by impatient creditors. Add to that the legal costs if you do get sued and you can see why doing nothing is a poor option. Doing nothing will really only make matters worse.

2. Contact all creditors: With the mortgage crisis still being sorted out, there are many programs sponsored by the federal government to help modify loans that are underwater or that consumers are having trouble paying. For instance, the Making Home Affordable program will be in effect through the end of 2013. You can call 1-888-895-HOPE for more information on this program and to learn about other resources. Beyond the mortgage landscape, many creditors may be willing to work with you and lower your interest rate if you contact them. After one of my personal credit cards defaulted to 32% after a missed payment, I was able to contact the credit card company and negotiate a reduction. Negotiating reductions in interest rates and modifying the terms of loan agreements with creditors can really help balance your budget.

3. Consider debt consolidation: If you have a lot of debt and are getting contacted by many collection agencies, your debt may already have been sold. In this case, contacting a debt consolidation company may get you the help you need to stay afloat. These services offer free financial counseling and reduce the number of collection calls that you will receive. They will help you structure a payment plan that will work within your budget and allow you to pay your bills.

4. Bankruptcy: If all of these options fail, you can always consider bankruptcy. Bankruptcy protection has been a saving grace for millions of Americans that are in way over their heads. Bankruptcy can eliminate much of your debt and put you in a position to get a fresh start. While this process will reduce your credit score, it is not the credit bomb that many fear. Many are able to rebuild their credit within a few years.

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Saving in the home

by Chris on March 13, 2012

in Frugal Living,Home

The desire to reduce spending is a common one. Some people want to free up extra cash in their budget to pay down other debts more quickly. Some want to use extra cash to boost savings and retirement account balances. Others simply want to enjoy the peace of mind that comes with having a little bit of extra cash left over at the end of each month. If you have been looking for ways to save, the good news is that you may be able to find savings right in your very own home.

Insurance Savings 
Many people today carry multiple insurance policies. If you are like others, you may have a homeowner’s or renter’s insurance policy, life insurance, auto insurance, and health insurance. Finding cheap life insurance as well as cheaper coverage for all of your insurance policies can help you to save a considerable amount of money. You can compare rates with a price comparison site to find savings. You can also consider other options for savings such as increasing your deductible or lowering coverage slightly.

Energy Savings 
There are numerous ways homeowners or renters alike can save money around the home. Simply adjusting the thermostat a few degrees cooler in the winter or warmer in the summer can provide you with considerable savings. Installing and programming a programmable thermostat to adjust the temperature daily when you are out of the house can also save you money. You can consider getting your heating and cooling system serviced annually, as this has been shown to improve how efficiently these systems operate. Further, consider getting a home energy audit to identify do-it-yourself projects that can yield savings. For instance, an energy audit may indicate you could save money by installing new weather stripping on doors and windows.

Grocery Savings 
Many people who have the desire to cut down on expenses have already made the decision to avoid pricey meals at restaurants. In the process of eating at home more frequently, the home grocery bills also increases. Through meal planning efforts and improved shopping strategies, you can save money on your grocery bill. For instance, consider not just the price of ingredients that are used to prepare a meal, but also consider if that meal will provide leftovers that can be eaten for lunch or dinner. Some meals are considerably more expensive to prepare, and these can be prepared on special occasions rather than on a regular basis. Also consider preparing meals based on seasonal ingredients as well as items that are on sale in your grocery store on a given week. This requires flexibility while in the grocery store. It is often best to shop for food during non-peak hours so you can have increased freedom to compare prices and find great deals on your food purchases.

Through the above steps, you may be able to further reduce your monthly expenses. These strategies and steps can help you to save money each and every month, and this money can be used to pay off debts, add to your savings, or provide you with added peace of mind each month.


This guest post is written by Elizabeth Roque, an in-house writer for Franklin Debt Relief. She presents information about debt relief services, credit card debt reduction and getting out of debt on a variety of financial sites online.

Your credit score is an essential part of your financial life and can have a direct impact on many different areas of your finances. Your credit score can affect your insurance rates, low interest rates and deposits when entering into contracts. If you want to save money, it’s important to maximize your credit score as much as possible. In order to maximize your credit score, you need to know what goes into calculating it. Fair Isaacs is the company that created the FICO scoring model that the major credit bureaus used to calculate your score. There are five components that are evaluated when coming up with your credit score.

Payment History

The first factor that is considered is your payment history. This is the most important factor that credit bureaus look at when calculating your score as it comprises 35 percent of your credit score total. Your payment history tells the credit bureaus whether you make your payments on time or whether you regularly make them late. In this section, the credit bureaus will also look at information like judgments against you and how many accounts you have paid as agreed in the original terms.

Account Balances

Another factor that the credit bureaus will evaluate is your amounts owed. This makes up 30 percent of your credit score. The credit bureaus will look at every account that you have and see how much you owe. In addition to looking at the amounts owed, they will also look at the amount of available credit. If the amount that you owe is too close to the amount of available credit that you have, this will hurt your score. If your balance is more than 30 percent of the available credit limit, this will reflect negatively on your credit profile. This means that if you want to improve your credit score, paying down your balances should be a priority. Figuring out how to get out of debt can be tricky, but it is one of the best ways to boost your score.

Length of Credit History

The length of your credit history is another factor that is evaluated when coming up with your credit score. This is an important factor for credit bureaus to consider because it tells them whether you can handle credit over the long-term. If you are a new creditor, you are considered to be a bit of an unknown. Once you develop a track record, you are easier to predict. This aspect makes up approximately 15 percent of your credit score.

New Credit

The credit bureaus also look at the number of new credit inquiries that you have. If you are constantly trying to apply for new credit, it looks like you don’t know how to handle credit. This portion makes up 10 percent of your credit score.

Credit Mix

The type of credit that you have can also impact your credit score. If you have several different types of credit, this helps boost your score. For example, if you have an installment loan such as a mortgage along with some credit cards and student loans, this reflects positively on you. Having several different types of credit shows that you know how to handle multiple accounts without defaulting on any of them. This portion makes up another 10 percent of your credit score.


A college degree is a must have for anyone wishing to succeed in today’s job market, but being able to afford one isn’t always easy. Today, many former college students have horror stories of graduating with tens of thousands of dollars in student loans and struggling to find entry level jobs that will allow them to afford repayment. However, going to get your degree, whether you are a non-traditional or traditional student, doesn’t mean you have to be prepared to leverage your financial future. It simply means that in order to make college tuition more affordable, you need to be prepared to do some of the following:

Go to Community College

A four year degree is required by many employers, but that doesn’t mean that you have to spend all four years at one university. By taking community college classes during your first two years, you can get all your basic requirements out of the way and will only pay a fraction of the cost to do so. If you have high grades, transferring to a four year school will be a breeze and you will be more likely to attain scholarships.

Fill Out the FAFSA

Many students, both traditional and non-traditional, don’t fill out the FAFSA because they believe that they or their parents make too much money for them to qualify for any federal assistance. Regardless of how much money you make, you should always fill out the FAFSA. Even if you are on the higher end of the national salary average, you may still be eligible for additional grants and scholarships that will make tuition more affordable.

Apply for Scholarships

You don’t have to be just out of high school, sporting a 4.0 GPA, or be an all-state sports star in order to obtain scholarships. Anymore there are thousands of scholarships available to all sorts of candidates, and sites like Fastweb and make it easy to locate them. For many, all you have to do is complete a 500 word essay or complete a quick survey to be eligible for scholarships that can be as high as $5,000.

While Discover law school loans may be a must if you get in to Harvard Law, knowing that you education will pay for itself upon graduation makes that investment worth it. However, if you are going to school simply to get a degree, taking on thousands of dollars in loans may cause future financial burdens that will keep you from attaining your professional goals.

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