When used smartly, with prudence and financial discipline, credit cards can be quite a convenient financial tool that can help you manage your rolling money better. However, anyone who has ever missed a credit card payment knows that missing timely payments of your credit card bill is one of the cardinal financial sins. Missing the due date of your credit card bills can have significant financial implications that could affect your overall credit worthiness.

Many falsely believe that paying the minimum amount due on your credit card bill is sufficient to avoid interest on the outstanding bill amount. However, your entire outstanding credit card bill will attract interest charges, irrespective of the amount that you have paid. Missing a credit card bill payment means a late fee will be levied when you fail to pay the minimum amount due by the bill due date. The longer the delay, the charges and late fees keep piling on and a heavy interest is levied on outstanding bill amount.

Depending on your card issuer, the annualized interest rate on this outstanding amount can go up to as high as 45% p.a.While there is a short window of interest free grace period that the RBI directs card issuers to allow and you can avail this window to pay any pending bills that you may have. However, missing a payment means that your credit score is likely to be adversely affected and the card issuer may reduce your credit limit too.

If, for whatever reasons you are unable to pay your outstanding credit card bill, contact your credit card issuer to convert your purchases into equated monthly installments. However, it may cause problems should you decide to apply for a consumer loan in the future.

Debt management plans are usually offered as a part of a debt consolidation solution to your various debt problems. According to doylesalewski.ca it is a great way for you to seize control of your own finances and eliminate any unsecured debts you may have at the same time. Remember that unsecured debts are those that aren’t covered by a collateral asset such as a house or car. Typical unsecured debts include credit cards and student loan payments.

How it Works for You

When you sign up for a debt management plan, you are required to make a deposit every month to the company you signed up with. This deposit is used by the advisors at the company to pay off each of your multiple debts in a schedule that has been negotiated and agreed upon with the people you owe money to.

This monthly deposit you make is one that is determined by how much you can afford to pay each month while living frugally. You are informed of the amount you will pay before actually signing any agreements. You can have the monthly payment amount suggested to you by letting the debt management company analyze your income and expenses.

The Benefits of Using Debt Management Plans

These plans are made for a single reason – to keep your organized. This is the main advantage of such a program. It doesn’t reduce how much you owe, of course, but makes it far easier to pay off the debts because you make them on time. You can also finally make a budget for yourself that has a set goal and is realistic, without overdoing your spending on debt payments. These regular payments you make to pay off your debts also serve to improve the look of your credit score as time goes by, meaning that your creditors will no longer need to call you every two days to remind you about your outstanding payments.

Choose the Right Counseling Company

There are many credit counseling companies out there that are willing to help you manage your debt with a debt management plan. Most of these claim to be non-profit, while others will charge you for their services. You should always try to find a company that has trained, qualified and certified counselors working for them. Agencies like the Consumer Protection Agency, the Better Business Bureau, and the local DA office can help you identify companies that have a good reputation without any complaints or a history of bad service.

Points to Consider When Signing Up

It can take over three years to pay off all your debt using a management plan. While paying off your debt, you will have to live more modestly than you are used to. You also won’t be able to take out loans or apply for new credit cards while you are enrolled in the plan. If your payments on the plan are late, your costs may rise over time, and you will be at risk of having to stay in it for longer. With all these in mind make the right decision for yourself and your bank account!

Do you have some money saved up? It is completely normal to want to see that money grow in investments. If you happen to be in debt, though, investing seems like nothing more than a pipe dream. How do you get out from under a mortgage while investing money at the same time? Well, fr.doylesalewski.ca says that you can do just that. There are many ways in which you can balance your debts while investing in new ventures.

Know the Types of Debt You Have

Your ability to invest while in debt is based on the type of debt you’re trying to pay off. Some types of debt make it a very bad idea to invest in other ventures during. Others are not so bad. High-interest debt is the worst kind. This type includes credit card debts and similar situations where the interest rate is more than 10%. Low-interest debt, on the other hand, is easier to invest during. This includes car loans, mortgages, and bank loans for personal use.

Why Should You Invest While in Debt?

Getting rid of debt is a process that takes a long time. Loans that last for up to 30 years exist. You don’t want to dedicate all your time and money to paying off these debts and find that you have nothing waiting for you at the end of it. When you pay off debt on its own without investing, you gain financial freedom at the end of the period. This comes at the cost of less time for any future investments to mature. If you start a portfolio right now, the time value of money is such that a $100 investment today could yield over $10000 at the end of the 30-year period of your loan. This value depends on the interest rate of your investment over this period of time.

You Need a Different Portfolio

Investing while in debt is different to investing in ventures in the traditional way. The difference here is that instead of making low-risk investments you use that money to pay off your loans and long-term debts. The returns, in this case, include a reduced debt balance as well as the return on your high-risk investments including stocks. The higher the risk you take with your investments, the less money will go towards your loan payments. Of course, you need to consider budgeting to make sure that regardless of your investments you will still have just enough to pay off your loans.

Investing is still possible when you’re in debt. The question you should be asking yourself is: should you? This is a very personal decision. It depends on your confidence, your ability to assess risk vs. reward, and much more. This isn’t something that should be engaged in on a whim. You’ll be making some high-risk investments. Make sure you’re psychologically ready for this adventure. You don’t want to wind up demotivated and possibly depressed because an investment falls through. Learn to roll with the punches and focus on managing your debt too.

The biggest nuisance with applying for a home loan is getting the application rejected. While there are many reasons that lead to a loan disapproval, having a low CIBIL score is a major factor, which makes getting a loan seem impossible. However, there are several ways around the CIBIL score that can get your home loan approved. Here are some alternate ways that may help you to get your home loan approved, irrespective of your CIBIL score.

Consider your income

If your source of income is good enabling you to repay your home loan on time without adding any financial burden on you, you can get your application approved even if your CIBIL score is lower than the required number.

Check your family’s CIBIL score

If you have a bad CIBIL score, you should consider the score of your spouse, either one of your parents and other family members. With a good CIBIL score in the family, you can request them to get your home loan application approved by simply becoming a joint loan holder.

Turn to lenders that offer loans with low CIBIL scores

There are certain NBFCs and HFCs that offer home loans to even individuals with a low credit score. But you may get stuck with comparatively high interest rates on the loan.

Go for loan against collateral

To get a home loan with low CIBIL score, you can even go for collateral security, which includes FDs, shares, assets, etc.. For such loans, lenders don’t bother about the CIBIL score of the applicant.

Getting a low-interest home loan with a CIBIL score of 0 or -1

A CIBIL score of 0 or -1 means you have no credit history that a lender can go through to determine the status of your loan application. You can simply talk to your lender about your creditworthiness and ask for help to get the ball rolling. Show your income proofs, credit appraisals, employer and employment details, etc. to the lender to negotiate the rate of interest.

Once you have secured your home loan with 0 or -1 CIBIL score, make sure that you pay it off on time to get this recorded in your CIBIL report for future reference. Also, keep in mind that foreclosure and arriving at a settlement with the lender is bad for your CIBIL score.

The National Pension System (NPS) is a defined contribution retirement plan offered by the government. The plan is regulated by the Pension Fund Regulatory and Development Authority (PFRDA).

Subscribers must avail their Tier 1 NPS accounts with one of the PFRDA-appointed Point of Presence (POP). The contributions may be invested in 3 asset classes’ viz. equities, government securities, and corporate bonds. These funds are managed by professional fund managers designated by the regulator.

NPS is compulsory for government employees except the armed forces. The plan is optional for the private sector personnel. An increasing number of private sector employees are choosing NPS to take advantage of the various tax benefits available under the Income Tax (IT) Act.

Here is how government employees may choose fund managers

Permanent Retirement Account Number (PRAN)

Applicants are updated about their PRAN application status through an email or SMS. This number is unique for each subscriber, which makes the NPS account completely portable. The applicants may check the status with the POP or the regulator’s website in case the PRAN card is not received.

Choosing the fund manager

Government employees did not have the liberty of choosing their fund manager as available under the All Citizen Model. The state or the central government had the responsibility of choosing the fund managers. However, recently, PFRDA announced that public sector employees will now be at par and may choose their preferred fund manager to handletheir NPS contributions.

Being able to choose their preferred fund manager provides the subscribers an opportunity to assume higher risks and enjoy better NPS interest rate. The returns on NPS contributions depend on the percentage that is invested in the different asset classes. Therefore, by investing the maximum permissible amount (50% of the total annual contribution) in equities offers investors the chance to earn higher returns.

Changing the fund manager

The private sector personnel also have the option of changing the fund manager in case they are unsatisfied with the services. The proposed modification by the regulator also makes the option of changing the fund manager available for the government employees.

Opportunity to earn higher returns

The public sector employer matches the annual contribution made by the employees to the NPS. Having the option to choose their preferred fund manager allows the subscribers to take advantage of investing more in equities, which may potentially increase their returns.

The NPS corpus may be withdrawn on maturity. Investors may withdraw 60% of this amount as a lump sum. The balance must be compulsorily converted to an annuity plan. Subscribers may use a pension plan calculator to estimate the potential returns on their investments.

The revised norms for government subscribers make NPS beneficial for the investors. They may now choose the fund manager and the investment breakdown to maximize their returns.However, the existing system of the government choosing the fund manager will also continue for those subscribers who do not want to make their own choice.