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An Easy Guide to Managing Credit Card Debt

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If you’re in debt to multiple lenders, opting for debt consolidation is a good way to regain control of your finances. In simple terms, debt consolidation is a loan to pay off credit cards and is a tactic often used by people who are struggling to keep on top of their repayments. Below, we’ve put together an easy guide to managing credit card debt and explain how debt consolidation may help you.

The benefits of debt consolidation

Taking a loan to pay off credit cards has two primary benefits:

  • You assimilate your debt into one monthly payment, making it easier to manage.
  • You might save money on your repayments, as the interest rate on your debt consolidation loan might be lower than the combined interest of your other forms of credit.

Why should you consolidate your debts?

Using a credit card is a form of revolving debt. It doesn’t need to be paid over a specific period, and it has no fixed term. In other words, it keeps rolling over until you pay it back. For most people, this means more interest payments and a longer period of time in debt. You can only avoid interest payments if you pay your credit card off in full each month, which isn’t a position that most people comfortably find themselves in. Taking out a loan to pay off credit cards allows you to bring an end to the recurring debt and focus on paying fixed monthly repayments to another lender.

How does debt consolidation work?

Thankfully, debt consolidation is easy to understand:

  • You calculate how much you owe on your credit cards.
  • When you have your total, use this as your target amount for the loan that you apply for. You will need to consider its interest rate compared to the interest you’re currently paying on your credit cards.
  • When you’ve found a suitable loan, apply and receive the money. Then use it to pay off your credit cards.
  • You’re then required to pay your debt consolidation loan each month.

Using a personal loan to consolidate debt

Perhaps the easiest option to consolidate debt is to take out a personal loan from a lender like Koyo Loans. This allows you to receive an agreed sum of money that you will need to pay back over a pre-arranged period of time. If you’ve done your research, you should be able to find a personal loan that has a lower rate of interest than you’re currently paying on your credit cards. Often, personal loans are unsecured and are relatively easy to apply for. Applying for a personal loan will also simplify your debt repayments and make your life that little bit easier each month. Alternatively, you could apply for a balance transfer card, but you need to make sure you understand the fees before applying.

Should you pay debt off quickly?

There’s no doubt about it – the quicker you pay off your debts, the less interest you will pay. For instance, if you borrow £1,000 at 10% with a loan term of 3 years. You’ll pay the initial £1,000 plus £300 in interest payments. However, if you borrow £1,000 at a rate of 8% over five years, you will end up paying £400 back. So, don’t get caught out when calculating the rate of interest on your loans, and always try and pay your debts off as quickly as possible. At the very least, you will need to meet the minimum monthly repayments, but it’s best to pay slightly more if you can to keep on top of the amount of money that you owe.

Debt consolidation and your credit score

In the short term, taking out a debt consolidation loan might have a negative impact on your credit score. However, in the long term, it will improve it. Also, remember that credit scores aren’t the only metric used by lenders. Many utilise Open Banking to get a much clearer picture of a borrower’s financial situation before approving or rejecting a loan application. Regardless, you need to make sure you pay your debt consolidation loan off in a timely manner to ensure it doesn’t negatively impact your credit score.

Negotiating credit card debt independently

You should only really think about negotiating your credit card debt when you’re in danger of missing your repayments. You should seek independent advice before doing this, as you don’t want to harm your long term prospects of accessing credit. You might be able to negotiate a temporary reduction in repayments but make sure you fully understand the long term impact of doing so.

Next steps

Hopefully, you can now see that getting a loan to pay off credit cards can be a useful step for many people. If you feel like a personal loan will help you improve your debt management, get in touch with a lender like Koyo Loans and start your loan application today.

 

Is it necessary to be wealthy to consult a financial planner?

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We always rely on lawyers when in need of legal advice, or career counsellors while thinking about which line of academics to pursue. However, when it comes to financial advice, a lot of people simply rely on advice from their friends, colleagues, or even look for answers on the internet. While this can be useful, it is essential to understand that there are professional financial planners that are in the best position to take care of an individual’s financial matters.

Now, a lot of people are worried about the fact that consulting a financial planner could prove to be expensive. This is one of the most common rumours out there which is just not true. Not everyone might necessarily need to consult a financial planner. However, those who invest in mutual funds and have portfolios that are not fulfilling their goals can greatly benefit by consulting one and getting proper guidance. Financial planning is all about using limited financial resources in order to realise one’s financial goals successfully.

Read on to learn more about how a financial planner can help in achieving one’s financial goals:

Is consulting a financial planner worth it?

Hiring a professional who has expertise in handling financial matters can be a much more economical option as compared to acting on an inexperienced individual’s advice. There will be many people who are well-intentioned, giving all sorts of financial advice. However, this does not necessarily mean that it is the right advice for the individual in question. A lot of people rely on influencers online that publish content with financial advice. However, it is important to understand that each individual’s financial state differs from the other, and not everyone would benefit from the same advice. Consulting a financial advisor and paying their fees instead can be a great decision as they learn about your individual financial goals and base their suggestions while keeping those goals in mind.

Is it possible to plan finances without hiring a professional?

Of course, an individual can always choose to plan their finances by themselves. However, it is also essential to keep in mind that financial planning is not everyone’s cup of tea. This does not mean that the individual does not have the right mindset for money management, just a lack of time on their hands. Managing investments, seeing that they are aligned with financial goals, reviewing the performance of their investments, etc. can take up a lot of time. In such cases, simply relying on a financial planner can prove to be a lot easier. They would know which types of mutual funds to invest in based on the individual’s goals, which can take a big weight off the investor’s shoulders.

A good financial advisor can help in creating a clear plan and guide individuals with their investments that can help them achieve their financial goals. This will also help an individual to stay in control and maintain a balance between their income and expenses.

Ways To Save Your Business Some Money

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Business owners know as well as anyone that saving money is always a priority. Running a business isn’t cheap, and you need a healthy flow of dough to keep everything operating without issue.

Finding solid ways to cut back on costs will give you a financial advantage over the battle you’ll face in the first few years of starting a new business. Take a few moments now to check out a brief compilation of some helpful ways to save your business some money.

Utilize digital marketing to the max

Traditional marketing can be a bit more pricey than digital marketing methods. Some digital marketing outlets are even free if you do the content work yourself. Either way, digital marketing is much more affordable and more effective than traditional marketing methods.

Use your website to boost your visibility online, and consider adding a blog to your pages as well. A good blog can do a lot to draw interest from web users. Check out how this unloading service blog does a great job at relevance and education regarding the industry.

Consider remote work for your employees

Remote employees don’t cost your business nearly as much as it does to maintain an office space. Remote employees use their own hardware, and they don’t have to rely on your business to provide a safe and comfortable space for them to operate.

Even if you can’t take your business completely remote, you may benefit from offering remote opportunities. Consider the various ways in which your business could work in remote operations, and create a way for your business to save some money along the way.

Outsource jobs whenever it’s efficient

Outsourcing various elements of your operation to other capable businesses or individuals could also help you save some money on operations. Setting up a digital marketing campaign is a good example of where you can use outsourcing to cut costs.

You can outsource your digital efforts to a professional agency that specializes in that particular field of business, so you don’t have to worry about the issue or use any of the valuable time of your employees to get the job done.

Negotiate with your vendors

If your business works with various vendors to operate effectively, you do have the ability to haggle a bit with those resources. Vendors are not strangers to negotiations, and you can probably work something out to make the connection more beneficial for you both. You never know until you try.

Always work with a detailed budget

Overall, it’s a lot easier to save money for your business when you work on a budget. Make budgeting a priority in your business, and take the necessary steps to make sure your spending sits within the boundaries set by your budget.

 

3 Ways To Better Manage Your Debt Repayment

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When you’re in debt, it can feel like a mountain that you’re never going to be able to reach the top of. But once you do reach the summit, you’ll be amazed at just how light you feel and how much more money you have to retain control of over the course of a month. However, to get to this point, you’ve got to have a plan in place for repayment of your debts.

To help you in doing this, here are three ways to better manage your debt repayments.

Get An Accurate Report Of All Your Debts

In order to really start making progress on paying off your debt, you first have to know where you owe money and exactly how much money you owe. Without this information, you can’t create an accurate and complete plan for how you’ll go about paying off this debt.

When making this calculation, make sure you calculate not only the total amount of money that you owe right now, but also how much you’re paying in interest and what your monthly payments are. This way, you can know how much you’re responsible for right now, how much more you’ll be responsible for when paying all of the interest on your revolving balances, and the total amount you’ll be paying to get completely out of debt.

Pick A Debt Strategy The Will Work For You

Depending on how much debt you have and how you feel about your debt, you’ll want to pick a debt repayment strategy that will work for you.

There are quite a few different strategies you can choose from for repaying your debt. One option is to get rid of the smallest amount of debt first and then add those payments to the next smallest debt until all your debt is gone, often called the debt snowball. You can also try paying off the debt with the largest interest rate first so that you don’t have to pay more interest than is necessary, which is called the debt avalanche. Or, if you have too many different debts to effectively manage on your own, you can also consolidate your debt payments and just pay everything at once each month.

Don’t Allow Yourself To Create More Debt

When you’re working hard on paying off your debt as quickly as possible, the one thing that can majorly set you back is if you continue to add to your debt. Knowing this, you should make it part of your debt repayment plan to not create any more debt at this time. Put your credit cards away and stop using them until your debt and spending is back under control.

If you’re having a hard time managing the repayment of your debts, consider using the tips mentioned above to help you overcome this.

 

How Shareholder Activism Can Help Make COP26 a Success? 

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Few could ignore the protests that surrounded UK’s finance day on November 2nd, which threatened to overshadow COP26. Green activist groups were protesting against ‘greenwashing,’ frustrated that the public has been misled about the success of green initiatives. 

Rishi Sunak made a speech in which he promised multi-trillion-dollar commitments. He said all the right things and even suggested that he would put the required pressure on the private sector. Surprisingly, he even said that the government would financially contribute more readily to green initiatives in developing countries. He then went on to avail that the United Kingdom would become the first Net Zero Aligned Financial Centre. What does this mean? In a nutshell, all financial institutions in Britain will soon be required to achieve net-zero emissions. Ambitious? Yes. Achievable? Perhaps.

His speech wasn’t warmly received by everyone, with a Net Zero Asset Managers report essentially suggesting that the gestures made by Sunak weren’t as they seemed. Specifically, the report highlighted that a bit of digging is enough to show that the numbers are misleading. As the UK continues its recovery from the pandemic, it’s not evident where the money will come from to fund climate change initiatives.

A commitment to net-zero 

Bringing our carbon emissions to net-zero won’t be cheap. However, it’s definitely cheaper than dealing with issues arising from climate change. For context:

  • The UK has suffered to the tune of £300 billion due to the pandemic.
  • Estimates indicate that the cost of getting the UK to net-zero would cost £1 trillion over 20 years.
  • If the government doesn’t take any action, the cost is likely to be nearer £2 trillion to deal with climate change.

Officials at COP26 made it clear that preventative measures must be taken as soon as possible. But what does the UK government think? Rishi Sunak highlighted the following:

  • 80% of the planet’s economy is committed to carbon neutrality or net-zero.
  • The UK has promised $100 billion to support developing countries with reaching net-zero.
  • An additional £100 million has been pledged to the Taskforce on Access to Climate Finance.
  • Mandatory sustainability disclosures will be created to hold the private sector to account.

What the chancellor omitted from his speech 

Despite his grandiose pledges, Rishi Sunak omitted one essential aspect from his speech: how on earth will the UK government achieve these targets? The financial sector is hardly squeaky clean when it comes to pledges and ignoring loopholes, so there’s a lot still up in the air about how things will play out. Given that so many governments are failing on targets laid out by the Paris Agreement – due primarily to Covid-19 – it begs the question, how will this be any different?

Activist investing brings hope to the table 

While the government’s announcement that they will pressure the financial sector is welcome, it’s not enough. For real, lasting change, investors must pressure their companies from within and develop metrics that can be tracked and evaluated. This is where activist investing has such an important role to play. It forces companies into action and necessitates compliance with key ESG initiatives.

Activist investing platforms like Tulipshare are already doing what they can to drive change from within. This collective approach to investing is undoubtedly a step in the right direction, at least where holding the government and private sector to account is concerned.

3 Things You Can Do To Make Your Home Renovations More Affordable

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If your home is in need of some renovations, taking on these types of projects can get very expensive. So if you’re trying to make the necessary improvements while sticking to a tight budget, it’s vital that you find some ways to save money and get what you need for a lower price.

To help you see how both of these things can be possible, here are three things you can do to make your home renovations more affordable.

Revive Rather Than Redoing

Depending on how extensive your renovations need to be, you might want to consider reviving what you already have rather than completely redoing parts of your home in the renovation.

For anything structural, you may not actually be able to revive your existing situation. But for renovations that would be cosmetic, you might be able to get away with simply giving a little extra love to your finishes, which can save you a lot of money as opposed to getting something brand new. Especially for things like hardwood, cabinets, and caulking in the bathroom or kitchen, cleaning up the materials can make your space look fresh and new without having to pay for a brand new version.

Help With Demolition

Demolition is one part of home renovation that you may be able to do primarily on your own

For minor renovations, you may be able to take care of the renovation and debris removal without the help of a professional. However, if you’re going to be doing a lot of renovations that will require a big amount of demolition, or if the parts of your home that you’re renovating are structurally important to the home, you’ll likely want to hire a professional in demolition to take care of this for you. But if you are able to do even some of the demolition yourself, you’ll be able to save yourself the money of having to pay someone else to do this work.

Get The Floor Model

When it comes time to bring in the new appliances, furniture, or other features for your newly remodeled home, buying these pieces can be a huge cost for you.

One way you can save money on these purchases is to get the floor model of whatever product you’re wanting to buy. Once you find what it is you want, try visiting various stores or retailers who sell this product. And if you’re able to find one that they have help on the floor for display, you might be able to purchase this exact piece at a huge discount, since it’s been out in public and touched by other potential buyers.

If you’re going to be making some renovations at home and are wanting to do this an inexpensively as possible, consider using the tips mentioned above to help you see how this can be done.

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