Is your lifestyle keeping pace with your income, or is your lifestyle growing more quickly than your income? If you have plenty of cash loans, personal loans, credit card balances, and other types of unsecured loans, your income may be growing more slowly than your lifestyle. In other words, you may be spending more than your income justifies. Over the long term, this can lead to even more personal loans and even bankruptcy.

Terms of Your IncomeIt is vital to start living below your means. Don’t make the mistake of living a lifestyle that does not reflect your income. Even living right at your means and income can mean trouble if your hours are suddenly cut back or if you lose your job. Living below your means lets you build a healthy emergency fund, lets you avoid debt, and ensures that you can live on less if you have to.

In addition to living below your means, start working on your job skills so that you can develop your income and your lifestyle. If you do get a small raise, invest or save those small changes in income rather than upgrading your lifestyle. You won’t miss the money and the cash will add up nicely for you.

Should You Take Out a Refund Advance Loan During Tax Time?

A refund advance loan or a refund anticipation loan, as it is sometimes known, allows you to borrow money against your income tax refund. This type of loan is an emergency loan offered by tax preparers and it is often very attractive to taxpayers at this time of year. If you know that you will be getting a tax refund soon but need the cash now, a refund anticipation loan can seem very attractive. As well, these cash advance loans are offered by tax preparers and are often heavily marketed, which can make them seem appealing.

However, like all cash loans, refund anticipation loans are not free. You will have to pay a fee above and beyond what you pay your tax preparer for filing your taxes. The fees for refund anticipation loans vary widely and while in some cases these loans are less expensive than payday loans, this is not always the case. In general, if there is no emergency, avoid refund anticipation loans and wait until you get all your refund cash. However, if you need to take out a payday loan during tax season, look for a low-cost refund anticipation loan. This type of loan typically allows you to borrow more and may cost less than a payday loan (depending on your tax preparer).…

Dealing With DebtIf you don’t have unsecured loans, signature loans, and other forms of debt, work hard not to create this type of debt. It is expensive, it lowers your credit score, and repayment of this sort of debt is stressful and drains your paycheck each month. If you already have some debt, work hard to pay it down.

Many people assume that they need to increase their income in order to pay down debt, or they assume that they need to earn more in order to avoid having debt in the first place. Nothing could be further from the truth. Many families manage to live on one income and still save and create an emergency fund. The secret is in the planning. If you want to stay out of debt, you need to budget carefully and spend carefully. You need to set goals and start saving.

Small things can really add up. Growing some of your own vegetables, buying used clothes and cars instead of new, and reducing bills where possible really adds up and the savings can go towards an emergency fund and towards paying off those debts.

Another important part of the equation is paying down more than your minimum repayment amount on your credit cards and other debts. It can make a larger difference than you think. If you have a credit card with an 18% interest rate and a $1000 balance, it will take you over a decade to repay that amount if you pay only the minimum each month. You will also pay more than $1000 in interest as well as your original $1000 debt. However, if you add just $25 more to the minimum amount each month, you will be able to repay the $1000 balance in under two years and you will pay under $200 in interest. Paying off your debts faster counts.…