debt free

New changes to the retirement account rules to know of – Retire debt-free

Did you know that contributing a portion of your income to retirement accounts can help you qualify for tax breaks and sometimes even for employer contributions? Another new and lucrative perk which retirement accounts like 401(k) or IRA will now have is a legal necessity for investment advice which isn’t biased. Apart from this one, there have been some more tweaks and changes to retirement account which is definitely going to have an impact on the people who are eligible to contribute and how big or huge their tax savings are going to be. If you’re a baby boomer, you should know about the recent changes that may affect your tax savings. Check them out.

Change #1: Legal unbiased advice in your best interest

This new rule is all set to start in April 2017 and according to it, a financial professional who makes recommendations on investment about your IRA or 401(k) is legally obligated to offer you advice in your best interests. He should recommend you the funds which provide highest compensation to the financial advisor. This is a part of the fiduciary level of care where the advisor is asked to act as according to the best interest of the client. However, this new rule will only be applicable to retirement account and advice on any other kinds of tax or financial issues won’t be held under this rule.

Change #2: Charitable contributions on IRA

Withdrawing money from the conventional IRA account is necessary after attaining the age of 70 and half and income tax remains due on every single contribution. But in case you donate a portion or the entire part of the distribution to a qualified charity organization and you’ve crossed 70 and half years of age, you won’t be liable to pay taxes on this transaction. Such IRA tax-free charity contributions have always been a temporary feature of IRAs since the year 2006 but it was recently that it was made permanent.

Change #3: Income limits of Roth IRA become higher

You can easily earn an added $1000 in the year 2016 and yet save for retirement. The eligibility of Roth IRA will phase out for people whose gross income is between $117,000 and $132,000. Usually it is a rule that Roth deposits are done with after-tax dollars but the earnings that you make every year aren’t taxes. Withdrawing money after attaining 59 and half years of age from Roth accounts which are more than 5 years old are also considered as tax free. Though it won’t help you with the present tax picture but it will definitely assist you in the long run.

Change #4: The new retirement account, myRA

There’s a new retirement account, the myRA which was launched throughout the nation in November, 2015. This new account has been targeted at people who don’t have access to 401(k) plans. Individuals who want to save can contribute $5500 per annum to this new Roth account and if they’re more than 50 years of age, the amount can be $6500. There’s only 1 investment option, a variable interest paying Treasury savings bond. However, as soon as you hit the maximum balance that you can maintain on your myRA account ($15,000) or if the account turns more than 30 years old, the money will automatically be transferred to the private sector Roth IRA.

Hence, if you’re a retirement investor, you need to be up to date with the changes that are happening within the industry. Take into account the above mentioned changes brought about to the retirement accounts and measure your steps according to the rules.

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Turn your finances around in 2015 – Expert tips to accelerate your financial situation

For the twenty-somethings, the standard advice would be to take a close look at their finances and skip those $5 lattes and Starbucks in order to put that money in the bank. However, Adam Nash, the CEO of Wealthfront says that giving up the $5 latte is secondary to the more important questions of controlling your finances. Do you follow a frugal budget? Are you spending much less than what you make in a month? Are you saving enough funds to meet your goals? If the answer to all these questions is ‘yes’, sit back and enjoy the latte. But if your answer is ‘No’, you need to buck up with your personal finances. Here are some steps that you can take in order to stay on top of your finances.

  1. Know how emotional you are about your money: It is true that when it comes to money, you get a bit wobbly. For instance, you work pretty hard to pay off your mortgages whereas if you would have kept your mortgage for a longer time, you could have got tax breaks for a longer time on your income. Hence, when you take steps to remain debt free, consider the pros and cons of prepaying so that you don’t incur fees and penalty charges in the near future.
  2. Save enough for your emergency fund: The idea is to save enough money so that you live without income for at least 6 months. An emergency fund is more like a buffer and it protects you during times of crisis. In case you’re someone unfortunate who is being derailed with unforeseen events like medical bills and car repairs, then it is this chunk of cash that will help you avoid falling into debt.SunnyImage_Financewand(1)
  3. Think of your net worth: According to a well-known personal finance blogger, always keep a bigger picture of your finances by taking a look at your net worth and not your net balances. If it’s going upwards, you’re definitely doing great. This will always keep you accountable for whatever you do with your personal finances.
  4. Negotiate with your creditors: Most debtors think that their creditors always try to push them further into debt but this is not the fact. You should always negotiate with your creditors and keep them informed about your present financial state. They might have some alternative option for you with which you can get out of debt with ease. You can also get help of the IVA Debt help and advice and obtain an improved debt repayment plan.

If you absolutely love your early morning cup of coffee at Starbucks, you should go for it but at the same time make sure you spend less on the other areas. Try to follow a budget throughout the month so that you have an idea of what you’re spending and what you’re earning. Keep evaluating your budget every month and make necessary changes.

How to Reshape your Finances and Live a Debt Free Life

Debt FreeMany think that living a debt free life is a farfetched dream and cannot be easily attained. It is one of those things that they strive to gain but fail every time due to some circumstances or the other. Be it reckless lifestyle or overspending on the credit cards debts sometimes are too hard to shake off.

However by taking some planned steps you can cut down your dues and live a debt free life. It may be a little time taking and a little difficult at the beginning but it is not impossible. So, instead of repenting on the things that are already done, try and get your finances back on track by implementing some of these debt free direct ways:

  1. Design a budget plan: If you want to keep an accurate track of your expenses and get control over your finances it would be a good idea to design a budget plan. If you can stick to a well made monthly budget plan you can cut down your unnecessary expenses and can save some money to pay off your bills. A proper budget plan also helps in maintaining a stable financial life by avoiding debts.
  1. Cut down your credit card bills: You may not realize the amount of problems you face due to reckless spending habits till you get your credit card bills. You may be fond of buying things with cards but the habit may not be beneficial if you default on your bills at the end of the month. If the amount is high you may find it difficult to repay them. Such defaults may further lead you to debt problems. So in order to avoid that the best thing is to set a limit on your credit card expenses.
  1. Reduce your interest rates: You can get rid of your debts faster by reducing the interest rates on your debts. If your financial condition is poor inform your creditors and convince them to reduce your interest rates. If they agree to your negotiation deal you can pay off your debts comfortably and also avoid any problems relating to foreclosures, lower credit scores or bankruptcy. However make sure that you give proper reasons and show earnest efforts in becoming debt free.
  1. Avoid defaulting on payments: When in debts it is very important to make the payments of your other loans properly. It helps in improving your financial condition slowly and maintains your credit score. Avoid defaulting on the monthly payments of any bills. If required keep a track of your payment dates so you do not default on them and end up paying penalties.
  1. Consider other sources of income: If you want to get rid of your debts faster you just cannot depend solely on your primary income. The amount may not be sufficient for making the payments after meeting all your basic financial needs. In such circumstance consider taking up a part time job or work overtime to supplement your income. You can use this income to pay off your debts without hampering your budget plans.

How to Take Control of your Credit Card Debt

How to Take Control of your Credit Card Debt

Credit card debt is one of the single biggest issues affecting people in the UK, as people are often tempted by the benefits of a credit card but then struggle to pay the necessary monthly repayments. From May 2012, the average amount of unsecured household debt in the UK was £7891, showing that there has been a substantial increase on the level of debt on 2011 and the 5 year period before 2008.

Usually it is the convenience of credit cards which makes them more appealing to use when the cash flow is running low. Unfortunately for those who use them, there is a high rate of interest associated with them that can be difficult to repay over time.

Not only do these reasons suggest why credit card debt is so high in the UK, they also make it extremely difficult for individuals to repay their liability. With many more people unemployed or being made redundant, it is clear that those in credit card debt don’t always have the disposable income to pay off the debt on a regular basis. It is only those with a proactive and determined approach to saving that will be able to overcome credit card debt in the future.

Consolidate your debt

If you are in debt with a number of credit cards, it can be even more difficult to accept more than one individual liability, and make multiple repayments when your money is tight. When managing your debt, try to pay off each credit card one at a time and once you have settled the account, close it down. Alternatively, you could also transfer your balance onto one credit card to ensure that you can manage your money in one place.

Try to shift your debts onto a 0% credit card and either pay it off before the 0% term expires, or shift the balance to another card before the interest kicks in. If you can’t get approved for a 0% card, a low-interest card (5-10%) will still be lower than the APR on most debts.This will help to create one clear goal for you as opposed to trying to pay off debt on many credit cards. By working out the APR of each credit card you will be able to see which card needs to be paid off first.

If you are struggling to pay off any of your debt you could always contact the CCCS ( and see if they can help as they can sometimes arrange for debts to be frozen or consolidated into a single manageable monthly payment.

Only spend what you can afford

Although credit cards can offer financial support and tend to be convenient for the user, they can encourage you to spend money you don’t have. A more effective solution to the problem of limited cash flow is to budget your levels of disposable income, and ensure that every penny you spend is accounted for and necessary. If you commit to only keeping cash, you will know exactly how much you are spending as opposed to feeling like you have an endless amount of money to spend on your credit card.

Make sure you can afford your repayments

If you are trying to pay too much on your credit card monthly bill repayments, you will soon find that you may be getting yourself into further debt. By implementing a strict budget each month you will know how much disposable income you have each month, as well as how much you have to repay your debt. Make a list of your income outgoings as well as a list of essential and non essential spending in order to see how much you can pay each month towards your credit card debt.

If any creditors call to ask about your debt, you will then be able to explain what capacity you have to make the repayments each month. Committing to manageable repayments will help you to regain trust with your creditors and as well as helping yourself to feel more confident with your saving methods.

Obviously, it is great if you can pay more on your minimum monthly repayments as this will help you to reduce your credit card debt much quicker, helping you to feel more relaxed and carefree about your financial situation. By dealing with your debt in this logical way, it is likely that you will learn from your experience and be more careful next time you are tempted to open a credit card.

This article was written by Debt Free Me; specialists in debt consolidation and financial management. Visit for free advice on managing credit card debt and your finances.

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How To Be Debt Free

The credit boom and subsequent credit crunch of the last decade has left many Americans with an overwhelming level of debt that they have no real means of ever paying back. And this will no doubt have been a contributory factor in the 20 per cent rise in personal bankruptcy filings witnessed during 2010.

And if you are one of the millions of Americans with a seemingly insurmountable level of debt then there are a number of options open to you that could help to improve your financial situation.

Live the frugal life

This may seem obvious but if you curb your spending habits then you may see a rapid improvement in your financial circumstances. For example, if you have a $2.00 coffee on your way to work every day and then spend a further $5.00 on lunch each day then that amounts to over $150 every month and almost $2,000 per year. And you can save a large portion of that $2,000 by simply cutting back on the morning coffee and preparing your lunch at home and then taking it to work with you. And if you apply this principal to other areas of your life then you can save even more money and may even keep enough money back to put into savings.

However, this will only make a difference if you have a manageable level of debt as it may help you pay it off quicker than expected as you have more money to pay down each month. If you have a larger amount of debt you may have to consider some of the following options.

Debt consolidation

Debt consolidation works by gathering up all of your outstanding debts, such as loans and credit cards, and then offsetting them with another, larger loan that is usually taken out and secured against any property you may own. This could be in the form of a remortgage of your home or a tailored debt consolidation loan that some lenders will offer.

This is a good solution for many as they do not have to worry about various credit lines, which can be confusing and difficult to manage, and it can also offer a lower rate of interest and so you will not pay as much money back in the long term. The downside to this is that you have to be in a position whereby lenders are still willing to offer you more credit and, should you fail to keep up with the repayments, you could lose your home.

Debt management and settlement

If the first two steps do not suit your circumstances then you could enroll in a debt management plan whereby a third party company will contact your creditors in a bid to reduce or freeze interest rates and put a stop to costly default fees and phone calls demanding payment.

This works well as an interim measure for those heavily in debt and may also lead to a settlement plan whereby your debt management planners agree on a compromise figure with your creditors which may lead to you only paying back 50 per cent of what you owe to have the debt settled and written off.

However, this will have a damaging effect on your credit rating, if it not already irreparably  damaged, that could mean that you will struggle to gain credit for up to six years.


This is usually the last resort for many as the Federal courts are involved in liquidating your assets to eliminate your debts and a Chapter 7 bankruptcy order takes into account personal income regulations to determine whether you are eligible. If you have any saleable assets then these will be seized as part of the bankruptcy and the implications for your credit score are severe and could last for up to seven years.

Although you could be discharged from any unsecured debts within a matter of months bankruptcy should never be seen as an easy option as the sanctions and future limitations placed on you are severe. For more information on bankruptcy visit the United States Courts website.

If you are in debt then they are just some of the options available to you and you should always seek professional financial advice before deciding which debt solution is best for you.

Many may be wishing they had a finance degree online, or the equivalent after the credit mistakes that have been made.

Article written by Les Roberts, debt specialist at

Fastest way to become debt free

Fastest way to become debt free

Eleanor Simpson is a debt counselor for Franklin Debt Relief, the leading company in debt settlement programs for consumers.

Are you looking for the fastest way to become debt free? Bankruptcy is no longer the best option, since the 2005 overhaul significantly reduced the number of consumers who qualify for financial relief. Balance transfers or ten-year consolidation loans are not quick fixes either. You could always work another job or sell your possessions, but the extra effort and stress is often not worth the payoff. Fortunately you have access to experienced debt relief  professionals who will work with your creditors and can slash the amount you owe by up to 60%. Debt settlement services can help you become debt free in as little as 12 to 36 months. If you are behind on your credit cards, store cards, personal loans, etc. by 90 days or more, your creditors want money and they will settle to obtain it. Depending on your situation, you have two plans from which to choose: lump sum settlement or periodic payment settlement.

In a lump sum settlement, the debt relief service negotiates with individual creditors and collection agencies to find a
single, final payment that will end their harassment. This payment is typically 40 – 60% of your balance and completely satisfies the debt. A lump sum settlement typically takes four to twelve months and then the debts are marked as settled on your credit report.

The second option is a periodic payment settlement. In this scenario, your debt relief service still negotiates with your
creditors, but you will continue to make payments until the settlement threshold is met. This option is convenient for
people who cannot afford to make a lump sum settlement payment, but it does take two to five years to complete. A
periodic payment settlement is still a better option that attempting to make minimum payments on high-interest credit
cards to become debt free.

Working with debt relief services is the fastest way to become debt free. Use the experience of these financial professionals to navigate complex legal requirements and convince your creditors to work with you. By negotiating a simple settlement agreement, you can gain a fresh start to your financial future.

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