5 Financial Moves to Make in 2018

new-year-eve

It’s understandable if you drifted off course financially during the last couple months of the year. However, you don’t want bad money habits to follow you into the New Year. If your finances have slipped, it’s time to get back on track for 2018 and devise a plan to tackle your debt efficiently and effectively. Take a step back and evaluate your finances before the clock strikes 12 on December 31.

Here are some tips that can help you refresh your finances and stay motivated in the New Year.

1. Review Your finances

Take a look at your overall finances and consider setting both short-term and long-term goals. Confused about where to start? You may want to begin by obtaining a free copy of your credit report at Credit.com. Through Credit.com, you can request reports from all three of the major nationwide credit bureaus: Equifax, Experian and TransUnion.

Since you might have been using your credit cards often during your holiday shopping, be sure to check your credit report for any irregularities. Fraud and identity theft skyrocket during the holiday season. While you are checking your credit report, you also might want to check your credit score. If you are using more than 30% of your credit cards, you may see a slight drop in your score in the post-holiday season. While credit scores can fluctuate slightly from time to time, it’s important to recognize when a deep drop occurs so you can find the problem and resolve it as soon as possible.

2. Set Goals and Make a Plan

Goals give us something to look forward to and work toward. Make a list of all the financial goals you plan to achieve in the next 12 months or so. Establish a payment strategy that works best to tackle not only your post-holiday debt, but also your overall debt. Consider making a list of all of your debts (secure and unsecure) and devise a plan on how to get them down.

Ask yourself what your short-term and long-term goals are. You might be looking to save up for a wedding, for retirement planning, or for your student loans. When it comes to loans, consider paying more than the minimum and making payments twice each month to help tackle your debt more efficiently. If you think you won’t be able to tackle all of your debt at once, focus on the highest-interest rate debt first before you work on the rest.

3. Stay Motivated

You may be stressed out from your financial situation. Stress can be very overwhelming, especially when it’s money related. Try to write down all of the reasons why you are stressed out. Focus on two to three financial problems or financial stress points and write down ways you may be able to solve that issue.

For example, you could write the following:

  • “I am stressed because I keep missing my credit card bill and now I am in debt from the late fees.
    • Solution: Maybe I can set a reminder on my phone or sign up for automatic payments so I don’t forget next time.
    • Solution: Since I’m deep in debt now, maybe I will put extra money towards my monthly payments instead of just paying the minimum.”

4. Put Yourself on a Financial Diet

Try and put yourself on a “financial diet” after the holidays. Focus on your debt instead of spending frivolously. Consider only spending money on essential expenses and use coupons when you can. If you make a few changes to your lifestyle—bringing the exact cash that you need to the grocery store or bringing a bagged lunch to work instead of eating out—you will improve your overall financial health. You will also adapt to these new habits and boost your cash flow. If you think you have a problem with impulse buying or you find yourself in deep debt, then you might want to consider seeking outside financial help.

If you only have enough money in your bank account to pay your bills at the end of the month and anything unexpected expenses are being paid for with credit cards, it may be time to rethink your financial strategy. It’s easy to get caught up in the credit card debt cycle especially around the holiday season, however getting out of debt means planning for the expected. Planning for those “what if” moments can help you avoid breaking the bank in case of an emergency. You may be thinking I can always just use my credit card, however, using a credit card in a “what if” situation should be your last option.

5. Don’t Cheat Yourself of a “What If” Fund

If you only have enough money in your bank account to pay your bills at the end of the month and you’re paying for any unexpected expenses with credit cards, it may be time to rethink your financial strategy. It’s easy to get caught up in the credit card debt cycle, especially around the holidays. However, getting out of debt means planning for the expected. Planning for those “what if” moments can help you avoid breaking the bank when an emergency comes. You may think, “I can always just use my credit card,” but really, a credit card should be your last option in an emergency.

To get started on your “what if” fund, you can set reasonable goals, open a savings account, and be sure to make regular contributions to your savings until you reach 10% net income. If you take money out, be sure to replenish the funds! Just think how great it will be having money available if an emergency happens.

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How to Host Thanksgiving without Going Over Budget

thanksgiving1

Thanksgiving is a time to cherish family and friends and to enjoy all your favorite foods, drinks, and desserts! You want to make this day special for all your loved ones, but don’t forget your budget. Debt can easily pile up during the holidays. Between the cost of food, beverages, decorations, and dessert, your wallet may not end up being too thankful. Luckily, there are ways to make your Thanksgiving dinner memorable and budget friendly!

Here are four ways to host a Thanksgiving dinner without gobbling down your funds.

1. Start Early

Don’t overwhelm yourself by shopping for Thanksgiving at the last minute. This can throw off your budget—not to mention the store will be hectic. There’s a good chance popular Thanksgiving foods and ingredients will be marked up if you shop right before the holiday, so you should purchase nonperishable items as early as possible. Starting early will give you the time you need to hunt down the best holiday deals.

Consider making a list of what you need and then search for deals to save you money. But before you rush out to use those coupons, take inventory of what you already have. You might be surprised what’s been hiding in that cluttered pantry or packed freezer.

In addition, when buying alcohol, consider asking your store for its deals on buying cases. Purchasing a case can save you money in the long run and can come in handy for a future party or holiday gift. Finally, take a stab at do-it-yourself recipes instead of just buying items. This can help save you money even though it may be more time-consuming.

2. Ask for Help

Food can be expensive, and food prices have gone up in recent years. You were kind enough to host Thanksgiving, so don’t be afraid to ask your attendees to help out. Ask friends and family to bring specific items so that you can save both time and money and also avoid stress. You may even want to consider making it a potluck dinner. Ask your guests to bring an appetizer, side dish, dessert, or even their favorite bottle of wine or beer. This can bring new tastes to the table, lessen your expenses, and keep you within your budget. 

3. Limit the Number of Dishes—or Don’t

The number of dishes you serve depends on the number of guests you’ll be feeding. By limiting the number of dishes, your grocery bill will be much lower. Consider ditching sides that haven’t wowed guests in the past and offer your guests fewer dishes in bigger quantities. This way you can buy ingredients in bulk, stay within your budget, and still have enough to feed all your guests.

On the other hand, increasing the number of side dishes can mean purchasing less turkey, which can also save you money. If you go this route, consider purchasing sides that won’t break the bank. A few canned or frozen sides can go a long way.

4. Rethink Your Décor

Your home décor can provide a nice atmosphere for your Thanksgiving dinner. Of course, you want your table to look the part, but at what price? Holiday decorations can be expensive and can take away from other areas of your Thanksgiving budget. Try to get crafty with your decorations. Find things like fall leaves, hay, and gourds to use as holiday props. You may also want to visit the dollar store to find other budget-friendly decorations.

If you do want to splurge on something and don’t have enough place settings for your guests, consider buying simple white dinner plates and a set of nice silverware. These have an elegant, timeless look and can be used for future holiday parties at your home.

If you follow these tips and you still find yourself struggling, you may need to make sure your budget’s really working for you. Consider rethinking your budget before your next event, or consider a high-rewards credit card to help your next event run smoothly. Don’t forget, you can check your credit score for free at Credit.com before you sign up.

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The Ultimate Holiday Debt Survival Guide for 2017

Here are six personality types that can keep you from financial success and how to spot them.

Millions of Americans have an overwhelming amount of debt, and during the holidays, many consumers spend more than they have. Don’t fall victim to overspending and accruing debt this holiday season. You can still love and celebrate the holiday season without overspending on holiday gifts, food, decorations, lights, and entertaining. After all, the holidays are a time to gather with friends and family and to be grateful for what you have!

We compiled the ultimate holiday survival guide to get you through this season of giving without going into debt. Here are five tips to help you spend wisely and protect your finances.

1. Create a Holiday Budget

You might be tired of hearing about budgeting, but if you’re serious about not overspending this holiday season, you should make a holiday budget. It’s important to be realistic—don’t make guesses if you can avoid it. Look back on how much you spent last year to guide you as you create your budget, and see where you could cut back.

The key to staying on budget is proper organization so you can have a holiday season that’s free of financial stress. When it comes to gift giving, be sure to make a list and check it twice. Don’t feel pressured to give to friends or extended family if your budget doesn’t allow it.

2. Use Cash

It can be discouraging to start off the New Year already behind on the eight ball in money matters. To avoid a financial hangover in January, you may want to consider using cash or a debit card for your holiday purchases—instead of a credit card. By having cash on hand when holiday shopping, you will be less likely to go over budget. You’ll be forced to spend only what you have available as opposed to a large credit line.

If you do plan to use a credit card, remember that you’ll have to pay interest on your purchases if you don’t pay the entire balance in full. Be sure to add due dates to your calendar for each of your credit cards and schedule a reminder on your phone. Overdue payments can hurt your credit score and push you further into debt with late fees.

Additionally, learn to prioritize your bills. Pay off the card with the highest interest rate first—otherwise you’ll pay more over time. You should also consider dropping any retail credit cards after you’ve paid them off. These tend to have the highest interest rates and limited benefits.

3. Plan Ahead

Last-minute shopping is stressful, and it can also be costly. If you’re in a rush, you’re more likely to forget about your budget and instead grab what is most convenient. Taking the time to research the best deals, sales, and prices can save you time and money. Try spreading your holiday gift purchases throughout the year, in place of doing it all in December.

4. Get Creative

If your budget doesn’t allow you to buy for everyone you would like to this year, a great alternative is a holiday grab bag. With a grab bag, everyone buys a few small gifts to wrap and throw into a bag or a box, then each participant randomly picks one gift at a time until all the gifts are gone. Anyone who would like to participate should agree to a price that fits into everyone’s budget and how many gifts each person should buy. This is not only frugal but also fun!

If you’d rather stick to traditional gift giving, get creative with it. Try making do-it-yourself projects or crafts—a homemade gift is much more sentimental than a store-bought one anyway. For your children’s teachers or coaches you would like to include in your holiday list, consider gift cards, home-baked goodies, or both combined. Gifts don’t need to be lavish to show someone you appreciate them.

5. Implement Damage Control 

If it’s too late and you’ve already overspent this holiday season or are already in deep credit card debt, don’t panic. There are ways to recover and do damage control after the holiday season is over.

The most important thing of all is committing to paying off your debt. It might be easier to simply continue your regular spending habits and pay the minimum balance when you remember. But giving debt priority, even when it’s an insignificant amount, will do wonders in helping you maintain good financial health.

With all the new items you’ve received during the holiday season, you might have some older things you can sell. Clothes, electronics, and even books could earn you a little extra cash to help pay off your debt. Amazon, eBay, and your local consignment shops or thrift stores are fantastic venues for selling your unwanted stuff.

Take a look at your budget and make sure you set aside enough money each paycheck to make at least double the minimum payment. But if you can manage it, you should aim to pay much more than that. Fine-tune your budget to see where you can cut back so you can make more substantial payments to your credit cards. The sooner you’re out of debt, the sooner you can start putting that money where it really matters.

Don’t let your finances take a major hit this season. Follow these tips to avoid overspending, and keep an eye out for other common holiday pitfalls. By building more frugal shopping habits, you can also improve your credit score. If you’re curious about how your credit’s faring now, take a free look at your credit score through Credit.com.

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Should You Get Another Credit Card? Ask Yourself These 5 Questions First

favorite credit cards

Credit cards play a significant role in your financial life—from establishing credit to determining your buying power and more. While credit cards have become an integral part of society and even have their perks, you may be wondering how many credit cards you should keep and if it would be wise to get another one.

Before you decide to add another credit card to your wallet, there are some things that you will want to consider. Find out if applying for additional credit cards makes sense by asking yourself these five questions first. 

How Long Have You Been a Credit Card Holder?

If you are a new credit card holder, it can take six months to a year to see an effect on your credit score. Without an established credit history, it may be difficult for lenders to decide whether to extend credit to you. A short credit history can also impact your interest rates, keeping them higher than desirable. If you have had your credit card for less than a year, getting a new one may not be the best choice right now.

What to do: Be patient. When using the credit cards you already have, pay on time and in full each month so that future credit card companies will see how responsible you are and will be more likely to extend you credit with a good interest rate. If you are a new credit card holder, try holding off for one year before applying for another credit card.

How Are You Managing Your Current Credit Cards?

It may be tempting to have more spending power at your disposal, but before you apply for another credit card, make sure you can financially handle it. Examine how you are currently managing your credit cards. Are you struggling to pay the minimum each month? Are you unable to make payments on time? If you answer “yes” to either of these questions, it’s probably not a good idea to apply for another credit card right now.

What to do: If you are already struggling, ask yourself why you need to get another credit card. Is it because you don’t have enough cash flow or you have an emergency situation? Instead of making any hasty decisions by opening another line of credit, develop a plan to lower your current credit card balances and create a budget that will help you organize and control your spending.

How Are You Going to Use Your New Credit Card?

When considering a new credit card, it’s important to know what your intentions are and how you are planning to use it. Some reasons for opening a new credit card account may be more impulsive than practical, so think carefully before signing that credit card application. If you plan to use the new card as a backup, most likely you won’t use it often. Some credit card companies have a policy of canceling credit cards due to inactivity, and a canceled credit card can cause your credit score to take a dip.

What to do: Before you decide to apply for a new card that you may not use, use your current cards effectively. Pay your balance on time and in full to build your credit. Some cards even offer cash back rewards that reward smart spending.

What Types of Perks and Rewards Does the Credit Card Offer?

If you have established excellent credit, you may be receiving offers from many different credit card companies claiming perks and rewards galore. If you know that you can financially handle another credit card and are looking to take advantage of some perks that your current credit cards do not offer, you may want to consider another credit card. Before you move forward, do your research on each one.

What to do: Don’t get sucked in by flashy offers that won’t benefit you in the long run. Cash back rewards and frequent flier miles won’t help if you aren’t able to pay your balance or if the cards don’t offer rewards that you can take advantage of. It’s important to make sure that the credit card you choose is the right fit for your needs. Decide which perks are most important to you and would give you the most bang for your buck. 

What Is the Interest Rate?

While you may have every intention of paying off your credit card balance in full every month, sometimes life happens and the only option in the moment is to make minimum payments. Whether it’s the loss of a job or a divorce, many situations can throw you off track financially. High interest rates on credit cards can compound an already stressful situation.

What to do: While some credit cards may hit everything on your perk and benefit checklist, if the interest rate is too high, skip it. Hefty amounts added to your credit card bill every month will only make it that much harder to get out of a tight financial situation should life throw you a curveball. Look for credit cards with low interest rates that will be sustainable for long term use.

Once you’ve examined your reasons for wanting another credit card, you can determine which one is best for you—if any at all! Depending on your needs, you can use Credit.com’s Credit Card Finder to find the right card for you.

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5 Ways to Negotiate with Your Credit Card Company

Man use smart phone and holding credit card with shopping online. Online payment concept.

Even if you are paying your credit card bills on time, you may still be looking at your statements each month in distress. It’s all there in black and white: the interest rate, the annual fees, and maybe even the occasional-but-hefty late charge.

If you feel stressed when opening your credit card statements, it may be time for you to fight for a better deal. Luckily, negotiating with credit card companies isn’t as hard as you think. If you are persistent and determined, you’ll be surprised at how eager some banks and other credit card issuers are willing to work with you.

Here are five ways you can negotiate with credit card companies—and keep it on your terms.

1. Go Right to the Top

There’s no sense in wasting any time. When calling your credit card company to negotiate a better deal, it’s best to ask to speak to a manager right away. It’s crucial, however, to always be polite and assure the representative who answered the call that there isn’t a problem.

The representative may ask you if there is a way for them to help you before they send you to their supervisor. At this point, explain to your representative what you are trying to accomplish and what you would like to change about your credit card bill—they may be able to help on their level. If they are unable to assist you, however, speaking to a supervisor is more likely to get you the result you are looking for.

2. Request a Due Date Change

If your credit card payment due dates are putting you in a compromising financial position and are not aligning with your budget or pay schedule, request a due date change. Many credit card companies are willing to move the date to help increase timely payments.

If you are consistently making late payments, it would be in your best interest to request a more suitable date. Not only are you incurring late fees and interest, but you’re also causing your credit score to take a dip. A due date change can make all the difference in keeping you financially healthy.

3. Bargain for a Better Interest Rate

Your interest rate might be good—but is it good enough? Perhaps you have been getting some competitive offers from other credit card companies but choose to ignore them because you are content with your current credit card company. If so, you may be missing out on a better deal.

Take those other offers and use them as a bargaining chip instead. Come to the table prepared with all the perks, interest rates, and other benefits that you would be getting if you switched cards. More than likely, your credit card company won’t want to lose you as a customer and will be willing to beat or at least match the offers you are getting.

4. Ask for a Late Payment Fee Waiver

Credit card companies may be willing to let a little hiccup of a late payment slide for customers with long and responsible payment histories. If you have consistently been late with your payments, however, they probably will not give you credit for all your late fees—but they may be willing to negotiate with you if you offer to sign up for automatic payments. If you show good faith in trying to improve your payment record, you may be able to get in their good graces and be accommodated.

5. Haggle to Get That Annual Fee Removed

While there are many credit cards out there that offer perks without an annual fee, many others charge as much as $95 per year in exchange for a few extra perks. When you first signed up for your credit card, the annual fee you were paying may have worked in your favor because you were taking advantage of the benefits as a cardholder.

Take a look at your monthly spending. Are your cash back rewards and other benefits outweighing the annual fee? If your answer is no, then it’s possible you are holding a card that isn’t the right fit for you anymore. While it’s not recommended that you close your credit card account (doing so can also lower your credit score), try haggling to get the annual fee removed or consider downgrading to a no-annual-fee option.

Before you apply for any credit card, review your credit report for free at Credit.com and make sure your credit score is healthy enough to get you approved. A hard inquiry into your credit can drop your credit score, so make sure you’re prepared. Visit Credit.com’s Personal Finance Learning Center for more information.

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Why Your Credit Score Is Important as a Student

College is even better with the right credit cards. Don't miss out on deals and cash back!

Attending college comes with a host of new responsibilities, and your parents have (hopefully) sent you off with the wisdom and encouragement you need to handle those responsibilities on your own. Your studies and your GPA are your top priorities, but you may have other obligations that are important too. Whether you are responsible for paying tuition, holding a part-time job, or fulfilling an internship, these life-learning experiences can help you prepare for your future career.

While you’re busy writing term papers and picking up weekend shifts, though, there’s something else you should be working on: your credit score. That little number will play a significant role in your financial future, so here’s a closer look at why your credit score is so important as a student and how you can build, maintain, and keep your credit score in tip-top shape.

Why Credit Matters

1. Your future job opportunities may depend on it.

Once you graduate, you will be applying for jobs that will kick-start your career, and your goal is to land a job that not only makes you good money but is enjoyable as well. If you’re not careful, though, a poor credit score could keep you from getting that dream job.

Many employers run credit checks before they hire a candidate. A good credit score tells an employer that you are an organized and responsible person. You may have all the qualities they are looking for and your skill set may fit every description to land the job, but if your credit score is in bad shape, your opportunity may be given to another candidate with the same skill set and a better credit score.

2. Good credit could help you land your first apartment.

You may decide to live at home with your parents for the first few years after graduating college. This temporary arrangement can help you save up enough money to get yourself out on your own and into your first apartment. But keep an eye on your credit during this period, as it could impact your ability to get an apartment down the line.

Even if you have enough money for the deposit, your future landlord wants to be assured that you will be a responsible tenant that pays the rent on time, so they may check your credit report. If your score is low and your credit report shows that you aren’t paying your creditors on time, you may not get approved to rent the apartment.

3. You usually need solid credit to secure the best interest rates on loans.

Want the best interest rates on your future auto loan or mortgage? Then you need good credit. Getting the best interest rates on car loans, home mortgages, or any other type of loan generally requires a great credit score.

Lenders will base your interest rate on multiple factors, but your credit score will often carry a lot of the weight in that determination. If your credit is pristine, you have the upper hand—with a better chance to negotiate in your favor. Shopping around for the best interest rates on loans is easier with an excellent credit history and score.

Once you understand why your credit score is important, you’re ready to start building and maintaining it.

How to Start Building Credit

If you are starting from scratch as a college student and don’t have any credit history, a secured credit card is the safest and best option. A secured credit card is one of the best ways to build credit because an up-front refundable cash deposit is required to serve as your credit line. The cash deposit also serves as collateral in case you default on payments. In some cases, you might qualify for a credit line that’s higher than your deposit, but you can always expect to put some money down for a secured card.

While you never want to default on any credit card and should avoid it at all costs, that deposit does provide a way for you to pay off the card if you come upon unfortunate financial circumstances. However, even though the credit card company may be able to recoup the amount owed with your deposit, your late payments will still be reported to the major credit bureaus and you may still incur interest and late fees.

If you make purchases and pay the balance in full and on time consistently, you will create a positive credit history, and at that point, you will be able to apply for an unsecured credit card. Just keep in mind that if you are under 21 and do not have proof that you are employed, you will need a parent to co-sign your credit card.

How to Keep Your Credit in Good Shape

It may be tempting to treat yourself to something you want when you first receive that credit card, but you should try to steer clear of making purchases that are not necessary. Understanding your wants versus your needs is key to keeping your spending habits in check.

It’s important to live within your means and to keep your credit card balances well below your credit limit. It’s also crucial to pay your credit card bills on time consistently. Having a budget and cap on your spending each month will also help you maintain positive financial habits and make good decisions before buying. And once you have built credit and established a good credit history, you’ll still want to continue these steps to keep your score healthy and robust well into the future.

Credit is a big deal. Whether you’re just starting to build credit or have been working to build your score for a while, regularly checking your standing is a great practice—it’ll give you insight into your credit habits and alert you to any fraudulent activities that might be hurting your score. You can check your credit report for free at Credit.com.

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5 Tips for Splitting Bills With Roommates

Roommates can be great. Or a nightmare. Here's how to keep your experience as positive as possible on the financial front.

There are many benefits that come with roommates: the ability to rent a larger space, share cleaning duties, and easily find friends to watch a movie with. On the other hand, sharing a space with a roommate – or roommates – is not always easy and can bring on some challenges, especially when it comes to money.

Here are some tips to help you split the bills and keep the peace.

1. Establish Ground Rules & Guidelines

Just as your lease spells out every detail, consider working together with your roommates to create some ground rules or guidelines. This is a good time to discuss exactly which expenses you will be sharing and which you will be paying for individually.

A major key for keeping the peace is making sure bills are organized. Figure out when and how bills will be collected and split each month, how they will be payed, and who is responsible for paying what amount. While this may sound obvious, too many times roommates will wait until the last minute, causing stress, tension, and possibly late bills.

2. Make a Cost Spreadsheet

Once ground rules and guidelines are created for paying the bills, make a spreadsheet outlining each expense you and your roommates will need to pay. Each expense should show details such as due dates, the amounts owed, and the person responsible for paying. It may be wise to have a monthly meeting to discuss the bills and this spreadsheet. This will make sure everyone is on the same page and no one is surprised by a bill when it’s time to pay.

3. Use Apps

There’s always an app for that! When you have large expenses, such as rent or utilities, consider using an app that can help with the math and the payments. Gone is the excuse that a roommate “doesn’t have cash” on them as Venmo can easily solve that issue. This free app lets you send money from a debit account to friends. The app also lets you request money letting your roommates know that money is due.

Another great app is Splitwise. This app lets roommates track bills, tally who paid, and send reminders so you’re never late. If a cost spreadsheet is too old-school for you, consider using an app to make paying bills easier among you and your roommates.

4. Keep Some Purchases Separate

Unless you and your roommates plan on selling everything when the time comes to move out, consider buying furniture separately. While it may sound logical to split furniture costs that you both will be using, what happens when your lease is up? Deciding who gets to keep what can be stressful and problematic. Consider making a list of furniture and electronics necessary for your place and figure out who will be responsible for each item while keeping your overall costs even.

Like furniture, groceries are another item which roommates should consider buying separately. If you love to eat fresh foods while another roommate loves frozen pizzas, splitting the costs won’t exactly be even. This also creates controversy when your roommate decides they want fresh food that day and indulges in your groceries.

5. Choose Your Roommates Wisely

Obviously you won’t want to live with someone who you’re going to constantly clean up after. You also won’t want to live with someone who will never pay their share of the bills. Doing so could end up hurting your credit, especially if they skip out and you can’t afford the rent on your own. You may want to request that they check their credit scores and you can do the same. That way you’ll know what their history of paying bills is like (you can get your credit scores for free on Credit.com).

While it may be hard to know your possible future roommate’s habits, at the very least, consider meeting with them beforehand so you can feel them out. You won’t want to be stuck in a lease with someone you’re going to regret living with.

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How Debt — Yes, Debt — Can Help You Jump-Start Your Business

Debt isn't always a bad thing. In fact, it can help your small business thrive.

Many business owners run in the other direction when they hear the word debt. But debt can help a business thrive. If you take away the stigma, you can see how it can be used to your advantage — if you know how to manage it. Here are four tips for using debt to help grow your business.

1. You’ll Grow Faster

Taking out a loan can help you grow your business, creating more opportunity for profit. A loan can be used to purchase new equipment to develop your product quicker, increase your overall inventory or help open a new location. By taking out a loan, you give yourself room to grow without making additional investments with company profits.

Before taking on a new loan for your business, make sure you have a plan. If you take out a loan without one, or if your business is struggling financially, it may set you back. However, if you leverage your debt effectively, you could be on the right track to using your debt wisely. Before making any big financial decision for your business, consider speaking with a debt attorney or financial planner to help you weigh out your options. (Disclosure: I am a debt attorney.)

2. You May Keep Ownership of Your Business

Sometimes businesses need extra cash flow to expand and continue running smoothly. By choosing to take out a loan, you will owe the lending institution interest but retain full ownership of your business. Any profits you make after paying principal and interest will be yours to keep.

If you decide to take on a partner to increase capital, you may not only lose full control of your business but be asked to share profits, so be sure to think through the options before you sign up.

3. You May Get Tax Deductions

In most cases, the IRS will allow your business to deduct the interest paid on your loan if you used it for business purposes. This tax relief means more money for you and your business — a good thing since every dollar counts for a business owner. Consider speaking with a tax expert to see if you meet the requirements for tax relief.

4. You May Build Credit & Increase Your Spending Limit

When you decide to take out a loan for your business, a lending institution is trusting you to repay the debt. If you make responsible, on-time payments, you can increase your business’ creditworthiness, or business credit score. Smart credit habits can increase your overall spending limit, lower your future interest rates and help you obtain better terms. You’ll need decent credit to take out a business credit card, so be sure to check your credit score before you apply. You can view two of your credit scores for free on Credit.com. Checking your credit is free and won’t harm your scores. It’s also a way to stay on top of your personal finances.

Using a business loan to help generate cash flow can be a way to grow your business, but it isn’t for everyone. Taking on unnecessary or bad debt can put your business at risk if you aren’t careful. Though a loan can be helpful, it’s important to be aware of the consequences in case things get out of hand. Before you shop for a loan, evaluate the possible risks, costs and benefits, and develop a proper business plan.

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The post How Debt — Yes, Debt — Can Help You Jump-Start Your Business appeared first on Credit.com.

6 Things to Accomplish in Your First Year After College

Life after college is about more than just landing your first job. Here's what you should focus on.

Now that your college years are behind you, it’s time to begin another chapter in your life. While you may have been juggling school work, a part time job and a social life all at once, post-graduation brings a whole new meaning to “adulting.” In the next few years you may be looking to purchase a home or start a family, but for now, let’s look at a few things you should try to accomplish your first year after college.

1. Travel

You may soon realize that it can be difficult to find free time to travel when you start working a 9-to-5 job. Therefore, consider traveling the summer after graduation. It’s a great chance to see places you may not be able to see when you begin working full-time. Traveling can help clear your mind and relieve the stress of those last few college finals. It’s understandable to find it hard to even think of traveling with your student loan payments looming large, but you may regret not doing so when you begin working. Consider making an allowance in your budget for travel and remember not to add on any more debt! (Pro tip: A travel rewards credit card is a great way to help pay for your travel, and if properly managed, can also help you build your credit.)

2. Land a Job

Of course, the reason why you went to college to begin with was to establish a career. Chances are your first job won’t be your last. Now is a good time to start a job where you can learn new skills that can be used later in your career. Don’t be afraid to take a job that doesn’t directly align with your college major. You can learn something new in every job, and remember you are building skills and your career is a path.

3. Learn to Network

While networking may not sound so thrilling, learning to engage with other professionals and sell yourself is an important life skill. Learning to network is a stepping-stone to enhancing your career. It helps to improve your communication, build relationships, generate ideas and lets you stay current on trends related to your major.

4. Get Your Finances in Order

Graduation is a great time to revisit your finances and make necessary adjustments. Now that you’re out of college, your expenses and income will be different. This means making changes to your budget, taking into account any new expenses such as rent, travel costs for work and, unfortunately, those pesky student loans. Knowing exactly where your money is going can help free up some cash flow, which you can use to help pay down student loan debt.

Make sure you gather all your information regarding your student loans. You will soon be responsible for the repayment of these loans, so the more you know and understand about them, the better off you will be.

5. Open a Savings Account

For those who don’t have a savings account, now is the time to open one. If you’re working, consider opening an employee-sponsored retirement plan such as a 401K or an individual retirement account (IRA). While you may find it difficult to contribute when you have student loans, the earlier you begin savings in these accounts the better. Starting early will give your money more time to grow. Even saving a bit in your first year out of college will make a difference in the long run.

6. Accept Change

After college, you may be faced with a few changes you’re not quite used too. Whether it be starting a new career or moving to a new city, expect some challenging transitions in your first year out of college. This is not to scare you: Change can be a good thing, and when you embrace it, you can make the best of these changes.

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The post 6 Things to Accomplish in Your First Year After College appeared first on Credit.com.

How to Take a Vacation When You’re Juggling Student Loan Debt

With a little discipline and money management, you can travel responsibly.

Are your student loans keeping you from taking a much-needed vacation? While many put off planning a trip to pay down their loans, others find ways to do both. Student loans don’t need to feel like handcuffs restricting you from the excitement of traveling to a new or favorite destination. With a little discipline and money management, you can travel responsibly. Here’s how.

1. Live Within Your Means

While it’s always advisable to live within your means, taking on an extra-frugal mentality will not only help you save money for your vacation but also help you put more money toward your student loan debt. Living within your means starts with creating a budget.

Many dislike the word budget, or think it’s an impossible task. However, you may be surprised how much cash you free up when you limit your expenses to a set amount and cut unnecessary spending. When you have an idea of where your money is going, you see where you can make cutbacks. (Here are 50 things to stop wasting your money on.) Even a few cutbacks can free up enough cash for your vacation.

2. Start a Vacation Fund

If you don’t plan on traveling anytime soon, you may want to open a vacation fund where you put money aside each month. If you’re in a position to set money aside, even a small contribution a month will add up in no time. You may want to consider making automatic transfers so you’re not tempted to spend the money elsewhere. Just remember, saving money in an emergency fund (and for retirement) should take precedent.

3. Spread Out Purchases

For those looking to book flight and hotel accommodations with their credit cards, you may want to consider spreading out these purchases. Typically, flights and hotels will be the costlier part of your vacation. When you book these together, you’re making it difficult to pay back in full — add in your student loans and monthly bills, and this may break your budget. By planning ahead and spreading out these large vacation expenses, you’ll make your monthly credit card and loan payments a bit easier.

4. ‘There’s an App for That!’

If your travel and hotel accommodations eat up too much of your vacation budget, you may want to consider other options. Sites such as Airbnb let you rent out homes, apartments or even rooms, often for a lower price than a hotel. When traveling by air, consider downloading helpful apps like Hopper. The Hopper app predicts when flights to a specific location will be cheapest and notifies travelers when they should consider purchasing tickets.

5. Pick Up a Side Gig

A side hustle can be a great way to help supplement your current income. This extra cash can help pay for your vacation while helping you keep up with student loan payments. Between babysitting, tutoring, freelance writing or shifts at your local gym, there are endless possibilities. Consider finding something that interests you so it doesn’t feel too much like extra work.

6. Opt for a Staycation

While a staycation may not sound as appealing as an actual vacation, sometimes a trip around your own region can end up being surprisingly relaxing or adventurous. Consider researching what your own area has to offer. Between beaches, hiking trails and museums, you may find a staycation is just what you need to forget about those student loans.

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