Personal Finance

Towards a Healthier Financial Future

Topic: "Debt"

← Curating the web to find the most interesting and helpful information about your money.

Word of the week

Avalanche Method

With the avalanche debt payoff strategy, you focus on repaying debts based on their interest rates. This method prioritizes interest rates and paying off debt with the highest interest rate first. You move on to the next highest interest rate debt after the first is paid off. This helps you pay less interest over time.

Strategies for Paying Off Debt Faster →

Serious stuff

Jessica Lutz @ Forbes: How I Worked Through My Financial Baggage And Got Serious About Saving Money

This is all temporary and you can figure it out →

Word of the week

Snowball Method

The snowball repayment method consists of listing all your debt balances and tackling them from smallest to largest depending if the interest rates are the same. This method prioritizes balances as you move on to the larger ones next. This helps build momentum and motivation by settling debts faster.

Explore different strategies for paying off debt faster and how you can utilize our debt payoff calculators →

Word of the week

Savings Ratio

This ratio indicates how much a person should save for their future objectives. Savings / Gross Income is the savings ratio. Gross income is the total of all earnings, including bonuses, dividends, interest, royalties, rent, and money received from a business or profession.

Neontra automatically calculates your personal savings, expenses and debt ratios →

Infographic of the week

Holiday Survival Guide

The winter holiday shopping season is the most expensive time of year for most households. This year, spending is expected to be even higher due to rising prices. This infographic helps you start planning to shop and save for the 2023 holiday season.

Holiday Survival Guide How to plan and save for the 2023 holiday shopping season →

Word of the week

Co-Borrower

When two people apply for a loan or credit line together, they are known as co-borrowers. The money associated with the loan are equally accessible to the co-borrower. Payment obligations fall on both the principal borrower and the co-borrower. A common example of this is a married couple that applies for a mortgage or auto loan together.

What Is a Co-Borrower? Role in Loan Documents and Vs. Co-Signer →

Did you know?

According to Sallie Mae’s How America Saves For College, families reported spending an average of $28,026 on college in the academic year 2022-23, an 11% increase from $25,313 in 2021-22.

How America Pays for College 2023 →

Word of the week

Collateral

Capital or asset pledged to a bank or other lender in the event that the borrower is unable to make all of the repayment instalments on a loan.

Collateral Definition, Types, & Examples →

Word of the week

Creditworthiness

The term "creditworthiness" describes the degree of a lender's trust in a borrower's capacity to return a loan. The borrower's creditworthiness is mostly based on how successfully they have handled their prior financial commitments.

Discover how long it would take to pay down your credit card with our free credit card payoff calculator →

Infographic of the week

Ranked: Median Student Debt for a U.S. College Degree

According to the Federal Reserve, student loans added up to $1.6 trillion in Q2 2023, making them the third largest category of U.S. household debt behind auto loans ($1.8 trillion) and mortgages ($12 trillion).

Ranked: Median Student Debt for a U.S. College Degree The Visual Capitalist ranks student debt by U.S. college degrees →

Did you know?

In 1950, Diners Club introduced the first payment system resembling a credit card. This wasn't a real credit card, though. It was a charge card instead, and the cardholder was expected to pay the whole debt each month.

Use our credit card payoff calculator to help you plan for a brighter future →

Word of the week

Amortization

The amortization period is the length of time it takes to pay off a mortgage in full. The amortization is an estimate based on the interest rate for your current term.

Learn more on how your amortization period affects your costs →

Word of the week

Credit Limit

The most you can spend with your credit card is determined by your credit limit. When you first receive a credit card, the issuer sets your limit. You can request a decrease or increase.

What Is a Credit Limit? How It's Determined and How to Increase It →

Word of the week

Credit Utilization Ratio

A comparison of your available credit to how much you have actually utilized. A good credit score can be attributed to a low utilization ratio. The ideal target is to use 30% or less of your available credit.

You can view your personal ratio with our Health Check →

Word of the week

Overdraft

An overdraft occurs when you do not have enough money in your bank account to cover a payment or withdrawal. These transactions may include: - Debit purchases - Bill payments and pre-authorized debits - Cheques - Withdrawals - Transfers between bank accounts

Learn more about getting overdraft protection →

Word of the week

FICO

The three-digit FICO Score, or a Beacon Score, determines whether your credit is good or bad. Fair Isaac & Company, also known as FICO, is a US-based business that sells Equifax and TransUnion Canada their unique rating system. When you apply for credit, lenders can quickly and reliably learn details about your finances thanks to the FICO Score.

Getting your credit report and credit score →

Word of the week

Credit

Credit is money that you may borrow from someone (like a bank or credit card company). You must consent to repaying them on a predetermined timeline, typically with interest, by signing an agreement. The four basic types of credit: - Revolving credit - Charge credit - Instalment credit - Service credit Each serves a different purpose and works in a different way.

Learn more about credit and why credit scores are important →

Did you know?

Credit card and auto loan missed payments increased by 19% in the first quarter of 2023, according to Equifax, as Canadians struggled to keep up with rising living expenses and interest rates.

Don’t let credit cards rule your life. Our credit card paydown calculator will help you plan for a brighter future →

Serious Stuff

Why you got into debt, and how to get out "Between massive mortgages, student loans, lines of credit and credit cards, a lot of us are struggling to pay what we owe and stressed about it."

Serious Stuff Podcast: Why you got into debt, and how to get out →

Word of the week

Cost of Borrowing

The total cost for you to borrow money. This includes the principal amount of the loan, interest, fees and any other costs associated with the loan.

Keep track of all your debt and the true cost of borrowing →

Word of the week

Credit Score

"Your credit score is a three-digit number that comes from the information in your credit report. It shows how well you manage credit and how risky it would be for a lender to lend you money. Your credit score is calculated using a formula based on your credit report. Note that you: - get points if you use your credit responsibly - lose points if you have trouble managing your credit Your credit score will change over time as your credit report is updated."

Learn more about your credit score →

← Curating the web to find the most interesting and helpful information about your money.