Debt Help

How to Make a Budget

How to make a budget…Many people need to make a budget.  Their spending habits are out of control, or they’d just like to be accountable for all of their incoming and outgoing money.  “How do I make a budget?” is something many people would like to know how to do.  When making a budget, you need to first decide what your motivations are for making a budget. Most people, when asking how to make a budget, want to try and save money and have money to invest or to save for a vacation. But, if you really want to make a budget, it’s very much a possibility.

Once you have decided why you want to create a budget, you need to sit down and figure out what your necessary expenses are. For instance: your mortgage, car payments, cell phone payments, etc, etc. Those are just straight up necessary payments that need to be paid. Once you have determined what those are, you can figure out how much you have left to spend.  You need to sit down and analyze all income that you are making each month.  Then, you deduct the necessary expenses from the income, and you have the remaining amount to divide into other expenses. Say you have $1000 at the end of the month after all bills, you can say to yourself: “Okay, I am going to spend $400 a month on groceries, spend $200 on gas, and put the other $200 into the savings account.” With the final $100, you can make that your ‘spending money.’

Spending money (and spending limits) are important to have, especially if you’re trying to budget because it limits your impulse purchases. By having a little spending money, you can still go to dinner, order a pizza, or do something like that which will appease your ‘desires’ without you going crazy and spending all your money. Once you have done all of this, you will have figured out your budget. A good budget, though, fluctuates from time to time if it needs to. Nothing is set in stone and if you work on it effectively, you can really save some money.  Now you know how to make a budget!  Hopefully it will help you pay off debt!

Best Way to Lower Your Credit Card Interest Rates

Many people who are in debt search and wonder how they can get their credit card rates lowered, especially if they have cards with very high interest rates. Whether your goal is to reduce your debt, lower your monthly payment, or maybe even consolidate your credit cards, everyone would be happy with paying lower interest rates.

I recently missed a credit card payment, not because I didn’t have the money, but because I just forgot. (How many people have been in that position?) They called me the day after it was due, I explained the situation, and paid the money immediately. They didn’t care. My credit card interest rate went from 12.99% to 28.99% and my monthly payment increased by 66%! When you make a budget and are trying to stick to it while trying to pay off your debt, such an increase is brutal, let alone the amount of my monthly payment being applied to the principle was much lower. Can you feel the struggle?

So, I called them, explained the situation while apologizing for missing the payment. I told them that I had gone two and a half years without a missed payment and that I paid as soon as they told me about the overdue payment. That didn’t work. They said it would be about a year until they could lower my credit card interest rates.

So, I just gave up. A month or so later, I was telling my co-worker about it and she encouraged me to keep calling the credit company, and I’ll finally get someone who will lower my credit card interest rate. I didn’t believe her and I didn’t really try it. The next week, she asked if I called, and I told her I didn’t because it probably wouldn’t work, but she kept pushing that I should call… so I did.

And I only called once, and the lady I spoke with lowered my credit card’s interest rate! Not only did she lower my interest rate, but she made it lower than it was BEFORE I missed a payment (10.99%… a whole percent lower!). Plus, she refunded my late payment fee and the extra interest I paid in that month or so that it was at the higher rate! Can you feel the relief that I felt? I would have been happy with 23%, 19%, or 16%… anything lower than 28.99%!

Long story short… keep calling. You will get someone who is willing and able to help you reduce your credit card interest rate, especially if it’s a high rate. Don’t give up… if you have to wait a week and try again, do it! You won’t regret it!

Welcome to Debt Aim!

Thank you for visiting Debt Aim.  We aim to be one of the top resources for you to learn tips and tricks as well as the hard work needed to buckle down and eliminate debt.

We plan to address many topics regarding debt including reducing and eliminating debt, budgeting, using credit cards properly and to your benefit, and finding the best method for you to finally be debt free.

Stay tuned for some great articles!