BANKATLANTIC SHARES TIPS FOR REDUCING PERSONAL DEBT
FORT LAUDERDALE, Fla. – June 25, 2009 – As many Americans struggle against the one-two punch of corporate lay-offs and rising credit card interest rates, it is no surprise that millions are falling deeper into debt. According to TransUnion, credit card delinquency rates were up 11 percent in the first quarter of 2009, a strong signal that Americans need to pay more attention to their personal finances and pay off their debt.
Ken Binger for BankAtlantic, Florida’s Most Convenient Bank, regularly offers proven "best practice" tips to families struggling to reduce their debts. “Debt management is actually one of the most underutilized aspects of personal finance. With a few easy-to-use techniques, families can save thousands of dollars simply by being more strategic in how they manage and pay their bills,” says Binger.
• Understand your credit score: Check your credit score at least twice a year. Financial institutions use it as an indicator of how “risky” you are. This determines whether or not you will get credit in the future, and how much interest you will be charged. Improving your credit score can save you tens of thousands of dollars, especially if you are thinking about buying a house or taking out a car loan.
• Get organized and avoid missed payments: Late payment fees are very high, and can seriously hamper your efforts to pay down your bills. If you do miss a payment, call your creditor and ask to have the penalty waived. They’ll usually accommodate the request, at least the first time.
• Take advantage of low interest credit card offers: You can reap large savings on low or 0 percent interest credit cards. By transferring your balance from high interest cards to cards with lower Annual Percentage Rates (APR), you can reduce your monthly minimum payments and lower the amount of interest you pay over time. It will also help you keep an eye on your balances.
• Avoid racking up more debt: Hide your credit cards and start using cash or a Debit Card. Put your credit cards in a safe place in your home, not in your wallet where the convenience makes it easy to spend. Similarly, remove your credit card numbers from your online accounts. It’s easy to spend online when your card information is stored – the best way to break the habit is to simply delete the card from the account. Use your Debit Cards, which works as a credit card and deducts funds directly from your checking account.
• Refinance your mortgage: Determine if refinancing is right for you. If you can reduce your interest rate by 1 percent or more, it will often save a great deal. This is particularly true if you have high rates due to a less than stellar credit score. Start by asking your current mortgage lender about lower rates. If they aren’t responsive, shop around and check out all available options.
• Eliminate Private Mortgage Insurance: If your down payment was less than 20 percent, you are probably paying Private Mortgage Insurance (PMI). Find out if you have a 20 percent cushion through reducing your debt and/or home appreciation. If so, contact your mortgage company to explore the process of removing the PMI.
• Consolidate your student loans: Interest rates are very low right now, so it might be worthwhile to consolidate your loans into one low-rate package. Look into the various student loan consolidation packages. A 1 percent reduction on a $10,000 loan could save you $100 a year – and if your loan amount is larger, the rate cut will save you even more.
• Enroll in an automatic debt repayment plan for student loans: Many student loans offer a rate reduction if you sign up for their automatic debt repayment plan. Not only will you enjoy the convenience of not having to make physical payments through the mail, you’ll love the savings!
• Watch out for and avoid unanticipated debt: Medical and dental debt, for instance, can pop up anytime. Be proactive! Use flexible spending accounts “FSAs,” which allow you to pay certain medical, dental and child care expenses using pre-tax dollars. If you’re not taking advantage of these accounts, you’re wasting money. Check with your HR department to see if your employer offers FSAs. If so, check out the benefits, enroll and start proactively saving.
• Track your debt, and take the pain out of paying: The sooner you identify how much debt you have, the sooner you can make a plan to pay it off. Calculate the amount of debt you are in, as well as the money you are currently paying on it. The quicker you pay it off, the less you’ll have to pay in expensive interest charges, and the more you’ll save in the long run.
Reducing your expenses through strategic debt management is one of the surest ways to save money today and keep money in your pocket tomorrow.
Media Contacts:
Sandra Fine, rbb Public Relations
Phone: 305-567-0535 Email: Sandra.Fine@rbbpr.com
Sharon Lyn or Leo Hinkley, BankAtlantic
Phone: 954-940-6383 Email: CorpComm@BankAtlanticBancorp.com
About BankAtlantic:
BankAtlantic, “Florida’s Most Convenient Bank”, is one of the largest financial institutions headquartered in Florida. Via its broad network of community branches, online banking division - BankAtlantic.com , and conveniently located ATMs, BankAtlantic provides a full line of personal, small business and commercial banking products and services. BankAtlantic is open 7 days a week with extended weekday hours, Free Online Banking & Bill Pay, a 7-Day Customer Service Center and Change Exchange coin counters. Hours vary by location; please visit BankAtlantic.com\Locations for a complete listing.
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