Carrying Credit Card Debt
If you carry a balance on your credit card not only are you paying exorbitant interest rates but you also ruining your opportunity to get a mortgage or some other kind of loan and you are lowering your credit score. If you want to fix your personal finances you need to eliminate your credit card debt. If you need help in eliminating your credit card debt get it.. You won’t have any leverage with lenders if your credit is in poor shape. The sooner you eliminate your credit cards the less likely you will ruin your rating.
Too Much Home or Auto Deb
You should not exceed thirty percent of your gross income when it comes to how much you are paying for your mortgage. On that same line of thinking, how much you pay in transportation expenses should never be greater than ten percent of your income (that includes insurance, gas and repairs). If you are paying more in one or both of those categories, you are in over your head with regards to home or auto debt.
What to do? It may be time to rethink where you are living. If you are unable to afford a home or apartment with a thirty year fixed rate mortgage, you can’t afford to live there. If you are unable to pay the 60 month loan for a vehicle, you should be driving that car. Those are simple personal finance basics you must know.
You Tapped Into Your Emergency Fund or You Don’t Have an Emergency Fund
The value to have money in hand has become more and more valuable with each passing day. You should have an emergency fund. That fund can assist with paying for unexpected expenses like as car repairs and it will even cover any bills if you lose your job. Most people aim to create an amount that is equal to three months living expenses. If you have a family it is wise to be able to cover six months. Clearly the more you can afford, the better. If you don’t have an emergency fund, you should start creating one. A way to get started is to have a goal of creating an amount of $1,000 and then go from there.