1. Ignoring Your Debt
2. Getting Taken In by Unsolicited Email Promises
3. Consolidating Credit Cards Onto a Home Mortgage
4. Reducing Costs Without a Plan
5. Trying to Please Everyone
6. Bypassing Annual Checkups
7. Opening New Accounts for Better Rates
8. Closing Credit Card Accounts
9. Not Knowing Your Rights
10.Not Knowing Forgiven Debt is Taxable
I especially highlighted # 4 and 8, because I am a victim of this. I did not have a plan I just rushed to pay off a debt and ignored other bills. Also once I paid off a bill, I immediately close the account of a credit card I had in college, because I felt I had no discipline, feeling I will run up the card again. Therefore, I just closed it and it hurt my FICO.
Read more in detail at TheStreet.com
Wednesday, April 4
10 Debt Reduction Mistakes
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3 cool comments:
Hi,
I came across your blog from DebtCC Blog Hunt.I want to add one more point here i.e. "Never taken financial planning or budgeting seriously". Actually this mistake bothers me a lot.
Ben you must be kidding. The only way you will have financial freedom is if you DO take financial planning AND budgeting seriously. Financial freedom doesn't "just" happen; it takes thinking of one's financial future as their own small business and managing it that way.
Moneymonk, do you mean opening new CCs with #7? At first I took it as new online savings accounts, but now think you must mean new CCs.
RE: #4 reducing costs hmmm...I think that's always a good thing plan or no plan :-)
Thestreet.com goes more into details:
7. Opening New Accounts for Better Rates:
One way that some people try to reduce debt is to move balances from high-interest credit cards to lower-interest credit cards. While in theory this is a good move, it again assumes that you have solved the issues that got you in debt in the first place. If these reasons haven't been addressed, opening new accounts, even with the best intentions, will simply lead to more credit cards that are maxed out.
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