Archive for the ‘Planning and Budgeting’ Category
The Top Ten Mistakes with Budgeting
It will save you money
Making a budget is essential for your financial well-being. Once you have a sound plan in place, the worst recession won’t be able to topple you. But beware, purveyors of payday loans – if you aren’t careful, you can fall prey to one of the top 10 budget mistakes.
Having two household incomes – because you need them
If there is a second income in your household, it’s nice to be able to use that one for savings. That said, too many people have a second income to overextend their credit, especially when buying more home than they need. What if one income dries up? Live within the means of only one income and you will be more economical, and safer.
Not putting money away
Savings accounts, college funds or even rainy day funds. Whatever you choose to use it for, you need to set small portion of each paycheck aside. It pays to be prepared!
Overspending
Will that hole in your soul really be filled with a new television? If your old one works just fine, seriously consider whether you need a replacement. Impulse buys can be lethal, so make sure your budget is about what you really need every month. Sure, there should be some money earmarked for entertainment, but you must be disciplined enough to stay within the boundaries. When you do shop, try to look for sales and special deals.
Not recording expenses
When your budget is young, this is essential. Record purchases in the register of your checkbook, Smartphone, or a notebook, and create visual proof you’re following your budget. Eventually you will get the hang of it and won’t need to record things right away, but if you start to notice trouble, don’t be afraid to go back to recording it all.
Going credit crazy
This is very symptomatic of overspending. If you don’t have the money for something, don’t buy it. Using credit makes it too easy to overspend, and long-term revolving interest is very expensive. If you have to use credit, try to pay it off as quickly as possible and not carry a balance.
Being too charitable
This one might sound odd, but it’s obvious, isn’t it? There’s nothing wrong with generosity, but your own bottom line comes first.
Going overboard with birthday parties
Parents of young children may know about this one. I’m not talking about how much to spend on junior’s gift, but on the party guests. Giving goodie bags is a common practice for kids, but is it really necessary? Cake, ice cream and games should be enough.
Too many bills
This is why it’s useful not to go crazy with credit cards. Sure, housing and utility bills are generally unavoidable, but do you need eight or nine credit cards, too? A too many bills can lead to errors and omissions, not to mention more money you’re paying out.
Being afraid to ask for a raise
If you are valuable to your employer, make sure they know. If you don’t feel your pay level is consistent with others in your field, talk to your boss about it. If you are indeed valuable, a reasonable employer will at least consider it. If your employer won’t, consider improving your skill set and education to get a better job.
Not creating a budget
A person without a plan is a person who will soon be parted from their money. Payday loans can help, but budgeting is the best way to handle your finances over time.
A Word about Personal Finance Education
A Word about Personal Finance Education
Poor Debt Management Can Affect Generations
A lot of people that struggle with their personal finances, like debt and credit issues, run into trouble because they’ve never learned about good budgeting. They likely have relatives that have the same issues. They likely don’t discriminate between needs and wants, and altered expenditures accordingly. Left unchecked, such behavior has caused individuals to fall deeply into debt. Just as in situations of physical abuse and substance abuse, the dysfunctional handling of debt and credit is often passed down to future generations. Poor financial decision making, however, is much easier to rectify than the aforementioned dysfunctions.
You Have Control of Your Own Financial Future
In looking at personal finance, debt and credit, it is important to understand that an individual has ultimate control over their destiny in any of these arenas. While many feel as though their spending is out of control, the exact opposite is true. You can regain control over your spending, and you may need help to do so. Simply, a person must recognize that they have a problem, that this problem is a threat to their future and that correcting the problem is fully within their control.
Debt Education is the Answer
Once a problem is realized, a person can then begin to take steps to repair their personal finance debt by becoming educated on financial topics. We live in an information age, and there is unprecedented access to information on how to fix your finances. From budget tools and software, classes in your area, even books and articles written by experts, plenty of resources are available, many for free. Keeping this in mind, a great place to start one’s financial education is with the basics of understanding how to create a personal finance debt budget and to understand how credit works. This can be learned by combing the Internet and reading various articles written on the subject or books can be checked out from the library to gain a basic understanding.
Low-Cost Debt Counseling is Also Available
Also, several non-profit organizations offer low-cost debt counseling services. Contacting one’s local Chamber of Commerce or related public agency can help locate such services. In doing so, a debt counselor can help with creating a budget, consolidating outstanding bills and offer further resources helpful to one who is determined to regain control over their personal finance debt.
No More Excuses
No matter how things went wrong with your finances, credit or debt, there’s no excuse for keeping it up. Nor is there any reason for such economic woes to be passed on to future generations. A person really looking to get in the driver’s seat with their personal finance, correct bad habits, and start reducing stress as a result, there are plenty of resources that can help them get started.
Buying a Used Car Follow These 5 Tips
More people are starting to consider the merits on buying used cars. New cars depreciate so quickly that a used car can make more financial sense. Making the decision to buy a used car instead of something new can save you quite a bit of money. The average car loses 60% of its value in the first five years. Depending on how a car was maintained it could have many good years left after four or five years. Keep reading and you will find some sound and proven tips for buying a used car.
#1 Start with some looking around shopping and avoid any hasty decisions. Visit several car dealers and test drive various cars. Your objective as the car buyer is to compare several different vehicles and get an idea of what is available. This first step is strictly to gather information on possible choices and prices. Then go home and get on your computer and search for information on your choices of used cars. Compare safety ratings, options, selection, reliability, miles and pricing. Now narrow down your choices based on the information you have gathered.
#2 Determine how much you can afford or want to spend on your car. Before you go the car dealer you need to decide if you are going to finance or write a check for your purchase. If you are planning to finance your used car purchase you should talk to your bank or credit union first. Car dealers and salesman have a way of talking you into spending more than you planned.
#3 Remember to inspect the vehicle before making a decision when get to the car dealer. Use a car buying checklist for the things that you need to check when buying a used car. You will want to check the engine, the body, vehicle history and the transmission. Be sure you take the car in question for a good test drive because you may find problems. Drive the car at various speeds and make sure you are comfortable driving the car.
#4 Plan your car buying steps and follow your plan. In the earlier steps you decided what was right for you both financially and car wise. Stick to your predetermined price and do not allow yourself to be swayed by the car salesman. Remember the car salesman’s job is to sell you a car by whatever means possible. Follow your plan and stay within the guidelines that you have set before you go to the car dealer.
#5 Do not purchase the used car unless you are clear on all the details. Set aside any emotion and make your decision by thinking logically. Because the car buying experience can be overwhelming for some they sometimes make an emotional decision. If you are not completely sure about the car or the deal go home and think it over. You need to be sure before you spend such a large amount of money. There is no return policy for cars, once you buy the car and drive it home you are the owner.
Buying a good used car can save a lot of money, but buy a bad used car and it can haunt you for a long time. Everyone that buys a used car has the same objective, getting a good deal. We all want to be sure we got the best price on a car. Even though it is a used car it is important that you spend your hard earned money responsibly. Ultimately you are the car buyer so you are in control.
Budget From Your Own Home
Where To Begin
The first thing to do is get a piece of paper or program on the computer such as Microsoft Office. Your money needs to be split into different categories that will show where the money is being spent. None of the sections should be labeled miscellaneous. One of the categories should have rent, house payments, or another living expense. Electricity, water, cable, etc should all be put into one utilities category. Each child should have a category. You should split up food into groceries and restaurants. You and your spouse will need two different categories if you can afford them. There should be a category for car expenses and one for personal items. These should show you where your money is going every month.
The Next Step
Make sure you know what amount is to be put toward bills. These would include things such as rent or phone bills. Make sure they are at unchangeable rates in order to keep your budget intact. This will help you to see what money goes to which things. You should then place the amount you normally would spend in a month into each category. You should figure out what you spend on things by living for a month and recording what you spend money on. It may shock you how much money is being spent in different areas.
Last Thing on the List
The last step is making sure your budget balances out compared to the your income. This means your personal fund may need to be subtracted from. If there happens to be extra money at the end of the month, that is a great thing; the money should be put into savings for future emergencies. It is important that you stick to the budget. The budget may show you that you can’t go out to eat anymore, and you must then stop going out. In the end it will be worth all the money you saved by not spending money on everything you want.
My Short Story
In college many people struggle. It seemed impossible to be able to afford to pay for anything. I had to figure out how to pay all of my insurance and monthly bills which I managed. I was concerned that I wouldn’t be able to afford all of that as well as food and personal expenses. To pay for everything I had to put as little money as possible into each category. My family needed a new program that I found and used. The program worked miracles in my lives. I learned how to stretch my money to pay for all of my expenses. My budget is still being done with this program.
These Coupons May Not Bring Me in “Oprah” But…
I confess. I have always been amazed by these women who save outrageous amounts of money on their grocery bills by using coupons. Discount Coupons
As my mom subscribes on magazines like “Good Housekeeping” and “Ladies Home Journal”, there would be another article about a woman who performed magic while shopping using discount coupons to come out. I can clearly recall the pictures of that particular article. A woman, with her smile stretching wide from one ear to the other, was pushing one brimming grocery cart. Her husband stood between two more carts, pushing one while pulling the front of the other. She beamed as she held up a very long receipt, representing everything she had just purchased – all three full carts – for just $20.
Mom became inspired, but it would go in phases. Then she would cut almost every coupon from the Sunday newspaper every week. But, most of the time, she would clip a coupon here and there, and use them if she happened to remember. Grocery Coupons
Several months ago, I saw someone on the “Oprah” show, talking about how easy it is to save money by shopping with coupons. Although I must admit, I was not fascinated. What I meant was shopping with coupons must take a lot of time out of each day,right? There needs to be time to find them, cut them out, sort them, put them in some sort of filing system, and then retrieve them when it’s time to go shopping.
Now that I’m grown and raising my own family, I thought I would give it a try. However, the whole process really eats a lot time.
But then when I was about to give up, I found this web site that would ease my work real good. SaveGroceryCoupons.com switched on the convenient work for me. This web site has frequent updates regarding name brand coupons and free trials. It is a lot easier to find coupons this way compared to flipping through the ads in the Sunday newspaper each week.
I just took advantage of a $4.00 rebate on the “Monsters vs. Aliens” DVD just for buying two family-sized boxes of Hostess baked goods, which will make a great Christmas present for my kids. Coupons
Headache-Free Shopping On Grocery Coupons Web Site
Six months ago, my employer started to lay off people. I was in that first batch to be let go, without any regard for the years of service I had put in. As of this date I haven’t found a new job yet. The unemployment check I receive each week is not enough to keep my family’s life comfortable Discount Coupons
I couldn’t afford to lose some luxuries like the telephone and the internet service. A couple of times a week I go to the public library so I can check my email. I also make revisions to my resume while I’m there, based on help wanted ads that I’ve seen. While I’m printing my resume, I print my latest coupons from the web site that has been such a big help in feeding my family over these last few months – SaveGroceryCoupons. com.
When I stopped by the unemployment office one day, I overheard two women talking about SaveGroceryCoupons.com. What’s funny is that they were not unemployed. They work there with nice clothes and all but they appeared worried about their finances and providing for their families – the same predicament as I was. ( I thought that recession has affected everyone even the employed. Grocery Coupons
I know all about coupons but I’ve always regarded it as a waste of time to cut them out from the newspapers. Plus I didn’t have the extra money to buy the newspaper to get the ads and coupons each week. But I knew there were computer stations at the library near my house, so when I stopped by the next day to check my email, I typed the web site into the computer and took my first look.
The library doesn’t allow prolong use of the computres so I don’t have much time to browse unimportant sites when I’m surfing. I appreciate SaveGroceryCoupons.com’s website a lot. The site is user friendly and easy to navigate. My favorite section of the site is where you click on “Featured Coupons” and it shows you your options.
The coupons on SaveGroceryCoupons. com are for name brand products, which is so important to me. I have tried groceries from the deep discount stores, where you put a quarter in to use a cart and have to buy your grocery bags. Those groceries with the funny brand names just aren’t the same and I won’t compromise quality for my family. Coupons
Seven Ways to Begin Reducing Debt
Debt management and getting started
Getting in to debt can be easy. No matter where the debt comes from – student loans, personal loans, credit cards or a mortgage, debt can pile up quickly. Managing your money is the first step in managing your debt and paying off what you owe. It is easier to accomplish large tasks such as this when you break it into small steps. Get started managing your debt today with these seven simple suggestions.
1- Understand your income
First, sit down and determine exactly how much money you will have coming in over the next week, month and year. Use commonsense about your income, especially if it can be variable. If you aren’t sure and need to use a ballpark figure, use a low number to give yourself some extra room. Be realistic about the income you can expect.
2-Understand your expenses
There are two forms of expenses – fixed and flexible. When an expense is reoccurring, consider it a fixed expense. Vehicle insurance and mortgage payments are both fixed expenses. Non-reoccurring expenses that do not have a fixed cost are considered flexible expenses. One-time purchases, such as clothing, can be considered a flexible expense. Record your fixed expenses and make your best estimate of flexible expenses.
3-Organize your budget
Plan your budget once you have a good understanding of your income and expenses. Ascertain the amount from each paycheck you will allocate towards each bill. Sketch out how much cash you can put towards paying off your debt. Make sure you leave some money for savings, even if it is a small amount.
4- Prioritize your debt
There are many different types of debt. Differing types of debt carry different interest rates. Taking on debt allows you to buy money when you need or want it, and interest is what you pay for that cash. Work out a way to pay off the highest-interest debt first. Putting an end to your highest-interest debt first saves you money.
5- Create a savings account
It is important to settle your debt. Creating a savings account is equally important. Create a reserve of cash that is enough to pay between two and six months worth of bills. You can know that you will be more able to handle unexpected expenses when you have a cash reserve.
6- Recognize your rights
When they are trying to collect a debt, credit collection agencies can be aggressive. It is important to know that even when you are in debt you have rights, so educate yourself. Begin informing yourself by checking out the FTC and Fair Debt Collection Practices Act. Even when you have debt, you are protected with rights. Debt collectors are not allowed to bully or intimidate you.
7- Enjoy positive habits
Once you have gotten into the habit of keeping track of your money, keep doing it. When you stick to your plan, it is possible to pay off debt. Keep up the habit – slow and steady is the best formula to follow.
Being Unemployed Provides the Opportunity to Get Rich
It’s difficult to get rich if you’re working. Your time is consumed slaving for someone else and that means you have no time to create your own fortune.If you’re laid off, you have an advantage. First, you have some time to think. You have time to plan.Moreover, you have time to digest that the reason you’re laid off is that you’ve been barking up the wrong tree and what you’ve been doing the last ten years will never get you rich.If you’ve been fired as an administrative assistant, the dumbest thing you can do is pursue jobs as an administrative assistant. Why apply for a job that got you laid off in the first place and had no chance of having you get rich?
Realize that the reason you don’t have a job is that people don’t need what you offer! I don’t say this to make you feel bad, I say this to tell you that it’s time you offered what people want. I see lots of hard luck stories on TV and in the newspaper.People out of work because no one needs what they offer and these people don’t offer what others will pay for. Would now be a good idea to start offering what people want so that you can always make money and get paid and get on the road to get rich?
In a minute, I will explain what others are always willing to have.But to begin with, you need to know that you can learn a new skill. You do not learn new skills by going to school.I see thousands of unemployed people going to school to learn a new skill—a new skill that no one needs in a weak economy!The skills that have true worth are not offered in colleges or vocational schools.All of these classes have benefit ONLY if a business will hire you. It’s much better if you don’t need anyone to hire you. It’s much better if you know how to get rich on your own or if you have a skill that people will ALWAYS hire no matter what the economy.
When I go to my job, I see this guy pushing a trash can on wheels and in the garbage can are all the tools to wash windows. If you put this guy in a suit, he could easily be a corporate vice president and I would not be surprised if he lost his job at such a position. But does he stupidly apply for more jobs as a corporate vice president so that the same thing would happen to him again, so that he could get laid off again and repeat the cycle of being at the affect of the economy or another person’s business? You can’t get rich that way and this guy knows it. Anyway, this guy goes from store to store downtown, and offers the business owner to wash windows. I am certain that he earns $200+ per day as there are thousands of stores in the downtown and if he charges a small fee (e (e.g. $15 to $25), he gets plenty of business. He may not realize it but at least he is on the path to get rich.
He won’t get rich cleaning windows but let’s see what can occur.He asks each business owner if they want to have him come back and wash the windows in 2 weeks. Enough store owners say yes.So now, he hires an unemployed guy for $10 an hour and has him wash the windows for the retail stores that want their windows to be cleaned every 2 weeks.Our entrepreneur continues to visit new stores and get more new accounts and in a short while, has four others working for him and is making $100,000 a year and will never, ever be at the mercy of anyone.He will never be laid off. And he can grow his business as large as he wants because he can go to the next town and replicate this success. If at some time in the future there is no desire for window cleaning, then he will clean toilets or clean homes or paint or do whatever it is that others desire. Does that make a lot more sense—to offer people what they want rather than to keep sending out your resume offering businesses what they DON’T want?Start thinking of yourself not as an administrative assistant or a loan processor or an elementary school teacher or whatever it is you got laid off from, but as a provider of things and services that people want. Let me tell you what people want.
If you happen to have any skill at fixing things, great. People always need stuff fixed in their house or business and everyone they call is unreliable. You could be the first reliable fix-it person.You would quickly get called over and over.The last worker I hired to repair stuff in my office showed up late, left with tasks incomplete and was generally inefficient.Will I telephone him in the future? No. Will I have a need to have things fixed? Yes.
Are you a people person? Then go take the Sandler Training and learn how to sell. If you can sell you will always have work and can easily get rich.You can walk into any business, even in this poor economy and tell the business owner you will sell their products and services and be paid commission only.Plenty of business owners will retain you immediately. If you can REALLY sell, a skill that even most sales people don’t have, you will have money in your pocket every day.Want to make more? Just sell items that are more expensive and earn larger commission checks.
I am writing this on December 23. In the next 2 days, lots of people will be driving to their relative’s house for the holidays. If you purchase $100 of flowers down at the flower mart in the morning and stand at a busy intersection, you could easily sell those flowers for $500. People will see you and think “we should bring some flowers to Aunt Martha.” Just look around and ask yourself “what do people want?” The more answers you have for that question, the more opportunities to get rich and you can leave your old life of unemployment behind.
If you liked this article and are ready for the next step, read Five Ways to Get Rich.
Credit Weary Consumers Turn Back to Cash
Cash only money management
A recent CNN Money article highlighted people from all over the USA who have switched to cash only transactions to better manage finances. William Hazelgrove of St. Charles, Ill., is tired of mortgage loans, auto loans, unsecured loans and debt. He’s not alone in his sentiment toward credit and debt, but unlike other consumers, he is doing something about it. Hazelgrove had previously dealt with credit like a lot of people had. When he received bills, he’d pay them with his credit card. It wasn’t until his credit company hiked the interest rate due to the recession that he realized the problem. “I realized if I ever wanted to live within my means, I would have to switch to using cash only.”
Hazelgrove took charge of his finances, and steadily paid off debt and increased savings. He took on a second job and channeled the money directly to both. His complete solution included:
- Keeping a debit card balance above $100
- Liquid savings of $5,000 for emergencies
- Using Quicken to keep track of every expense
One of the main commitments he had to subscribe to was not spending when cash was low. He stated, “It was hard, especially towards the end of the month, but I had to forego credit card spending. If I couldn’t afford it, then it had to wait.” He admitted it was hard, but he was able to pursue and achieve his goals. Living without using a lot of credit isn’t exactly a bad idea.
Statistics on credit
When it comes to credit, almost everyone has it. A recent study by Hoffman & Brinker revealed that Americans totaled up to $ 917 billion in credit debt by September 2009. Just about 70 percent of that credit is currently past due.
It’s no secret that consumers over-used their credit, and the harsh reality is that lenders have changed their rules in terms of lending and limits. Without an action plan, many Americans will find themselves at a difficult juncture in their finances. Mortgage loans, car loans and unsecured loans are no longer given out to just any applicant. Prior to the recession lending laws were lax. It was easy to get funding and almost every credit-scored applicant could find some lender to extend money. Granted, the money most likely would come with a hefty interest rate, but for most consumers that was a price they were willing to pay.
Today’s world of cash management
The lending crash had the biggest effect on people going cash-only. Due to the number of defaulting borrowers, credit card companies had to take drastic action to mitigate their losses. They raised interest rates to unmanageable levels and cut limits. Another person, Daphne Harringe of Cincinnati, OH, said, “We always used credit to manage our monthly bills. Always. Then suddenly our interest rate shot up to 27 percent after one delinquency. It was difficult to manage, but we realized that we had to switch to cash if we were going to save our future.”
More and more consumers are heading towards a cash-based money management system. Particularly because of the way credit lenders took the recession, borrowers saw how unreliable credit can be at times. More consumers are moving away from funding methods like credit cards, mortgage loans, and unsecured loans. They are opting for cash as they forge ahead and create their financial futures.
Xmas Gifts Without Hefty Price Tags
Buying gifts for loved ones can often be a bit of a drain on the finances. When there are many more people to buy for, like at Christmas for example, this gift-money balance is made even harder. Add to this the fact that many people are short of cash due to the recession, and you can soon have a bit of a nightmare trying to get Christmas presents for everyone without breaking the bank. Don’t fear though, here are 3 great tips for making your xmas a frugal one.
DIY gifts. Many people are put off making their own gifts as they think it will take too much time and look a bit rubbish. However, the more you make gifts, the easier it gets and the better the results. Try to tackle something easy at first, such as making candy or cakes. When you think you have got your head around these, you can tackle something a little more advanced such as personalised ornament making or even clothing
Shop around. Finding that best price for a certain item has never been so easy. The technological revolution has meant that you can compare prices instantly, whereas before you used to have to brave the Christmas high streets for hours to do the same. There are lots of price comparison sites around where you search for individual products and find the sites that offer the best prices on gifts for men and gifts for her.
Sales. You don’t always have to get your gifts before Christmas. These days it is more acceptable to wait until the January sales to buy your presents, and more families are doing this every year. It often makes perfect sense in fact as retailers often have 50%+ sales in the new years months. However, some retails are now offering sale prices on gifts for her and gifts for him even in December.
