Category Archives: Personal Finance

Why It’s Important to Have Life Insurance

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Unexpected accidents can lead to financial ruin for any family that is not prepared for the worst. Outside of that, families who know that death will come with heavy financial burden may not have the means to save in the time frame available. There are many reasons to have life insurance, and all you need is one reason which makes it important to your family.

Workplace Insurance Has Too Many Gaps

Many people, especially if you work in a service or construction-based job, will provide some form of life insurance. The terms of these policies usually provide coverage only under very precise situations. Usually, workplace life insurance will only provide benefits to surviving family members if the death took place while on-the-job. Or, if the death was a result of injuries from the workplace. The likelihood of that happening is extremely rare. Additionally, these policies don’t often cover the entirety of funeral expenses.

Paying Off Debt

Your surviving family members may not be financially responsible for your debt. Some forms of debt, such as credit cards do not pass on to your next of kin. Meanwhile, student loans may qualify for forgiveness in the event of a death; in some circumstances, forgiveness is not available. Debt can follow your family after you pass, even if they’re not legally liable for resolving the outstanding balance. Why? Debt collectors will not stop collection efforts until your family either pays or takes legal action. Having life insurance can prevent your family from dealing with harassing demands for money that isn’t available.

Providing Financial Stability

Life insurance policies are meant to cover expenses that the family otherwise would not be able to pay for. Usually, this will include funeral expenses, outstanding debts, and to cover everyday household expenses. Regardless of your type of life insurance, your family will likely lose a source of income after someone passes. Most adults, even older adults, contribute to the household monetarily. After you pass paying the mortgage, buying groceries, or keeping up on the heating bill may prove difficult.

Additionally, many people choose a life insurance policy that will provide a form of inheritance. This can leave young children a bit of financial stability when they come of age. Or young adult children can benefit from some added financial stability that they would have had if their parent was still around.

It’s Generally Not Expensive

Depending on the type of insurance you get, the extent of the coverage, and your age, insurance may not be expensive at all. Life insurance isn’t expensive when you get quotes and shop around as well. Like any other form of insurance, be sure to contrast and compare rates and policies before committing to anything. Many policies are available for a monthly payment that would not provide the same payout if you had just saved that money. This argument, commonly used against getting life insurance, doesn’t account for the fact that many people won’t save that 30, 50, or 100 dollars every month. Work with an insurance provider that makes you comfortable and has policies that cover everything you care about.

Frequently Asked Questions on Informal Debt Agreements

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A increasingly popular debt relief option for many is that of a Informal Debt Agreement. This allows you to negotiate your debts and repayments without the legally binding documentation that lands your name on the National Person Insolvency Index (NPII).

If you are having trouble paying down your debts, feel inundated with collection calls, or have to resolve debts with multiple creditors, you might consider negotiating an informal debt agreement. We’re going to look at the most frequently asked questions about informal debt agreements and shed some light on how they are beneficial. Dealing With Debt has provided a quick checklist on FAQs on informal debt agreements.

  • What’s the difference between an Informal and Formal Debt Agreement?
  • What if a creditor doesn’t accept my agreement?
  • Can an Informal Debt Agreement affect my credit score?
  • Are there any debts that are excluded from an Informal Agreement?
  • How can I make payments with my Informal Debt Agreement?
  • Is there a limit to the amount of debt that I can negotiate in an Informal Debt Agreement?

What’s the difference between an Informal and Formal Debt Agreement?

The key differentiation between Formal and Informal Debt Agreements is that a Formal Debt Agreement is managed through the Australian Government, whereas Informal Agreements are negotiated independently.

Informal agreements do not appear on your credit report, unlike formal agreements. They also are not binding- meaning the creditor may still choose to take further legal actions against you. Creditors are not required to accept your debt agreement.

If you have a job or professional license, you may find that they are affected by a Formal Agreement because of its impact on your credit rating.

What if a creditor doesn’t accept my agreement?

Because creditors are not required to accept any informal agreements, you may find that they choose not to accept yours. If so, you’ll still be required to maintain your minimum repayments with the creditor.

Can an informal debt agreement affect my credit score?

No. Once you create an arrangement with your creditor, your responsibility will lie in maintaining your payments according to your arrangement. If you miss any payments, the creditors may begin the process of collections. If you’ve previously had any defaults on your account that have made it to your credit rating, the informal agreement will not remove them from your report.

Are there any debts that are excluded from an Informal Agreement?

Fortunately, no. Formal Debt Agreements only apply to unsecured debts. Your Informal Agreement, however, can include all debts. This can be secured and unsecured debt, Centrelink payments, joint debts, business-related debts, and more. All that’s required is that your creditors accept the terms you propose for how you intend to make repayments under your specific circumstances.

How can I make payments with an Informal Debt Agreement?

It’s common for you to set up a direct debit from a bank account that will serve as a singular payment, which covers all the debts that are listed and covered in your Informal Debt Agreement. They are created to be affordable payments that come out in conjunction with your pay schedule.

Is there a limit to the amount of debt I can negotiate in an Informal Debt Agreement?

This is another flexible option with Informal Debt Agreements. There isn’t a limit to how much debt is covered when negotiating these terms. There is no minimum amount of debt required to qualify for an Informal Agreement, and there is no maximum amount that would exclude you from this option.

We know that sometimes debt becomes unmanageable and overwhelming. Explore your options and get on track.

Budgeting is Fun – And You Can Still Do the Things You Love

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Budgeting may sound like a dull and mundane task, but it can actually be really rewarding. Getting a firm hold of your finances can help you to become more organized in other aspects of your life, and can actually lead to increased happiness. This has actually been confirmed in an article in the Wall Street Journal. Nowadays, it’s easier to budget than ever. There are apps that do most of the hard work for you. It’s important to remember that budgeting doesn’t mean you have to sacrifice the things you love. There are still ways to enjoy games and entertainment at low cost or for free.

Budgeting Apps

In the past, you may have tried writing everything down on a piece of paper and realized that this is a highly ineffective way of budgeting. Luckily, in the smartphone era, there are much more structured ways of plotting everything correctly. Apps like You Need a Budget help users to divide all their earnings up into groups such as travel and entertainment. From the easy to use interface, it is then clearly visible how much money is left to spend on certain things.

Promotions Let You Play for Low Cost

There are numerous ways to have fun while still saving money. In fact, some sites even give players the chance to win something with their promotions. One Lucky Pants Bingo promotion is a first deposit bonus of 200 percent in bingo bonuses, which means players have free money to stake in games upon joining. Using deals like this instead of spending your own money is a great way to have fun while on a budget.

Alternatively, the mobile gaming market has a vast number of free games for players to enjoy. A lot of the MMOs like Terminator Genisys: Future War follow a freemium model. This means that players can enjoy all the game’s features, but have the option to pay money to speed things up a bit.

Reading and Listening

Another way to get cheap entertainment is through the Amazon Kindle and Audible apps. As a way of attracting customers, there are loads of promotions and special deals involved with these. Upon joining Audible, users get the first month free and also receive a credit to use on an audiobook of their choice. In addition to this, there are various free books and series on offer in the library.

Kindle has a similar scheme, for which users pay a monthly subscription. Kindle Unlimited features a vast range of books that members are able to download and read for free. For people who get through a lot of books, this option is bound to save a lot of money. If books aren’t your thing, there’s likely a similar scheme to fit your hobby out there – it’s worth a search.

Budgeting properly allows you to put a portion of your earnings into savings. Having this safety net to use in an emergency or spend on a holiday can provide peace of mind and lead to a happier life.