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Ways to pay off your debt faster: a review of Tally

If you are in any type of debt, you will probably jump at the chance to discover new ways to reduce or even pay off your debt in a timely manner. It’s important to recognize these opportunities—and even more to determine if they are legit. Read on for ways you can pay off your debt faster through services like Tally.

What is Tally?

Tally is an app that is designed to help you pay off your credit card debt. After you download the app and provide it with the necessary information, Tally gives you an analysis of your debt and a plan to help you pay it off, specifically through discovering how to maximize payments in such a way that it addresses those debts with greater interest rates first.

This app also takes financial customer service one step further: in order to utilize all the features of the app, you can apply for a line of credit with the Tally. This may seem counter-intuitive, but Tally charges a lower rate of interest than many of the credit card companies you are paying each month. If you decide to open a line of credit with Tally, they will redistribute your monthly payments to your creditors in a manner that minimizes your interest costs as much as possible.

Do I want to do this?

Sure! Okay, you should really do more research first. Tally is specifically marketed to those who want to reduce their credit card debt, especially if you are also paying on a high interest rate. Tally’s website emphasizes that they seek to level the playing field for those in debt by allowing them the opportunity to make smaller payments while still maintaining their credit.

If you are in debt but it runs more along the lines of student loans, medical expenses, etc., that are not on your credit card, this app may not make a difference for you. The website does offer some other financial resources at no additional cost, like a debt calculator, so it may still be worth your time to scroll through the options.

But really—do I want to do this?

Before you decide if Tally is the right fit for you, consider some of the pros and cons this service offers:

Pro: The app is easy to use, even for the most inexperienced money manager. Tally is set up to walk you through the steps you need to begin reducing your debt, and maintains a high user rating on its website and in app stores. This means less stress for you, and, even better, more savings.

Con: While the app itself is very user-friendly, you may have a hard time qualifying for their line of credit, which is how you reap most of the benefits it offers. In order to qualify, you need a FICO score of at least 660. Being a resident of certain states also disqualifies you, though the app is working to be available to every state.

Pro: Using Tally means paying just one bill each month instead of managing multiple payments and bills. This is not only less stressful for you, but also saves you some time each month. Plus, you can rest assured that you have not skipped any bills by mistake, since Tally is the one paying your credit card company each month.

Con: Not all credit cards participate with the app. Tally is working to secure more partnerships, but at least one major credit card, USAA, is not compatible with the app, so you would need to continue to make that payment separately.

Pro: Tally is ideal for those who are looking to build good credit habits, like paying down debt each month and keeping track of expenses you charge on a card. Using Tally can help you practice smart debt management and that experience and knowledge will continue to serve you no matter how long you decide to use the app.

Con: In spite of the app’s lower interest rate, it is still one more financial strain to consider. And while Tally encourages the habit of paying off current debt, they do not address the idea of holding off from going into more debt in the future. So when you use this app, keep in mind that you are still paying them for a service, and that the most important thing is to get out of debt in an efficient and responsible manner.

So what’s the bottom line? If you have credit card debt and you want help managing it, see if Tally works for you! Be sure your credit score is high enough, and check the website to learn if your state currently participates with the app (about 30 states currently do). At the end of the day, no app can replace your ability to be smart with your finances, so take it one step at a time.

Five ways to celebrate National Financial Awareness Day

August 14th is National Financial Awareness day—a day dedicated to preparing for your financial future and building financial stability. It’s crucial to take the time to review your finances—sound monetary decisions can make a significant impact in the long run. Today, try to complete one of the items below so you can take control of your finances.

Check your savings

Take a look at your savings account—in the event of an emergency, do you have enough funds to get you through? If not, use today to set goals to ensure you’re saving for the future. Calculate your monthly expenses and develop a plan of action to ensure you have the recommended three to six months’ worth of savings.

Reevaluate your budget

Have you found yourself not sticking to your budget lately? Take the time to reevaluate your spending and make changes where you see fit. Periodically reviewing your budget is a crucial step that is overlooked. Make it a habit to frequently assess your budget and see what should be adjusted.

Brush up on your financial literacy

Financial literacy is key to being confident in the monetary decisions you make, and it can be easy to forget the basics. Take the time today to brush up on your financial literacy. There are dozens of free tools to help, like ACHIEVE, a free financial literacy program from Georgia’s Own. ACHIEVE offers various topics and videos on essentials like owning a home, financial caregiving, planning for retirement, and more.

Take steps to improve your credit

Your credit score is a critical representation of your financial past, present, and future. You need good credit for just about anything, like owning a home, applying for an auto loan, or applying for a credit card—your credit score can even determine the price of your auto insurance. Look at your credit score and see where you can improve. If you don’t know your score, visit the federally authorized site annualcreditreport.com to receive a free copy of your credit report.

Get a head start on taxes

It’s never too early to get a head start on taxes. Begin gathering necessary documents, like receipts, expense records, and donations, then put them in an organized folder, so you have them prepared for when you’re ready to file. Preparing paperwork beforehand will save you time—and sanity—when tax season begins. If you want to take it a step further, you can even organize your tax records from the past few years, so you have those prepared if the IRS ever needs to conduct an audit.

We hope these tips help you take control over your financial future. And, as always, Georgia’s Own is available to help—click here to find more resources to help you make smart monetary decisions.

How to start an emergency fund

Throughout the COVID-19 pandemic, people have recognized the value of having an emergency fund. People have lost their jobs, faced unexpected hospital visits, and more, leaving some struggling to pay bills. Regardless, it’s still crucial to have funds saved in the event of unforeseen circumstances—26% of Americans have no emergency savings, and only 23% have enough to cover six months’ worth of expenses. Follow these tips to help you get started on your emergency fund, so you’re better prepared for the future.

Track your expenses and spending

Before planning how much you should have in your emergency savings, it’s essential to know your monthly expenses. Calculate how much you spend on your rent or mortgage, utilities, and other necessary items. Tracking your spending is tedious, but there are dozens of budgeting apps, like EveryDollar and Wally, to help you estimate your regular spending. 

Set your emergency savings goal

After you’ve gauged how much you spend per month, set your goal of how much you want to save. According to CNBC, less than 30% of households have less than $1,000 saved. That isn’t nearly enough to cover costs in the event of a setback, like a trip to the hospital or unemployment. It’s recommended to have at least three to six months’ worth of expenses saved. 

Develop a plan

Once you set your savings goal, it’s time to form a plan of action. Decide what you’re going to do to reach your goal—that could be anything from setting aside a certain amount of money each week to cutting back on unnecessary spending. You can set goals all day, but it’s crucial to know exactly how you’ll reach them—otherwise, it’s easy to fall off track.

Put funds in an accessible place

How you save is extremely important, but where you save is just as critical—if not more. To make the most of your money, put your funds into a high-yield savings account that allows you to easily make transfers between accounts. High-yield savings accounts have higher interest rates than traditional savings accounts—sometimes 20 to 25 times more. While you earn more money in the long run, it’s important to consider factors such as initial deposit or minimum balance requirements and interest rates.

Start saving

Now that you’ve set your financial goals, how you’ll achieve them, and where you’re going to put your funds, it’s time to start saving. One way to help increase your savings is by setting up automatic transfers—you can set an amount to transfer to your savings each week, every two weeks, or each month. Even if it’s only $50, you’ll be surprised at how quickly your savings will grow. Another great way to increase your savings is by setting aside your tax refund. You can set aside all of it or even just a portion—either way, any amount will help get you that much closer to your goal.

Consider what constitutes an emergency

Now that you’ve started to set funds aside, it’s imperative to decide what constitutes an emergency, so you’re only using your emergency fund for its intended use. This could be unexpected hospital visits, car repairs, job loss, or other unanticipated situations. Defining what you consider an emergency is important so you know your emergency fund is used properly, rather than being spent on frivolous things. Remember, it’s not fun money—it’s money you’re setting aside so you know you and your family will be okay should something happen in the future.

Georgia’s Own is here to help you be prepared for the unexpected—visit our website to get started on your emergency fund today.

15 ways to save at the grocery store

It’s natural to waltz down grocery store aisles and add everything you see to your shopping cart. Strategically placed products catch your eye and make you think you need them immediately. Overspending at the grocery store is a habit that’s difficult to break—but, it can be done. Here are 15 ways you can save during your next trip to the supermarket:

Check your pantry

Before you head to the store, check to see what you already have. There are websites and apps, like Supercook or Cookpad, that allow you to find recipes based on ingredients. Depending on what’s in your pantry or fridge, you could make meals with what you have and avoid going to the grocery store altogether.

Make a grocery list

Compile a list to be sure you’re purchasing the essentials, and stick with it. Don’t stray from your list—you’ll spend more money than you intended.

Compare stores

While you’re determining your list, create a grocery store comparison chart. Pick your essential items, choose your stores, obtain the prices, and compare. It’s an invaluable tool that will ultimately save you money.

Use coupons

This seems obvious, but using coupons can help tremendously. There are dozens of websites, like coupons.com, that have free, printable coupons. Also, be sure to read your local store’s circular—it promotes items that are on sale. In addition to circulars, look for digital coupons that are store-specific.

Don’t shop hungry

The golden rule of grocery shopping: don’t shop hungry. According to Psychology Today, when you’re hungry, you overload your shopping cart with items you don’t need. Your brain focuses on finding its next food source, so you grab everything appealing within sight. To combat this, be sure you’ve eaten before you go. You’ll avoid the temptation of grabbing unnecessary items, and your wallet will thank you.

Leave the big spenders at home

Whether it’s your kids or your spouse, there’s always someone adding more than you need to your cart. It’s not always easy to say no, so avoid the situation entirely by leaving your big spenders at home, if you can.

Keep a running tally of your cart’s cost

Steer clear of the dreaded, “I spent how much?!” when you make it through the check-out line. As you add items to your cart, keep track of the running cost. It doesn’t need to be exact—just a rough estimate.

Avoid eye-level items

It may be easier to grab the first option you see, but scanning the shelves is critical. Stores use the motto “eye level is buy level” for a reason. We look at items that are eye level, so that’s where grocery stores place the most expensive items. Look for cheaper items on higher and lower shelves.

Don’t purchase pre-cut food

It’s often simpler to purchase ready-to-eat salad and fruit, but that’ll cost you more in the long run. You won’t receive as much, either, and pre-cut food doesn’t stay fresh for long. Trust me—just buy the head of lettuce and make your salad. It’ll take less than ten minutes, and you’ll save money.

Ask for a rain check

Did someone get too greedy during the BOGO sale? You can ask your store for a rain check on items that sold out during a promotion. If your grocer allows it, you can snag the item once the store restocks.

Don’t always buy in bulk

It appears cheaper, but buying in bulk isn’t always the best choice. Sometimes, depending on the unit price, it can wind up being more expensive. If you’re debating whether you should purchase items in bulk, it’s crucial to check the unit prices and compare them to see if you’re saving or spending more.

Try generic brands

Don’t be afraid to try the store brand. It’s often just as good as the national brand but a fraction of the cost. If you don’t like it, most grocery stores will allow you to return it and get your money back or swap for the national brand.

Shop in season

If you’re purchasing produce, be sure to buy items that are in season. Not only is it fresher and tastier, but it also costs less. It’s all about supply and demand. When produce is in season, there is an abundance—therefore, it costs less per pound. Compare that with something out of season—there is less of the product in-store, so it’s more expensive.

Pay with cash

When budgeting, cash is king. Paying for items with cash allows you to set a budget and stick with it—once your cash for an item runs out, that’s it. Finance expert Dave Ramsey swears by this method. Bring enough money to cover your groceries for one trip. If your total runs over, take items in your cart out. It’s hard but better than ruining your monthly budget.

Changing how you grocery shop can have a notable impact on your financial well-being. By shopping sensibly, you can stick to your monthly budget, as well as reach other money-related goals you may have. Try one, or some, of these tactics next time you’re at the grocery store—you’ll be amazed at how much you save!

Does a balance transfer affect your credit score?

Balance transfers are an excellent way to consolidate your debt and pay it off as quickly as possible. But, it does have positive and negative impacts on your credit score. Despite some minor negative impacts, balance transfers can immensely transform your credit score. Here’s how:

How does a balance transfer negatively affect your credit score?

A balance transfer can cause a dip in your credit score in the short run. When you apply for a balance transfer, lenders conduct a hard inquiry to determine if you’re a capable borrower. Hard inquiries remain on your credit report for about two years. Several hard inquiries show you’re seeking credit from too many sources, which could indicate you may not be a reliable borrower. This differs from a soft inquiry, which is when you check your credit or a lender is trying to pre-approve you. Soft inquiries do not affect your credit score.

Balance transfers can also lower your credit score by reducing the average age of your accounts. If you have three cards with an average account age of 48 months, and you decide to open a balance transfer card as your fourth, the average age of your accounts would lower, which could drop your score.

This has a minimal impact on your credit score, but it’s still critical to be aware of. It’s imperative to keep old, unused accounts open to maximize the average age of your accounts. But, if an old account has a high annual fee that you can’t afford, then it might be in your best interest to close it—weigh the pros and cons before closing the account.

How does a balance transfer positively affect your credit score?

Despite some hindrances, a balance transfer can considerably raise your credit score. Balance transfers reduce your credit utilization rate, which is the percentage of available credit that you’re using.

Low rates show that you’re not accumulating debt. Ideally, you want your credit utilization rate to be below 30%. For example, if you have multiple credit accounts and move the balances to a single account, your credit utilization rate shows as 0% on the old accounts. It’s crucial to take advantage of the 0% APR period so you can pay off your debt as soon as possible. This will then decrease your credit utilization rate over time.

Your credit utilization rate accounts for 30% of your FICO® Score, which is the score most used by lenders.

What should I do after I apply for a balance transfer?

After you’ve applied for a balance transfer, avoid applying for more credit. Limit the number of hard inquiries on your credit report as much as you can, and only apply for loans unless they’re necessary.

Don’t make purchases with your balance transfer card. The sole purpose of your card is to pay off debt, not accumulate more. When you add to that debt, it makes paying your balance during the 0% APR period more challenging. Create a budget to cut out unnecessary expenses and avoid accruing more debt.

Lastly, set up auto payments to ensure you’re paying your credit card bill on time each month. This boosts your credit even more—payment history accounts for a large portion of your FICO® Score. Choose a specific amount to transfer from your checking account to pay your bill. It should be enough to pay off your card within your 0% APR period.

Balance transfers can do wonders for your credit score, despite some drawbacks. When you use a balance transfer card responsibly, your credit score can grow in the long run. Check your spending habits, stick with your budget, and you’ll be debt-free in no time with a credit score on the rise.

If you’re ready get your finances in order, try a balance transfer.

Six tips to save for your future home

So, you’ve decided you want to buy your first home. It’s an exciting time, but there are various things to consider—the most significant being a down payment. Standard down payments are approximately 20% of a home’s cost. If you’re purchasing a $200,000 home, your down payment could cost upwards of $40,000—that’s a considerable amount of money! It seems daunting to think about saving that much money, but it can be accomplished—here are some tips to help you start saving towards your first home purchase.

Determine a goal

If you haven’t already, determine how much you need to save. Set a definite goal and time frame, that way you have a tangible end within your reach. Then, set a monthly budget so you aren’t overspending and can accumulate as much money as possible. An essential thing to consider is ensuring you are debt-free—focus on paying off your debts before you acquire more. It’ll save you more stress in the long run if you pay off that student loan or credit card before making a big purchase like this.

Savings account

If you already have a savings account, then great. However, there are more options than a traditional savings account that will help immensely when saving for a down payment. Look into a high-yield savings account or money market account. You’ll earn more interest than you would with a traditional savings account—the longer your money sits in the account, the more interest you earn, which ultimately puts you closer to attaining your goal of owning a home.

You can also consider a Certificate of Deposit, otherwise known as a CD. CDs enable you to set money aside for a predetermined time, so you earn a set amount of interest. There is less flexibility and liquidity, but this is ideal if you have a particular time frame where you want to meet your goal. However, it’s crucial to note that you could be subject to a fee if you prematurely withdraw funds.

Cut out unnecessary expenses

When you’re preparing your budget, look at where you spend the most amount of money. If it’s unnecessary, cut it out. Things like going out to dinner or buying coffee start to add up—if you spend $5 per day on coffee, that totals up to $25 per week. It doesn’t sound horrible, but if you proceed to do that weekly, it costs $1,300 per year. Shocking, right? Imagine how much closer you’d be to your down payment if you simply brewed that coffee at home. 

Pause saving for retirement

Odds are, you’ve probably begun saving for retirement. It may seem strange not setting money towards your 401(k) at first, but just remember, it puts you that much closer towards your goal of owning a home. If that idea scares you, just remember—it’s only temporary. You can start putting money towards your retirement again once you’ve purchased your home. However, despite what some websites may say, absolutely do not withdraw from your retirement account. You could be slapped with penalties and taxes for withdrawing early.

Set aside your bonus

Got a bonus or tax refund? Be responsible: put it into your savings—you’ll be thankful you did when you’re relaxing in your cozy breakfast nook, sipping on a hot cup of home-brewed coffee. As tempting as it is to solely use your refund on a new wardrobe or a fancy dinner, every dollar counts when you’re saving for a home.

Get creative

I can assure you, things are lying throughout your apartment and collecting dust. Scour and gather everything you’re not using, and sell them. Or, ditch the summer vacation. According to Business Insider, people fork over nearly $2,000 annually on summer vacations. I know—vacations are sometimes necessary, but foregoing your family trip this year will catapult you towards attaining your goal. Do you like animals? Start offering to pet sit or walk your neighbors’ dogs. Or, you could begin driving for a rideshare service or food delivery. Take that extra cash you earn and immediately put in your savings. You won’t miss it—I promise.

If you’ve done all of these but still need some backing, many credit unions offer down payment assistance programs for first-time home buyers. These programs help with home financing, loans for first-time buyers, and more. There are also various federal and state programs that offer similar support. However, it’s critical to keep in mind that you’ll pay more interest with a lower down payment.

Saving up for a home seems intimidating, and with such a large amount of money, it’s hard to imagine ever being able to save that much. These pointers will aid you in reaching your goal, so you can finally fulfill your aspiration of owning a home.

Have questions about buying your first home? We’re here to help!