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What To Do If You Have A Bad Credit History

A bad credit history can be greatly unsettling and it’s something that you might only find out when you’re eventually refused a loan or mortgage that you desperately need. Many people feel helpless and confused when they realise that their credit history is less than ideal and they’re categorised as being unreliable or untrustworthy. As it’s not something that you’re necessarily taught at school, knowledge on the world of credit often comes from trial and error or learning from the lessons of others. If you have a bad credit history or think you might, here are four simple things that you can do to help yourself out of it.

1.      Find out the Cause

There are many things that can cause blemishes on your credit history and some of them you might not even know about. Bad financial behaviour like failing to meet payments on time or having legal action taken against you because you have breached a contract can leave serious marks on your record. The less obvious problems actually come from not borrowing at all. This means that lenders cannot asses your reliability because your credit record is very short or doesn’t exist at all. Similarly if you only borrow small amounts for a short time you can have a worse credit history than those who have taken out loans of large sums for longer. This is because, ultimately, loan companies want to make money so if you can show that you can afford to pay interest on top of your repayments then you are more attractive to them. If you find out that your credit record is bad, then it’s important to first identify what may have caused it so that you can take the right steps forward.

2.      Seek Advice to Improve

Next you should seek advice from money advice agencies or from friends or family you know that manage their money well or are in the financial sector. Beware of credit companies who constantly advertise that they can ‘solve all of your credit problems’ and ‘erase bad credit’ as many of them are likely to be scams. The fact is that there are no quick fixes when it comes to improving your credit rating. It takes time, patience and conscious effort with a disciplined budget or debt plan.

3.      Make Some Changes

When you have a plan, it’s time to actually implement some changes into your lifestyle and money management habits. There are many ways you can do this depending on what problems you have. One easy way to help payments get transferred on time is by setting up payment reminders on your bills or signing up for direct debit, but make sure you monitor that you have enough in your account first so that you don’t get charged with nasty overheads.

4.      Research Your Options

If you are refused a loan or insurance, don’t be afraid to ask for a report on why the company has made this choice. You are entitled to a report within 60 days of receiving the notice so be sure to do some research on your record. Some companies offer special deals for those with poor credit history such as guarantor loans so don’t worry as there are still options available to you. Credit report companies can also provide you with a free credit summary that will help you to spot inaccuracies in your rating.

Navigating the money minefield is tricky business especially if you’re on a tight budget or have been in troublesome situations in the past. But you don’t have to let it hold you back forever and with these simple tips you can move forward into a better financial future.

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Be the first to comment - What do you think?  Posted by Cash Flow Mantra - April 16, 2014 at 8:00 am

Categories: Credit/Debt   Tags:

5 Mistakes That First-Time Investors Make

Can you imagine having enough money in your back pocket to be able to buy every single person in the world a Cherry Coke and a Cheese Burger? Warren Buffett can, but even he had to start somewhere.  Whether you’re young or old, there’s always time to start investing. Unfortunately, it’s not the easiest thing in the world to understand, and many make poor decisions that result in negative profit. We know that this is definitely not ideal, so we’ve put together this guide of the five mistakes that investors most commonly make.

 1.      Starting too Late

Many prospective traders and investors know that they want to invest from a young age, but they never do. Instead, they leave it too late, and this means they’re wasting valuable time in which they could be building up their investment assets and therefore their profit. Starting early is clearly a priority if you want to make as much money as you can as quickly as you can.

2.      Being Passive

Money doesn’t make its way into your bank account while you sleep. Instead, you have to go and actively seek it out. By being active in this way, you’ll ensure that you take every opportunity you can. This means:

  • Talking to potential co-investors
  • Watching the news to discover investment opportunities
  • Engaging with the local community to see what service/product they require that you could create
  • Nurturing your current investment projects so that you know they’re constantly at their best.

3.      Investing in Something Easy; Not Something You Love

The best investments you will ever make will be in the areas of life you are passionate about. This is because if you’re not personally and emotionally invested in a certain idea or project, you won’t be able to complete your duties as the investor to the best of your abilities. If you’re passionate about interior décor, don’t invest in FX – invest in property.

4.      Relying on Intuition; Not Informing Yourself Enough

A good investment is one that you’ll research and educate yourself on before you become financially invested in it. This can come in a number of different forms – from reading forums, to consumer and business advice from somewhere like the Citizens Advice Bureau to discussing ideas with practicing business professionals.

5.      Using an Old Trading Platform

Gone are the days where you ring up your Forex broker and ask them to open and close positions. Instead, now the emphasis is very much on you to do your own work, which you do using an online trading platform such as Alpari’s ecn mt5. These platforms are regularly updated, and so new features are added on an annual basis. This means that it’s crucial to keep updating your trading platform. Without doing so, you’ll fall behind and you might lose your competitive edge.

 

Ultimately, all brilliant investors had to start somewhere, so avoid the above problems and learn from others’ mistakes. If you do, you’ll find yourself far better equipped for the job.

Be the first to comment - What do you think?  Posted by Cash Flow Mantra - April 14, 2014 at 6:19 pm

Categories: Investing   Tags:

The End of the First Quarter

Well, the end of the first quarter for the new business happened recently, and I finally got some numbers together to look at the results.  In fact, the bank representative emailed me yesterday in order to file a report on the new ownership, so it was easy to just send him the spreadsheet.  Hopefully, the bank is pleased.  Bills are getting paid and payroll is being met at the same time that debt is being eliminated so it should all be good.  February was a bit lean, but weather was terrible in January and February.  The business was actually totally shut down for 3 days, and we still managed to come out reasonably unscathed.

Comparison to 2013

I won’t share detailed numbers, but I know the sales from last year and divided by 4 to come up with a quarterly average.  When I compare to the net receipts after taking out sales taxes, I find that the current number was up by 7%!  And that is without anyone doing full time sales.  The business had tried to get lean in order to survive and only had 3 workers down from 5 at one point.  We have talked about bringing on a 4th part-time in order to get someone out to do more sales and customer interaction.  That will probably happen this quarter.

ProForma

I think one of the issues with the prior management was lack of attention to detail when it came to finances.  Looking over the books, I got the sense that there was lack of awareness as to the actual expenses of the business.  I got an initial proforma from the prior owner, but went to look back at the past 3 years’ tax returns in order to come up with my own numbers and make some modifications.  There have only been a few surprises when comparing expected vs. actual performance.

First, the amount spent on telephone has been double.  It could be because we added another cell phone so my wife could have a dedicated business phone since she has been doing a staggering amount of work during these first 3 months to keep things heading in the right direction.

The other surprise has been the expense for health insurance.  The prior insurance company pulled out of the market due to ObamaCare and the new policies with a different company ended up being about 30% more expensive for a similar plan but with slightly less favorable deductibles.  That is one reason that the next employee will be part-time.  No way I want to pay another 25% increase to the benefit column at this time.

Slight Profit

The good news is that at the end of the quarter, we were able to show a slight profit after paying all expenses.  Hopefully, as spring and summer arrive we will be able to continue the current pace or even grow a bit more.

 

 

 

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Be the first to comment - What do you think?  Posted by Cash Flow Mantra - April 9, 2014 at 10:05 am

Categories: Investing   Tags: , , , ,

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