Burdened by Bankruptcy? 5 Quick Tips for Emerging from Debt

If you declared bankruptcy in the past couple of months or years and are still struggling to get back to normal, you can be proactive to improve your life. The whole point of enduring a bankruptcy is to get your life back on track. Let's take a look at four tips to help you rebound.

Chapter 7 vs. Chapter 13 Bankruptcy

Although filing for either form of bankruptcy means it will show on your credit record for the next 10 years, there are significant differences between the two. With a Chapter 7 bankruptcy you likely had barely any disposable income, so you will be forced to liquidate your non-exempt assets in order to appease your creditors. Though this type of liquidation likely won’t cover the full amount owed, the remaining debt will be discharged (in nearly all cases).

If you are eligible for a Chapter 13 bankruptcy, also known as a reorganization bankruptcy, you meet minimum income requirements to avoid a complete asset liquidation. Instead, you’ll be able to keep your home and other assets as long as you adhere to a court-approved repayment plan. You will still be expected to pay your regularly scheduled mortgage and car loan payments in order to keep those assets.

If you qualify for it, Chapter 13 is much preferable to Chapter 7 bankruptcy, but in both cases you will have to rearrange your life in order to meet your obligations.

Create a Detailed Budget

Once you've declared bankruptcy, you'll have to develop a plan to handle your finances. This means spending mainly on necessities, with only a few luxuries from time to time. Follow the advice of Greg McBride: “Track your expenses for three months to get an idea of how much you're spending and where that money is going. Then create a realistic budget that fits within your monthly income.”

Apply for a Secured Credit Card

In order to rebuild your trustworthiness with credit, you'll have to start out with baby steps. The first step is obtaining a secured credit card. A secured credit card lets you improve your credit score little by little as you spend what you've deposited on the card. Reach out to bankruptcy trustees like those with Keith G. Collins Ltd in Winnipeg to help you through the bankruptcy and credit counseling processes. Once you've brought your credit back up to a respectable level, you'll soon qualify for traditional credit cards and be able to pass employer and landlord credit checks without a problem.

Bring Cash Everywhere

While you'll be able to qualify for a secured credit card after bankruptcy, you should always carry cash wherever you go. You won't qualify for any lines of credit with significant spending caps, so you'll have to spend within reason for a series of years until you can prove that you are once again credit worthy.

Establish a Bill Paying Schedule

One of the best ways to rebuild your credit and avoid extra costs is to pay all of your bills on time and in full. If you run out of cash and are only able to pay part of your bills or make late payments, your credit will continue to suffer. Don't let that happen. Create a calendar that is specifically devoted to bill due dates. Rebuild your credit little by little and eventually you'll be able to qualify for loans and lines of credit once again.

If you've declared bankruptcy, don't wallow with hesitancy and indecision after the fact. You have a golden opportunity to get your life back on track. Follow the advice above and you'll be well on your way to a return to normalcy.

So You Want to Flip a House? 5 Must-Know Tips

House-flipping is one of those hobbies or occupations that a lot of people are drawn to by the lure of big dollars for comparatively little work. After all, the concept is pretty simple. You find a house that is priced low that needs some work, buy it, complete the work and sell it for a huge profit. The perfect house flip.

Of course, it doesn’t always work out this way. In fact, anyone who has been through it a time or two knows that it rarely works out this way. It’s even more challenging now that real estate prices seem to be forever climbing and the house-flipping competition is at an all time high. Still, if you are intent on giving it a try, it’s important to learn a few things before you begin and not when you’re already half-way through.

Here are five must-know tips to take with you:

Research, Research, Research!

Research is never very exciting, but it’s always necessary and if you don’t do it you’ll be left out in the cold in the house-flipping game. Take the time to compare the home you want to flip with others in the area. Also, look a little closer at the renos that were done on the other homes that have sold.

Just because a house in the area sold for a great price doesn’t meant the profit margin was also great. It also doesn’t mean that you will get the same price by doing some minor renovation and repair work. Keep an eye on what upgrades people have been doing in the neighbourhood before you get too excited.

Buying Low Isn’t Always the Answer

It’s easy to get the “buy low and sell high” mantra stuck in your head with house-flipping, but buying low isn’t always the answer to big profits. Finding a house that’s priced way below the average for the area may mean that it is falling apart and requires that much more in repairs to bring it back up to where it needs to be.

You never want to overpay, because you’ll never make decent money flipping houses, but too low isn’t good, either. Here’s a scenario: House A sells for $200,000 and needs $75,000 worth of work done and House B, which is similar, costs $250,000 but only needs $25,000 worth of work. House A looks like the better deal, but in the end they each work out the same, only you’ve done a lot more work with the cheaper house.

Gotta Have Some Savings

When you make the decision to try and flip a house, keep in mind that you need to have adequate savings to use while the process is taking place. This is especially true if you are working on the house flip full time and don’t have another full time source of income. You need money for living expenses, all the renovations and any incidentals that may come up, which isn’t uncommon.

Also, if that house doesn’t sell on the schedule you’ve created in your mind, you will have to wait longer for your profits. Sometimes, houses sit on the market for weeks or longer, even with all the wonderful upgrades you’ve made.

Be Realistic

Remaining realistic throughout the process is also a tip that many house-flippers lose sight of along the way. The goal is to make money, so creating visions of selling seven-figure homes in areas where houses have never been above the mid six-figures, is not realistic. It is imperative to stay grounded in reality and remember where you are trying to sell the home. It’s nice to upgrade with the best possible fixtures and having a “vision” is great too, but making money is the main objective.

Realism and even a little conservatism in your math is also a good idea when flipping a house.Once you figure out how much the project will cost, add several thousand dollars to that because costs have a way of adding up fast. No one ever complained about having too much.

The House As a Whole

Looking at the house you want to flip as a whole entity or property will help you choose the home purchased loan, appropriate upgrades and delegate funds where they will provide the greatest benefit. You want balance in your repairs and upgrades, so it’s important to look at the landscaping over the property, exterior of the house, the kitchen, bathrooms, bedrooms, flooring, paint, ceilings, lighting, even the molding and smaller features like outlets or switch plates. Plumbing, electrical and similar elements that are hidden from view are also very important.

You’ll always hear about certain rooms or certain aspects that can’t be ignored, but unless you look at the property as a whole, it won’t be as good as it should be.

Venetia Rose has been a freelance writer and blogger. She loves to share and keep herself updated with the latest tips in mortgage and financial consulting. Her interests are cooking, photography, craft and painting. Follow her on Face book https://www.facebook.com/laksh.venetia

The GOLDen Years: Five Financial Changes You Need to Make When You Hit 60

After spending a lifetime building a career and working toward your retirement goals, it can be an adjustment financially once hitting the age of 60. Although you may be used to living a certain lifestyle, financial adjustments may need to be made to preserve your retirement savings and have your needs met. There are a few changes to make to ensure that the funds last for several decades and are well preserved—keep reading to learn about the most influential changes you should make to your finances once you hit those golden years. 

Reallocate Your Investments

To protect your assets, you might consider shifting to low-risk investments to prevent loss from occurring if you feel comfortable with what you have saved for retirement. If you expect to live longer, you can shift to more aggressive investment options for a few years before you evaluate the success and projected future of your investments. Depending on your financial situation, reallocating your investments could provide you will a little buffer cash to put your mind at ease.

Establish Scheduled Distributions

It's important to reassess your budget each year and make adjustments where inflation may occur for the cost of living. Contact your financial services provider to schedule payments weekly or quarterly, which will ensure that you live within your means and preserve your retirement fund. Look for areas where you can and should make adjustments so that you can take care of payments in a timely manner while still enjoying your finances set aside for retirement.

Downsize Your Home

For those who are in their 60s and have children who have moved out of the home, they are likely living in a property that is too large for their needs. After raising a family that is now on their own, it may be time to downsize and reduce the cost to maintain the home. Consider relocating to gated community or condo where landscaping and maintenance won't be a concern and costs for home upkeep will be lower. When it comes to home insurance, the professionals at Underwriters Insurance Brokers Ltd who specialize in Vancouver home insurance suggest that you increase your deductible so that you can enjoy lower monthly premiums. Living in a house that is too big, and paying too much for home insurance will drain your hard-earned retirement funds much faster than necessary, so consider downsizing before too much money is wasted.
Use the Money from Taxable Accounts First

To avoid paying more in taxes with your 401(k)s, make it a point to use the money from the accounts that will be taxed the most after also using the accounts that are not a part of your IRAs or 401(k)s. Using your taxable accounts first will be more efficient, and will keep you from cringing too much when tax season rolls around.

Take Advantage of Tax Breaks

Each state has age-related tax breaks that offer deductions and exemptions for ample savings each year. Research what you qualify for through the state department or talk to a financial advisor to find out what types of tax breaks you might be eligible for. Many people have no idea that they qualify for any tax breaks, so they miss out—do your research and talk to your accountant or financial advisor to see if there are any breaks you should know about or look into.

By making a few financial changes once you turn 60, it can preserve your retirement funds and make it possible to live more comfortably in your golden years. Although it may take time each year to manage your investments and downsize in certain areas, the changes will ensure that you enjoy a happy and healthy retirement while taking advantage of the fruits of your labor.

How Safe Is Your Retirement Fund? 5 Things To Consider When Building Your Portfolio

When looking to retirement, you will want to save money and put it away in the right mutual funds and stocks. Otherwise, you are going to end up having a tough retirement. With this in mind, here are five things to consider when building your portfolio. 

Don't put all your eggs in one basket:

While you probably have heard this term before, you will want to listen to this advice. Think about it, if you look at the last few market downturns, you will notice that some stocks drop 90 percent, while others will not suffer as much. To avoid serious issues, make sure to buy mutual funds; or, if you don't want to buy mutual funds, invest in, at minimum, 15-20 companies. If you’re not sure where to start, there a ton of options out there when it comes to working with a professional. Look online, read reviews, talk to neighbors, there is a lot you can do. Thomson Schindle Green Insurance & Financial Services Ltd is one of those insurance companies up in Calgary and a great example of just how many options there are out there! 

Blue chips are best:

Without a doubt, if you are close to retirement, you don't want to look for the next Tesla, Facebook or Microsoft. No, you want your money to grow slowly and securely. Remember, while you might enjoy double-digit returns, you will hurt your chances at success if you keep buying lottery tickets.

Look for dividends:

If you are like most people, you will want to enjoy a steady income during your retirement years. To get this, you should buy some dividend stocks. Not only will you enjoy a decent ROI, but you can receive a quarterly check from the company. Then, you can use this money to fund your day-to-day life.

Check it out:

Every once in a while, you will want to look at your portfolio and see how it's doing. Otherwise, if you don't look at your returns, you will end up with lagging stocks and mutual funds that hurt your returns. Remember, there is nothing wrong with selling a losing stock if you want to make more money in the long run.

Bonds:

Without a doubt, if you are looking to retire and enjoy a safe and secure time in these years, you will want to buy bonds. While you don't need a portfolio full of bonds, you will want to buy a few. Ideally, when buying bonds, you should buy ones that will pay out. Remember, you don’t want to take a risk with this investment, especially if you are approaching retirement or already retired. Luckily, with municipal bonds, you can enjoy tax savings and a steady source of income.

With these five tips, you can enjoy a safe, secure and happy retirement. On the other hand, if you don't take it seriously, you will struggle to live a happy retirement.