MonthMay 2020

Consolidate Payday Loans and Get Out of Debt

The simplest way on how to consolidate payday loans and get out of debt is to negotiate. Payday loans can be quite uneconomical for many people and are a great deal worse than credit card debt. There are ways that you can save money and find yourself with enough income left over to pay off the loan.


People think that they can pay off their payday loans at any time

loan repayment

However, this is simply not true. Accumulate interest payday loans, and the amount you owe will grow as well. There are simple ways to get out of debt while staying with your current income.

Most people, when they have more than one new loan to pay off, tend to prioritize the most important of them. You may not be able to get away with just paying one of the loans, but you can certainly save yourself from paying any of them. Before you begin your budget, divide the loans up to and consolidate them all into one new loan.

In addition to consolidating all of your debts, you may also want to consider refinancing your loan. Refinancing your loan can often save you money, even if it means paying less interest. You can also get lower monthly payments, which can keep your monthly expenses under control.


You will still need to pay off the loan

payday loans

One of the most popular ways to get out of debt is to consolidate your loans into one new loan. If you consolidate your current loans into one new loan, then you can avoid paying interest, and you can usually get lower payments.

The right way to consolidate payday loans and get out of debt is to get rid of your old debts and consolidate them into one new loan. Even if your debts do not disappear overnight, you can be better off in the long run. You should also remember that you may save money by getting one loan, rather than having multiple loans with different terms and interest rates.

Just by combining all of your old debts into one loan, you will reduce your interest rates, lower your monthly payments, and often eliminate late fees. This is a key point to keep in mind because many people overpay when they are late on their previous payday loans. By consolidating them all into one loan, you can save a lot of money by not having to pay a lot of money in late fees and interest.

Once you have consolidated all of your past loans into one new loan, and your current interest rate has been lowered, you can start budgeting. Before you begin making any cash flow changes, it’s important to review the budget carefully. Check and make sure that you can afford your new payments, and make sure that you don’t miss any of your payments.


Lowering late fees or adding repayment options, is that possible?

payday loans

If you do find that you have a hard time affording your payments, you may want to discuss with your lender about the possibility of lowering your late fees or adding other repayment options. Sometimes it’s possible to pay off some of your loans at a lower interest rate. If you have bad credit, sometimes you can use an alternative payment method to avoid dealing with bad credit.

When you have consolidated all of your loans into one new loan, you may be tempted to transfer your balance over to the new loan. While this may be true in some cases, the majority of your balances can remain on your current bank account. You may be able to transfer some of your debt over to another lender, however, so make sure you understand that you cannot transfer the entire balance of your loan.

One of the best ways to manage a new loan that you have received is to get the total of your past loans, and subtract that from your present income. If you had a very low income, it may take a large chunk of your savings to pay back your new loan. In this case, be sure to save enough money to pay your new loan off, even if it means cutting back on your expenses.

Cashing your RRSP to pay off your debts: a good idea? – Consolidation of Loans

Some taxpayers hesitate between contributing to their MMTYs or paying their credit cards. Others are rather considering cashing in their MMTYs to pay off their debts. Is this a good solution? In the majority of cases, the answer is no. The short and long term consequences of this strategy are numerous.

The consequences of cashing in an MMTY to pay off debts

The consequences of cashing in an MMTY to pay off debts

1. Withholding tax

When you invested in your MMTY, you recovered the tax paid on this amount. If you buy it back, the financial institution will retain an amount of money to pay it to the taxman. For example, if you withdraw $ 10,000 from your MMTY, 25% of this amount will be withheld at source. You will therefore only receive $ 7,500.

2. Withdrawal costs

Many financial institutions charge transaction fees for early withdrawals. You may also have to pay a penalty representing a percentage of the amount withdrawn.

3. Impossible to liquidate certain investments

Some investments do not allow withdrawal from an MMTY to pay off debts. Among other things, this is the case for the FTQ’s solidarity fund. This allows the collection of an MMTY ” only if it is a debt that causes an interruption of an essential service or if you are subject to a seizure of essential property. “

4. Increase in your taxable income

The amounts withdrawn from your MMTY will be added to your annual income. This increase in income could raise your tax rate. It could also decrease the amounts received under certain tax measures such as the Canada child benefit or the GST credit.

5. Loss of your contribution room

Unlike a TFSA, you do not get back your contribution room after buying an MMTY. You will therefore not be able to reinvest these sums later. You will have to settle for your new accumulated rights.

6. Loss of your yield

The advantage of investing early in an MMTY is to take advantage of compound interest. For example, a sum of $ 10,000 left in your MMTY for 25 years at a rate of return of 5% will have a value of $ 34,813. Planning to reinvest $ 10,000 after paying off your debts? If you only have 10 years left to grow it, its value will only be $ 16,470.

Impact on your retirement income

Impact on your retirement income

If you withdraw your MMTYs today, you are reducing the income available for retirement. If you are self-employed or do not have a pension fund, your financial security will be compromised.

What to do before cashing your MMTYs?

money debt

Many solutions exist to solve a debt problem. You can increase your income, sell assets, consolidate your debts, or even make a consumer offer. Do not hesitate to consult in order to benefit from professional advice adapted to your situation.

Credit card payment: All information about costs and security

For many people, the credit card has become a constant companion in everyday life that they no longer want to do without. Whether in the online shop, in a restaurant or while traveling – payment by credit card is uncomplicated, fast and, moreover, secure. Still, some people are still suspicious of the credit card. The word “credit” should have a not insignificant part in this, since it usually combines the notion of interest burden and debt. But you can rest assured: When used correctly, the credit card is as cheap as other means of payment.

Globally accepted means of payment

Globally accepted means of payment

The days when only a few hotels accepted credit cards are history. Plastic money has long become a common payment option. There are acceptance points all over the world. If you have a credit card from the major issuers, such as Visa or Mastercard, you can use it to pay for what you have to pay. In most cases the credit card should be accepted. It starts with the daily shopping in the discounter around the corner and also helps in many other situations: The shopping spree in the city with a credit card should be just as successful as the shopping tour on the Internet.

Not without a credit card

The internet is a global thing. And so you should have come into contact with online shops or services that are located abroad. American companies in particular rely heavily on credit cards and sometimes even only accept them as electronic means of payment. Then a credit card would be essential if you want to use the online service or shop in the shop. The Apple services iTunes, Apple Music and the app store are such a case.

Payment by credit card is not only possible with traditional shopping. The credit card has its origins in travel. And so it is also common and widespread in hotels, car rental companies, taxis, restaurants and cultural institutions such as opera houses. Finally, many online services can also be paid for with a credit card: online magazine subscriptions, video game downloads, music and film streaming. Most providers accept the plastic money.

Uncomplicated and quick at the checkout

Paying with a credit card is straightforward and does not differ significantly from checking card payments. The seller or – for example in the hotel – the receptionist pulls the credit card through the card reader. You then have to provide a signature as a cardholder. As a rule, the identity should also be confirmed with the identity card ; in practice, however, this does not always happen. Occasionally, on the other hand, it can happen that the PIN is requested when paying in the store, for example if the signature is illegible.

Pay with a click with your credit card

So-called contactless payment with a credit card is possible via Near Field Communication (short: NFC). The card itself does not even have to be removed from the wallet. The amount will be debited automatically as soon as the wallet with the credit card is in the checkout area. This enables even faster payment processing, for example at the supermarket checkout.

A larger TV for the living room at home, a bouquet of flowers for the mother, booking a rental car for the next vacation: In times of the Internet, we are always just a few clicks away from giving ourselves or our loved ones a little pleasure. The credit card is also a common method of payment for online purchases. Then the usual credit card details are requested or they are already stored in your own user account due to previous purchases.

A signature, as is required in the retail store, is of course not provided online. Instead, when making purchases as a cardholder, you must provide the credit card number, your name, and the card’s expiration date. The card verification code is also requested. The purchase can only take place when the seller has all the credit card details.

How safe is it?

How safe is it?

Basically, credit card payment is a safe bet. In recent years, better and better security standards have been developed to prevent fraud and the associated loss of money. PCI (abbreviated to Payment Card Industry Date Security Standard) is such a security procedure. From a certain size, selling companies must participate in this process and protect their digital systems according to specified guidelines.

Additional security standards are added to online purchases, for example 3-D Secure, which is implemented in Visa with the Verified by Visa service and in Mastercard with SecureCode. And querying the card verification code (CVV or CVV2 for Visa, CVC or CVC2 for Mastercard) also makes online purchases more secure. Because this code does not appear on any credit card statement, but only on the card itself. If you lose a statement, fraudsters cannot use it to make purchases online on your account.

Card blocking in case of loss

An important security aspect is ultimately the possibility of having the credit card blocked quickly in the event of loss or theft. This can be done in several ways and in the shortest possible time. You can have the card blocked by your bank, credit card company or by a central emergency service. Since you have to enter your card details here, it makes sense to write them down in advance. If you act quickly, you may not lose any money. Cash on the other hand, which you had in your wallet, would definitely be lost if your wallet were lost. The advantage of plastic money is also evident here.

Credit card payment costs

Credit card payment costs

In principle, payment by credit card is free at most banks. However, whether there will be any costs afterwards depends on the type of credit card you are using. For batch, debit and prepaid cards, all payments are debited immediately or at the latest at the end of the month. So there is no loan interest. The situation is different with revolving cards. With these payments in installments are possible; accordingly, loan interest is due on the outstanding amount. The following applies to all cards (except prepaid): If you slip into the overdraft facility of your account, the usual overdraft interest will of course apply.

Foreign currency fee abroad

Using the credit card abroad is not necessarily associated with additional costs. For most providers it is crucial whether you pay in a foreign currency (i.e. not in euros). When shopping outside the dollar zone – and by the way also when withdrawing money – foreign currency fees are usually incurred. And even if you use an internet shop that uses a currency other than the euro, the fee will be charged if you pay online with your credit card. If you pay attention to such factors, you avoid unnecessary trouble when looking at the next credit card statement.

Quickly pulled out, clicked quickly

Quickly pulled out, clicked quickly

Practical when strolling through the city, uncomplicated when buying online, essential when traveling: the credit card is an integral part of everyday life. Most credit cards are suitable as a method of payment. But not every card offers the services that everyone wants. And actually not all people want the same thing. One provider may incur higher foreign currency fees than another, but they may charge a small fee for cash withdrawals. If you are looking for a (new) credit card, you should first compare the services of the credit cards. That is the first requirement if it should also fit in the end.