As American’s we love to buy things and spend money, and most individuals and households have at least one credit card. Credit cards are convenient and easy to get, but they usually come with a high-interest rates, and if not used responsibly they can put you in a mess of debt that’s hard to get out of. We will go into to detail on debt and how to manage your personal debt.
Some debt is considered good debt, like taking out loans for education or borrowing to buy a home. It makes sense not to borrow more than you need and to shop around for the best rates.
Bad debt, for many Americans’ is debt you rack up on credit cards. When we go into debt to pay for things like meals and going to the movies, they seem like small priced items at the time but they add up fast. You should only pay for these type of items on credit if you plan to pay off your balance in full every month.
Being Aware of What You’re Spending
It’s easy to buy things without giving it much thought. Start tracking where you’re spending your money and where you can cut back on spending.
Pay off Debt with the Highest Interest Rates First
Examine all your loans and credit card balances and pay down the ones with the highest interest rates first. After you tackle one, start paying off the next highest interest rate loan.
Build an Emergency Fund
Have enough money set aside to pay for a least 6 months’ worth of living expenses, in case you unexpectedly get laid off or a medical condition arises.
2 thoughts on “Manage Your Personal Debt”
American Express will permanently blsilkcat you, if you have a bankruptcy in your past. The only way that you might get around this is if you have a partner with good credit who will apply for the card on behalf of the business, and then add you as an authorized user later.If you need to establish business credit, you will need a Tax ID#, which I am sure you already have. Next, you will need a Dunn Bradstreet Number. Don’t let them force you to pay money to have a report established. They will try to sell you services, but you can get a number at no charge. Each year, you can voluntarily provide your business financial information to them. None of this costs money. They will try to tell you otherwise, but do not believe them!As far as cleaning your personal credit, work with National Consumer Rights Alliance. They have removed things that you would not believe could even be removed from reports! Even bankruptcies. Their website appears below.In order to get your business credit established, it helps to have about six people who have extended you credit to report to D B. Start with your CPA, attorney, local printer, and landlord. After that, you can set-up business accounts with Office Depot, Home Depot, Lowe’s, and others quite easily. As you build your credit with these companies, they will report your payment history to D B, and that will generate a PayDex Score. NEBS, Reliable Office Supplies, National Sanitary Supply, and U-Line all give easy business credit and report as well.Once you have been in business for two years, and you have a good payment record, you should have little problem getting business credit without a personal guarantee. Dell Computer will give you credit after you have already been established at least one year.Business credit cards (Visa, Amex, MC) do not report to D B, but may report to Experian Business. Do everything that you can to avoid having to provide a personal guarantee for any business debt. If you must give a PG early on, try to get it removed after six to twelve months of good payment history.The second link below will give you a large business credit line (up to $25,000) that will report as a positive account to D B. You can also set-up a personal line ($5K to $10K) with the same source.I wish you luck, both in your business, and with your personal credit situation.