Becoming Debt-Free – The Ultimate Goal

Recently, there has been a resurgence of people looking for ways to become debt-free. I believe a lot of this is due to the publicity of the debt the US government continues to grow. Many Americans, have started taking a closer look at their own finances and realizing that they might have out of control debt problems. There are many websites like the one of Dave Ramsey and it touts the goal of becoming debt-free as the ultimate financial goal. Most of these programs are pushing the idea of becoming debt-free without filing bankruptcy. The problem is, many American’s debt has gotten so high that many have no other choice but to file for bankruptcy.

At the end of 2011, it was reported that the average American has close to $16,000 in credit card debt. When adding the interest rate into the mix, it’s looking highly unlikely that these average Americans will ever be able to get out of debt without the help of filing bankruptcy. The problem lies in the debt ratios and not really in the total amount of debt. If someone made $150,000 a year and had $16,000 in credit card debt, it’s pretty obvious they could budget themselves and take a little bit of pain to pay it off in a short amount of time. When someone is making $35,000 a year it becomes next to impossible because of their living expenses. Consequently, most of these people make the minimum payment just to keep their credit card accounts open. They don’t even realize it but they’re becoming enslaved to their debt.

It is possible to become debt-free without filing bankruptcy, but it takes discipline and capital. If someone doesn’t make enough money and have gotten themselves into some serious debt, outside of winning the lottery, the only thing that will get them out of debt is a bankruptcy filing. All the debt-free gurus tell their clients to avoid filing bankruptcy at all costs. Most of them will even admit that for extreme circumstances, extreme action is required and that’s where the individual should consult a bankruptcy attorney. I guess it really depends on who one goes to for their advice. A financial consultant will push budgeting, while a bankruptcy attorney will suggest a bankruptcy filing to eliminate the debt. It’s common for folks that are in trouble to consult a bankruptcy attorney hoping for an easy way out, only to find out that the attorney advises them that their debt problems are more of a budgeting issue and it’s possible to get out of debt without filing bankruptcy.

When considering how to go about becoming debt-free, one should gather up their monthly bills and figure out without charging any more on their accounts, how long would it take to pay off all their bills. As a rule of thumb, if it takes longer than five years it might be time to consult a bankruptcy attorney.

Why Credit Counseling Often Fails

If you look at the concepts surrounding debt relief through credit counseling, you will find that it makes a lot of sense. You may also be surprised to know that although that is true, it has a very poor success rate.

Credit counseling involves getting advice from a debt professional. Ideally, they will look at your debts, your income and expenses to help you decide on the best course to eliminate your debts. They are knowledgeable of the legitimate ways you can pay off all that you owe and if you need a professional debt management expert or negotiator. They can also honestly tell you if you have no other choice but to opt for bankruptcy.

The benefit of getting a credit counselor is having an expert guide you in coming up with a payment and budget plan. In truth, this is what you really need to get over your debts. As long as you are dedicated, following through your debt payment plan should suffice.

However, statistics show that not even half of the people opting for a credit counseling option are able to conquer their financial woes. More often than not, they end up filing for bankruptcy. There are two things that point to the failure of credit counseling.

One of the two involves the wrong attitude towards this debt relief option. This can be their inability to make a complete commitment or continually incurring debts – there are many scenarios that will lead to failure. If the debtor is not willing to change their behavior and correct their spending and budgeting habits, they will not find the discipline to see through the payment plan that they have created. It is hard to pay off debts and it is very easy to fall back into it so you know that a wrong move can spiral out of control and render your past efforts futile.

The other reason why credit counseling can fail is because of an unrealistic representation of their financial standing and a wrong assumption on what this debt relief option can give them. Credit counseling is only meant for debtors with the means to pay off their debts. It does not lower your outstanding balance. The counselor is also unable to negotiate with your creditors for you. If you need to communicate with your creditors, you need to do that yourself. If you are evidently on the brink of bankruptcy, talking to a credit counselor cannot prevent that from happening. This is especially true if you have no way of increasing your income enormously. Debtors filing for bankruptcy are encouraged to get credit counseling but this is not a way to help you steer from it.

Based on what you understand of your credit standing, you need to consider just what your monetary capabilities can afford. If you cannot meet the minimum payment of your debts, you need to opt for debt settlement or debt management. If you cannot make any payments at all, bankruptcy is your option. At the very least, a credit counselor can help you decide which option can help you arrive at a debt free life.

Free From Debt, Free At Last!

If you’ve been battling debt for years and have finally paid it off, you must feel as if a giant weight had been lifted from your shoulders. If you’re tempted to dance around the room shouting, “free at last, free at last,” I certainly wouldn’t fault you. Being seriously in debt can have a very negative impact on your life and getting completely out of debt can feel like there’s a new day dawning.

$120,000 in debt

I recently read the story of a couple that had managed to get $120,000 in debt. They hadn’t done anything extravagant either. There were no trips to Paris, no luxury automobiles, and no McMansion. The way they put it was that they had gotten into debt the boring way – one credit card charge at a time. There was a happy ending to the story as they paid off every cent they owed though it took them five years. The not so happy part is in they both had to work second jobs in order to pay off their debts – and they were in their late 50s. Can you imagine how happy they were and how free they felt when they paid off that last credit card?

High marks for their ethics

You have to give this couple very high marks for their ethics. They could have filed for bankruptcy and discharged probably all of that $120,000 in debts in just three to six months. Instead, they decided to do the right thing, which was to pay off everything they owed even if it did require a lot of sacrifice and extra work on their part. Spoiler alert – they did this with the help of consumer credit counseling.

Consumer credit counseling

Consumer credit counseling can be a good way to get your debts under control and to eventually pay them off as did the couple in this story.

If you’re not familiar with credit counseling it’s where you go to a consumer credit counseling agency – either in person or online. You are assigned a credit counselor who will help you develop a budget and create a debt management plan for paying off your debts. When all your creditors sign off on your debt management plan, you will longer be required to pay them. The credit counseling agency will pay them for you while you then send it a check every month until you complete your plan.

The pros and cons of credit counseling

If the idea of using credit counseling to pay off your debt appeals to you, it’s important that you know both the pros and cons.

The pros are that you get your creditors off your back, you get a monthly payment that should be less than the sum of the payments you’ve been making and you’ll have more time to pay back what you owe. In fact, the typical credit counseling payment plan takes five years. And the credit counseling agency is usually able to negotiate down your interest rates so that you actually pay back less money.

The cons

However, there are also cons. You will have to surrender all your credit cards and not take on any new revolving debt during the five years it will take you to complete your plan. If you fail to make any of your payments, your plan might be revoked and you could end up in a real mess of trouble. And the accounts included in your debt management plan will usually be written up on your credit report as “not being paid as agreed,” which could have a negative effect on both your credit and credit score.

You, too, could be free at last

If you want to do right by your creditors, credit counseling could be a good answer. It’s not a quick or easy way to get out of debt but if you’re willing to put in the work and spend the time, it could eventually have you, too, shouting “free at last.”

How to Get an Affordable Credit Insurance Broker

When it comes to getting a credit insurance broker, you probably have many questions about what you need. You may even be wondering why you need a credit insurance broker to begin with. The bottom line is that you have many things to worry about where your business is concerned. Making sure that you are profitable is a problem that reaches to just about every area of your business. Bad debt can quickly ruin your profitability.

However, you have many things that you do every day to keep your business running. You do not have time to worry about whether your debtors’ payments are on time. Depending on the size of your business, it may even take several phone calls, spreadsheets and reports to figure out how much outstanding debt you currently have. For that reason, you need someone to help ensure that you get paid the money that debtors owe you. You cannot afford to have bad debt.

Know Your Needs

The first thing that you need to do when looking for a credit insurance broker is to know your needs. Depending on the size of your company, you will need someone who is experienced at working with all different kinds of businesses. You want to work with someone who knows what questions to ask you and the solutions that best fit your needs. Credit insurance is probably not something that you know all about, so it will be important to find someone who knows what you do not to fill in the gaps for you.

Shop Around

Take the time to shop around and find the right broker for your company. You want to hire someone that you feel comfortable with, whose professionalism and experience are on the scale that you require. So, do some research, ask other business owners and shop around to decide who the best broker will be for your company.

Check Credentials

When you have decided on a company that you want to work with, check into their credentials. Look at testimonials from past clients and request a previous client list, so that you can see who they have worked with before. Nothing speaks to a broker’s ability to handle your needs more than the needs they have met for past clients.

When looking for a credit insurance broker, it is easy to get overwhelmed. When you know the basics of what you need and take the time to research your options, you should be able to find the right broker for your business.


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Money Transfer Services To Send Money To Your Relatives Speedily

Back in the day, people used the postal services in order to send across checks to their relatives or to service providers. Whenever someone needed to send money, it would take time for it to reach the concerned persons. When you are able to make payments instantly, it carries a number of advantages over writing checks and waiting for the other person to pick them up.


One of the most significant benefits of money transfer is the speed of the transaction. Checks can take more than a week or two to get processed. Transferring money, on the other hand, takes just a day or two to process. The speed at which financial transfer transactions take place make it easier for people to manage their finances better and pay their bills on time. You can easily avoid late charges, when you send the money across the speedier way.


It can be risky to send a check via postal mail. Sometimes, the check can either get lost or get stolen on its way to the recipient. If the check is lost in the mail, then you could have to pay late fees and charges even though you try to convince the creditors that you did try to make payments on time. If the check gets stolen, it can result in consequences that are worse than that. The thieves could easily gain access to your account number and routing number. With that information, they could possibly even drain your bank account of all the monies. When you use cash transfers in place of checks, these problems can be easily prevented.


You can easily have several accounts and set up a special account to move your money back and forth or to send money to another person. Even though it can take a lot of time for the account to get verified and set up, you can initiate money transfer within a matter of a few seconds when you finishing setting up your account. This makes it easier for the money to circulate around and in case one needs to make a major purchase. It would also be possible to take advantage of the higher interest rates in case of a cash transfer and make sure funds are available in your special account in case of a financial exigency. Cash transfer is as simple, easy to handle, and as flexible as that.