How to Pay off Debt Early

Tips to Pay off Debt

By Justin Pritchard, About.com Guide

ou can save a lot of money if you pay off debts quickly. The methods below will improve your chances. Before you choose one, make sure you understand how to pay off debt early with each lender. There may be fees or special steps you need to take.

Does it Make Sense to Pay off Debt Early?

Sometimes it's a great idea to pay off debt, and sometimes it's a mistake. Explore the pros and cons and then make an informed decision:

You can run numbers to figure out how much you'll save (and possibly get motivated). See how fast you can pay off debt with pre-built Excel loan calculators, or calculate loans on your own.

Just Send Money

The simplest way to pay off debt early is to pay extra whenever you can. It’s also the hardest to pull off since it requires discipline. You may want to consider using one of the techniques below if you don’t think you’ll stick to the program.

If you like to fly by the seat of your pants - and you’re confident that you can pay off debts on your own - just send extra payments. Include a note with your check saying 'Apply to principal'. That way, your lender won’t get confused; they’ll know you’re trying to pay off the debt.

One Extra Payment

You’ll pay off debt more quickly by adding an extra monthly payment each year. If your monthly payment is $1200, then pay an extra $1200 sometime during the year. You might use money from a tax refund or bonus.

If you’re like most people, it can be hard to come up with the extra payment. An alternative is to spread the extra payment out over the entire year. Divide your monthly payment by 12 and add that amount to each monthly payment. Your $1200 payment will become a $1300 payment (1200 divided by 12 equals 100; 100 plus 1200 equals 1300).

Pay off Debt with Biweekly Payments

You can also pay off debt by paying every two weeks instead of every month. You’ll end up making the equivalent of one extra mortgage payment each year. When you pay off debt with a biweekly payment, you shouldn’t see a dramatic change to your monthly expenses. However, you’ll see dramatic savings as you pay off debt over the years.

Lender Programs to Pay off Debt

Your lender may have several options to help you pay off debt more quickly. These programs may require you to pay additional fees, so be careful. If it’s worth it to you, go ahead and pay the fees.

If you don’t like the fees, find a way to pay extra while avoiding the fees. You might set up automatic monthly payments in your bank’s online bill pay system. Be sure the checks include a note saying 'Apply to principal' in the Memo line.

Other companies, besides your lender, will also gladly take a fee for a debt payoff program. They sell software programs and systems to handle everything for you (or at least tell you what to do). You generally don’t need these services unless they’ll help solve a discipline problem. If you’re not getting it done any other way, do whatever works - but make sure you save more than you spend.

Sources : //banking.about.com/od/loans/a/ payoffdebttips. htm

10 Side Effects of Bad Credit

How Bad Credit Affects Your Life

As you're maxing out your credit cards and ignoring your bills, you might not realize the effect it's going to have on your credit. Credit card payments and level of debt have the most impact on your credit score. Mess up in these areas and your credit score will plummet.

"What's the big deal with a low credit score," you might ask. Since so many businesses now judge you based on your credit score, having bad credit can make life extremely difficult from getting a job to getting a place to live. Here are some of the most common side-effects of bad credit.
1. High interest rates on your credit cards and loans
Creditors and lenders see bad credit applicants as riskier than their better credit counterparts. They make you pay for this risk by giving you a higher interest rate. Over time you’ll end up paying more in interest than you would if you have better credit.

2. Credit and loan applications may not be approved
Because creditors and lenders think you’re a risk, they might not want to lend to you at all. You may find that your applications are being denied because of bad credit.
3. Difficulty getting approved for an apartment

Who knew that landlords checked credit before allowing you to sign a lease? It’s true. Having bad credit can leave you homeless or close to it.

4. Security deposits on utilities
Utility companies – electricity, phone, and cable – check your credit as part of the application process. If you have a bad credit history, you may have to pay a security deposit to establish service in your name, even if you’ve always paid your utility bills on time.
5. You can't get a cell phone contract
Yep, cell phone companies check your credit too. They contend that they’re extending a month of service to you, so they need to know how reliable your payments will be. If your credit’s bad, you may have to get a prepaid cell phone or go without one at all.
6. You might get denied for employment
Certain jobs, especially those in the finance industry, require you to have a good credit history. You can actually be turned down for a job because of negative items on your credit report, especially high debt amounts, bankruptcy, or outstanding bills.
7. Higher insurance premiums

Insurance companies check credit too. They say that lower credit scores are linked to higher claims filed. Because of this theory, they check your credit and charge a higher premium to those with lower credit scores, regardless of the number of claims you’ve actually filed.

8. Calls from debt collectors

If you have past due bills, chances are debt collectors are calling you for them. It typically comes with the territory when you have bad credit.

9. Difficulty starting your own business
Many new businesses need banks loans to help fund their startup. A bad credit history can limit the amount you’re able to borrow to start a new business, even if you have the greatest idea and the data to prove it.

10. Difficulty purchasing a car
Banks check your credit before giving you a car loan. With bad credit you might get denied or you might get approved with a high interest rate. Most of those “no credit check” car lots charge extremely high interest rates that make it difficult to make your monthly car payments.
Resources : credit.about.com/od/creditrepair/tp/ bad-credit-side-effects. htm

GM in Crisis—5 Reasons Why America's Largest Car Company Teeters on the Edge

Strapped for cash, GM is on the brink of bankruptcy. It's a dramatic shift for a car company that had begun to right itself after decades of trouble. So what happened? We turned to PM Advisory Board Member and Chairman of the Center for Automotive Research, David Cole, for his take. Ironically, GM's perfect storm of troubles hit just as the company seemed to be making progress on a number of fronts: The company is producing its most competitive cars and trucks in decades, and the upcoming 2011 Chevy Volt has generated more excitement for GM than any product in recent memory. On the cost side, the market slowdown has closed factories, which has removed most if not all of the industry's overcapacity of cars and trucks. And when a new labor agreement kicks in, GM's cost to produce a car will fall to a point where it can once again be profitable. That's the good news. The question is, will GM be around to benefit once the economy improves? The troubles at GM are vast and complex, but Cole summarized what he sees as the immediate and long-range factors that have brought the once dominant automaker to its knees.

By Larry Webster

Published on: November 18, 2008
www.popularmechanics.com/automotive/new_cars/4292379.html

(Photograph by General Motors/John F. Martin)

1. Demand Shift and Uncertain Energy Policy
Cole says that "The first shot was the dramatic rise in energy prices this past summer. That caused a rapid mix shift in vehicles—and had a major impact on profitability." GM, Ford and Chrysler have relied on SUVs and trucks for the majority of their profits. Those vehicles commanded high sticker prices and by the late nineties made up 50 percent of the U.S. car market. When demand for the big vehicles dropped quickly and customers went for smaller, less expensive, less profitable cars, auto companies had two major issues to deal with: A loss of revenue and a backlog of unwanted trucks. Cole adds, "A big factor is our lack of an energy policy in this country. We just haven't had one. When we do things like corn-to-ethanol that don't have a foundation in economics or technology, you're really kind of teeing up to a situation where you're going to have a problem."

2. The Financial Meltdown

"The Big Kahuna in this is the financial meltdown," said Cole, "When you're down to 10 or 11 million light-vehicle sales a year, that is such a precipitous fall even from a recessionary standpoint. What has really caused the problem is lack of cash." Wall Street's problems have hit GM in two big ways: The company can't borrow money to ride out the storm, and the credit squeeze has dramatically hindered car sales. The auto industry lives on credit as do its customers, so when access to car loans or leases is limited, sales fall off a cliff. Yearly auto sales in the U.S. have hovered around the 15 to 16 million mark for the past few years and many analysts believe the total for 2008 could be as low as 10 million—the lowest in more than a decade.

3. Legacy Costs

Every car GM makes carries "legacy costs"—the costs of providing healthcare and pensions to scores of retired workers. For every GM worker, there are about 10 dependants, which are defined as retired workers and their families. According to Cole, "When the international car companies came to the U.S., the move stuck the domestics with a very large disadvantage related to legacy costs. And that's $2000 a car." That two grand must be built into the sticker price of any new GM car and truck. And that's money on top of developing, producing and marketing a car—costs that Honda, Toyota and others don't have. It makes competing difficult for the domestic automakers, "like playing basketball with a bowling ball," according to Cole. GM's per-hour labor rate for car assembly is about $75 per hour, compared to $40 to $45 for other car companies. That particular disadvantage, says Cole, will be "gone by the end of next year," when a new labor agreement goes into effect.

4. Sub-Par Quality and Lackluster Cars

Back in the early '80s, while GM president Roger Smith fell in love with the idea of automating workers out of car factories, Toyota and others focused on refining their production techniques and produced much higher quality cars. Customers left GM's brands en masse. The company's market share has fallen from a high of just over 50 percent in 1962 to around 23 percent in 2007. In recent times, the quality gap has narrowed considerably but "perception trails reality," commented Cole. Getting those customers back would require a herculean effort. Vehicle's like GM's very first attempt at a crossover—the sub-par 2001 Aztec—didn't help. Cars like that left customers will little incentive to return.

5. Global Slowdown

GM operates in 41 countries, and if its U.S. operation has been in decades of decline, other markets have been growing, particularly in Asia. But the financial shock has spread across the globe and sales are down everywhere. In effect, GM is bleeding from several wounds. As the largest of the Big Three, GM has been the focus of the media spotlight. But Ford and Chrysler are facing similar problems. And of course, thanks to many of the same factors, even healthy car companies are feeling the pain. The domestic auto companies weren't the only ones that capitalized on our thirst for light trucks. Half of Toyota's offerings are trucks and minivans. The difference is, Toyota doesn't come into this tough period already weakened by past mistakes.
www.popularmechanics.com/automotive/new_cars/4292379.html

GM in Crisis—5 Reasons Why America's Largest Car Company Teeters on the Edge

Strapped for cash, GM is on the brink of bankruptcy. It's a dramatic shift for a car company that had begun to right itself after decades of trouble. So what happened? We turned to PM Advisory Board Member and Chairman of the Center for Automotive Research, David Cole, for his take. Ironically, GM's perfect storm of troubles hit just as the company seemed to be making progress on a number of fronts: The company is producing its most competitive cars and trucks in decades, and the upcoming 2011 Chevy Volt has generated more excitement for GM than any product in recent memory. On the cost side, the market slowdown has closed factories, which has removed most if not all of the industry's overcapacity of cars and trucks. And when a new labor agreement kicks in, GM's cost to produce a car will fall to a point where it can once again be profitable. That's the good news. The question is, will GM be around to benefit once the economy improves? The troubles at GM are vast and complex, but Cole summarized what he sees as the immediate and long-range factors that have brought the once dominant automaker to its knees.

By Larry Webster

Published on: November 18, 2008
www.popularmechanics.com/automotive/new_cars/4292379.html

(Photograph by General Motors/John F. Martin)

1. Demand Shift and Uncertain Energy Policy
Cole says that "The first shot was the dramatic rise in energy prices this past summer. That caused a rapid mix shift in vehicles—and had a major impact on profitability." GM, Ford and Chrysler have relied on SUVs and trucks for the majority of their profits. Those vehicles commanded high sticker prices and by the late nineties made up 50 percent of the U.S. car market. When demand for the big vehicles dropped quickly and customers went for smaller, less expensive, less profitable cars, auto companies had two major issues to deal with: A loss of revenue and a backlog of unwanted trucks. Cole adds, "A big factor is our lack of an energy policy in this country. We just haven't had one. When we do things like corn-to-ethanol that don't have a foundation in economics or technology, you're really kind of teeing up to a situation where you're going to have a problem."

2. The Financial Meltdown

"The Big Kahuna in this is the financial meltdown," said Cole, "When you're down to 10 or 11 million light-vehicle sales a year, that is such a precipitous fall even from a recessionary standpoint. What has really caused the problem is lack of cash." Wall Street's problems have hit GM in two big ways: The company can't borrow money to ride out the storm, and the credit squeeze has dramatically hindered car sales. The auto industry lives on credit as do its customers, so when access to car loans or leases is limited, sales fall off a cliff. Yearly auto sales in the U.S. have hovered around the 15 to 16 million mark for the past few years and many analysts believe the total for 2008 could be as low as 10 million—the lowest in more than a decade.

3. Legacy Costs

Every car GM makes carries "legacy costs"—the costs of providing healthcare and pensions to scores of retired workers. For every GM worker, there are about 10 dependants, which are defined as retired workers and their families. According to Cole, "When the international car companies came to the U.S., the move stuck the domestics with a very large disadvantage related to legacy costs. And that's $2000 a car." That two grand must be built into the sticker price of any new GM car and truck. And that's money on top of developing, producing and marketing a car—costs that Honda, Toyota and others don't have. It makes competing difficult for the domestic automakers, "like playing basketball with a bowling ball," according to Cole. GM's per-hour labor rate for car assembly is about $75 per hour, compared to $40 to $45 for other car companies. That particular disadvantage, says Cole, will be "gone by the end of next year," when a new labor agreement goes into effect.

4. Sub-Par Quality and Lackluster Cars

Back in the early '80s, while GM president Roger Smith fell in love with the idea of automating workers out of car factories, Toyota and others focused on refining their production techniques and produced much higher quality cars. Customers left GM's brands en masse. The company's market share has fallen from a high of just over 50 percent in 1962 to around 23 percent in 2007. In recent times, the quality gap has narrowed considerably but "perception trails reality," commented Cole. Getting those customers back would require a herculean effort. Vehicle's like GM's very first attempt at a crossover—the sub-par 2001 Aztec—didn't help. Cars like that left customers will little incentive to return.

5. Global Slowdown

GM operates in 41 countries, and if its U.S. operation has been in decades of decline, other markets have been growing, particularly in Asia. But the financial shock has spread across the globe and sales are down everywhere. In effect, GM is bleeding from several wounds. As the largest of the Big Three, GM has been the focus of the media spotlight. But Ford and Chrysler are facing similar problems. And of course, thanks to many of the same factors, even healthy car companies are feeling the pain. The domestic auto companies weren't the only ones that capitalized on our thirst for light trucks. Half of Toyota's offerings are trucks and minivans. The difference is, Toyota doesn't come into this tough period already weakened by past mistakes.
www.popularmechanics.com/automotive/new_cars/4292379.html

America's Crisis: Asian Perspectives

Sources : http://www.asiasource.org/americacrisis/ Dec 2008

America's Crisis: Asian Perspectives is a multidisciplinary series of policy, business, cultural, and education programs at the Asia Society that explore recent world events from a variety of perspectives.


On September 11, 2001, the twin towers of the World Trade Center in New York were destroyed and the Pentagon in Washington, DC, partially damaged by suicide attackers aboard civilian aircraft. More than 3,000 people are estimated to have died as a result of the attacks.

American investigations immediately following the attacks led to Saudi dissident, Osama bin Laden, being identified as the mastermind behind this operation.

On October 7, the United States began air strikes against Afghanistan aimed at ousting the Taliban (who had long sheltered Mr bin Laden) , thereby creating the conditions for his capture, and the eventual dissolution of the Al-Qaida network.

The Taliban have since been overthrown and an interim government under Hamid Karzai has been established in Kabul. Mr bin Laden remains elusive.

The American military operation is continuing in Afghanistan and the search for Taliban and Al-Qaida members has been extended into Pakistan, where a number of them have apparently sought refuge.

This Special Report provides some background to the important issues, regions and players involved in this crisis.




Resources

Background
Access background information on the war in Afghanistan, Osama bin Laden, and the Taliban, as well as resources on Islam, reference maps, and suggested readings.

Humanitarian Issues
Keep track of the humanitarian relief effort in Afghanistan, which is continuing alongside the military operation. Also access information on women's issues, the drug trade in the region, and the economic challenges facing Afghanistan.

Interviews
Access interviews, video clips, and a listing of Central Asia experts.

Asian Perspectives
Read commissioned articles, news, and commentary from various Asian perspectives.

Sources : http://www.asiasource.org/americacrisis/

THE SOCIAL IMPACT OF ECONOMIC CRISIS....

Dr. Carunia Mulya Firdausy
(Centre for economic and Development Studies-Indonesian Institute of Sciences)
ABSTRACT The Indonesian monetary crisis, which later became a full blown economic crisis, has made the country from one of the world's fastest growing economy into its slowest growing economy. The impact of the crisis on social -economic aspects of national development until now still persist, and it takes years to come to fix the problems created from the crisis. This paper specifically addressed the social impact of the crisis on employment and examine policy implication and recommendation to reduce the unemployment problem due to crisis in Indonesia. It was no doubt that the economic crisis has increased the number of unemployment in Indonesia. Using data from National Survey of Social-Economic 1998 it was estimated that the number of unemployment was about 4.5 million people (excluding the new entrants of 1998 and the backlog of 1997). To solve the unemployment problems, at the short term, the government should reintroduced policies and programs to reduce interest rate. The importance of the interest rate policy is mainly to encourage the industrial sector to expand their production in achieving their economies of scale. However, the interest rate policy should be carefully designed as to mitigate the impact on the rupiah and inflation. In addition, the role of foreign investment needs to increase in the future. Capital is complementary to labor. During the last few months tens of billion dollars have been sent out of the country causing the huge depreciation of the rupiah and domestic capital shortages of capital, partly causing the sharp rises in unemployment. Much of this domestic capital will never return. Therefore, direct foreign investment is needed to create income by employing the unemployed, facilitate the continued production of the physical capital of bankrupt enterprises, increase the utilization of capacity of manufacturing industries, produce complementary producer and consumer surpluses, facilitate the transfer needed technology and skills from overseas, expedite exports, provide financial and other required services. An finally, the future potential of conglomerates to contribute to economic development must not be squandered. However, the bad past practice of conglomerates, such as the anti-competitive rent yielding and other special privileges granted by the Government should be abolished so that those conglomerates can become efficient, competitive and socially productive enterprises. The rate and nature of the change in the business environment must be such that the potential of the conglomerates, as well as other large enterprises and SMEs (Small and Medium Enterprises) can be realized. However, this is not saying that crimes committed by conglomerate executives and owners should be forgiven. The success of the above policies and programs in overcoming the unemployment problem due to crisis is certainly subject to financial assistance from overseas and political stability in the country. Therefore, it is a must for the government on one hand to maintain the political stability in the country and to seek for international assistance to ensure that many Indonesian do not fall more deeply well below the poverty line. And on the other hand, the government should renew their economic activity and investment that can be sustain in the future as it was before the crisis time. INTRODUCTION The Indonesian monetary crisis, which later became a full blown economic crisis, has transformed the country from one of the world's fastest growing economy into its slowest growing economy. The average annual growth rate which used to be 8 percent since 1970 until 1996 declined significantly to -14 percent in 1998. One of the result of the negative economic growth is the increasing number of unemployment. According to M. Djuhari Wirakartakusumah (1999), the number of unemployed workers in 1998 was about 32 million people or 34 percent of the nation's 94 million labour force. It consists of 13.5 million job seekers and new labor entrants from earlier years and 18.5 million as critical unemployment due to the sharp drop in construction and manufacturing activities, especially among unskilled workers. And also it is because of an increasing number of firms on banks to close their doors and or a long draught in the agricultural sector (see World Bank, 1998; Soesastro, 1998; Firdausy, 1999).FOR FURTHER INFORMATION PLEASE SEE THE ORIGINAL POST AT :
sources : http://www.ismea.org/asialist/Firdausy.html

Top Seven Reasons why I use my Credit Card for Everything

I charge absolutely everything to my credit card. Everything. Even $3 purchases if I can. Why, you ask, in a world where credit cards are "evil", would I do such a thing?

I am a credit card junkie (and have been for many years) for a number of reasons:

It builds up a great credit rating. By charging and paying off up to thousands of dollars in expenses each month, I have built up a rock-solid credit rating - the best one possible. So whenever I have sauntered into the bank for a loan, I have been accepted right away, and at the lowest possible interest rates, with no security deposits required.

It's quick and easy. Swiping a card these days is often as quick as (if not faster than) paying with cash and counting out coins.

It's great for accounting and spending reports. Since I don't dole out cash, or make purchases on my debit card (and I rarely use cheques), all my monthly spending is nicely bundled into one report: my monthly credit card statement. Not only that but my current credit card of choice actually categorizes my spending for me, so at a glance I can see how I've spent my pennies for the month and year-to-date.

I don't need to carry cash. Trips to the bank machine are few and far between, as $60 can last months depending on my spending needs.

Automated billing is great. Cell phone bills, utilities, cable, you name it. If I can sign up for automatic billing, I do. It doesn't mean I don't look at each carrier's statement to ensure the charge is correct. But it does mean that on a monthly basis I don't have to worry about paying any bills (other than my credit card!) - they're already paid.

Almost everybody takes Visa. From the coffee shop to the grocery store to online spending to travelling, to…well…everywhere. I have Visa, MC, and Amex, but I find that Visa is most widely accepted worldwide.

And my number one reason for charging everything to my credit card (drum roll, please):

Frequent flyer miles. Since I started to charge all expenses to my credit cards, I have collected and redeemed miles for everything from fancy dinners to sports gear, to multiple flights all around the world. Hey - just for spending money I would always have spent, I've been able to take advantage of all sorts of free swag. What's better than free?

Note: The trick to a spending plan such as the one I have laid out here is a rock-solid budget. I never (read: never ever) spend beyong my ability to pay off the bill in full each month. As Sarah mentioned in her recent article, credit cards are best viewed as thinner versions of your checkbook.

SOurces : http://www.wisebread.com/top-seven-reasons-why-i-use-my-credit-card-for-everything