Foundation of Credit Repair
There are three factors that are the foundation of credit repair and are directly related to
how successful you will be at repairing your own credit and getting out of debt. They are:
how successful you will be at repairing your own credit and getting out of debt. They are:
- Knowing how much you EARN
- Knowing how much you OWE
- Knowing how much you SPEND
Knowing how much you EARN
Most people if asked, do not know what they earn on payday. Common answers to this
question often begin with “Around…” or “Right at…”. What’s more obscene is that most
people don’t even know what is being withheld from their paycheck! Especially those
employees that are paid on commissions. This is not a good way to get out of debt.
When it comes to credit repair it is important to know everything about your finances so you
can execute your plan to create a better credit report.
Do you know your tax bracket? If you miss time from work for whatever reason, are you
certain your paycheck is calculated correctly?
Often, people do not want to be this detailed with their earnings because quite frankly,
feeling ill is not a priority in peoples lives. But it is important that you know exactly what
your cash flow is so that you can better manage your money and make decisions about your
spending habits.
Just because you can afford another $50 monthly payment does not mean that you can go
out and make a $3000 credit card purchase.
It can even help you in your career decisions. Such as maybe getting further education to
improve your earnings or even realizing that you are wasting your time at your present job
and that it’s time to find a better position with better pay with another company.
Most people if asked, do not know what they earn on payday. Common answers to this
question often begin with “Around…” or “Right at…”. What’s more obscene is that most
people don’t even know what is being withheld from their paycheck! Especially those
employees that are paid on commissions. This is not a good way to get out of debt.
When it comes to credit repair it is important to know everything about your finances so you
can execute your plan to create a better credit report.
Do you know your tax bracket? If you miss time from work for whatever reason, are you
certain your paycheck is calculated correctly?
Often, people do not want to be this detailed with their earnings because quite frankly,
feeling ill is not a priority in peoples lives. But it is important that you know exactly what
your cash flow is so that you can better manage your money and make decisions about your
spending habits.
Just because you can afford another $50 monthly payment does not mean that you can go
out and make a $3000 credit card purchase.
It can even help you in your career decisions. Such as maybe getting further education to
improve your earnings or even realizing that you are wasting your time at your present job
and that it’s time to find a better position with better pay with another company.
Knowing how much you OWE
As nauseating as it may be, you must
write down and calculate your debt.
Yes, all of it. Most people pay their
debts as it “come in”. Still, others pay
their debts as they “remember
them”. The best way to get straight
with your debt is to create a system
of paying your debt. I recommend
two steps.
First, make a list of all your debts.
Include the name of the creditor, the
amount of the payment to each
creditor, the dates they are due, and
the grand total owed to each
creditor. Meaning the pay-off
As nauseating as it may be, you must
write down and calculate your debt.
Yes, all of it. Most people pay their
debts as it “come in”. Still, others pay
their debts as they “remember
them”. The best way to get straight
with your debt is to create a system
of paying your debt. I recommend
two steps.
First, make a list of all your debts.
Include the name of the creditor, the
amount of the payment to each
creditor, the dates they are due, and
the grand total owed to each
creditor. Meaning the pay-off
How much you SPEND
This is important. This step will make you cringe. It may even make you cry. Not so much
because you will realize how much money you are needlessly spending. But more because,
you will be forced to decide what stuff to cut out. In most situations, needless spending is
fun spending. And nothing turns adults into babies faster than telling them they can’t spend
money on stuff that’s fun anymore. Some fun stuff that costs money:
This is important. This step will make you cringe. It may even make you cry. Not so much
because you will realize how much money you are needlessly spending. But more because,
you will be forced to decide what stuff to cut out. In most situations, needless spending is
fun spending. And nothing turns adults into babies faster than telling them they can’t spend
money on stuff that’s fun anymore. Some fun stuff that costs money:
sports cars
designer clothes
jewelry
high dollar shoes
hairstylists
designer clothes
jewelry
high dollar shoes
hairstylists
manicures
pedicures
tanning
salons
health clubs
pedicures
tanning
salons
health clubs
eating out
vacations
weekend excursions
movie tickets
ADD YOUR OWN
vacations
weekend excursions
movie tickets
ADD YOUR OWN
Many of us fall behind on our debts because we spend beyond our means. Trying to stay in
style.
You have to take a very serious and hard look at where you are spending the “extra” cash
you think you have left over, after you have paid all of your mandatory debts.
I am not talking about CUTTING BACK. I am talking about CUTTING OUT on this needless,
fun spending and directing this "extra cash" towards your debts.
I know, that if you are committed to sacrificing in these areas of fun spending, it will result in
your being able to pay off your creditors, become debt free, improve your credit report and
then you will be able to spend that “real extra cash” on the needless fun stuff and really
enjoy it, rather than worrying about how you are going to pay for it all.
These 3 factors will prepare you for your journey to becoming debt free, and are the
foundation of the success of solid credit repair.
style.
You have to take a very serious and hard look at where you are spending the “extra” cash
you think you have left over, after you have paid all of your mandatory debts.
I am not talking about CUTTING BACK. I am talking about CUTTING OUT on this needless,
fun spending and directing this "extra cash" towards your debts.
I know, that if you are committed to sacrificing in these areas of fun spending, it will result in
your being able to pay off your creditors, become debt free, improve your credit report and
then you will be able to spend that “real extra cash” on the needless fun stuff and really
enjoy it, rather than worrying about how you are going to pay for it all.
These 3 factors will prepare you for your journey to becoming debt free, and are the
foundation of the success of solid credit repair.
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Debt Credit Learning Center
amount.
Add up the total of monthly payments and the grand total due to all creditors. This will give
you a clear picture of your total money spent each month on debt. Money that could
otherwise be earning interest at your bank.
Second, make use of a wall calendar. Preferably, one with big squares with enough room to
write in the names of your creditors and the dollar amounts that are due in the appropriate
dates. Make the time to fill in the entire year, January through December. Do not fill it in as
you go. You don’t want to 'conveniently' forget one of your creditors. By doing it this way,
you will happily see, with every flip of the month, just how much money is being wasted as
opposed to earning positive interest at your bank.
These two steps must be used simultaneously to be effective.
Add up the total of monthly payments and the grand total due to all creditors. This will give
you a clear picture of your total money spent each month on debt. Money that could
otherwise be earning interest at your bank.
Second, make use of a wall calendar. Preferably, one with big squares with enough room to
write in the names of your creditors and the dollar amounts that are due in the appropriate
dates. Make the time to fill in the entire year, January through December. Do not fill it in as
you go. You don’t want to 'conveniently' forget one of your creditors. By doing it this way,
you will happily see, with every flip of the month, just how much money is being wasted as
opposed to earning positive interest at your bank.
These two steps must be used simultaneously to be effective.