Posted: April 10th, 2012 | Author: Joe | Filed under: Credit, Debt, Tips | Tags: Credit Debt, Debt Negotiation, debt settlement, debt solutions | 6 Comments »
If you’re one of the millions of credit card holders who has found themselves buried in credit card debt with a balance you can’t hope to pay down, then you may be wondering if you can Negotiate Your Credit Card settlement yourself. Well, it is possible to do, but it’s not easy.
3 Ways To Negotiate a Credit Card Debt Settlement Yourself.
The first thing you need to consider is what kind of arrangement you are going to seek. Let’s be honest, you’d like your credit card company to forgive all your debt and pretend it never happened, but short of bankruptcy, that isn’t likely to happen.
Once you’ve accepted the reality that you will need to pay something, you need to determine what that something will be. Here are 3 possible debt payment solutions to offer to your credit card company when you make the call.
I. Lump-sum settlement.
This is by far the easiest to understand and to sell to your credit card company, but it’s often the hardest to carry out, because you need a large sum of money available.
Since most credit card issuers aren’t going to negotiate until you are behind, one strategy is to stop making payments to the credit card company and put that money (and as much extra as you can afford) into a savings account for a few months.
This is what many debt settlement companies do for you, or at least it’s what they say they will do for you. In many cases, they hold the money and let the credit card company come after you for the full debt owed anyway. It’s a big reason why debt settlement is not a good idea in many cases.
If you have access to a chunk of money, they you can make an offer to your credit card issuer for a 1 time payment that is less than the full amount you owe.
WARNING: This technique will likely hurt your credit score, but then again so will having a high debt balance and not paying it off…
II. Workout arrangement.
This is a much easier option to carry out than the lump sum. The Workout arrangement is when the bank agrees to freeze your interest payments and late fees while you payback your balance. This is also the most ethical solution in my opinion, because you’re telling the credit card company that you will meet your obligations and pay back what you owe, as long as they agree to stop pushing you back under while you do it.
WARNING: You will most likely no longer be able to use your credit card, since the bank will probably lower your limit. This is a good thing in the long term though, since it will keep you from racking up even more debt. However, the lower credit limit will increase your debt-to-income ratio, and lower your credit score.
III. A Forbearance Program.
This one is probably the easiest solution to sell to the credit card company, but not the best for your bottom line. A forbearance program is an agreement by the bank to pause your payments and interest fees while you get your finances back on track. This is like taking a timeout to gather your resources for the next play.
The next play though is usually getting back on a payment plan in which you agree to pay the full amount owed and any interest and late fees accrued – forbearance is not forgiveness.
Final thoughts.
Whichever solution you choose, keep in mind that these are tough times for everyone – credit card companies included. They can’t get blood from a stone and they know that. Credit card holders still have a lot of leverage and everything is negotiable. Job loss and negative home equity have put the squeeze on banks trying to collect full payment.
You can use one of the debt solutions from above as a starting point, then see what else you get bargain down in the process. For example, you might get the bank to forgive all late fees and interest fees and give you a forbearance if you agree to pay the full principal. It all depends on your situation, and is up to the individual creditor.
Regardless of which solution to choose, be sure to get your credit card issuer’s agreement in writing before you send them any money.
Also, be sure to read How to Negotiate Your Credit Card Debt for more detail on the actual process behind making the call.
…and for your own sake, stop living beyond your means or you’ll find yourself back in the same place further down the road. It’s the number 1 reason why Debt Settlement And Loan Consolidation Don’t Work.
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Posted: April 3rd, 2012 | Author: Joe | Filed under: spending, Tips | Tags: Cable, Cable Bill, cutting the cord, How To, save money, Spend less | No Comments »
An increasing number of people are wondering how to lower their t.v. cable bill or even how to cut the cable cord altogether. It’s no mystery why. The average American family with cable t.v. is paying over $900 a year for the service.
What would you do with an extra $900 in your pocket this year?
Aside from saving money, you may find you have more free time as well. Cable television feeds the viewer a constant stream of programming. This leads many to plan their lives around when their favorite shows are on, and spend the remainder of their time channel surfing in the hopes of finding something to fill the void.
Cutting the cord changes your life. It does so because alternative providers don’t provide content in the same way – they provide it more like a menu of available shows. Not quite a la carte, but closer than cable. It’s a bit of a mind shift, but it puts you in control of your life again.
Since cutting the cord, my wife and I find we watch tv when we want, and when there is a show we’re interested in. The rest of the time we used to spend channel surfing we now spend talking, reading or just plain living.
I know many others who report a similar phenomenon. I hope that you can experience it too.
Now, without further ado, here’s how to cut the cord on cable t.v., save hundreds of dollars doing it and learn to live again.
Step 1. Determine your “must see” t.v. shows.
Every cable television customer I’ve ever spoken with admits they only watch a handful of channels or shows, yet pay for a tiered package of hundreds of channels encompassing thousands of shows. Most of their television watching time amounts to simple channel surfing and complaining that “there’s nothing on”.
Alternative television options don’t work like that. Aside from the Dish Network, or DirecTV, you don’t get a one-stop provider that will give you everything you get with cable t.v.. Of course, going with one of those other content providers won’t free you from large monthly bills either.
Since the point of this operation is to replace your existing cable with alternative providers but at a lower price, we need a list of shows you consistently watch. Mark the “must see” shows in your list, and start with those.
Step 2. Find out where you can watch your shows online.
Once you have your list of shows, it’s time to figure out where you can watch them. Netflix and Hulu are 2 wildly popular streaming content providers. Amazon is another. The trouble is, none of them has all the shows available. Many shows are only available on one or the other – not all.
You may be lucky and find that everything you watch is available through Netflix, or you may be like my wife and I and realize that most of what you watch is on Netflix, but one or two of your “must see”s are only on Hulu.
For a more in depth look at various providers, read: Where to watch online content streamed to you television.
Step 3. Determine how to stream online content to your t.v..
Once you have your list of shows and verified they are available from alternative sources, you’re ready to proceed.
In this 3rd and final step, you need to determine what kinds of hardware, if any, you will need to make the magic happen.
Unfortunately there’s really quite a bit of information to impart for this step, and I don’t want this post to go on forever.
To that end, I have shared that information here: How to stream online content to your t.v..
Good luck and happy cord cutting!
A word of caution
I feel I should offer a few words of caution as an addendum to this post, to help you avoid being burned one last time by your cable provider. This has happened to some cord cutters – don’t let it happen to you.
Some cable providers charge less if you bundle your cable and internet services together and will charge a higher rate for just internet, so be sure of your provider’s policies before you drop the cable t.v. service.
If you are unlucky enough to have such a cable provider, you can find other high speed internet providers in your area. As a rule of thumb, you want at least 5mbps download speeds, but higher is better.
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Posted: March 29th, 2012 | Author: Joe | Filed under: spending, Tips | Tags: Cable, Cable Bill, cutting the cord, Saving Money, spending | 1 Comment »
If you’re like me and millions of other Americans, you’re tired of paying close to $900 a year for cable television. In this post I will discuss how to watch streaming t.v. shows on your television after you’ve learned where to watch t.v. shows without cable service.
Streaming programs to your television.
The first thing you need to determine is whether you can stream programs straight to your television, or if you need an additional device to get the stream to your television.
Many HDTVs sold in the few years are “smart t.v.’s” -televisions that connect to the internet, so it may be as simple as plugging the internet cable into your television.
Even if you have a traditional t.v., you can still watch full episodes of your favorite shows from the internet on your t.v., however, if your television does not have an HDMI input you will have a more difficult time.
For the remainder of this post, I will focus on watching streaming t.v. shows on a non-Internet ready television.
Pick a device.
There are a host of devices that connect to the internet and/or home network and let you stream online content to your television.
Inexpensive Blue-ray dvd players, like the Sony BDP-S580 Blu-ray Disc Player (which currently retails for $112) provide internet access to Netflix , YouTube , HuluPlus , Pandora , and more. That’s just one example, there are many internet ready Blue-ray players on the market.
Some are wi-fi ready, and others aren’t. Just be sure that if you’re going to buy a new player for streaming t.v. content that you get one that suits your situation. In other words, don’t get a player that’s not wi-fi ready when you have no means of getting an internet cable to connect to it in your living room.
Besides the internet enabled Blue-ray players, there are other HD streaming media player devices like The Boxee Box by D-Link and the many flavors of Roku. And of course, there’s the Apple TV for all you mac lovers out there.
I wasn’t sure what to get or even if this whole experiment to cut cable was going to work when I set out to try it, and I didn’t want to drop $150 or more on a device I wasn’t going to use. Instead, I went with the Roku 2 HD Streaming Player, for $69. I had a $50 Amazon gift card from Christmas, so I felt a little better about the purchase. Even so, $69 is a small price to pay to free yourself from the cable beast.
I have to say that I am very impressed with the Roku. It’s tiny -I mean “fit in the palm of your hand” tiny. It’s so light weight that the HDMI cable weighs more! But the performance is quite good. Not as good as the Sony Blue-ray player we have, but that’s a hard line into the internet and just a better device overall. This is also due to this Roku being the 720 HD version. If I was going to rely solely on only my Roku for streaming content, I’d probably upgrade to the Roku XD 1080p Streaming Player.
But I use the Blue-ray as my primary Netflix and Hulu Plus device. I use the Roku for everything else, like PlayOn.
If the device you’ve chosen is wireless, as I suspect is the situation for most people these days, you may need to upgrade your network to get the best quality and performance.
How to stream online content to your t.v..
Television programming from the internet can be sent over your wireless network to your t.v. or through a traditional Ethernet cable. If your device or television accepts direct connection via Ethernet cable, then it’s as simple as plugging it in. However, if your device requires wireless internet then you will need a router.
If you already have a wireless home network you may be ahead of the game, but if it is more than a few years old you may need to upgrade to get the best performance. This was the situation I was in. My home network router was about 6 years old and provided what I needed for basic internet use, but it just could not keep up with streaming HD video.
Here are the Best 5 wireless routers recommended by CNET Reviews:
I went with the ASUS because it was on sale for $119 and I found a promo code to drop it to $109, but that was a rare alignment of sale and promo code. It’s also a dead sexy device. 
Spending over $100 on a new networking device seemed like a lot since we’re trying to cut our cable bill and lower expenses, but once we realized that it’s a 1 time expense and we will be saving that much in 3 months without having a cable t.v. bill, it quickly became a justified expense.
Streaming live t.v..
Streaming live t.v. shows from the internet can be done with additional services, like PlayOn.tv. Basically, services like PlayOn run on a computer in your home that is connected to your network, and takes live shows from the internet and streams them to your network device like Roku or Boxee to your t.v.. Live streaming is most important with sports. Most other shows can be watched only a week later over the internet, and would behave like watching a show over DVR.
It’s also important to note that some television shows are not available on Netflix, or Hulu Plus. Some are only available on Hulu basic or on the network website. CBS shows are a good example of this. One of my personal favorites is NCIS. You cannot watch full episodes of NCIS anywhere except the CBS.com website. I have no idea why CBS doesn’t license the show to Hulu, but they don’t. So the only way to watch NCIS (and some other current CBS shows) is to use a service like PlayOn, or connect your pc directly to you television.
Final thoughts.
Cutting the cord is a trade off. you’re swapping some channels and options for a lower monthly bill, or possible no monthly bill. Much of the costs described in this post are 1 time expenses, unlike your cable bill.
Once you cut the cord, and purchase the necessary equipment, there are no rental fees, broadcast fees, miscellaneous fees or any of the other hidden charges cable companies love to stick you with.
Just be sure to get your ducks in order before you cut the cord, because getting all your shows in one place is not as simple as it is with cable. Many of the devices and/or hardware can be purchased piecemeal too. You can try Netflix and Hulu Plus for 30-days free. I recommend doing so before you cancel cable. That way you can see if those providers are going to work for you.
Also, keep in mind the minimum internet speeds for movie and television quality:
- 5 mbps for 720p HD
- 10 mbps for full 1080p HD
- 10+ mbps for 3-d HD content
You can check your current internet speed at Speakeasy Speed Test.
Happy cord cutting!
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Posted: February 21st, 2012 | Author: Joe | Filed under: Insurance, Tips | Tags: Auto Insurance, Insurance, Life Insurance, PMI, Private Mortgage Insurance, Tips | 3 Comments »
Fear sells, and nothing is more fearful than the future. Insurance agents have known this for ages, and the most unscrupulous of them will play up the fear factor to the hilt. That’s not to say that all insurance is unnecessary or that all agents are fear mongers. Insurance has a definite purpose – to protect you from the financial risk of some future event that, while unlikely to happen would be financially devastating if it were to happen.
Many insurance policies sold today are simply unnecessary in most cases. Knowing which policies are needed and which aren’t will go along way toward arming yourself with the knowledge needed to protect yourself from less honest agents.
1. Private Mortgage Insurance (PMI).
First up on the hit parade is the onerous PMI. Many homeowners only become aware of this after they buy a home an see their monthly mortgage payment has this extra fee included. PMI has nothing to do with protecting you or your home. It’s insurance for the bank to insure against the possibility that you default on your mortgage.
You didn’t expect the bank to pay for its insurance, did you?
Private Mortgage Insurance is required for loans with less than 20% equity – either a refinance for more than 80% of the value of the home, or a mortgage with less than a 20% down payment.
PMI can only be avoided in the initial opening process of the loan, after you’ve got the loan you have to wait until you have at least 20% equity in the home. This can be due to appreciation in the home’s value, which is unlikely in the current housing market, or by paying down the loan. Homeowners can accelerate this process by making extra payments – just make sure they are principal only payments.
(check out Why A Mortgage Loan Without PMI Is A Bad Idea.)
2. Extended Warranties.
An extended warranty is basically insuring against a breakdown of the product outside what’s covered by the basic warranty. That may mean a breakdown after the basic warranty has expired, or a breakdown of something not covered by the basic warranty.
Unless you’re purchasing a high-ticket item, the warranty is likely to cost almost as much as a total replacement. I paid $115 for my first lawnmower. At the time of check out, the sale clerk tried to upsell me on a 3 year extended warranty. I would “only” cost me 30 bucks a year. That would have been $90 in total – for a $115 lawnmower!
The dirty little secret on most warranties is that they only cover the things that rarely go wrong to begin with. So in most cases, you’re better off playing the odds that it won’t break. This is especially true if you save up the entire purchase price of the item before buying, and don’t buy on credit. Also, waiting for prices to come down helps too. I might be tempted to get the extra warranty on a $5,000 new flat screen television, but a $700 one? Not so much.
But then, the thought of spending so much on a “want” makes my frugal self revolt.
3. Automobile Collision Insurance.
Collision insurance is meant to cover the cost of repairs if your vehicle is involved in an accident. This isn’t necessarily useless. It depends on your financial situation and your car. I drive old cars that I can either pay for entirely or pay for mostly, leaving me with a lower loan amount.
Banks typically require you to carry collision insurance, so if you have a loan you will likely get stuck with this bill. But after the loan is paid off, the car is likely worth less that the insurance premiums you’re paying (are darn close)! In which case, you’d be better off putting that money into a savings account for car repairs (should they arise) or a new(er) car.
4. Rental Car Insurance.
People buy this?
Apparently they do, but they probably shouldn’t. Most people rarely need a rental car while their car is in for repairs, and if they do the cost is far cheaper than what they would pay in premiums. Personally, the few times my car has been in the shop long enough to need alternative transportation, the shop has provided either a loaner car or paid for the rental car.
5. Flight Insurance.
I’m not sure what this is meant to cover. I gather it’s meant pay your survivors should you die in a plane crash, but your life insurance would do that anyway.
6. Water Line Coverage.
Ah, now we’re getting to the really fringe insurance types.
This policy would cover the repair costs of the water line that runs from the street to your house. The likelihood that this would ever become a problem is slim – especially in new neighborhoods and given the relatively short distance covered in most suburban neighborhoods.
7. Life Insurance for Children
Life insurance is meant to cover the income of the insured in the event that they die prematurely. Children don’t have dependents to worry about. Some agents try to sell this kind of insurance as an investment for the child’s future. This gets to the Term Life Insurance vs. Whole (or Universal) Life Insurance debate. (see Life Insurance: What kind should I buy?) The same is true in this case – skip the whole life policy and invest the money that would go toward a premium in a Roth IRA for the child. (See Secret # 2. Make Your Grandchild a TAX-FREE Millionaire!) It will perform better with less fees and he’ll have access to the contribution amounts for his first home, while the rest will continue to snowball toward retirement.
This is meant to cover your expenses if someone steals your card or makes fraudulent purchases. It’s a complete waste because you’re only liable up to $50 by law, and most credit card companies wave that for good customers.
9. Mortgage Life Insurance.
Mortgage life insurance pays off your house in the event of your death. This is useless, since it’s the purpose of Life insurance to begin with , only life insurance will pay off the mortgage, and your children’s college expense and anything else you need.
10. Unemployment Insurance.
With government unemployment benefits lasting over a year, you’re far better off building an emergency savings account and using that to supplement the unemployment checks. If you can make Unemployment Insurance premium payments, you can make contributions to an emergency fund.
Check out the inspiration for this article and 5 more unnecessary Insurance Policies.
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