Educate Yourself on the Property Conundrum

We need to educate ourselves about financial matters to avoid getting into the kind of debt we have seen in the last few years.  That is, educate and avoid bad debt and the need to erase debt in the future.  

I found this easy to understand video on the property conundrum  - understand the housing bubble..

Here you will find on the Khan Academy follow up video - it is easy to see why the recession happened!  We called them NINJA (no income, no job) loans.  The third video....and there are more but it gives you a good idea of what went wrong.

Salman Khan is a former hedge fund manager with a desire to educate on finances.  This is a selection of his bite size videos.  Great work!

The idea behind Khan Academy is to provide a “world-class education to anyone, anywhere.” Khan has been praised by Bill Gates, who, according to a CNN Money article, uses Khan’s videos to help his children with their homework. Khan offers more than 1,600 videos on a number of subjects, including finance. There is also an exercise dashboard with sample problems and formulas to help you out. You can also make use of a knowledge map to plan out your course of study, or look at a progress report

 

 

 

A Tip to Erase Debt

A tip to  erase debt: Put your credit cards somewhere where they will not tempt you. You may like to consider keeping at least one card for emergency purposes.  If you have poor credit, you may find it more difficult to get a credit card in the future and if you keep at least one account open, then you won't have to worry about applying.  One tip is to put your credit cards in a zip lock bag, put the zip lock in a container of water and place the container in your freezer.  Not only will the cards not be tampered with, you won’t be able to use them on impulse!

Erase Debt and Avoid Debt Burden.

We all know that some debt is necessary but it's how you borrow and what you borrow for that is the important thing. This tip that will help you to avoid the need to erase debt:

•   Only take on only debt you can afford the repayments to and only buy items that appreciate in value when using borrowing. 

Do you have a large credit card balance? This is not good debt – and yes it is a debt as you must pay it back and the interest on credit cards are one of the highest at around 18 percent or higher.  An overwhelming credit card balance caused by your need to impress others is just a costly lie. 

•     Living within your means is living honestly.  Make a promise to yourself to live within your means and do a budget.
•   Rather than using your credit card for spending, save for the purchase.
•  Always pay more than the minimum if you cannot pay your credit card in full.

Because of temptations and high interest rates it is important to control and erase debt on your credit cards.