Financial Freedom
5 Tips To Avoid and Overcome Debt Problems
5 Tips From The NCR To Avoid and Overcome Debt Problems
As at end of December 2010 the number of consumers with impaired records stands at about 8.6 million.
To aid consumers, the National Credit Regulator has offered 5 excellent tips to avoid over indebtedness.
- Always Act On A Letter Of Demand
- Seek Help From A Debt Counsellor
- Never Skip Your Payments
- Prioritise your house loan
- Start saving today
When you receive a letter of demand, don’t ignore it!
Contact your creditors and explain your situation. Remember creditors would rather receive some payments, than none at all.
If you cannot afford your monthly repayments, approach your credit providers and negotiate lower payments.
Debt Counsellors help consumers to manage and restructure their debts.
Act now, do not wait until it is too late!
Continue making payments, even when you are under debt counselling
Pay as much as you can prevent the debt from escalating
If you do not pay, you could lose your house or your car!
Never skip a mortgage payment, even when you are under debt couselling
Pay as much as you can
Be careful – you can lose your house
Save some money every month
When you no longer have debts increase your monthly savings
Do a budget and stick to it!
5 Smart Ways To Stop Impulse Buying
Impulse buying is one of the leading causes of rising debt. It’s really easy for us to tell ourselves “Don’t Buy It”, but most of us are not really going to stick to our guns – well not all the time. Avoiding those impulse purchases takes some self discipline, smart thinking, and good preparation.
Here are 5 ways to kick that old impulse buying habit.
1. Carry Cash
Studies have show that shoppers paying by cash are less likely to make hurried decisions. Actually seeing the money leave your hand, will help you limit your spending.
2. Leave Your Credit Cards At Home
Carrying your credit cards around, only helps to increase the temptation to make a purchase.
3. Develop A Financial Plan
With a blueprint of where you want your money to be going, you will be able to make better decisions going forward.
4. Avoid ‘Toxic’ Friends
Iron Sharpens Iron. So try to spend more time around people who are financially successful and stable. Avoid the big spenders, who love to flash their cash.
5. Plan Your Shopping Trips
Make a list of what you need and take it with you. When you’re out shopping, challenge yourself to only buy what’s on the list.
Why It’s Important To Have And Use Your Credit Cards
Credit Cards are often associated with negative feelings of over indulgence, big outstanding debts and monthly bills, but having and using a credit account is actually very important.
You should think of your credit score and history as a powerful financial tool.
Below, one reader explains how he had been living debt free for years, yet even though he would be a perfect client for most lenders – he now faces a very common problem.
I have been living debt free for over 10 years. I had credit at one time and have never had any problems with late or missed payments. I have always had a good job. It seems that my name and existence has been deleted from the credit reporting system. Is there a way for me to at least put the fact that I exist back into the system before making an application for credit?
Closed accounts are deleted from your credit report 10 years after the account has been closed. Without an active credit account there is no way to maintain a credit history, and no way you can build your credit score.
This would not be a problem, unless you need to borrow finance in the future to purchase a property or to start a business venture.
A positive credit history is, undoubtably, a valuable financial tool.
That is why we advise you to always keep at least one credit account, periodically use it to make purchases and then pay it in full each month. Doing so will maintain your credit history without taking on debt.
Without an existing credit history, you might that you’ll need a cosigner or a deposit to secure the necessary finance.