by Brianna Budny, June 5, 2017 in Credit & Debt
Figuring out how to pay off debt can be daunting. The more money you owe, the more overwhelming tackling the amount can be.
When trying to become financially free, you need to have a plan. There’s a saying that goes, “you can wander into debt, but you can’t wander out of debt.”
One plan is to pay everything off in order of interest rates. Paying off your debts in order of highest to lowest interest rates will cause you to pay the least amount of interest. When following this plan, you will focus on paying off the one with the highest interest and then making minimum payments on everything else.
“Tackling the highest rate balances first can motivate you to take charge and cross the ultimate goal of crushing all of your debt,” said Sarah M. Place, CEO of Place Trade Financial Inc.
In order to clean up your finances, the first thing you need to do is not add any more debt. It helps to create the habit of spending wisely. Cut up the credit card, don’t go buy another pair of shoes and you don’t need to go out to dinner every time a friend invites you. Now, this doesn’t mean that you can’t buy or do anything, but you should budget everything and pay for them in cash while you are getting out of debt. Paying with cash will help you not spend more then you budgeted.
Your second order of business might be to list your balances in order of highest to lowest interest rates.
Your list of debts could look like this:
- Credit card 1 – $5,000 at 13% interest
- Credit card 2 – $3,700 at 11.25% interest
- Car loan – $11,000 at 6.5% interest
- Credit card 3 – $2,500 at 5.3% interest
- Student loan – $15,000 at 3.6% interest
The first debt you will focus on paying off will be the one with the highest interest rate. In the example list above, you would pay off the credit card with the 13% interest rate first and make only minimum payments on everything else. After the first one is paid off, you will move to the one with the second highest interest rate. You keep moving down your list until all of the balances are at $0.
By focusing on paying off one at a time, it will help you stay motivated to accomplish your goal.
One of the biggest advantages of starting with the highest interest rates first is that you will end up paying less because the highest interest debts will be gone first. The quicker you pay off the highest interest debts, the slower your balance will grow.
“You slow the rate of growth on your overall debt portfolio by getting rid of the debt that was growing at the highest/fastest rate. Allowing the same amount of money to stretch farther and help you pay off lower interest rate balances faster,” said Place.
Tips to pay off debt faster and stay on track
- Have a $1,000 emergency fund for things that may come up like a flat tire or an urgent care visit.
- Eat dinner at home. Cooking at home is cheaper and healthier for you
- Pack a lunch. You can save up to a few hundred dollars a month by bringing your lunch instead of eating out.
- Get an extra job. Adding $1,000 or more a month to your income can help speed up this process.
- Shop for clothes on the clearance rack or resale shops.
- Use coupons at the supermarket. Look for coupons in ads, mailers, emails and coupons apps.
- When you do go out to eat, use a coupon or find a deal.
- Use cash. People tend to spend less if they use cash.
- Do a written budget. This will help you stay focused and organized with your money.
- Have an accountability partner. This will help you get back on track when you want to go on a shopping spree or take out a new credit card.
Paying off the highest interest rates first makes the most financial sense. If you’re the type of person that needs more motivation and quicker “wins,” you may want to look at how paying off the highest interest rates first compares to other ways of getting out of debt.
No matter how much you owe, paying everything off can be a hard journey. It’s important to stay focused and remember why you want to do this in the first place. Your reason for paying off your debt may simply be to be financially free or it may be so that you can qualify to buy a home you love. Whatever your motivation, it is important to stay focused on your reason why. The process of becoming financially free will not be fun or easy, but it is always worth it in the end.
by Malcolm BeanMay 29, 2017 in Homeowners Tips
The weather is getting warmer and the days longer. That means it’s time to gather the crew and enjoy the sunshine together. Of course, there’s nothing more symbolic of summer than a good old-fashioned cookout. Having a plan can make sure you’re able to truly relax. Here are a few tips so that you and your guests will truly enjoy the summer experience.
A Quick Note About Rain
It’s important to remember that outdoor parties happen outdoors. I’ve never read a forecast I believed, so keep an eye on the weather to make sure all your hard work isn’t ruined by a few rain drops. Have a backup plan in case the weather takes a turn for the worse.
Crank Up the Tunes
The soundtrack of your party is what’ll take it to the next level. A playlist of classics is guaranteed to make sure everyone enjoys the music. Even the most beloved song gets old the fourth time the playlist restarts. Make sure the list is long enough to last. At a minimum, it should be half the length of your party.
Mosquitoes
These little pests can turn the most enjoyable evening into a struggle. Make sure they’re not invited by using these tricks to make your space a mosquito-free zone. Most importantly, remove any standing water, as that’s where they lay their eggs. Next, lighting some citronella candles will do wonders to keep bugs off your guest list. Providing bug sprays can also offer personal relief to your guests.
Outdoor Lighting
Once the sun starts to dip, you might enjoy cooler summer temperatures, but you don’t want to lose sight of the party. Literally. Maybe you already have some outdoor lights, but make sure they’re softer ones, not blinding flood lights. If you have a safe space for it, a fire is a great way to provide some illumination. If not, string lights can bring a charming touch to your event. Have them set up ahead of time so you’re not fumbling around in the dark.
Yard Games
The constant buzzing of phones is a quick way to dampen the party mood. One way to keep people from checking their social media nonstop is with yard games. Kids and adults are both likely have a great time with these fun activities. A beanbag toss (also called cornhole in some parts of the country) is a yard game classic, and you can even make your own set!
Think of Your Guests When Planning the Menu
If it were just you eating at this party, you’d know exactly what to serve. But your guests should be your first thought when planning the menu. On a very important level, you don’t want to trigger any allergies. But it’s also important to make sure your vegetarian and vegan friends will leave just as satisfied as your carnivorous ones. Reach out to your guests before the party to get info about your guests’ allergies and preferences.
Make It Customizable
A nice way to put the power in the hands of guests is have a condiment bar. This lets your picky eaters decide what they do and don’t want. Spice things up by using Popsicle sticks as labels for the condiments. Provide a good spread, but make sure to stock up on the go-to items, like ketchup and mustard. Take it even further by providing a s’mores bar with all the fixings. Some unexpected items like peanut butter can bring new life to this summer classic.
A Cool Way to Cool
A cooler is just as important as a grill for the success of your party. Keeping your drinks chilled is the best way to keep your guests happy and hydrated. Bring in the summer vibe by freezing partially full frozen water balloons to serve as ice for your cooler. The pop of color is a fun addition, and as the water melts, it can be a great activity, too.
Clean Grill, Clean Fun
If you don’t clean the residue off your grill, the ghosts of meals past will end up haunting your guests. Mix of ¼ cup of baking soda and ¼ cup of water together to scrub the grate and let it sit. After 15 minutes, wipe it off with a cloth and run it at high heat to burn off any excess, and you’re good to go!
Leave No Meat Behind
As you’re grilling, you might notice the little bit of meat that gets stuck on the hot grill. It’s the worst. Luckily, it’s easy enough to avoid, and the solution can even add some flavor to your dish. Use olive oil to keep your meat from sticking. Use a paper towel soaked in olive oil to apply a coat of oil to the grill. It’s important that the grill already be hot and the meat be close behind so the oil doesn’t simply burn away.
The More Plates, the Merrier
It’s so tempting to keep just one plate at the side of the grill to plop everything on and sort it out later. But if you’re grilling vegetables, sometimes you don’t want those flavors to mix. A separate plate for each type of grilled goody will make sure all combos are intentional.
Patience: It’s What’s for Dinner
Fight your inner micromanager and trust your grill to cook your meat. When you’re checking for doneness, don’t poke, flip or stab anything. When in doubt, let the pros tell you how long to grill all the different items in your meal. Leaving your food alone will allow a premium sear and picture perfect grill marks.
What About the Children?
If your guest list includes some people born this side of the turn of the millennium, they’re going to want some activities to keep them busy. This is where those lawn games can come in handy. And having some specifically kid-themed games, like a water gun range, will make your party a hit with kids and their parents.
Think About the Drink
If you plan to serve alcohol at your party, having everyone’s favorite drink can be a real hassle. Instead of trying to please everyone, consider providing a house drink like outlaw lemonade. Providing an alcohol-free option is important, too. Checking with your guests beforehand will ensure everyone enjoys their time. Of course, you can still let guests bring their own drinks if so inclined.
With planning, your party can be a good time for your guests and for you. Kick back and enjoy the delicious fruits of your labor while soaking up some sun. You deserve it.
