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Looking to Retire Your Debts? 4 Reasons You’ll Want to Start an Automated Savings Plan

Posted By:  |  July 1, 2014  |  0 Comment(s)

savings account

If you happen to be living under the cloud of debt, it can be hard to even think of saving money when you’re nearly living paycheck to paycheck. While times can certainly be tough, it might be worth it to consider an automated savings plan, which may make the concept of saving just a little simpler for you. By re-distributing money from your main account each month, you can gradually pinch a little off the top that can go a long way toward your future financial success!

It Serves as an Emergency Fund

If you’re struggling to pay down debt, it’s highly unlikely that you have the additional funds to go around in case some calamity befalls you that ends up costing you a lot of money. From car repair to an unexpected illness, having an automated savings account can easily ensure that you have a bit of extra money in case you need it. And best of all, you won’t even notice the small amount that gets automatically transferred from your savings account each month.

It Gets You Ready for Retirement Savings

It can sometimes seem difficult to consider saving for retirement when it’s so far in the future, but it’s never too early to start paving the road for future financial reward. While retirement saving may be something many people put off as long as they can, an automated savings plan is a great way to get in the habit of saving money and you may even have the option to accrue some interest on the savings you build up.

You May Go from Spender to Saver

If you happen to spend all the pennies you have, an automated savings account can be a good way to distribute funds so that you don’t even know that you’re saving money in the process. While you might miss the money that goes into the account initially, you might find over time that the idea of having extra funds in the bank is a source of comfort, and soon enough these funds just might add up to something more significant.

It Will Keep Your Eye on Future Financial Goals

Instead of spending everything you have in the bank on minor items like clothes and dining out, an automated savings account can train you for the time when you’ll be ready to make a big ticket purchase. It may seem like a little savings every month isn’t enough to put down on a house, an education or traveling the world, but $100 here and there can add up to a good amount if you stick to the plan over time.

An automated savings account can definitely bite into your bank balance a bit at first, but it can also be an extra way to save money and get away from the bad habits that turn into more debt. While spending might seem like a way of life right now, after you get a handle on saving it will only be a short time before you have money you can use to plan for the future or put toward a significant purchase!

Poll

  • How important is it to you for a debt consolidation company to offer financial education resources?
  • Takes your existing debt and try to settle with your creditors for a lower amount. If you pay off the settled amount, your debt will be considered paid in full.
  • Negotiates with your creditors on your behalf.
  • Fee based on a percentage of your total starting debt or a percentage of the debt they save you.
  • Most settlement companies have you create a separate "escrow" account where you will make monthly contributions over a certain amount of time to contribute to your settlement. Once there is a substantial amount of funds to show your creditors, the settlement company will try to negotiate a lower amount of debt.
  • Combines all your debts and creditors into one monthly payment.
  • Allows you to pay one monthly payment to the consolidation company, instead of multiple payments to different creditors.
  • You no longer owe your original creditors; instead you pay one monthly payment to your consolidation company.
  • Consolidation companies can help negotiate lower interest rates on your debts and help lower your total debt payment in the long run. A lower interest rate will lower the amount you owe in the end.
  • Allows you to consolidate all your different debts into one personal loan that can be paid off over time.
  • Can offer borrowers a lower interest rate with a longer payback term (compared to high-interest credit cards or medical bills). This will lower the amount of money required to pay off the loan over time.
  • Personal loan debt consolidation can be an effective way to raise your credit score quickly (within 3-6 months).
  • Borrowers can receive funds from their loan within only a few days.

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