Things you should know about Debt Management

Have you ever wondered how you get into debts?

Debt is something which, none of us would want to entertain in our lives. But sooner or later, we do get into debts and sometimes it takes years to clear it off. We all think that we have control over our money, but the fact is our mind is manipulated every moment towards spending money. Before you even realize it, you would have spent it on something unwanted. And the debts get added. If you follow a proper debt management plan, you will not only be able to clear your debts plus you will know to avoid getting into debts.

Debt Management

What is debt management?

First of all, you need to know what debt management is and how it can help you.List down the debts based on the interest rates. Start clearing off the ones with higher interest rates. If you find it difficult to clear off debts with the existing financial situation then you can look for debt management plans. There are various companies that offer debt management plans and you can choose based on your needs. The first essential thing to do is not falling into further new debts until you clear all the existing debts.

There are quite a few things that you need to know before you can plan on debt management.

The marketing strategy:

A research says that the turnover of media advertising industry was 207 billion U.S dollars in 2017, which is the result of you and other customers who fall as prey of the marketing strategy.

People in the fields of marketing, sales or advertising know it better to make you spend your money on the things which you might not need even. Call it the marketing strategy or your hopping mind which gets tempted to buy things – everything adds up to debts and tons of debts!

Installments add up to become debts!

You do all the research for a home, and finally found your dream home- a place of your choice with all the things as you wished, but wait for the cost of it is beyond your affordable limit. The cloud of disappointment surrounds you, and then a friendly salesperson comes and shows the path. He explains how the huge amount can be broken into small monthly installments to be paid in few years and it won’t pinch your budget as well. You might just notice the short-cut that leads to your dream home and not the debt that is going to be with you till you retire or may be longer. Meanwhile, you need to look for a way to save for retirement as well. A house or property out of your affordable limit will leave you with debts for a lifetime and make it difficult to plan your savings.

By knowing the debt management technique, you will be able to organize your finances well. You can avoid such scenarios by fixing a workable budget before you look for a house. This will also help you to evaluate your debts, clear it off and how you can progress towards a savings plan.

The comparison trap!

Why can’t I go for nice cars, big home etc. which other people have?

I can easily get those by paying small monthly installments over a period of months and years. But, what about savings? Others would have saved for it and bought, you might not know the details.

Don’t fall into the trap of comparing with others and end up buying something which you might regret for years. Paying 4 to 5 small instalments every month can seem like a burden in the long run. Especially, when there is a financial emergency, you are all stuck in debts and left with no money.

The savings strategy:

If you still want to buy things out of your affordable limit, then start saving for it. There are lots of ways in which you can get started with savings:

  • Start with saving in banks that offer better interest rates.
  • Look for ways to invest your money.

Create a short-term or long-term financial goal:

A short-term goal can be a down payment for a car. A long-term goal can be a down payment for your dream home. This will surely reduce your burden of debts. Once you have saved a good amount, the instalments may be paid off in a short span. You can even start saving once you clear your monthly instalments.

Summing up:

Getting into debts is very easy but getting out of it will take huge efforts and time. You need to manage your finance wisely or else you will end up in trouble. Through debt management, you will be able to learn to balance between your debts and savings.


Smart Retirement Plans

Everything changes with time. People grow old, retire from jobs and then start a new phase of life, the retirement phase. Retirement is a new beginning with new joys with the possibility of fulfilling the missed dreams of youth. Growing old does not indicate lower expenditure, rather it is the opposite. Today an average person lives more than 60 years. The old days become painful if one does not think about retirement plans as early as possible. In these days of high inflation, increasing life expectancy rate, rising health care costs and nuclear family tradition, retirement days are full with anxiety. One thing that promises a happy retirement life is a financial independence. It makes life easier. All it needs is a smart retirement plan so that one could enjoy the retired period to the fullest, without any worry.

Retirement Plans

Retirement plans involve many aspects to consider. The first thing is to decide when you are planning for retirement and what are your expectations that you want to realize after retirement. Say you want to go on travelling or want to buy a car. You may want to try in investment banking, gift your children something or just enjoying your later days with your spouse happily, anything you feel good.  Planning your wishes will help you in deciding how much money you will need after retirement. You can figure out the expected amount by considering your monthly needs which must include possible price rise and certain similar unexpected events that may occur potentially.

Once you have decided what you are saving for, it’s the time to plan how to save it. There are many ways to save the sum and spend it wisely when you will need that later.

Many if the government employees and people working with certain renowned private organizations are naturally extended with pension plans. It is a steady and reliable income source for the post-retirement period.

Even then the amount people get from pension plans is never sufficient enough to cover the expenses. Investment is another great way to achieve your goal. Depending on your retirement period and plans you can choose from a variety of available options. There are different kinds of investment plans are available with different insurance companies and banks. The important thing is to choose what suits you best. In case you are nearing retirement, you may like to choose the immediate annuity policy in which you will have to invest a large sum at once and start receiving pensions immediately. For those young workers who will retire very late, deferred annuity is the best option. Here you need to start building the fund at an early age and you will receive the pension out of this saving once you retire. You need to take care of the tax issue if you are planning for any of the above plans.

Investment banking is another way to get handsome money regularly in old age. You can invest your money in profitable business such as stock market, property marketing, mutual fund, bonds, equity etc. All these involve market risk and require some professional advice but can be highly profitable if manage wisely. The young investors need not worry about the risk as they are long-term investors.

Everybody should be conscious and choose a retirement plan wisely. So that you can enjoy your old day hassle free.


Tax Planning – Be Careful Every Step Of The Way

Experts will tell you that effective tax planning is vital to keep legal dues at a minimum level. Moreover, it maintains the strain of tax remuneration at a minimum level too. This works in a way that taxpayers are free of overpriced fines that will return from incorrect computation or incomprehensible deadlines. Needless to say, things like this need time, effort and diligence on your part. Attempting to try and do all the accountancy and computations at the last moment by you yourself is certainly uncalled for.

Each procedure concerned here has to be started upon as early as possible. They need to be maintained on a daily basis to confirm complete and consistent records so that you won’t be suspected of falsification of required documents.

Tax planning isn’t easy

tax planningLet’s just say, if you are not careful with your tax planning and its follow-up, it will leave you scrambling through the documents and other paperwork concerned here. Keep a constant check on your record keeping. As long as you get a hold of the receipts, identify your expenses and financial gain, have them scanned and hold on to digital documents. In case you lose the first copy, you would not have much difficulty to pull up another proof. This is helpful when you are vying for tax refunds for the year.

Cutting back is necessary

When you maintain the account of your earnings and disbursal, there are some measures that you must observe to cut back on your dues regardless of your option to file taxes online. These include repairs and maintenance as well as the payments to your insurance policy. Declaration of investment properties is additionally needed by the government. Though these investments are extra sources of financial gain, no matter what value is spent on their maintenance, these will be declared as legal deductibles. This will be for the payments directed to your insurance supplier.

Know the deductibles

If you run your own business, your deductibles might be available in a distinct kind. Regardless of the type of record keeping, you need to be equally thorough and reliable. Superannuation guarantee payments, immediate write-offs, bad debts and losses in stocks are many of those deductibles. Immediate write-offs happen once your total assets don’t add up to the figures set by the authority. If you are not deeding profits as you have got debts to hide, the government authority will offer you help by permitting you to declare your debts to accumulate bated deductibles.


Whether you are an employer in an organization or you own your business, you can efficiently include your tax planning with the deductions for your retirement account contributions. In fact, you should take special care to start on this as early as possible to gain on tax savings when getting ready for the long term early. If you are near your retirement age, you can increase the number of your monthly contributions as per your requirement and capability.