5 Financial tips for the first week of January 2013

The 5 Financial
tips for the first week of January 2013 are given below:

Tip no 1: Selling off
a part of one's personal assets is better than liquidation under bankruptcy to
repay the loans.

The court appointed bankruptcy trustee evaluate your assets
and determines what to sell in order to discharge debts. The sale proceeds are
used to pay back the creditors. You can avoid this predicament all together by
selling your assets on your own.

If debts are troubling you, then consider selling some of
your assets. For instance: antiques, a second vehicle, etc. Approach an
appraiser to have an estimate about the value of your asset. Sell the asset and
repay your debts before you're being compelled to file bankruptcy.

Tip no 2: Borrowing
from acquaintances in order to repay your debts is much better than bankruptcy.

You may feel
awkward and shy to borrow money from your friends or family members in order to
repay debts. You may not want to risk your sweet relationship with your
friends. However, it is much better to ask money from your relatives rather than
filing bankruptcy. This is because your credit score falls by 200-250 points
after filing bankruptcy. Moreover, it becomes very difficult to get a new line of credit
after bankruptcy. You may be able to obtain a loan after 2-3 years of filing
bankruptcy.

Borrow money
from the people you trust. Plan the mode of repayment also. You can't afford to
sour your relation with your near and dear ones.

Tip no 3: Run away
from payday loan lenders to avoid debt in 2013.

Payday loan lenders give loans very happily to the
borrowers. They don't even check the credit score of the borrowers. However,
they do charge a very high interest rate on the loans. Borrowers struggle to pay
such high interest rate on the payday loans.

It has been seen that usually borrowers are able to pay the
interest rates in the initial months. However, borrowers are compelled to skip
payments in the subsequent months. It is simply not possible for the borrowers
to keep on making huge monthly payments. Thus borrowers soon get into financial
problems.

If you’re facing financial constraints and need money, then
take out a personal loan from your friends or family.

Tip no 4: Change your
spending plan instead of consolidating debts.

Consolidating bills into a low single monthly payment may
seem to be the solution to your financial problems. However, it may not be so
in reality. You may get into deeper debt problems after consolidating your
bills. If you don't change your way of spending dollars and continue to accrue
debts, then your problems will never be solved.

Amend your spending style instead of consolidating your
debts. Spend less and save more in order to repay your bills. If you fail to
pay off debt on your own, then take resort to debt consolidation.

Tip no 5: Pay
yourself after repaying your debts to boost emergency savings.

Sometimes, too much debt restrains you from saving for your
emergency funds. So, once you've repaid your debts, channelize all your funds
towards savings. Save money for your emergency fund.

When you've several debts, you're practically living without
the money. You're unable to touch the money. However, after the debts are paid
off, you can use the money to build your emergency fund. This emergency fund
will act as a financial cushion during monetary problems. You won't have to take
out a loan and get into debts in future.