New York Digital Magazine

7 On Your Side tips to dig out of credit card debt

0
Booking.com


Beaver Seeds - Get Out and Grow Spring Sasquatch 300x250
Many holiday shoppers are just now waking up with the spending hangover, and numbers just released by the Federal Reserve indicate credit card debt is creeping up and reaching pre-pandemic levels.

So what’s the best way to level that mountain of debt?

Studies show a vast majority of people with good salaries are getting deep in debt by simply overspending on plastic, and FOMO mixed with YOLO can be a dangerous combination.

That lifestyle racked up huge bills for Ryan Masajo, but he managed to wipe out $85,000 in debt in just 3 1/2 years.

MORE 7 ON YOUR SIDE | Fake at home COVID tests are out there – how to spot them

First, buzzing his own hair saved him $720 last year, while ironing his own shirts cut expenses by $30 a month.

“I know that’s not a big deal, but I don’t like ironing,” he said.

What the self-described jet setting, Michelin star dining diva DID like was the good life.

“$85,000 in debt took time, travel, fine dining, student loans, shopping and YOLO,” he said. “Why would I save money? I am working hard now. It wasn’t the best choice. When I travel there is no budget, but I always said ‘yes’ to not be left out.”

He said things quickly got out of control.

“I got to a point where I had nine credit cards,” he said. “Six of them were maxed out, up to 25% interest rates.”

Like many people carrying big balances, he was inundated with offers for loans and debt settlement. He randomly chose SoFi.

“SoFi is a one stop shop for personal financing via a digital platform,” Senior Manger of Financial Planning Brian Walsh said.

He said Masajo is SoFi’s typical member.

“A huge segment of our population ignored by the financial industry, high achievers in education and careers who don’t have a ton of money,” he said. “They were largely ignored.”

Free financial planners helped Masajo create — and stick to — a daily budget, while consolidating his credit card payments into one personal loan with a lower interest rate.

“Four or five compared to ranging from 9% to 25%, so that was a big money saver as well from interest,” he said. “And my credit score shot up, because when you have a personal loan, it’s better for your credit if you have one instead of six credit cards that are maxed out.”

MORE 7 ON YOUR SIDE | Tips to safely donate to Bronx fire victims without being scammed

But SoFi says loans aren’t the solution for everyone. You must be committed to stop spending on your credit cards and change your financial habits.

“Really make sure you can stop the behavior that got you into debt before you even think about getting out of debt,” Walsh said.

Masajo and his partner created a video blog to share the journey from $85,000 to zero debt in less than four years.

The big takeaway is that with offers for loan consolidation, watch out for sharks. If an offer sounds too good to be true, it probably is.

Other red flags include promises guaranteed approval, not going through traditional lending process, and no reviews related to the offer.

Finally, always research reputation and read the fine print before signing up.

———-
SHARE YOUR STORY

Do you have an issue with a company that you haven’t been able to resolve? If so, 7 On Your Side wants to help you!

Fill out the form below or email your questions, issues, or story ideas by filling out the form below or by emailing 7OnYourSideNina@abc.com. All emails MUST INCLUDE YOUR NAME AND CELLPHONE NUMBER. Without a phone number, 7 On Your Side will not be able to respond.

Copyright © 2022 WABC-TV. All Rights Reserved.





Source link

Leave A Reply

Your email address will not be published.