Articles by Kevin Mercadante - FinMasters

5 Best Credit Builder Loans in 2024 | No Credit Check

Kevin Mercadante — Wed, 27 Oct 2021 10:45:21 +0000

Credit builder loans can place an installment loan on your credit record with little cost and no credit check. That can help you build credit, especially if you have a thin credit file or no credit score.

This guide is here to help you choose the optimal credit builder loan. We’ve assessed nationally available lenders, considering availability, loan terms, APR, credit checks, and more. This should help you decide which credit builder loan is best for you.

In this review:

How to Write a Credit Card Hardship Letter

Kevin Mercadante — Wed, 16 Jun 2021 10:00:07 +0000

If you’re unable to pay your credit card bills, you aren’t helpless. You have several options, and the best course of action is usually to take action: avoiding the situation won’t help! One option is writing a credit card hardship letter.

You may be surprised to learn that credit card companies frequently work with consumers in distress. It gives the company a better opportunity to collect at least part of the debt owed. If they refuse to cooperate, they know the next step for the consumer may be filing for bankruptcy. If that happens, the company may receive no money at all.

That arrangement doesn’t exactly put you in the driver’s seat, but it does provide you with a workable strategy. Remember that the credit card company doesn’t want to send your account to collections. If they do that, they will get only pennies on the dollar. They want you to keep making payments.

Check the Credit Card Hardship Criteria

You’ll need to do some investigating on this front. Most credit card companies don’t provide credit card hardship options on their websites. The information they do provide is often vague.

For example, Capital One will allow you to adjust your payment date to one that’s a better fit with your budget. Discover provides only general guidance, but none that points to their own hardship program.

You can certainly start by checking the credit card company’s website. But you’ll need to contact the company by phone, indicate you’re having difficulty making your payments, then request payment options. They’ll likely route you to the department that can help.

When they do, be sure to take notes. You’ll need to know what circumstances qualify as a hardship and what payment options are available. That information will help you tailor your credit card hardship letter to better meet the company’s requirements. That will improve your chance of being accepted into any payment relief plan they offer.

Many hardship programs are designed to help cardholders who can’t pay because of a major life event they couldn’t predict or control. That can include the death of a loved one, a prolonged period of unemployment, a divorce, or an extended illness.

The company will likely provide specific relief options, which may include putting you on a reduced payment plan, lowering your interest rate, or waiving penalties.

Credit card hardship plans are typically handled by a specific department within the company. You’ll need to contact that department. Try to get the name of an individual you can send the letter to directly.

Sample Credit Card Hardship Letter

You can use the sample below and customize it to fit your own situation.

Daniel D. Debtor
1000 Main Street
Anytown, USA 00001
(999) 888-7777
danieldebtor@email.com

June 1st, 2021

RE: Request for credit card hardship plan for credit card account #1234-1234-1234-1234

To Whom It May Concern:

I would like to set up a hardship payment plan for my credit card account. While I have maintained a satisfactory payment history up to this point, I can no longer do so at the current payment amount. I am experiencing financial hardship and need relief so I can avoid filing for bankruptcy.

My job was eliminated four months ago, and my unemployment benefit is too low to allow me to continue making payments at the current level. Since I have no immediate prospects for reemployment, I am requesting a reduction in my payment to $XXX per month. I believe that I can manage that amount, at least until I land a new job at a comparable pay level to my last position.

I'm enclosing a copy of my unemployment insurance claim award for your review.

Please contact me for consideration as I would like to get this plan set up as soon as possible.

Sincerely,
(YOUR SIGNATURE)
Daniel D. Debtor

Download credit card hardship letter templates:

Credit card hardship letter template for Microsoft Word
Credit card hardship letter template for Google Docs
Credit card hardship letter template in PDF

Please Read Before Using This Template!

This template must be customized to fit your circumstances. You will see instructions for the information that you will need to insert. These instructions are indicated by ____ text.

Be sure that you fill in all required information and delete the ____ text before you send the letter.

Your letter will be less effective if our instructions are still visible!

What You Should NOT Do

You’ll need to incorporate the information required by your credit card company in your letter. There are a few things you should avoid too:

Never lie about your situation. The credit card company has access to your credit report and can easily find out the truth.
Don’t commit to a payment you can’t afford to make. If you can’t afford even a reduced payment, the credit card company can terminate the arrangement.
Don’t miss payments on your new plan. Late payments may be reported to the credit bureaus, and the company may even terminate the agreement.
Don’t try to use your credit card. Even if you’re accepted into a hardship plan, your card privileges will almost certainly be suspended.

Finally, if you’re accepted into a hardship plan, see it through until you pay off your account is. That’s the whole purpose of being in the plan.

What to Include in Your Credit Card Hardship Letter

You should keep your credit card hardship letter brief and to the point. It should fit neatly on one page and clearly convey the most important information.

The letter should include the following:

A request for hardship consideration.
A compelling explanation for the factors that have caused you to be in financial distress.
Documentation supporting that distress. This can include a copy of a divorce decree, death certificate, a medical summary, or evidence of extended unemployment.
Your proposal for a plan (within the options the company provides) that you believe you can afford to work with.
An explanation that you’re working through your circumstances and how acceptance into a hardship arrangement will help you avoid bankruptcy.

Include a specific mention of the prospect of bankruptcy somewhere in the letter. Credit card debt is usually discharged in bankruptcy. If that happens, the company gets nothing.

The Bottom Line

Inability to make your credit card payments puts you in a compromised position. That doesn’t mean there are no options. If you get behind on your credit card payments or feel that you will soon, be proactive and contact the company immediately. Taking the initiative is seen as a sign of good faith, and there’s a good chance that the company will work with you to find a solution.

More Letter Templates

Our collection of free, fully-customizable letter templates is there to help you write effective letters when you need to set up, cancel or complain about something.

Browse Now

The post How to Write a Credit Card Hardship Letter appeared first on FinMasters.

7 Ways to Make Money Online (And the Reality Behind Them)

Kevin Mercadante — Tue, 25 May 2021 10:00:00 +0000

We’ve all seen the fire hose of articles and videos promising an easy way of making money online. Google “make money online,” and you’ll come up with more than 3.9 million results. Many of them – including many of those who advertise heavily – want to sell you some sort of magical key to online riches. But are they telling you the real truth about making money online? Is it possible to make money online at all, let alone to get rich?

It’s a popular topic, and for a good reason: who wouldn’t want to make thousands of dollars each month without even leaving the house?

The truth about making money online is that it is possible. That’s evidenced by the fact that thousands of people are at least making a living online. And a small percentage of those are getting rich!

That sounds impressive, right? But read on…

In this post:

How Long Does Information Stay on Your Credit Report?

Kevin Mercadante — Thu, 11 Mar 2021 12:40:00 +0000

Any consumer who has had a late payment, collection account, or bankruptcy has probably wondered just how long that old indiscretion will stay on their credit report. If you’ve changed your ways and straightened out your finances it can be a bit painful to look back at those items. It’s certainly not fun to have them dragging down your credit score.

If you’ve ever wondered how long information stays on your credit report, here are the answers you need.

Who Makes the Rules?

There are two primary factors determining how long the information stays on your credit report.

The Fair Credit Reporting Act (FCRA) places limits on how long negative items can stay on your credit report.
Credit reporting bureaus may have their own policies that govern how long information stays on your credit report.

Credit reporting bureaus cannot keep an item on your credit report beyond the limit set by the FCRA. They can and sometimes do choose to remove items earlier. The FCRA sets the longest time an item can remain on your credit report, not a minimum time.

How Long Does Information Stay on Your Credit Report?

Positive accounts spend more time on your credit report than negative ones.

Open accounts in good standing remain on your credit report indefinitely. That means they’ll continue to have a positive impact on your credit score.

Closed accounts in good standing will remain on your credit report for 10 years after they’ve been closed.

Negative information will generally remain on your credit report for seven years, though there are some exceptions. This is the 7-year rule.

Some types of bankruptcy will remain on your credit report for up to 10 years.

Hard inquiries will drop off your credit report after two years.

How the 7-Year Rule Works

The seven year rule covers most negative entries on your credit report. But where do those seven years start?

Because credit involves a series of dates, there’s often confusion about exactly when the seven years begin and end. Consumers often wonder if the seven years begins on the date the account was opened, the day it was closed, or some date in between.

The seven-year rule begins on the date of the first delinquency after which the account is no longer made current.

So how does that apply in actual situations?

If you missed a payment on your credit card in May 2020 and never made another payment, the entire account would drop from your account seven years from May 2020.

Now imagine that you missed payments in May and June, brought the account up to date in July, and then missed a payment in September and never caught up. The seven years would start in September.

If you missed payments in May and June, brought the account up to date in July, and then maintained the account in good standing, each missed payment would drop off your record seven years after it was due.

If an account has been on your credit report for more than seven years, you can dispute it. Be sure that you are calculating the seven years from the right date.

If a collector is pressuring you to collect an old debt, remember that the seven years start from the date of the first delinquency, after which the account was no longer brought current, not from the date the debt was sold to the collection agency.

A Source of Confusion

Much of the confusion over the seven-year rule stems from a discrepancy between the FCRA definition of the seven years and the definition used by the three major credit reporting bureaus. The FCRA states:

“The 7-year period referred to in paragraphs (4) and (6) of subsection (a) shall begin, with respect to any delinquent account that is placed for collection (internally or by referral to a third party, whichever is earlier), charged to profit and loss, or subjected to any similar action, upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency which immediately preceded the collection activity, charge to profit and loss, or similar action.”
15 U.S. Code § 1681c

This suggests that the seven years start 180 days after the first delinquency.

In actual practice, Experian, Equifax, and TransUnion all count the seven years from the start of the delinquency. They can do this because the FCRA requirement is the maximum time an item can remain. Credit reporting bureaus are free to drop items from the record before that time as they see fit. They just have to make sure they don’t keep them on record beyond that time.

Not All Derogatory Information Disappears After 7 Years

Most negative credit information will disappear from your credit report after seven years.

There is one notable exception: Chapter 7 bankruptcy. That entry will remain on your credit report for up to 10 years.

Chapter 7 is a complete form of bankruptcy. It discharges all dischargeable debts that exist as of the date the bankruptcy is filed. The clock starts ticking on a Chapter 7 bankruptcy from the date the bankruptcy is filed with the court, and not the date the bankruptcy is discharged.

If you filed for Chapter 7 bankruptcy in May, 2015, it will remain on your credit report until May, 2025.

The Impact of a Negative Entry Changes With Time

Negative entries will remain on your credit report for seven years, or ten for a Chapter 7 bankruptcy. They will not have the same impact on your credit score for that entire time.

Credit scoring models give more weight to recent information. That is true of both positive and negative records.

If you have a long positive history but several recent missed payments, those missed payments will weigh heavily upon your score. The opposite is also true.
If you have a few old negative records but a good recent history, the impact of those negative records will decline long before they actually drop off your report.

For example: A 60-day late payment that occurred five years ago will have less impact on your credit score than a 30-day late payment that happened within the past year.

In that way, negative information “ages out” of your credit report. The account will remain on your credit report for seven years. The impact it has on your credit score will gradually decline.

Severity is also a factor. Negative credit information has something of a hierarchy.

For example: A bankruptcy carries more weight than a minor collection account. A mortgage payment that’s 90 days late will have a bigger impact than a credit card payment that’s 30 days late.

The 7-Year Rule Doesn’t Mean Freedom After 7 Years

The 7-year rule on debts applies only to credit reporting, not to your actual obligation. An account that drops off your credit report will no longer affect your credit score. You still owe the debt. You can still be sued over the debt.

Each state has a statute of limitations that applies to debt. Once the statute of limitations expires, you still technically owe the debt, but the creditor can no longer sue you. You should know the difference between the seven year rule and your state’s statute of limitations.

Different Debts, Different Statutes

Different states have different statutes of limitations for different types of debt. The statute of limitations sets different time periods based on whether the debt is a written contract, an oral contract, a promissory note (installment debt), or an open-ended account (including credit cards).

The typical statute of limitations on credit card debt runs between three and six years after the account becomes delinquent^[1]. It can be as long as 10 years (in Rhode Island).

In some states, making a payment or acknowledging that you owe a debt can restart the statute of limitations.

The statute of limitations is generally longer with installment debt. It typically runs from a low of three years to a high of 10 years. Some states extend the limitation beyond 10 years, including Vermont and Maryland. In Maine, it’s 20 years.

Even if the debt has dropped from your credit report, the creditor can still take you to court until the statute of limitations runs out.

When the statute of limitations expires, a debt is time-barred. The creditor no longer has the legal right to pursue a judgment against you.

Judgments & Tax Liens: Exceptions to the Rule

According to Experian, judgments and tax liens no longer appear on credit reports^[2]. Does that mean you’re in the clear if you have one?

Only as far as your credit report. A potential creditor won’t find out about your tax lien from your credit report, but credit reports are not the only ways that creditors investigate potential borrowers.

Even if a judgment or tax lien doesn’t appear on your credit report, it’s still a matter of public record. A creditor or other party investigating your creditworthiness will have access to either obligation through a public records search. Many creditors perform public records searches as part of their evaluation process.

That makes a strong case for paying off judgments and tax liens as soon as possible. Either may remain a matter of public record indefinitely, but a paid judgment or tax lien is much better than an open one.

The Bottom Line

Debt is not forever. Seven years – or ten years in the case of a Chapter 7 bankruptcy – may seem like a long time, but when that time is over, that black mark will disappear from your credit record. Even before then, its impact will start to diminish.

If you have negative entries on your credit report, you will just have to wait out the time it takes for them to drop off. There is no way to remove a legitimate entry from your credit report, and anyone who says they can do it is probably running a debt relief or credit repair scam.

Your best bet is to work on establishing new positive entries. Those new entries will have more impact on your credit score than the old negative ones, and they will help you improve your credit even before the old entries drop off.

FAQ

How long does bankruptcy stay on your credit report?

Most personal bankruptcies fall into two types, Chapter 13 and Chapter 7. As explained earlier, a Chapter 7 bankruptcy will remain on your credit report for up to 10 years after the filing date.
Chapter 13 is a less extreme form of bankruptcy, and it typically remains on your credit report for up to seven years from the filing date. This will be true even if your repayment plan lasts for five years.

How long do late payments stay on your credit report?

Late payments remain on your credit report for seven years after the date the account first became delinquent and was not subsequently brought up to date. That will be true whether the account remains open or has been closed.
If the consumer brings the account up-to-date it will become a positive credit factor once seven years have passed since the delinquency. At that point, it can even be reported as “never late”.

How long do hard inquiries stay on your credit report?

A hard inquiry will remain on your credit report for up to two years. A hard inquiry occurs when someone requests a copy of your credit report as part of an application for credit.
Soft credit inquiries, where the creditor accesses your credit score without pulling your credit, appear on your credit report but do not affect your credit score.

How long does a collection account stay on your credit report?

Collection accounts can be particularly difficult to assess because they may involve multiple creditors. When the original creditor turns your account over to a collection agency, it becomes a collection account. That first collection agency may sell your debt to another. The debt may be sold multiple times.
As complicated as that sounds, it’s all a single collection account. No matter how many iterations it has, it will be removed from your credit report seven years from the date it was first reported as delinquent by the original creditor.

How long does a charge-off stay on your credit report?

The situation with charge-offs is similar to that of collection accounts. The account will fall off your credit report seven years after it first became delinquent.

How long do closed accounts stay on your credit report?

Consumers sometimes believe an account will be removed from their credit reports sooner if they close the account. This is not the case.
Even if you close an account with negative credit information, it will continue to appear in your credit report for seven years from the date the delinquency or deficiency first occurred. Paid accounts generally have a less negative impact on your credit than unpaid ones, and some newer scoring models may not consider them at all.

The post How Long Does Information Stay on Your Credit Report? appeared first on FinMasters.

Learn How Your Credit Score Is Calculated – 5 Key Factors

Kevin Mercadante — Mon, 22 Feb 2021 11:00:00 +0000

Your credit score is a three-digit number with an outsized impact on your financial life. Understanding how your credit score is calculated can make it easier to build a strong credit record that will help you open doors and opportunities.

The formulas that determine your credit score aren’t just random facts. Understanding them can help you make better financial decisions.

In this post:

What Is Credit Monitoring and Do You Actually Need It?

Kevin Mercadante — Sun, 14 Feb 2021 23:59:00 +0000

A healthy concern over the threat of identity theft is a perfectly rational attitude in today’s information-driven, Internet-based world. All types of information, including your personal information, is online, and much of it is accessed on a regular basis.

In most cases, it’s you or the financial institutions you’re dealing with who are tapping that information. But every now and again an unauthorized third party enters the picture. That’s when one or more of your financial accounts can be compromised. And under extreme circumstances, another party may assume your identity and use it to apply for new credit in your name, or even empty your financial accounts.

The only real protection from that kind of outcome is to be aware of it as soon as possible. That’s where credit monitoring comes in, and why you may want to consider taking advantage of it.

What is Credit Monitoring?

There are different variations of credit monitoring.

At a minimum, a credit monitoring service will monitor your actual credit activity. The basic service focuses on tracking your credit reports to identify suspicious activity or significant changes in your information. The purpose is to give you an early warning of identity theft that will allow you to take prompt action to minimize the damage.

More sophisticated services go into greater detail. This can include alerting you of large-scale data breaches, searching public records, monitoring your bank accounts, alerting you of changes in your address filed with the United States post office, and monitoring social media and the Dark Web for any attempt to sell your personal information.

Credit monitoring services come in a variety of packages, and you can choose the level of protection you want. Obviously, the more comprehensive the protection, the higher the cost of the service.

Do You Need Credit Monitoring?

The answer to this question will depend on your evaluation of the likelihood of your identity being stolen.

The more financial accounts you have, and the more active you are within them, the greater the likelihood will be of your identity being compromised.

If you have only a few financial accounts and your exposure is relatively low, you may not feel any pressing need to monitor your credit on a regular basis.

Identity theft can be a problem even if you’re only a light user of financial accounts. An identity thief isn’t always looking to take over a bank account or credit card. For many, the bigger prize is your very identity.

If the thief can get your name and address, along with your Social Security number or a valid account number, it may be possible to access other information. With your complete profile, the thief can pose as you and apply for credit, bogus tax refunds, apartment leases, and even medical benefits in your name.

The thief will get the benefit of all those activities, but you’ll be held responsible for the cost.

3 Ways to Monitor Your Credit

There are three levels of credit monitoring:

do-it-yourself,
free credit monitoring services,
paid credit monitoring services.

Which you choose will depend on your evaluation of your personal risk.

Let’s consider each of the three ways to monitor your credit.

Be warned in advance that no credit monitoring system is completely foolproof. No matter how thorough the service, there’s always the potential for theft to go unnoticed, or for a thief to slip in under the wire. That’s why the single biggest benefit of credit monitoring is the ability to alert you of theft as early in the process as possible.

Do It Yourself

If you don’t feel the need to sign up for a credit monitoring service, you can choose to do it on your own. Just be aware that the DIY route won’t provide anything close to comprehensive monitoring.

You can start by setting up alerts from each financial account you have. That will include bank accounts, brokerage accounts, retirement accounts, credit cards, and any loan accounts you have.

Alerts can be set up to let you know when your account has been accessed, giving you an opportunity to head off any unauthorized activity.

But setting up alerts with existing financial services won’t prevent a thief from applying for credit in your name. That will require regular monitoring of your credit reports.

You can do this by getting copies of your credit reports. Under federal law, you’re entitled to one free copy of your credit report each year. Since there are three credit bureaus – Experian, Equifax and TransUnion – you’ll be entitled to three free reports.

You don’t need to request the reports from each bureau. Instead, you can sign up for access to all three at Annual Credit Reports.com. That’s the only source authorized to provide your official credit report from each of the three major credit bureaus. For more information, read our guide on how to get your free credit report.

You can stagger receipt of the three reports. For example, you can access one credit report in January, a second in May, and a third in September. That will at least enable you to review your full credit report every four months. When you do, be on alert for any unauthorized activity or suspicious entries.

If you don’t have much experience with credit reports they may initially seem confusing. Start with our guide to understanding your credit report.

Free Credit Monitoring Services

If you want a more formal credit monitoring system but aren’t ready to pay for it, there are plenty of free credit monitoring services. Two of the most popular are Credit Karma and Credit Sesame.

You can also sign up for free credit monitoring services through current financial accounts. For example, many banks, credit unions and credit card issuers offer free credit monitoring as a service to their customers.

Free credit monitoring services won’t give you regular access to your credit reports. They will provide your credit score, including the details that make it up. Since your score is typically updated each month, you’ll need to monitor it for any significant changes.

A 10- or 20-point change in your score is normal. But if you see a 50-point drop and you don’t know why it happened, you’ll need to look closely at the reasons why your score fell.

If there’s any suspicious activity or information, you’ll need to investigate further.

If your personal information has been compromised by a data breach at a company you do business with, the company may offer you free credit monitoring services for a year or more. It’s something of a peace offering to help you minimize the damage from the data breach.

In many cases, the company experiencing the breach will offer credit monitoring to all affected individuals. If they don’t, you should ask the company to provide it. After all, your identity and information have been compromised, and you’re entitled to an opportunity to protect yourself.

Paid Credit Monitoring Services

Paid credit monitoring services give you much more comprehensive monitoring. The service will be regularly tracking activity on your credit report and alerting you of any unusual developments. It’s a more thorough way of staying on top of your credit.

The main problem that consumers have with paid credit monitoring services is cost. Paid services will typically require payments on a monthly or annual basis. And as is typical with these services, you’ll generally be required to put a credit card on file with the monitoring service, so that they can bill you automatically. If you forget about the service, which is easy to do if nothing happens, the billing carries on.

There are literally dozens of paid credit monitoring services available. But if you’re searching for the best service to use, you should take a close look at those offered by the three major credit bureaus. Experian, Equifax, and TransUnion each offer their own credit monitoring services.

Whatever services you’re considering, carefully evaluate the benefits each provides. There are big differences between services.

For example, some will provide monitoring of only a single credit bureau, while others will monitor two or three. Some will even offer identity theft restoration services, as well as insurance to cover the cost of financial losses and legal bills.

For most people, a paid credit monitoring service could be considered overkill. If you are at high risk of identity theft – for example, if you do a lot of business online, if you believe your personal information may have been compromised, or if you have already detected evidence of identity theft – it could still be a worthwhile investment.

Bottom Line

If you’re like most people, you have probably considered some level of credit monitoring. Most of us are aware of identity theft, and most of us want to avoid it. But before choosing a credit monitoring option, you’ll need to assess your risk level.

Do-it-yourself credit monitoring may be all you need. But if you have multiple financial accounts that you use on a regular basis, or if you often conduct business online, you’ll need to consider a more comprehensive level of monitoring. Fortunately, there are plenty of options to fit your budget and your personal preferences.

One last – and very important – piece of advice: the time to protect yourself from identity theft is before it happens. Once it does, it will already be too late.

The post What Is Credit Monitoring and Do You Actually Need It? appeared first on FinMasters.

How to Write a Debt Settlement Letter (With Sample)

Kevin Mercadante — Thu, 21 Jan 2021 11:00:00 +0000

If you have debts that you cannot pay, debt settlement is a way to reduce them. Your debt settlement letter will offer a proposal to settle your debt in full for less than the amount you owe. A well-prepared letter has a better chance of success.

Key Takeaways

Consider Debt Settlement Only When Necessary: Only opt for debt settlement if you truly cannot pay your debts. A settlement can reduce your debt, but your credit score will suffer.
Be Realistic: Your creditor doesn’t have to agree to a settlement, and a very low offer may be refused. Offering as much as you can afford to pay will improve your chances of success.
Require Written Acknowledgment: Get a written acceptance of your proposal before sending any payment so your payment being won’t be treated as partial fulfillment of the debt.

Sample Debt Settlement Letter

You can use the sample debt letter below as a template for your own debt settlement effort. Customize it to fit your individual circumstances.

Review the sample letter, then we’ll break it down with some items to consider for each section.


Daniel D. Debtor
1000 Main Street
Anytown, USA 00001
(999) 888-7777

February 1, 2021

Ms. Ava Ricious
Capricious Credit, Inc.
1 Abyss Avenue, Suite 390
Nowhere, USA 90001
(444) 555-6666

Re: Account #1234567890-X

Dear Ms. Ricious,

In regard to the above-referenced debt, I wish to propose settling the account for a reduced amount. It is not possible for me to pay the full debt, due to my recent (job loss, medical event, divorce, business failure, death of a loved one, etc.).

I understand the importance of settling my obligations, and I propose to settle the debt for $XXX. Please accept this amount in full satisfaction of the entire balance, and report the account as paid with each of the three major credit bureaus, Experian, Equifax and TransUnion.

If you agree to this arrangement, please prepare and mail a letter of acceptance to me. Upon receipt of your letter of acceptance, I will immediately forward payment for the agreed-upon amount.

Sincerely,
(YOUR SIGNATURE)
Daniel D. Debtor

Download debt settlement letter templates:

Debt settlement letter template for Microsoft Word
Debt settlement letter template for Google Docs
Debt settlement letter template in PDF

Please Read Before Using This Template!

This template must be customized to fit your circumstances. You will see instructions for the information that you will need to insert. These instructions are indicated by ____ text.

Be sure that you fill in all required information and delete the ____ text before you send the letter.

Your letter will be less effective if our instructions are still visible!

What’s in a Debt Settlement Letter?

Now that you have a basic idea of what a debt settlement letter looks like, we can get into the details of each section, and why you need to convey the specific information shown.

Address Section

Though the address section may seem like more of a formality than anything else, it includes information critical to a debt settlement proposal.

Your Address

As the sample letter shows, you’ll enter your name, home address, and phone number at the top.

Using a post office box is not recommended, since time may be of the essence. If you visit your PO Box only infrequently, you may miss a deadline included in the creditor’s letter of acceptance.

The Creditor’s Address

Notice that the name of a contact person in the organization is included in the creditor’s address? This is a critical point.

If you simply address the letter to the company, it may never find its way to an individual who will act on your proposal. In a very large organization, correspondence not directed to a specific individual can easily end up in the dead letter file. If that happens, your proposal will never be read, let alone acted upon.

You should send a letter to the person you’ve been dealing with at the company. If there’s no specific individual, make a phone call and get the name of a person likely to be in a capacity to work with your proposal.

The Reference Line

The “reference” line should include the relevant account number. This must be included so the creditor will know exactly which debt you’re proposing to settle.

The account number you’ll include on the reference line should be the one provided directly by the creditor. Account numbers listed on credit reports are sometimes scrambled, which makes them invalid.

The Body of the Letter

The body of your letter should be brief, two or three paragraphs at most. It should spell out the main points of your proposal. Anything more is unnecessary and could be misinterpreted.

Let’s look at each paragraph individually to explain what it should convey and why it’s necessary.

First Paragraph

Your opening paragraph should quickly state the purpose of your letter, which is a proposal to settle the account for less than the full amount.

In the next sentence, you’ll explain why you can’t pay the full amount. This revelation may convince the creditor that settling the debt is in their best interest.

In the last sentence, you should provide a reason why you won’t be able to pay the full amount. It should be a circumstance beyond your control. I’ve listed several within the parentheses, but feel free to include whatever situation may be preventing you from making full payment.

You don’t need to be long-winded here. The creditor will either consider your proposal, reject it, or request additional information.

Second Paragraph

You’ll use this paragraph to present the details of your settlement offer. This will include the dollar amount you’re proposing to pay.

Note that we’ve also added the terms of the settlement. This paragraph should specifically state that your proposed payment will serve as full satisfaction for the entire debt.

If the account has gone into collection and is appearing on your credit report, you’ll also include a request that the creditor report the account as paid with all three major credit bureaus.

This won’t eliminate the collection account from your credit report, but a paid collection is better for your credit score than an open one.

Final Paragraph

In this paragraph, you’re making the assumption that the creditor is accepting your settlement proposal.

As such, you’re also making two important requirements:

That the creditor acknowledges your settlement proposal in writing, and
that you won’t send payment until that written acknowledgment is received.

The second point is especially important. If you send a reduced payment without having written confirmation of your settlement proposal from the creditor, they may accept your payment as a partial payment on the full amount owed, then continue efforts to collect the balance.

Your Signature

Your letter will require your signature because you’ll be offering the creditor a contract, which is settlement of the debt.

If you fail to sign your letter, the creditor may interpret that as an indication you’re not completely serious.

What Should You Offer?

One of the most important components of your debt settlement letter is a single number: the amount you decide to offer. You’ll base that number on your assessment of two considerations.

Affordability. Never offer more than you can afford to pay. If your creditor agrees to your proposal and you fail to make the payment, the agreement will be void and your creditor will probably not consider another proposal.
Acceptability. You want to make an offer that your creditor will accept. You won’t know exactly what a creditor would settle for, so you’ll have to guess. If you go too low the proposal may be refused.

Remember that the average price that a collection agency pays for debts is 4 cents for each dollar of debt^[1]✓ ✓ Trusted source
Federal Trade Commission
FTC is an independent agency of the United States government responsible for preventing fraudulent, deceptive, and unfair business practices.. If you’re dealing with an original creditor, that’s about what they’ll get if they send your account to collections. If you’re dealing with a collection agency, that’s about what they paid for your debt.

It’s not a good idea to exaggerate your financial hardships. Creditors and collection agencies can get your credit report and they have access to the information you submitted when you applied for credit, so they will have a picture of what you can afford to pay.

The Bottom Line

As you can see, writing a debt settlement letter is a fairly simple process. The letter itself is brief, primarily spelling out the details of your proposal, which is all it needs to do.

If the creditor is open to your settlement offer, they’ll either provide written acknowledgment or come back with a counter-offer for a higher amount. Either way, your letter will have accomplished its intended purpose of getting the creditor to accept less than the full amount to get the debt out of your life. Your credit score will take a hit – the creditor may be willing to forget the debt, but the credit reporting bureaus won’t – but you will no longer have to deal with collection efforts or the threat of lawsuits. That’s a start, and you can use that start to begin building a better financial record.

More Letter Templates

Our collection of free, fully-customizable letter templates is there to help you write effective letters when you need to set up, cancel or complain about something.

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The post How to Write a Debt Settlement Letter (With Sample) appeared first on FinMasters.

How Much Can You Save in a Year?

Kevin Mercadante — Sun, 13 Dec 2020 14:10:10 +0000

Articles telling you how much money you should be saving are all over the Internet. They’ll tell you how much you should have saved by a certain age, or what percentage of your income you should be saving. If you haven’t been saving up to this point, articles like that might do little more than make you feel guilty about your “failure” to save.

Let’s take a different approach. Let’s look at specific places where you can find savings in your budget and look at how much you can save. You’ll be pleasantly surprised at the results, especially when you realize these are savings strategies you can implement in your own budget right now.

This isn’t meant to be a complete list, and some of these tips may not apply to you. They are examples of some common strategies that many people can use to save money. Use this list as a starting point. Look critically at your spending habits and see where you can find savings.

Financial independence starts with being a committed saver. And becoming a committed saver starts with learning to live beneath your means. The 10 strategies to save money below will help you to do exactly that.

10 Ways to Save Money

To show you how much you can save in a year, We’ve provided 10 strategies to save money below. Not all will apply to you, but it’s equally possible you’ll be able to save even more money than these conservative estimates.

Use this list as a starting point. Take advantage of the strategies that will apply to you and replace the ones that don’t with others that are more specific to your lifestyle and spending patterns. Flexibility is a critical part of the money saving game.

Let’s get started…

1. Switch to Generic Groceries

Potential savings: $696/year

The average American household spends about $7,000 per year on food^[1]. That works out to be about $583 per month.

Buying generic store brands is typically 20% to 25% less expensive than equivalent name-brand products. If you switch to generic store brands for at least 50% of your groceries, you’ll cut your food bill by at least 10%. If you’re spending an average of $583 per month on groceries, that’ll save $58 each month, or about $700 per year.

2. Replace Cable with a Streaming Service (or Two)

Potential savings: $1.056/year

Cable TV was a great concept when it first came out. You paid a monthly subscription for the service – usually around $20 – and got the benefit of many more channels, fewer commercials (but not always), and better reception in areas where traditional TV signals were weak.

A lot has changed since cable first rolled out. The average cable bill today is over $100 per month. You may have 200 or 300 channels, but you probably watch no more than a dozen of them on a regular basis.

A less expensive option is to go with a streaming service. For example, Hulu offers a streaming library with thousands of TV episodes and movies. They charge $5.99 per month for the basic Hulu service, $11.99 per month for Hulu (No Ads), and $54.99 for Hulu + Live TV – which offers live TV with more than 65 top channels and no cable required.

If you eliminate your cable service ($100+) and replace it with Hulu (No Ads), at about $12, you’ll save $88 per month. On an annual basis, that will save you a whopping $1,056!

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3. Raise the Deductible on Your Car Insurance

Potential savings: $201/year

Car insurance is a major expense, and you owe it to yourself to do whatever you can to lower your premium. One of the most effective ways to do this is to increase the deductible on your policy. The average American driver can save $201 per year by raising their car insurance deductible from $500 to $1,000^[2]. That works out to be about $17 per month.

This is a risky strategy if you have a history of at-fault car accidents. But if you have a clean driving record over the past few years, this is an easy way to save a couple hundred dollars per year. Make sure you have the funds to cover the higher deductible if you do get involved in an at-fault accident.

4. Brown Bag Lunch Instead of Eating Out

Potential savings: $960/year

With an average meal just at a fast-food restaurant running around $8, you can easily spend $40 per week – or $160 per month – just buying lunch out every day at work.

Brown bagging your lunch at least half the time will save $80 per month. That works out to be $960 per year. Higher-priced restaurants may cost twice as much as fast-food restaurants.

A good way to make this strategy more appetizing is cooking larger meals for dinner, with the extra being set aside for daily lunches. Not only will that eliminate the routine of sandwiches, but you’ll also save more money by cooking larger quantities for more meals.

5. Skip One Dinner Out Each Month

Potential savings: $720/year

Dinner for two at a moderately priced restaurant (think Applebee’s, Olive Garden, or TGI Friday) is roughly $60, including tax and tip. It can easily top $100 if you include alcoholic beverages, appetizers, or desserts.

Let’s go on the moderate side and say that you average $60 per dinner. (We’ll assume it’s just you and your significant other, and no children.) If you normally eat dinner out once a week, you’re spending at least $240 per month on the low end. If you have kids, you’re spending a lot more.

$3,459is how much an average American household spends on dining out each year.

Eliminating just one dinner out per month can save $60. That will work out to be $720 per year. It may also force you to up your cooking skills, which may eventually result in less desire to eat out in the first place.

6. Eliminate the Daily Starbucks Run

Potential savings: $768/year

The daily Starbucks run has become a common habit in the American workforce. The cost of an average latte at Starbucks is around $4. If you stop to get a latte every day on the way to work, you’re spending $20 per week or $80 per month. That doesn’t include the days when you may order a food item with your latte.

But let’s say you adjust your habit, eliminating Starbucks four times per week (but continuing to treat yourself on the fifth day). You’d save $16 per week, or $64 per month, more if you normally order food items as well.

7. Have a Garage Sale Twice Each Year

Potential savings: $400/year

If it’s one thing Americans are notorious for, it’s building up large inventories of stuff. Some people even buy bigger houses or rent remote storage space to hold it all.

Don’t throw any of your stuff away. What you consider junk could be items other people will pay real money for. At a minimum, plan to sell it at a garage sale. If you hold a sale twice a year, you can convert your “junk” to cash.

In my family, we’ve averaged about $200 per garage sale. By having two sales per year, that’s $400. If you average the $400 across 12 months, it works out to be about $33 per month.

You don’t have to limit selling excess household items to garage sales only. You can even more easily sell those items year-round through online marketplaces like eBay, Craigslist or Facebook Marketplace.

You don’t have to limit selling excess household items to garage sales only. You can even more easily sell those items year-round through online marketplaces, like eBay, Craigslist or Facebook Marketplace.

8. Kick the Smoking Habit

Potential savings: $2.292/year

It’s now an article of faith that cigarette smoking is the single worst habit for your health. That should establish a negative motivation to quit smoking. On the positive side, it’s also one of the single best ways to save money.

Kicking the habit can save $188 per month if you normally smoke one pack of cigarettes per day at the national average cost of $6.28 per pack:

At $188 per month, you’ll save $2,292 per year. You can double that if you smoke two packs of cigarettes per day, which will save you nearly $4,600 per year. That’s real money, with better health as a bonus!

See just how much you can save by quitting smoking using this calculator:

Go to the full page to use our calculator and see just how much money you can save by quitting smoking.

9. Take Advantage of Spending Round Ups

Potential savings: $300/year

If you’re looking to save money, one of the best ways to do it is through a dedicated savings app. An app like Acorns – which not only helps you save money but also invests the savings – enables you to save money as part of your typical spending patterns.

Acorns work by connecting with your checking account and credit cards. Through a process referred to as Round Ups, each purchase you make is rounded up to the nearest whole dollar. If you purchase a latte at Starbucks for $4.25, Acorns will round the purchase up to an even $5 – which will either be deducted from your checking account (if you use a debit card) or charged to your credit card. The “spare change” on the purchase – $0.75 – will go into savings.

Let’s say you make an average of 50 purchases per month using your debit and credit cards. With an average round up of $.50, you’ll save $25 per month. Acorns will even transfer that money into a managed investment account to help you grow your savings.

Acorns is designed to let you save money by spending money. The strategy is totally passive, so you won’t have to do anything different from what you’re already doing to get the benefit.

10. Set Up a Babysitting Swap

Potential savings: $1.200/year

Depending on where you live, the cost of a babysitter runs between $11 an hour and $22 an hour^[3]. The average of the two extremes is $16.50 per hour. If you use a babysitter once each month for an average of five hours, the typical charge will be $82.50. If you commonly tip your babysitter, the average cost could reach $100.

When my own kids were young, my wife and I got around the babysitter cost problem by setting up a babysitting swap with close friends – another couple who also had young children. The arrangement was mutually beneficial – we each got to have a night out on a regular basis without the high cost of hiring a babysitter.

If you work out a babysitting swap and you normally use a sitter at least once a month, you’ll save $100 every month. This was one of the best money-saving strategies we hatched when our kids were young. And it also made the relationship between us and the other family much closer.

More savings ideas: Here are some of the best ideas to help you enjoy your weekend on a budget.

Bringing the 10 Money-Saving Strategies Together

We’ve been looking at these strategies individually. Now let’s look at what happens when we put them together:

Spending Category	Average Monthly Cost	Reduced Monthly Cost	Monthly Savings
Switch to Generic Groceries	$583	$525	$58
Replace Cable with a Streaming Service	$100	$12	$88
Raise the Deductible on Your Car Insurance	n/a	n/a	$17
Brown Bag Lunch Instead of Eating Out	$160	$80	$80
Skip One Dinner Out Each Month	$240	$180	$60
Eliminate the Daily Starbucks Run	$80	$16	$64
Have a Garage Sale Twice Each Year ($200 X 2 sales)	n/a	n/a	$33
Kick the Smoking Habit	$188	$0	$188
Take Advantage of Spending Round Ups	-	-	$25
Set Up a Babysitting Swap	$100	$0	$100
Total Monthly Savings			$713
Annual Savings			$8.556

Notice that without even doing anything radical – like renting out a room in your home to a boarder or buying a cheaper car – the total monthly savings from the combined strategies easily top $700.

But where you can really see the benefit of these money-saving strategies is in the annual savings – that’s over $8,500 per year!

Now it can be justifiably argued that not all 10 strategies will apply to everyone. If you don’t have children, you won’t be able to take advantage of the babysitting swap. If you’re not a smoker, there’s no habit to kick. But the flipside is that you may save even more money than the table above indicates. For example, if you normally eat dinner out twice a week, and you cut it down to once a week, you’ll save $240 per month, rather than $60.

The point is to use the strategies as a starting point and customize them to your own lifestyle and spending patterns. There are thousands of dollars just waiting to be saved in the typical household budget.

This is a starting point. Adapt these strategies, adopt new ones that fit your lifestyle and spending habits, and start saving!

The post How Much Can You Save in a Year? appeared first on FinMasters.

How to Start Saving Money: A Quick-Start Guide

Kevin Mercadante — Mon, 23 Nov 2020 15:45:10 +0000

Have you been struggling with saving money? If so, don’t beat yourself up – you’ve got plenty of company across the country.

According to the Economic Well-Being of U.S. Households report published by the Federal Reserve System, 48% of Americans have less than $400 in savings available. That included 13% with no savings at all.^[1]✓ ✓ Trusted source
The Fed
The United States of America's central banking system is called the Federal Reserve System. The Federal Reserve Act specifies three primary goals for monetary policy for the central banking system: increasing employment, preserving price stability, and lowering long-term interest rates.

If you have little in savings, or even nothing at all, we’re here to help. Let’s look at some reasons why you should save, the mechanics of how to save money, where to store your money, and how to make saving a habit you’ll continue for the rest of your life.

Why Save Money?

This is a more important question than most people realize. Everything is easier once you know exactly why you’re doing it. If you’re going to go from non-saver to saver, you need a clear idea of what you’ll gain from saving.

So why save money? Let’s take a look at several reasons:

To give yourself a cash cushion. Small, unexpected expenses have a way of becoming big problems if you don’t have the money to cover them. Savings will keep small expenses from becoming big problems.
To become less reliant on debt. Savings can keep you from using a credit card anytime you don’t have the cash to pay for something. Eventually, you may find yourself using credit cards mostly to take advantage of cashback rewards and not because you don’t have the money.
To save for short-term purchases. One of the best reasons for saving money is to make major purchases, like a car, a vacation, or the down payment on a home.
To remove stress from your life. It’s not bills that keep us up at night, but the inability to pay them. Knowing you have extra funds stashed away will make for better sleeping at night and more productive days.
Savings are the foundation of financial independence. As your savings grow and your debts disappear, you’ll reach a level of financial freedom that may seem unimaginable right now.

Each of these benefits can become a reality in your life once you become a committed saver.

How to Start Saving Money: A Quick-Start Guide

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How to Start Saving Money in 4 Simple Steps

Like a healthy diet, regular exercise, or becoming more productive at work, saving money is an activity that gets easier with repetition. Getting started is the hard part, and many of us need a bit of a push.

Try these strategies:

1. Set Specific Savings Goals

For more experienced savers, it’s common to have multiple savings goals. But if you’re just starting out, set just one goal. That will make the process of moving from non-saver to saver easier.

For example, let’s say you want to replace your car next year and the one you want to buy costs about $30,000. Your current car doesn’t have much in the way of a trade-in value, but you want to make a large down payment on the new one to keep the monthly payment manageable.

If you finance the entire cost of the car, the monthly payment will be about $539. But by making a down payment of 20%, or $6,000, the payment will drop to a much more manageable $431.

You don’t have $6,000 for the down payment right now. But if you begin saving $500 per month, you’ll have the full down payment in 12 months. It’s also convenient. If you save $500 per month between now and the time you buy the new car, you’ll be accustomed to making that payment, which will make budgeting for car payments easier.

The purchase of a new car will provide the motivation for you to set a savings goal, and to stay on track with it.

2. Create a Budget and Leave Some Room for Savings

It’s hard to save without a budget. Your budget tracks your income and expenses. That helps you identify expenses you can cut or even eliminate. That means saving money on a regular basis.

If you’ve never worked with a budget before, check out free budgeting software, like Personal Capital. You can assemble and track your bank accounts and credit cards to see exactly where your money is going.

You don’t need to do anything dramatic to get started. Just by setting aside $10 per week, you can save $500 per year. But if you can save $10, you can save $20, $30, and eventually $50 or even $100 per week. That’s when saving money begins to really make a difference and you can set future goals like saving $10,000 in six months!

One of the best ways to save money is to do it automatically. You can have small amounts deducted from your paycheck and automatically transferred to a savings account. Once you’ve created the extra breathing room in your budget, saving part of your paycheck will give you a way to move money into your savings account without any effort or discipline on your part.

3. Supercharge Your Savings

If saving small amounts each week or month isn’t enough, you can fast-forward the process by finding additional sources of income or creating windfalls.

You can get extra income by working more hours, asking for a raise, taking a part-time job or even creating a side business by cashing in on any skills you have. The extra income will make your savings grow faster when added to the money you’re already saving out of your existing income.

Windfalls are one-time events or activities that create a sudden inflow of cash. The most common is an income tax refund, which average $2,812, according to the IRS^[2]. Another example is bonus income, money from a garage sale, or from the sale of personal items.

If you’ve always had the habit of spending windfalls, try redirecting them into savings. You’ll reach your savings goals much faster.

4. Make Saving a Habit

If you want to become a regular saver you’ll need more than a single goal. A series of goals will motivate you to continue moving forward.

A short-term goal might be building an emergency fund so you’ll have a cushion to eliminate much of the financial stress in your life. The second may be to save for the down payment on a car or to pay for an upcoming vacation. You may also have bigger, longer term savings goals, like saving for the down payment on a house. And if you want to look really long-term, you’ll begin saving for retirement.

Whatever objectives you select, having multiple goals will keep you in the savings habit, even after you’ve achieved your first savings goal.

Where to Save Money

Part of saving effectively is knowing where to keep your money. For money that you might need quickly, like an emergency fund, a savings account is ideal. Try these options.

A Local Bank or Credit Union

Either a bank or a credit union will be a logical first choice as a home for your savings. You probably already have a checking account, so it will just be a matter of opening a savings account, which can also be linked to your checking account. As you accumulate extra funds in your checking account, you can easily transfer them over to savings.

Banks and credit unions have the advantage of being local, and you may even have a loan through one already.

High-yield Online Savings Accounts

One of the major disadvantages with most local banks and credit unions is that they don’t pay much interest. According to the FDIC the average interest being paid on bank savings accounts nationwide is a disappointing 0.42%^[3].

If you’re not satisfied with that low yield – and you shouldn’t be – consider high-yield online savings accounts. They typically pay anywhere from 10 to 15 times the interest rate paid by local banks and credit unions. Many high-yield savings accounts pay interest rates that compete favorably with money market accounts, often with fewer restrictions and with FDIC insurance.

Examples include:

SoFi checking and savings account is currently paying 4.50% APY and requires no minimum opening balance.
Citi is currently paying 4.25% APY and also requires no minimum opening balance.
Ally Bank is currently paying 4.25% APY and requires no minimum opening balance.

Each of the above accounts also charges no monthly fees, which will give you 100% of the benefit of the interest earned.

Since these are essentially remote accounts, you’ll probably be less likely to access the funds as frequently as you might from a local bank. That will make it easier for you to keep your savings for their intended purpose.

Longer Term Savings

If you’re saving for longer term objectives, you may choose to put your savings in accounts that offer less access but higher returns. You will probably want to establish a solid emergency fund before taking on accounts of this type, because you won’t be able to withdraw without facing interest penalties. Consider these possibilities.

Certificates of Deposit, or CDs, are savings instruments that commit a sum of money for a fixed amount of time at a guaranteed interest rate. CD terms often range from 6 months to 2 years. This is a great way to lock up savings that you want to commit to medium term goals like building a down payment for a home. Interest rates will vary with the term and amount on deposit. Shop around for the best deals.

Tax-Advantaged Retirement Accounts, like IRAs and 401(k)s are long-term accounts designed to save for retirement. If your employer offers a 401(k) plan you should consider using it, especially if your employer will match part of your contribution. That’s free money, and you don’t want to turn it down. If your employer doesn’t offer a 401(k), consider opening an Individual Retirement Account or IRA. These accounts come in many types. Do some research and consider consulting a professional adviser before setting yours up.

Invest through Robo-advisors

If you have longer-term investment goals, you may want to consider moving some of your savings into an investment account. Don’t worry if you don’t know anything about investing, there are services available that will create and manage an investment portfolio for you and do it for a very low fee.

Robo-advisors are online, automated investment platforms that will create a diversified portfolio – including stocks, bonds, and other investments – with just a small amount of money. You can typically begin investing with as little as $10. Once you open an account and your portfolio has been created, all you’ll need to do is make regular contributions and watch your account grow.

One popular example is Betterment. It was the first robo-advisor and remains one of the largest. You can open an account with no money at all and begin building your portfolio through regular contributions. They charge an annual management fee of just 0.25%. That means you can have $1,000 managed for just $2.50 per year.

Another example is Wealthfront, which will include real estate in your portfolio, in addition to stocks and bonds. They do require a minimum initial investment of $500, but the fee is still 0.25% per year.

One of the very best robo-advisors for new and small investors is Acorns. They’ll create and manage your portfolio for you, though they do charge a fee of $3 to $5 per month.

The advantage with Acorns is that they help you to save money. They do this through a process referred to as “Round Ups”. You connect the Acorns app to your checking account or even your credit cards, and it will automatically round your purchases up and move the spare change into savings, then to your investment account.

For example, let’s say you purchase a cup of coffee for $4.25. Acorns will charge your checking account or credit card an even $5, then move $0.75 into savings. The round-up process will enable you to save money through your regular spending activity. That will enable your investment account to grow without you even noticing.

Create a Savings Ladder

As your savings habit settles in, your goals will expand and you’ll start looking for more sophisticated ways to save. If you’ve reached that point, consider a savings ladder…

You can set up a ladder system for savings that looks something like this:

Short-term savings – these are funds you’ll accumulate for an emergency fund or near-term spending goals like an upcoming vacation or holiday spending.

Medium-term savings – these can include larger savings goals, like saving for the down payment on a car or even a home.

Long-term savings – retirement is the best example of long-term savings, and everyone should begin a plan as soon as possible. Tax-advantaged retirement accounts and investment accounts are ideal vehicles for retirement savings.

This kind of laddered saving setup will not only help you to meet multiple savings goals. It will also provide you with plenty of incentive to continue saving money on a regular basis.

Get Started Now!

Now that you know why you should save, how to save, and where to save, the only thing left to do is get started. And the best time to do that is right now. Start with just $10, then build from there.

The reason millions of people don’t have any savings is because they never got started. Don’t let that be you! Start now, from whatever your situation is at the moment. Don’t worry about how much you’re saving. The goal is to get the ball rolling and create the momentum you’ll need to make saving a lifetime habit.

Looking for inspiration? There’s a whole realm of weird ways to save money that could potentially make a significant difference to your bank balance.

You won’t reach financial independence without becoming a saver, so start now and get on your way!

The post How to Start Saving Money: A Quick-Start Guide appeared first on FinMasters.