Tag Archives: debt

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I’m in Debt – What Should I Do?

While struggling with debt isn’t uncommon, getting out of it as soon as possible is important. Student loans, car loans, credit cards and other payments can lead to your pile of debt getting bigger and bigger. So, what steps should you take if you are in debt? Keep reading to find out. 

1. Clean Out Your House & Sell What You Don’t Use 

Start small and simply sell the things you don’t need. You’d be surprised how many things you have around the house that you never use. While doing this won’t erase your debt, it will give you some extra money to put towards paying it off and help you recognize some of the unnecessary purchases you’ve made. 

2. Find a Side Job 

If you have a full-time job but have weekends open, finding a part-time job to fill that time would be extremely beneficial. Working on your days off might not seem ideal, but if you’re serious about paying off your debt, it’s a great step in the right direction. Just remember these circumstances are temporary and the bigger your steps towards erasing your debt are, the quicker you can get it done. 

3. Analyze Your Spending Habits 

The best way to understand your spending habits is to write all of your payments from the last month or two down on paper. Once you see everything in front of you, try dividing that into categories – necessary expenses (like rent, utilities, groceries, etc.) and unnecessary expenses (coffee trips, clothes, video games, etc.). Now that you see how much you’ve spend on things that aren’t necessary, start rethinking the way you handle your money every day. Next time you think of buying that cute shirt, ask yourself if you need it. These small purchases add up and the money could be put towards your debt, instead! 

4. Never Spend More Than You Make 

How do people get into debt? They spend more money than they’re bringing in. If you’re trying to get rid of debt, you definitely can’t be adding more money to that pile. Trim down your budget so you know you’re making more than you’re spending. The best way to know if you’re doing this is to simply track everything you spend and everything you make. At the end of your pay period, make sure the money earned is higher than the money spent. 

Paying off the debt you owe might seem like a big job, but freedom from debt starts with taking the first step. Start by implementing these effective tips into your daily life, stay organized and keep a positive mindset. Debt is temporary if you work hard and stay motivated! Get saving by opening a savings account with us today.

How Do I Pay Off My Debt?

papers

Extreme amounts of debt can weigh heavy on your shoulders. It has been found that extreme amounts of debt are linked to higher rates of suicide and depression. This is why it’s so important to have an understanding of good debt vs. bad debt and how you can go about paying back your debt efficiently. 

Don’t Let it Define Your Life

You, of course, want to have your debt paid off as soon as possible. However, letting it define the value of your life is counterintuitive to being able to pay off the debt. You can enjoy your life while simultaneously paying off debt. A common saying about paying off debt is to think of it as a marathon and not a sprint. You aren’t going to have all of the debt paid off at once, but consistent payments will help get you there instead of burning out from sprinting.

Be Careful Who You Surround Yourself With 

It’s hard to stick to a budget when you’re surrounding yourself with friends who want you to spend money with them. It’s difficult to say no to socializing because of the money. At the same time, you should be surrounding yourself with people who understand your financial priorities and support you in those goals. Spend time meeting with financial experts to help guide you in your investments and debt management. 

Press Pause on Credit Cards

While credit cards are a great tool when used correctly, they can be a hindrance to paying off debt. Do your best to refrain from using them until you have your debt under control. 

Utilize Extra Income

If you receive a bonus or a pay increase, place all or a portion of those funds towards your debt. You won’t notice the difference, besides seeing the decrease in your debt to income ratio!

Start a Payment Plan 

In order to keep the momentum going, you should start paying off your most expensive debts first. This typically means the highest interest. Establish a set amount that you will pay each month and work it into your budget. Your amount should be more than the minimum payment due. 

Don’t let your debt take over your life. Get control of your dues today!

Habits of People Who Live Debt-Free

If you’re an adult living in America, chances are you’re living with debt. According to Pew Charitable Trusts, roughly 80% of American adults are in financial debt. You can see how it happens, between student loan payments, mortgage payments, car payments and credit card use, it’s easy to get yourself into debt and it can be tough to climb out.

But, how can you help yourself live debt-free? It is possible, and Milledgeville Bank has some tips that you can use. Some are tips that you can right away, while others will require a dedicated approach over an extended period of time.

Create a Plan for the Future

It’s easier to implement money saving strategies when you have a goal in mind. Whether you’re looking to save for a purchase or to pay down debt, you need to set a budget to follow every month, and then stick to it. It’s also crucial for you to closely monitor your finances by checking your statements and reviewing your account balances so you can note any abnormalities from the budget you’ve set.

Trim the Fat

The best way to make sure you can keep yourself out of debt is to limit your spending. This is easier said than done. Whether it’s limiting your credit card use to emergencies or saying no to a friend who wants to go out for a night on the town, cutting back on spending is the best way to keep yourself out of debt. If you choose to live on less than you make, you’ll save long-term.

Cash is Your Friend

While your credit and debit card make it incredibly easy to make purchases, carrying cash can actually help you spend less in the long run. If you limit yourself to carrying cash, you know exactly how much money you have (or don’t have). This allows you to be more careful with your money and more diligent about your purchase decisions.

Living debt-free takes hard work and dedication. But, just like anything that requires patience, the payoff once you’ve reached your goal is worth all the work. Let Milledgeville Bank help you develop the habits to live debt-free so you can live with less stress.

5 Strategies to Shrink Debt

Personal Finance

Minimizing your debt can always seem like a mountain of to-do lists. With various recurring payments, differing interest rates, and due dates that never seem to end, if you feel overwhelmed, you’re not alone.

 

While having a credit card, or other outstanding debt, isn’t a situation anyone wants to find themselves in, a surprising 38.1% of American households carry credit card debt.  Couple that with a total household debt average of $134,643.00 and the idea of debt starts to seem more common than you’d think!

 

While we know that having debt isn’t always the best solution, but Milledgeville State Bank is here to help you conquer it. We’ve found five proven ways to reduce your debt, and stop your spending process from adding more! Take a look at the five tools below, and see if they help you become debt free!

 

  • Find New Ways to Save: Whether it’s reducing your grocery bill, finding more affordable clothing options, or simply turning to the cash-only budget. There are numerous ways you can save. In fact, we recommend blogs such as The Simple Dollar, Making Sense of Cents, and Penny Hoarder to continue bolstering your savings knowledge.
  • The Snowball Method: This is by far our favorite way to reduce your overall debts. While you may need to start with finding some new ways to save, once you can allocate some extra dollars, you can put this effective method in action, eliminating your debts. Simply pay the minimum amounts on all outstanding balances, and then using the surplus funds, add to your smallest payment to help pay it off sooner. Once your smallest debt is completely paid, you can rollover the funds being used for that into your next largest debt and so on. Repeat this process until all the debts have been paid off.
  • Refinance Your Current Loans: The snowball method will help you erase debts one by one, however, using this other strategy you can see about reducing those payments in one quick action. Speak with one of our dedicated lenders to see if your home mortgage or personal loan can be refinanced at a lower rate to save on monthly payments. This may make a small dent, but every little bit counts!
  • Freeze the Credit Cards: In order to proactively prevent yourself from overspending, freeze all credit cards you currently have in your possession. This step helps you to force yourself to spend only what you have. If you decide to use cash only, the envelope system may help you save even further!
  • Set Up Automatic Transfers: This one simple trick can save you hundreds each and every year! By using your online banking as a resource, you can create an automation to ensure you are never tempted to spend those extra dollars. Instead of waiting for them to spend, allocate them in your savings plan, and tuck them away for paying down debt or building your emergency fund to eliminate emergency debts.

 

However you and your family decide to decrease your household’s debt, Milledgeville State Bank is behind you! We’d love to talk about your family’s financial goals, and help you identify the best tools to help you get there. Give us a call, or stop by your nearest branch to get started today.

7 Financial Goals to Make 2017 a Success

Money Management

Milledgeville State Bank challenges you to make 2017 the year of financial prosperity. Complete with an emergency fund, sound credit, and a monthly budget, you can conquer any fiscal goal so long as you keep moving towards it. To optimize your money management potential, we recommend these seven goals:

  1. Check Your Credit Score. There are many websites available which allow you to view your current credit score across the three reporting bureaus. However, the only federally authorized FREE site is annualcreditreport.com. This site gives users one free report from Equifax, TransUnion, and Experian every year. By keeping regular track of your score, you can ensure that no fraudulent inquiries have been made, and no outstanding debts are currently being held against you. After all, a higher credit score could mean potential savings elsewhere.
  2. Make a Monthly Budget. This tool is invaluable when building your personal financial success. By creating a plan for each dollar you earn you are no longer reacting to your spending, but proactively telling your money where it should go. Adding this transparency to your spending can often showcase areas where you may be spending more than desired. After adjusting your monthly allocations you can then reassign some of those dollars to help build your personal savings and other areas of improvement.
  3. Automate Your Savings. “Out of sight, out of mind,” or so the saying goes. Adding processes to your budget, such as automated savings, can help you to accumulate money before you miss it. Before you start planning your spending for the month, determine how much you want to save. So long as your fixed monthly expenses are covered, you can then create an automatic monthly transfer from your checking to your savings. By doing this the same day you are paid, the funds will be gone before you even know to miss them. You can then budget the rest of your spending to cover flexible categories like groceries, entertainment, and more.
  4. Start an Emergency Fund. In order to safeguard your savings, you’ll need to create an emergency fund. This particular account offers protection against unexpected expenses or dilemmas that could otherwise infringe upon your diligent accrual of funds. It is often recommended to begin by saving $1,000, and then gradually work up to three or six months worth of income. By adding this cushion to your personal finances, you ensure that you are financially stable enough to weather storms both big and small.
  5. Submit Your Taxes Early. Tax fraud is an increasingly relevant issue, posing many problems for both the IRS and tax paying citizens. To help avoid potential criminals from using your information to their benefit, we suggest completing your tax return as soon as possible. Additionally, if you have a potential tax refund, the earlier you file your return, the sooner you are able to receive it.
  6. Maximize Your 401(k). To make the most of your diligent savings, we recommend revisiting your HR materials, to find out the specifics of your company’s 401(k) plan. If they will match up to ten percent, and you’re only contributing six, you could be missing out on free funds! Additionally, if you want to retire by a certain age, you may need to adjust your contributions to maximize the years you still have during your employment.
  7. Pay Down Your Credit Cards. Interest rates on credit cards are infamous for being consistently high. If you have multiple credit cards which carry a balance, we recommend paying down the account that has the least amount on it. By continuing to pay the minimum installment on each card, you can then assign any additional funds to the card with the lowest value, to help pay it off sooner. Once the first card is no longer carrying a balance, you can then utilize the monthly installment and the additional funds to put toward the next card, and continue through the accounts.