Debt Wave Review: My Debt Management Experience


Posted on June 13, 2011 by debt_free

Let me start off by saying that nothing is more horrible than the feeling of working 40+ hours a week only to have it all go to bills and loans. This is the exact feeling I had about three years ago. I was working over 40 hours a week but I literally was only working to pay off my debt.

I decided that something needed to be done before my debt spiraled out of control. You see, my debt was a result of poor money management. I spent way too much money on toys and gadgets and on going out to bars almost daily. The end result was about 40,000 dollars in debt with no end in sight. I didn’t necessarily fall behind on payments but I soon began to panic as I realized that I was working my *ss off for nothing.

If you are in debt you may know the feeling…After some vague research I decided that my two options were Bankruptcy or Debt settlement. To be honest, I didn’t know much about either. I kind of figured that bankruptcy would damage my credit but would leave me completely debt free. I did some more research before making my final decision.

I eventually came upon a forum community that covered this very same topic. Browsing through the forum I found a sticky thread that listed several debt management companies recommended by forum members. That is how I came across Debt wave.

What follows is my experience with debt wave up to present time;

The call:

As stated above, I got the number for debt wave from a debt management community forum. This forum basically covered all things debt management. Forum members were either working their way out of debt, or there to help out their fellow colleagues.

Not knowing what to expect, I basically called them up to ask on the requirements needed to file for bankruptcy. The debt counselor on the other line went on to tell me that they needed to offer debt counseling first before they could determine what my best options were. She proceeded to inform me that they were a non profit, that their credit counseling left me under no obligation whatsoever.

After the first call I was asked to provide the information needed to determine my debt to income ratio. The debt to income ratio was used to determine how much money I could afford to use towards paying off my debt without affecting basic necessities (rent, fuel, food etc).

While I don’t remember the exact timeline, I do know that this all took place over several phone calls. Once debt wave had everything that they needed, they basically laid out my options for me. The debt counselor did not recommend bankruptcy or debt settlement. I was told that all that was required was some money management to help me get back on track. I had the option of continuing with free debt counseling or entering their debt management program.

I chose to join the debt management program with the hopes of getting rid of my debt faster. From there debt wave got in touch with all my of credit card and loan companies. They managed to reduce some of my interest rates (some credit card companies would not budge much) and came up with a plan of action to pay down my debt.

I was given a five year timeline in which I would have completely erased all of my debt. A small fee was also charged to continue to be a part of the debt management program.

That was basically all of the interaction I had with the company. What followed were monthly statements with a breakdown of my payments accompanied by a newsletter with money management tips. The newsletter basically covered the importance of tracking all expenses and that the only way to reduce debt was to stop over spending.

I believe I am now at my fourth year with less than one thousand dollars left to pay off. When I first started I felt like I would never get here but being debt free is coming closer to a reality.

Based on my situation, I didn’t necessarily need debt wave, but they were a huge help in guiding me in the right direction.

If there’s anything I’ve learned from my experience is to never spend more than what I actually make (no more credit cards) and to always have an emergency fund (you never know what life may throw at you).

 

Posted in Debt Management Tips | Tagged , , , | Leave a comment

Understanding debt management programs

Posted on October 13, 2010 by debt_free

Has your debt become more than you can handle? If so, you may want to consider looking into a debt management program. A debt management program’s main purpose is to work with your credit card companies to help lower interest rates and help you pay off your debt. Below are several factors to consider before choosing a debt management program. 

Debt management program vs debt settlement companies:

It is important to note that the purpose of a debt management program is to help you pay off all of your debt with minimal damage to your credit score. If you feel that paying off your debt in full is out of your reach, you may want to consider looking into a debt settlement program.

Debt settlement is an option for those who are severly in debt and have fallen behind on their payments. Keep in mind that this option can be damaging to your credit, and can be very difficult to pursue. Be sure to do plenty of research before pursuing this option.

Start with a credit counseling agency first:

Getting out of debt and staying out of debt takes a full understanding of your expenses. Most of the time all that it takes is a little counseling to get back on the right track. Start by getting in touch with a reputable non profit credit counseling agency. They will work with you to help develop a plan of action. Avoid counseling agencies that sound like a sales pitch. A credit counseling agency should provide you with all viable options based on your situation.

Debt management programs are only half of the equation:

If you have made the decision to start with a debt management program, understand that you are only tackling half of the problem. The other half lies in finding a way to stay out of debt. Most debt management programs also offer debt management counseling. The best way to stay out of debt is to budget accordingly. Determine what your monthly income is and list out all of your expenses. Expenses can be broken down into two categories. These two categories are going to be essential expenses (food, housing, utilities), and wants. Once you see where your money is being spent, you can manage your budget better.

Consider all of your options:

Debt is a serious issue. Be sure to understand all of your options completely before starting a debt management program.

Posted in Debt Management Tips | Tagged , | Leave a comment

Money management for married couples

Posted on April 29, 2012 by debt_free

Marriage can be a wonderful thing. It also brings forth a new set of challenges and responsibilities. Money management being in my opinion, the most challenging. There are several different ways to approach this problem. Below are what I feel are the most effective ways to talk about money with your significant other.

Full transparency:

Long are the days where you purchase whatever you want without thinking twice what anyone thinks. Transparency is not about asking for permission, but about respect for each other. Your actions will have a direct effect on both your lives.
Share one main account:

Money management tends to get complicated when there are more people involved. To make things simple, set up a joint account where the bulk of your salaries will go. This account should be used to pay off all bills including mortgage, car loans, utilities, groceries and so on.

Mixed accounts are okay:

If you must, set up personal accounts to go along with the main joint account. These personal accounts can be used for personal purchases such as hobbies and things of particular interest to you. Remember to set the right expectations before setting these accounts up. Come to an agreement as to what are considered purchases that require each others approval.

Communication is key:

Money is usually always a hot topic item. Problems will always arise regardless of your situation. The best way to deal with these problems is to start the money conversation early on in the relationship. Set expectations for your partner and don’t be afraid to compromise. The key to successful relationships is to idenfity the hot topic issues and to have a basic understanding as to how to deal with them.

Posted in Money Management | Tagged , | Leave a comment

Different ways to save money on a tight budget

Posted on March 5, 2012 by debt_free

Saving money can be hard, especially if you are on a tight budget. Despite the challenges, there are several ways to save regardless of the situation. Today we will discuss several different wasy to save money on a tight budget.

Forget about using credit cards:

Don’t use credit cards if you can’t afford to pay them off. This whole concept of borrowing money can and usually does end up causing more harm than good. Stick with cash purchases wherever possible. Keep in mind that this will affect your borrowing power. If having a good credit score is important to you, borrow but only if you have the money to pay it back.

Eat home cooked meals:

Dinner for two can run you anywhere from $20 to $60 dollars. Those same twenty dollars can provide a couple days worth of home cooked meals. Some of you may point out that fast food is usually cheaper than cooking at home. While this may be true, fast food isn’t technically real food. The question is, are you willing to save a few dollars at the expense of your health?

Budget your money:

If you’re on a tight budget, chances are you’re spending more money than is coming in. This can be for a variety of reasons. After-all, life is full of obstacles and nothing ever goes according to plan. Sometimes being strapped for money is more complicated than just poor money management. I recommend that you set money aside for those unforseen events in life. Start by setting up a new account that will not be touched unless a real emergency occurs. Start small and slowly build this account until you have at least 6 months worth of your salary in there. Once again, I want to stress that you build this up slowly. Breaking down goals into small attainable chunks, increases your chances of following through.

Monitor your accounts:

Do this at least once a week. The goal here is to identify where your money is going. Trust me you’ll be surprised at how small purchases slowly add up to several hundred dollars a month. This is also an excellent way to spot fraudulent activity in your accounts that could harm your credit score.

Avoid impulse buys:

Take the time to jot down your wants and needs. Don’t sacrifice needs for wants. Once you’ve determined where your money needs to go, try and set some aside for wants. This important if you want to keep your sanity in tact.

Posted in Money Management | Tagged , | Leave a comment

Money Management And Identity Theft

Posted on February 26, 2012 by debt_free

Money management is fairly straight forward when you are in direct control. Unfortunately this almost never the case. There are many outside forces beyond our control that can cause us to lose money quickly. Today we are going to discuss identity theft and the importance of monitoring our expenses.

What is identity theft:

Identity theft is the use of someone else’s personal information (ID’s, social security number, credit cards etc) to commit fraud. Identity theft is a rapidly growing crime with no signs of slowing down. In this digital age, it’s super important to keep an eye on all of our accounts.

Guard your personal information:

If you’re making purchases online, be careful who you give your credit card number out to. I tend to stick with larger merchants to reduce the risk of getting my credit card information stolen. While this isn’t 100% full proof, larger merchants are more likely to have the security in place to deter hackers. With that said, large merchants and credit cards companies are usually the target of said hackers. Proceed knowing that there is still some risk involved.

It’s also imperative that you understand who is requesting your personal information and why. In other words if you receive a call or e-mail requesting personal information, proceed with caution. If an e-mail requests your social security number and credit card information, this should raise a red flag. This method is known as phishing and is used by scammers to obtain personal information from unsuspecting victims. If you receive a suspicious e-mail, do not follow the link. I recommend that you contact the respective merchant or bank to verify the authenticity of the e-mail. The same can be said of suspicious phone calls. Don’t be so willing to give out your information simply because they claim to be an authority source.

A paper shredder is your friend:

Dumpster diving is a term used to describe people that dig through trash to obtain others personal information. You want to be careful what you throw into the trash. Bank receipts, credit card offers, bill summaries, blank check offers, and other personal information should always be disposed of by using a shredder.

Request a copy of your credit report:

Your credit score says a lot about you and your purchasing power. You can also use it to identify fraudulent transactions. You are allowed one credit report per year from the three credit bureaus so use this to your advantage. When looking over the reports look for mistakes and correct them immediately.

Monitor your accounts often:

The best way to spot a thief is by constantly monitoring your accounts. Monitoring your accounts will also help you with money management as it will help you get a better picture of your expenses. If you notice any suspicious activity, contact your bank immediately.

The simple act of commerce puts everyone at risk for identity theft. Scammers and hackers are everywhere searching for new ways to steal identities and money. The examples above are just a few ways to help you from becoming a victim.

Posted in Money Management | Tagged , , , | Leave a comment

Three Simple Saving Money Tips

Posted on December 3, 2011 by debt_free

Saving money can be very difficult at times. There are many factors at play that can make it difficult for someone to save consistently. With that said, some form of savings is better than nothing. Discussed below are three different ways to save money.

 

Avoid contracts of any sort:

 

One thing that I’ve learned in my years, is that anything can happen. And I do mean absolutely anything. Nothing is for certain, especially when it comes to money. For this very reason I caution you to sign on to any kind of purchasing agreement unless it is an absolute necessity. Once you agree to any form of agreement, whether it be a phone contract or car purchase, you are bound by their terms and conditions. Failure to carry out the agreement can and usually results in large penalties.

 

There are always alternatives to contracts. The obvious alternative is to pay everything with cash. If you don’t have the money then there will be no purchase made. Simple as that.

 

For cell phone service, there are several monthly services available. If you’re purchasing a car, don’t forget that you are buying something that depreciates in value. Consider buying a used vehicle instead.

 

I’m not saying that all contracts are bad. Just remember that once you sign something, you are bound to those terms and conditions. Should anything happen to your main source of income, you are still responsible to pay off what you borrowed.

 

Search for promo codes and free shipping:

 

While it’s not much of a saving, shipping costs can easily start to add up. Shipping costs are generally waived when there is a special sale or promotion. Speaking of promotions, browse the web for promo codes and you may be able to save some extra money on your online purchases. Coupon sharing sites are generally up to date on special promo codes and or coupons.

 

Pack your own lunch:

 

Believe it or not, most of our savings are going to come from our every day purchases. Take lunch for example. It’s easier and more convenient to eat out than it is to pack a lunch for work. Sit down and do the math for a minute though. Your typical meal can cost anywhere from seven to twelve dollars. Now say we work 5 days a week and eat out just as many times

 

during our lunch periods. That’s about fifty dollars a week or two hundred dollars a month in lunch money. Your lunch exenses can be much lower if you take the time to pack some food from home.

 

Saving money is all about cutting back on things that you don’t need. There are several different ways to approach this. The tips described above are good starting points. It may be hard to do, but try to live within your means to avoid falling into debt.

 

 

 

Posted in Debt Management Tips | Tagged , | Leave a comment

How to save money on taxes

Posted on January 24, 2011 by debt_free

With the holidays over, it’s now time to start preparing for taxes season. Being prepared can mean fewer headaches and potentially more savings when you file a return. The following are guidelines that can help you save money on your taxes.

Save when filing:

Filing taxes used to be a thing for accountants and professional tax preparers. Thanks to computers and tax software, it is now easier to prepare and file taxes on your own. A benefit of filing on your own is that the cost of filing is usually less. Software such as turbo tax also allows you to prepare and file taxes all in the comfort of your own home.

Save if you have children:

If you have children, your savings will be even greater. As a parent of children 17 and under, you can receive a $1,000 credit. You can also save money if your children are attending college. You may have to look into what credits apply for undergrad students as most credits have limited lifespans and are at times extended or replaced with other credit based programs.

Save money while helping out non profits:

Did you know that many charitable contributions to non profits are tax deductible? That’s right, helping others can help you save some money. Make sure that there is documented proof of your donations.

Running your own home business:

If you are one of the many Americans that works from home, there are many tax breaks that you can take advantage of. It is strongly recommended that you have a section in your home with your business as its primary function. If you are going to use your home as a tax write off, keep track of all necessary documentation in case of an audit.

Home improvements:

Have you made any recent improvements to your home? Well some improvements can end up saving you some money when you file your return. Energy saving improvements will earn you credit on your taxes.

These are a few simple ways to save money when filing your taxes. Saving money is all a matter of being aware of all possible options. This can be done with some research or having access to a good accountant.

Posted in Debt Management Tips | Tagged , | Leave a comment

New years resolutions: Finding ways to get out of debt

Posted on January 2, 2011 by debt_free

The new year is approaching so you know what that means, time to start making new years resolutions. Now is the perfect time to start re-evaluating our finances. Regardless of the time of year, it’s always a good idea to keep an eye on expenses. If you want to save more money below is a plan of action that can be useful.

Track all of your expenses:

And I do mean all of your expenses. A lot of times what ends up happening is that consumers only track major expenses. Small purchase like a daily cup of coffee can easily add up to several hundred dollars a month. Once you have figured out where all of your money is going, you can start cutting un-necessary expenses.

Seek out cheaper alternatives:

One of the fastest ways to cut back on expenses, is to completely cut out the smaller expenses (for instance that cup of coffee). If this doesn’t seem like a viable option, you can do the next best thing, and that is to find cheaper alternatives. This can be done by either purchasing a smaller size/quantity of the product, or by purchasing the lesser known brand.

If abandoning your favorite cup of joe is out of the question, you can opt to buy it less frequently (every other day). While this method won’t exactly save you much money, it is a step in the right direction.

Set realistic goals and stick with them:

Let’s face it, new years resolutions are made to be broken. Money management is one of the most broken new years resolutions. For some reason, people are failing to complete what they set out to do. Do not fall prey to this trap. Be realistic about your goals, do not set goals that you cannot achieve.

To help you stay motivated, start with small money management goals and set deadlines for each. Having achievable goals will help you stay motivated and help drive you from goal to goal.

Posted in Debt Management Tips | Tagged , | Leave a comment

Holiday Savings: How To Budget And Save Money

Posted on November 15, 2010 by debt_free

Saving money can be especially hard during the holiday season. With family gatherings, holding parties, and buying presents, it is easy to lose control of one’s budget. Many consumers will end up spending more than the should this holiday season. Below are some guidelines to help you budget accordingly during these times of celebration.

Make your own gifts:

Most of the fun of the holidays is receiving gifts. While it may be tempting to purchase gifts this year, it is not recommended if you are currently in a debt management program. If you don’t want to leave your friends and family empty handed, you can always make a gift. Making a gift for someone is an easy way of showing that you love them. Sample gift ideas include, knitting a sweater or scarf, making your own holiday cards, to making toys with cardboard (shields, swords, and spaceships come to mind).

Purchase gifts on a budget:

This option may be good for shoppers that know how to budget and save money. If you feel that making your own gifts isn’t enough, it’s time to start looking for sales. The best time to save money is during black friday. Black friday is the first friday after thanksgiving. On this day many retail stores offer huge discounts on popular items. Most of the incentive behind black friday is to get shoppers to shop more than they should. To avoid spending more than you should, make a list of everything that you intend to buy. Do not make any reckless purchases and you should be fine.

Cyber monday:

If you absolutely hate the act of shopping, you can look for deals online on Cyber Monday. Like Black Friday, expect to find huge discounts on Cyber Monday. The best part of Cyber Monday is that you can do all of your shopping in the comfort of your own home.

Dinners on a budget:

If you are big on holidays, chances are you will be spending a lot of money on dinners and groceries. Save money on groceries by shopping at discount grocery stores. If possible, try to pass the hosting duties to someone else. The more you can split your expenses, the better off you will be.

Set a budget:

This is quite possibly the most important step you will take to save money during the holidays. Set a budget and stick to it. Create a list and determine what your priorities will be during the holidays. Setting a budget will help keep you get out of debt fast by keeping you from creating further debt.
Posted in Debt Management Tips | Tagged , , | Leave a comment

Is debt taking over your life? Learn how to get out of debt fast

Posted on October 15, 2010 by debt_free

Do you find yourself struggling to pay the bills? If you are among the many americans that have borrowed more than they can afford, do not despair. Below are several steps to take to help you get out of debt fast.

Cut down on the amount of credit cards available:

Sometimes debt exponentially grows because consumers have too many open credit cards to keep track of. It’s time to have a serious look at all of your available lines of credit. The goal is to discontinue use of almost all of your credit cards. The first step in getting out of debt, is to stop spending money. In other words, you want to stop digging yourself into a deeper hole.

Locate the lines of credit with highest interest:

Getting rid of unneccessary lines of credit will stop your debt from spiraling out of control. The next step is to identify the credit cards with high interest. It’s time to start negotiating with credit card companies for lower interest rates. In order to be succesful at this, you have to be able to prove financial hardship. Companies will be hesitant to reduce your rates if they don’t see any change in your income and if they continue to receive payments from you. If you have bad communication skills, consider seeking help from an outside party.

Seek help from a credit counseling agency:

There are many reasons why consumers fall into debt. A credit counseling agency will help you identify the root of your money problems and help you solve them.

Consolidate your debt:

Consolidating your debt will make it easier to keep track of payments. You are generally going to be paying one lump sum that will then be distributed amongst all of your lenders. The good thing about this method is that your payments stay the same through out the term. In other words, you will continue to pay the same amount of money even if you are paying off  less creditors. Once you pay off one debt, the money is then allocated into the remaining accounts. This will help you pay off your debt much faster.

Posted in Debt Management Tips | Tagged , | 2 Comments