Face facts. Being debt-free means living within your means, which means spending only money you have in cash. Sometimes we can’t always give everyone everything they want. Take a step back. Does a three-year-old REALLY need an iPod? The latest toy gadget is often next year’s garage sale item. Be realistic and remember the holidays are about giving from the heart, not the pocketbook.

The first thing to do is to determine how much money you will have. Second, make a list of the gifts you need to buy and determine the amount you can spend on each gift. There are easy ways to cut down on the number of gifts. Maybe it’s time to start drawing names or giving one gift for the whole family.

Some gifts can be made. Cookies with a canister of hot cocoa and an assortment of teas or a basket filled with bags of homemade caramel corn and a few DVDs are great gift ideas for families. A young couple with small children would appreciate a book filled with coupons for a monthly night of babysitting. Cost to you – paper and some time. Value to them – at least $250 in saved babysitting fees and evenings to look forward to all year long.

Not sure of what to get someone? Stay in your budget and get a gift card for your allotted amount. Let friends and family pick out their own gifts at a favorite restaurant or store. If finances are tight for you, times are probably tight for them too. A $10 Starbucks card may not seem like much, but if Starbucks is a treat for your recipient, a gift card is something they could use three or four times. A $25 gift card to a department store can go a long way if the teenager is a bargain hunter and cruises the clearance racks.

Gifts are only one type of holiday expense. Don’t forget about decorations. Determine what you really need. Do you have to have the lighted deer outside or can you skip it this year? Buy items on sale. The weekend of Thanksgiving has great sales. Check with family and friends to trade decorations for a year. It will be new to you and won’t cost a cent.

Planning a big celebration dinner? Prices are cheaper at Thanksgiving, so pick up two turkeys or hams then. Stock up on the stuffing fixings, cranberries and other baking items. Clip coupons to save more.

There’s more green or silver to the holidays than a Christmas tree or Menorah; there’s also money.

I always suggest to being with a budget outline.  Write down your take home pay or net monthly income and subtract out all the common monthly necessities.   Here are some examples:

• First Mortgage
• 2nd Mortgage/HELOC
• Homeowners Insurance (If not included in mortgage)
• Property Taxes (Monthly)
• Property Upkeep (Monthly)
• Rent (If no mortgage)
• Household Needs

• Groceries
• Personal Care
• Health Insurance
• Medication

• Electric /  Natural Gas
• Sewer / Water/Garbage
• Home/ Cell Phone
• Internet
• Cable TV / Sattelite

• Car Payment
• Car insurance
• Gasoline
• Car Maintenance

• Child Care or Support/Alimony
• Student Loans
• Credit Card Bills
• Other Loans
• Tithe / Donations
• Misc Entertainment/Other

By laying the foundation with a budget, you will clearly see where all your money goes each month.  This will help identify wants vs. needs and highlight where to start saving on any recurring bills as quickly as possible.  A budget is also handy to find extra money or decide which ones go unpaid for other unexpected bills.

Once you have outlined a monthly budget see how long it will take to payoff any credit card debt currently owed.

With today’s economy being the way it is many Americans have found themselves overextended on their credit obligations.  Often when someone feels like there is too much month and not enough money they find themselves working harder to save every bit of liquid cash they have left.  When faced with unexpected situations it is hard to make a rational decision on the spot; most of us forget to weigh out the consequences or use common sense.

If you are unable to pay a bill on time, I’m going to start with some simple steps here first.  I suggest you consider withholding payments from items that have no interest, late fees, or report to your credit.  A few examples of those monthly bills could be cable or satellite TV, internet, cell or home phone, electricity or gas, and water.  Now please don’t quote me for saying they don’t charge extra for being late, but at least if you are there won’t be any interest compounded on their late fee like a credit card company. Most people probably don’t think to miss one of these bills in fear of having it turned off, but a majority of them will not take this action until 60 or 90 days of delinquency, and will usually give you fair warning before disconnection.  Also these accounts do not report on your credit each month, they use your credit to turn on the service and will only show a delinquent account if you never ever pay them again.

These steps should only be taken when you are working off a budget and the unexpected bill arrives.  There could be serious consequences if you are attempting to rob Peter to pay Paul and execute this method so please be careful.

In my next blog I will discuss the implications of late credit card bills, auto loans, and home mortgages so stay connected and follow me! www.twitter.com/debtadvice

In the true sense of consolidation, there would be one payment made each month, on the same due date, with only one interest rate. The most traditional form of debt consolidation has been done by refinancing a home mortgage.  This is a dangerous mistake many have made in recent years; exchanging unsecured credit card debt, for an interest only home equity line of credit, which is now secured by the home as collateral.   Although refinancing or obtaining a home equity line may offer the convenience of one payment amount, one due date, and one interest rate, the minimum payment is typically nothing but interest, which doesn’t pay off any of the debt already incurred.  There are two reasons why this becomes dangerous – First, your home secures the line of credit which means if you default they may proceed with foreclosure.  Second, it gives you a lower payment creating a deception that you can now afford to charge more on your credit cards. According to a study by Atlanta research firm Brittain Associates, nearly two-thirds of the people who borrowed against their home equity to pay off credit cards had runup more credit card debt within two years.

There are some companies that offer an unsecured line of credit to consolidate your debt, but this is very unlikely to happen when the majority of your credit cards are maxed out or there have been any type of late payment history.

Many often confuse both credit counseling and debt settlement as a form of debt consolidation.  Yes, they do work to achieve one monthly amount, one due date and in the case of credit counseling one interest rate, but none of your debt is ever put together or consolidated.  It may seem like a very minor issue to many, but to effectively eliminate debt, you first need to understand what you are doing, why you are doing it, and the truth about what will happen and when it does, to make it successful.

To learn more about the most effective form of debt consolidation; debt settlement visit:

http://www.commoncentscreditsolutions.com/page/12/step-by-step-debt-settlement

Have you noticed there seems to be a constant push in society to maintain a good credit rating?

No one wants to have bad credit or be known as someone who doesn’t pay their bills.  However, few realize that maintaining good credit only makes it easier to incur more debt.  A credit score has nothing to do with how much money you make or how many assets you own.  The score is a direct reflection of your credit lines, the length of time they have been established and the amount available to use, compared to the balance owed.

Banks use a credit score to determine the odds of you being able to pay them back.  Obviously a higher score means the odds are good you will pay them back, providing better rates and financing opportunities with little or no verification.  While a lower score means a larger risk, having to provide many documents, along with higher interest rates or lower credit limits. The information gathered in an application or job verification is simply their way of improving the odds that you will pay them back.  Very few references are called before credit is established, but many receive calls once you are having problems paying the bank back.

Often times in our culture today many become overleveraged in debt due to unforeseen life circumstances, such as job changes or medical problems.  When these events occur and we begin to use the “good credit” already established it quickly backfires.  Good credit is often confused by a great payment history. However, when carrying abundant debt or payments, most banks don’t want to loan you anymore credit.  Although you have never made a late payment over 30 days, the amount of debt owed, combined with the maximum usage of credit lines, and the type of accounts, will begin to decline your score.  You may not feel there is a problem while your accounts are still current, but have you ever considered the fact those accounts were not late were due to the ability to borrow on more credit?

Once a credit score starts to decline this indicates to the banks that it is time to change the terms, such as reducing credit limits, raising interest rates or closing accounts.  Simply put, credit card companies set this trap which many don’t see coming, while others who are warned, ignore the advice they were given to stay away.

The good thing about a credit score is that it has no memory and time will always heal all the bad marks.  I encourage many people to look at “bad credit” as a way to pay off their debt already owed, while holding onto “good credit” only keeps you in debt longer.  Worrying about credit when you are deep in debt is like worrying about the couch getting wet when the house is on fire (….you know it is going to get soaked by the firemen…)  There will come a day when you can buy a new couch and there will come a day when you can create more debt with credit again.

To gain more insight about debt relief options please visit: http://www.commoncentscreditsolutions.com/page/5/debt-relief-options

In the USA we all know we have the right to remain silent.  Did you know there is no requirement for you to speak with a creditor over the phone and provide them every single detail about your situation?  A great reason you contract a professional debt settlement or negotiation company is so they can do the talking for you; there is no requirement to tell a creditor you are using a debt relief company and I highly suggest you avoid providing your creditors with their name and number.  First you do not want to raise a big red flag about your situation.  Second every debt collector only wants money!  They do not want to call someone else when they have the responsible party on the phone.  There is nothing in it for them to call someone who didn’t create bill, isn’t responsible for the bill, or attempting to reduce the bill for you – again, they only want money from the person who created the debt and they will say anything to convince you that payment needs to be expedited to them immediately before further action.

There are many people who are absolutely frightened at the idea of someone calling them about money owed.  Many creditors use automated dialers to contact their delinquent clients and are often confused as telemarketers. You may think you can avoid these calls just by not answering them, but this will only compound your problem.  A creditor’s dialing system knows when you have picked up, if there was no answer or if they contacted you.  My advice is to answer the phone, get their information and very briefly let them know there’s been a financial hardship, you are unable to pay them today, and you will contact them when there are funds available to take care of the bill.  Thank the collector for calling you and terminate the call, it shouldn’t take more than a minute or two of your time.  Also by staying on the phone longer you may hear some questions or comments you can do without.  I believe doing this clearly demonstrates to your creditor an awareness of the situation and you are not going to let anyone else be in control. Remember this is your debt and you control the flow of conversation at all times, even when they call you at a bad time.

2. Ignoring a monthly budget.

We all know there are more than one or two life events that could land us in more debt than we care for.  Things happen such as a job loss, divorce, or living leveraged credit card lifestyle- financing everything from the necessities to weekend toys.  A debt settlement program is designed to get you out of debt as soon as possible, within your budget.  Debt settlement requires there to be a sacrifice in the usage of credit and spending in order to revive a savings habit. Debt settlement is only effective on an honest budget.  It will not work just because the monthly savings payment is less than your current monthly minimum payment; you must commit to spending less and staying focused on saving every cent to eliminate your credit card debt quickly.  I suggest eliminating the thought of “there’s never enough money to pay off my debts.”  Instead, think about where your money may be hiding; you may find a few small changes can be made to your budget or even just starting to follow one is really easier than trying to take on an extra job or selling everything owned.

3. Failing to keep in touch with the settlement coach and negotiations team.

Many consumers are not prepared for the upcoming challenges they face to eliminate their credit card debt.  The value in a debt settlement program is the encouragement and support provided by your team of experts; you need to be willing to call on the experts you chose to work with for the help needed. I understand it can be hard to ‘ask’ for help when facing financial difficulty, but failing to use your coach and support team in this process is the worst mistake to make.  Ideally the support team should contact you every other week and you should call them immediately when any questions arise; even minor details.  Understanding how to effectively work with your team of support will resolve any debt problem once and for all.

If you are in a program already hopefully you can avoid these common mistakes.  If you are wondering if debt settlement is right for you, please visit www.certifieddebtsettlement.com

In most algebra equations there’s usually a number which is already given that makes the problem easier to solve.  However, when it comes to compound interest and credit card debt, life’s variables like everyday family needs, car repairs and monthly bills, the math equation is easily confused; going unsolved. 

I suggest for many to start by removing the credit cards from the equation; this begins to make the problem easier to solve.  By starting with the removal of credit cards first, it eliminates a ton of variables such as minimum monthly payments, annual percentage rates, finance charges and late fees just to name a few!  What is left in the equation comes down to time and money; which changes the complex equation to a simple basic math problem like 1-1=0.   If you agree that time equals money, then by saving time to become debt free, it will always save money- no matter what!

As you can see once there’s a simple math problem to solve it becomes easier to find the solution.  It may be painful at first; maybe you’re stuck watching local TV instead of cable and eating at home instead of dining out.  However, a small sacrifice like letting go of credit to become debt free is what needs to be done.  All of us at one point in our life have found it hard to save time and money, but with the right plan of attack, a support team of experts, plus your commitment to controlling the variables, you will see the change you want to see in your debt with less time, for less money!

To learn more about how to solve your debt equation please visit www.CommonCentsCreditSolutions.com

JPMorgan Chase & Co. is raising some balance-transfer fees on credit cards to 5 percent, the highest among the nation’s largest banks, citing increasing regulations and costs after the U.S. put new curbs on the industry….

“This is the highest balance-transfer fee in the industry,” said Bill Hardekopf, chief executive officer of LowCards.com, a Birmingham, Alabama research firm.

Be sure to know the fees your credit card company charges before you take any action that could cost you a lot of money.  Or better yet, get out of debt and stop using credit cards altogether.