Category Archives: HOW TO & DIY

‘Credit repair’ agencies charge big money for what you easily can do yourself

Hi Nicole, I’m not sure why but I was just turned down for a car loan. I have a steady $80,000-a-year income. I don’t have much in savings but have started putting away $200 a fortnight. I suspect there might be something dodgy on my credit record back from my student days. I called a credit repair service I found – please don’t name them – that says they can clean up my credit file. I’d have to pay $1200 but they say I should be able to get my car after that. Is this a good idea? – Mike, Maroubra

No Mike… if this is not a scam, it’s darn close to it.

Has your debt levels spiralled out of control & gone off the rails? Then read this to FIX it.

So-called credit repair agencies have the same ability to rescue your record as you do yourself. Many will also try and migrate you onto other products – everything from a “budget management” program where you hand over your purse/wallet strings “for your own good”, to a negotiated “debt agreement” (if you were struggling with repayments) that’s extreme and similar to bankruptcy.

For this they’ll charge nose-bleed upfront fees and in many cases hit you with ransom-like, last-minute demands for more money.

But in the words of the Consumer Action Law Centre, which often deals with the messy aftermath: “These predatory companies are flourishing in a regulatory void. The current laws don’t prevent the harm.”

Do this instead Mike

1. Obtain a free copy of your credit report from Equifax (Veda rebranded), Experian or Dunn and Bradstreet. Don’t be fooled into paying for this; you’re entitled to one snail mail copy a year (and Dun and Bradstreet will even email it after a three-day delay).

Also for free you can get your credit rating itself – yes, we’re like the US now with a score and, increasingly, interest rates are based on it – from But you’ll need to create an account and (as with all such services) should expect emails from them.

2. Go through this with a fine-toothed comb. What’s on there that has hurt you? A bill missed by 60 days or more? Perhaps your name was on a share house utility … and your flatmates skipped out on it? It will be five years before this is expunged from your history – and (sorry) you’ll need to pay any outstanding debt.

3: Checking for errors is the only potential quick fix. Contact the provider first, then its ombudsman if necessary and finally a credit reporting agency to correct the mistake.

Meanwhile, don’t make more loan applications until you’re squeaky clean – they’ll drive your score down further. And take heart: Australia’s consumer ministers have just resolved to look at regulating debt management firms and announced a consumer education campaign to publicise the free alternatives. National Debt Helpline: 1800 007 007 or

Nicole Pedersen-McKinnon is a money educator and consumer advocate: You can write to her for help solving your money problem, or with a consumer question, at

‘If you don’t use cash, this won’t work’: Blogger amasses $50,000 with $5 savings hint

EVERY time you pay for something at the store and get change, save your $5 notes.

Put it away somewhere. Don’t spend it. At the end of each month, deposit your hoarded fives into a separate bank account.

Journalism professor Marie C. Franklin, who champions the idea on her blog “Save Money Fast With Fives”, has saved nearly $50,000 ($US40,000) by following this rule for the past 13 years.

Franklin said she first came up with the idea while putting two daughters through college and struggling to balance the family budget. “I made a decision that forever changed my relationship to money,” she wrote.

“Every time someone handed me a five-dollar bill I hid it away. I refused to spend it under any circumstance and started accumulating those fives, first in a separate compartment of my wallet, and then, as the pile grew, in an envelope.

“As the $5s started adding up, I put them in a separate bank account. Within weeks, I had a nice little stash, more than $200. Then $350. Then $500. By the end of the first year, I had saved almost $2000.”

She points out that $5 every day for a year works out to $1825 — two $5s and you’re looking at $3650. “Save five bucks a day until you turn 75 years old, assuming you’re 25 years old today, and that five dollar account, without adding in any compounded interest if you kept the money in a piggy bank, would be worth $91,250,” she writes.

And yes, obviously it means you need to start paying for things in cash. For millennials used to a cashless existence, that means shaking things up.

“You may love the idea of saving your nest egg with $5 bills but unless you use cash on a regular basis for everyday purchases like groceries, food or coffee to go, even gas and other issues of commuting and transportation, it will be impossible to save a significant amount this way,” she writes.

“Only cash will do the trick. End of story. Go to the ATM. Take out enough cash to cover the basic expenses you expect to face in the next seven days. Pay for as many things as you can in cash.

“Consume as you need, rather than simply buying out of habit. See how many $5s you get back in a week. If you like the number, repeat it into week two, then a third. At the end of the month, add it up.”

If you want to speed things up, she recommends a number of tricks to maximise your $5s, including paying for purchases less than $5 with a $10 or $20, or asking for two $5s instead of a $10 when getting change.

Others have found success with the $5 trick. Writing on Reddit, one user said they saved $2285 in five years, while another said they saved $1500 in six months.

“Working at a pizza shop and collecting tips I knew it’d be perfect,” wrote another. “From May to August of this year, I tried to bring home as many fives as I could. [In] mid-August, I cashed in all my fives and had over $525! Very easy way for anyone to start saving money.”

Henry Sapiecha

3 personality traits of famous billionaires

After analysing more than 900 self-made billionaires, the majority of which have made their fortunes during the past 20 years, UBS and PwC have revealed the top three personality traits.

Making money come to you.

make money come to you magnet image

1. An appetite for smart risk-taking

The first trait that is essential for entrepreneurial success is an appetite for smart risk-taking, according to the recent Billionaire Report.

“Self-made billionaires tend to have a very optimistic attitude towards risk, focus on risks they understand and find smart ways to reduce them,” said the report.

“What’s more, their keen instinct for risk and opportunity often allows them to exit at the peak, transferring risk to others.”

The report identified three elements of smart risk-taking among billionaires, starting with a risk profile that is “skewed towards focusing on the upside and being realistic on the downside”.

“They’re afraid to lose by not capturing an opportunity, tending not to worry about the downside of a new venture failing but instead being concerned about missing out on the upside,” the authors said.

The second part of being a smart risk-taker is looking for opportunities where there is already an advantage. “In these situations the risks for anybody without these advantages will appear high and they are likely to walk away,” the report found.

And the third element is the ability of self-made billionaires to recover from failure, often by keeping enough resources to enable that recovery and being ready to “pivot” or adjust an idea until they succeed.

2. Obsessive business focus

The second key personality trait of self-made billionaires identified in the report is obsessive business focus. “Self-made billionaires are constantly scanning the world for untapped opportunity,” the report said.

“Curiosity is a core skill of most self-made billionaires we met. This curiosity is constantly driving them to look for unmet customer needs that create a significant business opportunity.”

After the opportunity is identified, these billionaires “switch to an extremely focused modus operandi in execution that some observers could call ‘tunnel vision’,” the report found.

“One interviewee compared this to a fighter pilot who focuses on the horizon and totally ignores things at the edge of his sight.”

3. Dogged determination

And the third trait that is found among the world’s billionaires is, unsurprisingly, “dogged determination”. “Billionaires are highly resilient,” the report said.

“Undeterred by failures and roadblocks, they have a tremendous work ethic. They confront and overcome obstacles, persevering in the face of adversity.”

“Our interviews showed that self-made billionaires often tend to be serial entrepreneurs who learn from their mistakes and doggedly work towards great wealth creation.”

But while there may be a clear link between these three personality traits and high levels of wealth creation, Eve Ash, psychologist and chief executive of Seven Dimensions, told SmartCompany the same traits are often present among all business owners and entrepreneurs.

“Certainly the optimism factor, which is coupled with clever risk-taking,” Ash says. “It’s the feeling of not having the fear or being able to manage what some other people might find paralysing.”

Ash says often a positive experience that came about by an individual taking a risk can contribute to this trait, as can an upbringing in a family that encouraged entrepreneurship. Although Ash says sometimes this can work in reverse, with the children of a family where the parents worked in long-term jobs for other people instead choosing to “break away” and start their own company.

The billionaires analysed in the report have generated combined wealth of $US3.6 trillion, with US-based entrepreneurs having created the most wealth, especially in the technology and finance sectors.

However, the report found “Asia’s new industrialists, consumer product tycoons and real estate investors” are also in the mix, with rising real estate and capital markets playing a strong role in the creation of new billionaires.

Self-made billionaires usually start young but most do not hit the billion-dollar mark until well after they turn 40. Close to a quarter of billionaires looked at in the research (23%) launched their first business venture before the age of 30, while over two thirds (68%) got their first venture off the ground before turning 40.

Having some corporate experience appears to pay off, with almost half of the billionaires having worked in a large organisation before going solo. A large majority (82%) had completed tertiary studies.


Henry Sapiecha