Larson Financial

  • November 30, 2020

Getting control of your credit card debt requires taking a good look at how much you owe. You likely will need to define a long-term strategy for chipping away at the total amount you owe while ensuring you don’t dig yourself deeper into debt.

On the other hand, making late payments on bills, missing payments, piling on debts and regularly maxing out your credit card can result in seriously lowering your credit score. Just as an excellent score can give you access to loans, jobs and more, a low credit score can prevent you from being able to borrow more, pay low interest rates and even get certain jobs. Once you are spending money with plastic and paying bills regularly, you begin your history. This record of how often you borrow, how quickly you repay and how much you owe can follow you throughout your life. A credit score can be a strong indicator of your financial well-being. Equifax, Experian and TransUnion are the primary credit bureaus and assign scores ranging from 300 to 850.

Talk to creditors to find if they can work with you to make a plan that works. Only look into consolidation and settlement as a final resort.

Pursuing an exciting business idea and not considering all the costs involved can make your dreams short-lived. For many people, buying a home is the biggest purchase they will ever make. Unfortunately, more and more people find themselves forced to put off this purchase. Student loan debt, underemployment, rising home prices and stringent mortgage standards prevent people from buying their own homes until later in life. Owning property is a normal goal for a sound financial plan.

Home ownership not only develops a sense of achievement and pride but also build equity. It is also a major financial undertaking and a long-term investment. When the time to start paying comes, you have options for repayment. The Federal government offers longer term payment plans as well as graduated repayment options which allow you to bulk up your income and get some job experience under your belt before making larger monthly payments. In addition to signing the promissory note for your loans, take the time to examine exactly when your first payment will be due and how much it will be. Put that future date and cost on paper and in the time between now and then, begin saving money to repay your loans.

The bureaus determine scores based on a group of factors which reflect your spending habits. In February 2018, Experian released its annual national average VantageScore, a representative credit score, was 675, up from 666 in 2014. Still, it’s much lower than the 800 rating that qualifies to get the best interest rates when it comes time to buy a house or car. Developing consistent savings habits allows you to leverage time, your age, your current resources, compounding interest, investments and tax-advantaged savings. Make a financial commitment that you can keep, even if it means starting small, like $50 from every paycheck or cutting out your gym membership for an extra $100 a month. Remember, this account isn’t for splurging on the latest Apple product or a Michael Kors purse. Whenever you take money out, do your best to quickly replenish the withdrawal.

If you can work a few hours during the week, on the weekends or just holidays and summers, you can begin your post-college years with a surplus of money that can go directly toward loans. Student loan debt is almost as routine today as a car loan or credit-card debt. Few college graduates leave school without some sort of student loan to repay.

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This general guideline can give you a rough idea of what you’ll need, but to get a clearer understanding take a look at each part of the picture. One way entrepreneurs overcome their financial hurdles when starting out is by gathering venture capital, which refers to money from investors hoping to profit from partial ownership and the long-term, high-potential growth of new companies. Business owners use their own savings, loans, stocks and other sources for startup capital. It’s vital to research your industry and make a plan that describes exactly how you can maintain profitability. Some people rush into growing a business without properly vetting out a strategy for long-term success.

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