With the economy in the current state it is in, it can be difficult to find ways to save. Most people are trying their best just to pay the bills and even a penny extra seems to go to pay something else off. While saving is more difficult in a tough economy, there are still some things you can do to ensure you have enough put aside for a rainy day, emergency situation or your future retirement.
Showing posts with label budget. Show all posts
Showing posts with label budget. Show all posts
Thursday, August 02, 2012
Wednesday, April 04, 2012
How to Save Money for the Future
No matter how much money people earn, it always seems difficult to accumulate savings. This is because the more money they have, the more they spend. But there are many ways to go about putting money aside for future needs.
The first thing to do to start saving money is to set up an automatic savings plan. Have money automatically deducted from each paycheck and have that money placed in some sort of savings or investment account. This is a type of forced savings, but it is effective. If you never have that money in hand, you cannot be tempted to spend it.
The first thing to do to start saving money is to set up an automatic savings plan. Have money automatically deducted from each paycheck and have that money placed in some sort of savings or investment account. This is a type of forced savings, but it is effective. If you never have that money in hand, you cannot be tempted to spend it.
How To Develop A Good Budget For Your Financial Well Being
The monthly budget is the cornerstone to a sound financial plan and is a necessity for peace of mind for you and your family. There are some basic rules to follow when creating your budget that can make the whole process a snap. The advice below will show you how to make a budget that is right for your needs.
Gather information about what items you consider necessary to buy every month. Write down this list of your expenses. Include items such as food, clothing, gas, utilities and insurance premiums for your cars and home. Once you have completed your list, take each item and decide on a reasonable estimation of how much you will spend from your paycheck. To begin with, keep your categories simple and add additional lines if you wish to keep a special eye on a specific area of spending.
Gather information about what items you consider necessary to buy every month. Write down this list of your expenses. Include items such as food, clothing, gas, utilities and insurance premiums for your cars and home. Once you have completed your list, take each item and decide on a reasonable estimation of how much you will spend from your paycheck. To begin with, keep your categories simple and add additional lines if you wish to keep a special eye on a specific area of spending.
Sunday, February 07, 2010
Live Within Your Means and Budget!
The basic premise behind a budget is that the income has to exceed the expenses. It there is a deficit, then you either have to cut your spending or increase your income. Continuing on a deficit path will only lead to an eventual crash. It all has to start with a budget. It is important to get an understanding of what you are making and what you are spending so that you can bring it into balance.
Set your priorities. If you have to have two cars then choose a smaller house. If you have to have a large house then you could choose one in the country (where prices are lower). If you have to have cable then subscribe to the smallest package possible. If you have to have an addition on your home then shop around for the best company at the best price to do the work (or find one that will let you do it a step at a time).
Set your priorities. If you have to have two cars then choose a smaller house. If you have to have a large house then you could choose one in the country (where prices are lower). If you have to have cable then subscribe to the smallest package possible. If you have to have an addition on your home then shop around for the best company at the best price to do the work (or find one that will let you do it a step at a time).
Wednesday, February 03, 2010
Five Places in Your Life to Live Frugally and Save
Frugal living does not have to be about a life of depravation. The frugal life is one of thrifty shopping, careful choices, and a saving mindset. Making just a few adjustments in five areas of your normal life will help you become a frugal person.
Groceries are one of the most expensive items on any budget. Be sure to take a list with you to the grocery store; this will help to cut back on impulse items. If you are still concerned, then why not take a friend shopping with you. Exchange lists at the store and each of you can gather up the other's groceries, virtually eliminating all impulses. And don’t forget to cut out coupons. It may take some time, but it will add up in the end.
Groceries are one of the most expensive items on any budget. Be sure to take a list with you to the grocery store; this will help to cut back on impulse items. If you are still concerned, then why not take a friend shopping with you. Exchange lists at the store and each of you can gather up the other's groceries, virtually eliminating all impulses. And don’t forget to cut out coupons. It may take some time, but it will add up in the end.
Monday, July 27, 2009
The Basic Steps for Building a Budget
A great way to start living a frugal life is to plan for it. And when it comes to finances, the most important plan is a budget. Setting up a budget is possible no matter what you income, how you get paid, or what your current financial situation. Developing a budget is the first (and most crucial step) to becoming frugal. Here are some great tips on how to do it:
Sunday, July 26, 2009
Beginning the Frugal Life
Most people think of being frugal as living without enjoyment. Frugal people are seen as the scrooges of life – the ones who count every penny and refuse to part with one even for some heat in winter. The truth is that frugal people live some of the most joyous lives of anyone. They have money, little or no debt, and lots of freedom to enjoy it all.
The truth is that frugal people are not stingy, they are wise. They have learned to spend their money in the best way possible. The years have taught them to be thrifty and to look for the best deal or bargain. Experience has shown them to be patient and wait for the sale or to purchase when the time is right. Most importantly, frugal people have learned to save as many pennies as they spend.
There are many wonderful benefits to living a frugal lifestyle. The first is security. By choosing to hold off on purchases, trips, or other spending and putting that money into savings, you know that you have money if something should come up in the future.
Frugal people often have more time to enjoy life than others. Because they spend less, they need less to spend. This monetary need translates into easier working hours or even working from home. It’s a lot like retiring well before your time.
When it comes to making purchases, cash is still king and it gives you a great deal of power in negotiations. Living a frugal lifestyle will help you accumulate the cash you need to buy the things that are important to you. It will teach you to make calculated decisions with your money, not emotional ones. And it will help you be in a position to almost name your own price.
It is not extremely difficult to become a frugal person. It probably is a good idea to talk with your family (or anyone who lives with you) before you begin your quest. It is easier to accomplish it together. Start small by paying for what you need with cash and getting rid of your credit cards. Cut your spending and begin to institute a 24 hour waiting period for purchases. The more you wait and think, the less likely you are to purchase something you don’t need.
A frugal life can be a wonderful life. You have security, freedom, and an appreciation for all that you have.
The truth is that frugal people are not stingy, they are wise. They have learned to spend their money in the best way possible. The years have taught them to be thrifty and to look for the best deal or bargain. Experience has shown them to be patient and wait for the sale or to purchase when the time is right. Most importantly, frugal people have learned to save as many pennies as they spend.
There are many wonderful benefits to living a frugal lifestyle. The first is security. By choosing to hold off on purchases, trips, or other spending and putting that money into savings, you know that you have money if something should come up in the future.
Frugal people often have more time to enjoy life than others. Because they spend less, they need less to spend. This monetary need translates into easier working hours or even working from home. It’s a lot like retiring well before your time.
When it comes to making purchases, cash is still king and it gives you a great deal of power in negotiations. Living a frugal lifestyle will help you accumulate the cash you need to buy the things that are important to you. It will teach you to make calculated decisions with your money, not emotional ones. And it will help you be in a position to almost name your own price.
It is not extremely difficult to become a frugal person. It probably is a good idea to talk with your family (or anyone who lives with you) before you begin your quest. It is easier to accomplish it together. Start small by paying for what you need with cash and getting rid of your credit cards. Cut your spending and begin to institute a 24 hour waiting period for purchases. The more you wait and think, the less likely you are to purchase something you don’t need.
A frugal life can be a wonderful life. You have security, freedom, and an appreciation for all that you have.
Saturday, July 25, 2009
Being Frugal Now Can Mean Future Security
Nothing can tighten your chest more than knowing the electric bill is past due and that the bank account is hitting rock bottom. Not having the finances to pay ordinary bills can be the stress that breaks a marriage’s back. Learning to live a frugal life not only helps with your finances today, but it can also prepare a secure life for tomorrow.
Learning to cut expenses, to make thrifty choices, and to save all your excess opens doors that would never be possible otherwise. You could choose to retire early, start a business from your home, or just live off your savings. Being frugal will help you have choices that you wouldn’t have if you didn’t know how to manage your spending.
Retirement is not simply the idea that you are leaving your current employment. It is choosing to have a life where you don’t make a regular paycheck. With frugal choices you will no longer need as much income to maintain a financial balance. You can finally say goodbye to your nine-to-five if you choose (although that lifestyle is not for everyone).
Making frugal choices will help you build up your savings. Having several months' worth of income in the bank could finally give you the courage to start that business you have always dreamed of having. Being in a position where you don’t have to rely on your income will make it easier for you to find success on the path that you desire. The stress to make money will be replaced by a simple desire to succeed.
Being thrifty and putting aside your savings can help you build up a hefty nest egg in no time. You could choose to live off that money for a while and take a trip across country or around the world (backpacking of course, because that is a frugal way to travel). The money could be your living expenses while you go back to school. Living off your savings could give you enough time to finally write that novel.
The main idea behind the frugal life is that it gives you freedom. As you choose to walk away from purchases and save that money, you set yourself up to be able to make different and better choices tomorrow. As you cut your budget and save the difference, you protect yourself from unexpected events. Building a nest egg today will give you choices and security for tomorrow.
Learning to cut expenses, to make thrifty choices, and to save all your excess opens doors that would never be possible otherwise. You could choose to retire early, start a business from your home, or just live off your savings. Being frugal will help you have choices that you wouldn’t have if you didn’t know how to manage your spending.
Retirement is not simply the idea that you are leaving your current employment. It is choosing to have a life where you don’t make a regular paycheck. With frugal choices you will no longer need as much income to maintain a financial balance. You can finally say goodbye to your nine-to-five if you choose (although that lifestyle is not for everyone).
Making frugal choices will help you build up your savings. Having several months' worth of income in the bank could finally give you the courage to start that business you have always dreamed of having. Being in a position where you don’t have to rely on your income will make it easier for you to find success on the path that you desire. The stress to make money will be replaced by a simple desire to succeed.
Being thrifty and putting aside your savings can help you build up a hefty nest egg in no time. You could choose to live off that money for a while and take a trip across country or around the world (backpacking of course, because that is a frugal way to travel). The money could be your living expenses while you go back to school. Living off your savings could give you enough time to finally write that novel.
The main idea behind the frugal life is that it gives you freedom. As you choose to walk away from purchases and save that money, you set yourself up to be able to make different and better choices tomorrow. As you cut your budget and save the difference, you protect yourself from unexpected events. Building a nest egg today will give you choices and security for tomorrow.
Thursday, July 23, 2009
Cutting Extras Can Add Up Your Savings
Today’s society is all about the latest gadget, gizmo or service. We have to have it, and it has to be the biggest or most that is offered. In reality there are so many modern conveniences that you can live without if you choose to live that way. Releasing the services or gadgets that you don’t really need could save you thousands of dollars each year. Here are some ways to do it.
Get rid of the phone. If you are currently paying for a cell phone and a land line, then you need to decide which one you really have to have. Compare the costs of long distance, local calling, and features (such as call waiting). Choose whichever one is the best deal and fits your overall needs. If you cut the land line you could save around $50 each month. Getting rid of cell phones could easily double that amount (and it would mean that you COULDN’T be found all the time in all places).
High-speed internet service or dedicated internet service is not usually necessary for ordinary use of the computer. If all you are doing is playing games, then why not buy a CD instead. If you are only logging on to check your emails, then you can save the $50 a month by downgrading to a lower service. If you need only occasional access (once a month or once a year) to high-speed service then check with the local library and see they provide public use of the internet.
Cut the cable. If you can turn it off completely, then do. It is only stealing your time, your intelligence, and your family life. If you need some channels to keep the peace, then be sure to choose the smallest plan that can fit your needs. There are rumors that companies will eventually let you pick your channels individually which will be perfect for those who only watch a couple of channels exclusively.
Stop the presses. You will save money by not subscribing to any more magazines and canceling all the subscription you currently have. If you must have reading material in the bathroom, then why not check out a book from the local library. You will save yourself a fortune in subscription fees and you will help reduce the clutter in your house at the same time.
By cutting some of the extravagancies out of your daily life, you can save plenty of money. The more you save, the more you will want to cut - and the more you cut, the more you will find you want to cut and the more you will save. It is a wonderful cycle that eventually ends with plenty of money in your bank account.
Get rid of the phone. If you are currently paying for a cell phone and a land line, then you need to decide which one you really have to have. Compare the costs of long distance, local calling, and features (such as call waiting). Choose whichever one is the best deal and fits your overall needs. If you cut the land line you could save around $50 each month. Getting rid of cell phones could easily double that amount (and it would mean that you COULDN’T be found all the time in all places).
High-speed internet service or dedicated internet service is not usually necessary for ordinary use of the computer. If all you are doing is playing games, then why not buy a CD instead. If you are only logging on to check your emails, then you can save the $50 a month by downgrading to a lower service. If you need only occasional access (once a month or once a year) to high-speed service then check with the local library and see they provide public use of the internet.
Cut the cable. If you can turn it off completely, then do. It is only stealing your time, your intelligence, and your family life. If you need some channels to keep the peace, then be sure to choose the smallest plan that can fit your needs. There are rumors that companies will eventually let you pick your channels individually which will be perfect for those who only watch a couple of channels exclusively.
Stop the presses. You will save money by not subscribing to any more magazines and canceling all the subscription you currently have. If you must have reading material in the bathroom, then why not check out a book from the local library. You will save yourself a fortune in subscription fees and you will help reduce the clutter in your house at the same time.
By cutting some of the extravagancies out of your daily life, you can save plenty of money. The more you save, the more you will want to cut - and the more you cut, the more you will find you want to cut and the more you will save. It is a wonderful cycle that eventually ends with plenty of money in your bank account.
Tuesday, July 21, 2009
The Frugal Mind
Anyone can save money by not spending it. Misers and scrooges pinch their pennies and have a perfectly miserable life to show for it. The frugal life, however, is not just about saving money. It is about making choices to enhance your life.
There are always ways to spend your money – no matter how much you have. You can buy your lunch at work or you can buy groceries to make your lunch to take to work. The frugal person will make her lunch and then save the rest of the money for something else (a vacation, paying off the mortgage early, a spa day as a treat, or a new pre-owned car).
Income tax checks are a great chance to be frugal. You could use the money to put a down payment on a new car or to buy that surround sound system you always wanted. A frugal person will save a portion, pay off any outstanding debts with a portion, and use the rest for a treat that they have desired for a while (maybe a professional hairstylist or a new outfit for business meetings). The money will be used or spent, but it will go towards things that have lasting value. Splurges are allowed, but they are controlled.
Being frugal is about spending money the best way it can be spent. You learn to compare items and opportunities and decide which one is the best choice for you. It requires a willingness to do some research, a boldness to ask questions, and the ability to walk away until another day (or for good).
It takes a special mindset to live a frugal life. You have to understand the bigger picture and be willing to sacrifice a little now in order to gain a lot tomorrow. The trick is that you may not be able to see the gain for some time. It’s a walk of faith that in the end it will be better.
A great way to start on the frugal path is to meet some truly frugal people. They will be the happy people who have no hefty bills weighing them down because they have paid them off. Talk to them about their walk and see if they will help you along your own journey.
Learning to be frugal will help you to save money, but it is not just about the money. A frugal person learns to make the best choice in financial situations so that he can enjoy his life to the fullest.
There are always ways to spend your money – no matter how much you have. You can buy your lunch at work or you can buy groceries to make your lunch to take to work. The frugal person will make her lunch and then save the rest of the money for something else (a vacation, paying off the mortgage early, a spa day as a treat, or a new pre-owned car).
Income tax checks are a great chance to be frugal. You could use the money to put a down payment on a new car or to buy that surround sound system you always wanted. A frugal person will save a portion, pay off any outstanding debts with a portion, and use the rest for a treat that they have desired for a while (maybe a professional hairstylist or a new outfit for business meetings). The money will be used or spent, but it will go towards things that have lasting value. Splurges are allowed, but they are controlled.
Being frugal is about spending money the best way it can be spent. You learn to compare items and opportunities and decide which one is the best choice for you. It requires a willingness to do some research, a boldness to ask questions, and the ability to walk away until another day (or for good).
It takes a special mindset to live a frugal life. You have to understand the bigger picture and be willing to sacrifice a little now in order to gain a lot tomorrow. The trick is that you may not be able to see the gain for some time. It’s a walk of faith that in the end it will be better.
A great way to start on the frugal path is to meet some truly frugal people. They will be the happy people who have no hefty bills weighing them down because they have paid them off. Talk to them about their walk and see if they will help you along your own journey.
Learning to be frugal will help you to save money, but it is not just about the money. A frugal person learns to make the best choice in financial situations so that he can enjoy his life to the fullest.
Friday, December 26, 2008
Be Cautious When Taking Out a Cash Advance Loan
Has Christmas left you short of money? Need some quick cash? Getting a cash advance may be the answer, but beware, there are risks involved and you need to know exactly what you're signing up for.
Taking out a cash advance requires little on your part. All you need to do is prove you have a bank account and a job with a minimum monthly salary and the money is as good as in your bank with the cash being available in less than one day. However, money that comes this easy also comes with a few red flags and warnings.
Here’s what to look for:
Maximum Loan. How much can you borrow? Most payday loans have a maximum of $1000 or $1500. Consumer advocates warn against taking out a number payday loans, particularly at once. Not only because the fees you’ll be paying are expensive but because many banks will close your account if you bounce too many payday loan checks.
Most payday loans are paid back by the lender cashing a predated check that you write. If this money isn’t in your account when the loan comes due, the check will bounce and your bank will make record of it. If you’re taking out several payday loans to cover a debt or payment, and the funds aren’t available then the bank can close your account, which means it may be difficult to get another bank account.
Term. How long do you have to pay back your loan? Standard loan terms range from one week to two weeks. Make note to find out exactly when the loan is due and your check is going to be cashed so you can make sure you have money in your account.
Fees. How much is your loan going to cost you? The standard rates seem to range between $30 and $40 per $100 borrowed. That means that if you borrow $100 you owe $140. On top of that, if you’re unable to pay the loan back when its due you may owe significant fees. Find out what these fees are before you sign on the dotted line.
Contract terms. Some lenders have lots of small print. Read the small print. Many online lenders have a policy where they automatically deposit cash into your account every month, and they automatically deduct that cash, plus a fee, every month. Make sure you’re not signing up for one of these loans or you’ll be paying your lender on a monthly basis for loans that you do not need and getting out of this loop can be difficult.
Because payday loans are so expensive and there are inscrutable lenders out there, it may be helpful to consider other options.
Cash Central Payday Loans: Quick, Friendly, Secure
Taking out a cash advance requires little on your part. All you need to do is prove you have a bank account and a job with a minimum monthly salary and the money is as good as in your bank with the cash being available in less than one day. However, money that comes this easy also comes with a few red flags and warnings.
Here’s what to look for:
Maximum Loan. How much can you borrow? Most payday loans have a maximum of $1000 or $1500. Consumer advocates warn against taking out a number payday loans, particularly at once. Not only because the fees you’ll be paying are expensive but because many banks will close your account if you bounce too many payday loan checks.
Most payday loans are paid back by the lender cashing a predated check that you write. If this money isn’t in your account when the loan comes due, the check will bounce and your bank will make record of it. If you’re taking out several payday loans to cover a debt or payment, and the funds aren’t available then the bank can close your account, which means it may be difficult to get another bank account.
Term. How long do you have to pay back your loan? Standard loan terms range from one week to two weeks. Make note to find out exactly when the loan is due and your check is going to be cashed so you can make sure you have money in your account.
Fees. How much is your loan going to cost you? The standard rates seem to range between $30 and $40 per $100 borrowed. That means that if you borrow $100 you owe $140. On top of that, if you’re unable to pay the loan back when its due you may owe significant fees. Find out what these fees are before you sign on the dotted line.
Contract terms. Some lenders have lots of small print. Read the small print. Many online lenders have a policy where they automatically deposit cash into your account every month, and they automatically deduct that cash, plus a fee, every month. Make sure you’re not signing up for one of these loans or you’ll be paying your lender on a monthly basis for loans that you do not need and getting out of this loop can be difficult.
Because payday loans are so expensive and there are inscrutable lenders out there, it may be helpful to consider other options.
- Looking to local community-based organizations may make small business loans to individuals.
- Asking your creditors for more time to pay your bills. Find out what they will charge for that service - as a late charge, an additional finance charge or a higher interest rate. This may be significantly less than what a payday loan will cost.
- Find out if you have, or can get, overdraft protection on your checking account.
- If you need help working out a debt repayment plan with creditors or developing a budget, contact your local consumer credit counseling service.
- Look at the possibility of obtaining a credit card. The cash advance fees and interest rate may cost less than a payday loan.
- If you decide you must use a payday loan, borrow only as much as you can afford to pay with your next paycheck and still have enough to make it to the next payday.
Cash Central Payday Loans: Quick, Friendly, Secure
Tuesday, December 16, 2008
Getting Your Credit Back on Track
Many people are struggling with bad credit. Unfortunately it doesn’t take much to derail your credit. A few missed or late payments on any credit card or loan can send creditors knocking on your door and a world of stress into your life. If you are in this situation, here’s how to get your credit back on track and eliminate credit card debt as quickly as possible:
Step #1: List all of your credit cards, including your outstanding balance, your interest rate, and the minimum payment percentage and the minimum payment according to your latest statement. Yes, this could be painful and may strike a chord of panic in your chest. Don’t worry. This is the first step to gaining control of your finances and getting your credit back on track.
Step #2: Once you have that list, highlight or circle the credit card with the highest interest rate. This is the card you’re going to attack first.
Step #3: Add up the minimum payments for all of your cards. This means if you have five credit cards, what minimum balance do you owe on each and what is the total of your minimum balances?
Step #4: Create a budget. Yep, this may sound like a scary word, but a budget will tell you exactly what you have to spend each month and how much you have to pay off your credit card balances.
Step #5: Pay the minimum balance on each credit card you have EXCEPT the one with the highest percentage rate. On this card you will pay as much as you can on top of the minimum balance. So if your minimum balance is $125, and you’ve budgeted to pay an extra $100 toward your credit card debt, you’ll make a payment of $225.
Once your balance is paid off from your highest credit card, move on to the next highest credit card percentage rate. Continue the process until your debt is paid off.
Call your credit card companies and see if you can lower the percentage rate. If they will not lower your credit card rate, consider shopping around for a card with a lower rate. If possible, transfer the balances on your high rate cards to cards with a lower rate. Keep in mind that you will likely incur a fee for this transfer. Make sure you cancel the card that you just transferred the balance from. You certainly don’t need the temptation of a card with a zero balance to ruin your progress.
Step #1: List all of your credit cards, including your outstanding balance, your interest rate, and the minimum payment percentage and the minimum payment according to your latest statement. Yes, this could be painful and may strike a chord of panic in your chest. Don’t worry. This is the first step to gaining control of your finances and getting your credit back on track.
Step #2: Once you have that list, highlight or circle the credit card with the highest interest rate. This is the card you’re going to attack first.
Step #3: Add up the minimum payments for all of your cards. This means if you have five credit cards, what minimum balance do you owe on each and what is the total of your minimum balances?
Step #4: Create a budget. Yep, this may sound like a scary word, but a budget will tell you exactly what you have to spend each month and how much you have to pay off your credit card balances.
Step #5: Pay the minimum balance on each credit card you have EXCEPT the one with the highest percentage rate. On this card you will pay as much as you can on top of the minimum balance. So if your minimum balance is $125, and you’ve budgeted to pay an extra $100 toward your credit card debt, you’ll make a payment of $225.
Once your balance is paid off from your highest credit card, move on to the next highest credit card percentage rate. Continue the process until your debt is paid off.
Call your credit card companies and see if you can lower the percentage rate. If they will not lower your credit card rate, consider shopping around for a card with a lower rate. If possible, transfer the balances on your high rate cards to cards with a lower rate. Keep in mind that you will likely incur a fee for this transfer. Make sure you cancel the card that you just transferred the balance from. You certainly don’t need the temptation of a card with a zero balance to ruin your progress.
Saturday, December 13, 2008
Benefits of Creating a Personal Budget
A budget is a spending plan. It is your single best tool for knowing where your money is going and how much you have to work with. Of course, just the mention of the word budget can send even the most structured and organized person running for the hills. A budget, however, has several tremendous benefits. Among them are:
1: A budget makes it easy to save and have extra money. By tracking your expenses and income and controlling how much you spend on variable expenses, you will quite likely find that you have more money than you thought you needed. What are you going to do with that extra money? Of course the experts will tell you to save it and that’s probably a good idea, but maybe you could set aside just a little bit of that extra money to do something fun - like take a vacation or go to that five star restaurant you’ve been anxious to try.
2: A budget saves you time. How long does it take you to collect information at the end of the year for taxes? Even if you don’t do your taxes yourself, gathering all of those financial documents can take days and can be extremely stressful. When you have a budget, all of your expenses and income, including your taxes, are documented. This is particularly the case if you use a spreadsheet program or accounting software.
3: A budget makes it easy to track, and control, your spending. It gives you freedom from the stress of not knowing you have enough money to cover certain expenses. It is so much better to control your finances than to let them control you.
4: A budget can reduce family and personal stress. A family budget creates an environment of teamwork and communication rather than one of stress and blame. Everyone is accountable for the spending decisions made and the financial goals you’re striving towards.
5: A solid budget makes it easy for you to make spending and investment decisions with confidence. Have you ever had the chance to invest in something but you weren’t sure if you could? With a solid budget in place you know exactly where you stand financially and your investment decisions can be made with the right information at your fingertips.
6: Budgets help you plan for the future with ease and confidence. Are you saving for your retirement? If yes, are you saving the right amount or should you be saving more? Are you going to need a new car soon? If you are, will you have the money for it? A budget gives you the ability and the confidence to plan for the future because you know exactly how much money you have to work with right now.
There really is no downside to budgeting. It reduces one of the most significant causes of stress and it puts you in control of your money and your future.
1: A budget makes it easy to save and have extra money. By tracking your expenses and income and controlling how much you spend on variable expenses, you will quite likely find that you have more money than you thought you needed. What are you going to do with that extra money? Of course the experts will tell you to save it and that’s probably a good idea, but maybe you could set aside just a little bit of that extra money to do something fun - like take a vacation or go to that five star restaurant you’ve been anxious to try.
2: A budget saves you time. How long does it take you to collect information at the end of the year for taxes? Even if you don’t do your taxes yourself, gathering all of those financial documents can take days and can be extremely stressful. When you have a budget, all of your expenses and income, including your taxes, are documented. This is particularly the case if you use a spreadsheet program or accounting software.
3: A budget makes it easy to track, and control, your spending. It gives you freedom from the stress of not knowing you have enough money to cover certain expenses. It is so much better to control your finances than to let them control you.
4: A budget can reduce family and personal stress. A family budget creates an environment of teamwork and communication rather than one of stress and blame. Everyone is accountable for the spending decisions made and the financial goals you’re striving towards.
5: A solid budget makes it easy for you to make spending and investment decisions with confidence. Have you ever had the chance to invest in something but you weren’t sure if you could? With a solid budget in place you know exactly where you stand financially and your investment decisions can be made with the right information at your fingertips.
6: Budgets help you plan for the future with ease and confidence. Are you saving for your retirement? If yes, are you saving the right amount or should you be saving more? Are you going to need a new car soon? If you are, will you have the money for it? A budget gives you the ability and the confidence to plan for the future because you know exactly how much money you have to work with right now.
There really is no downside to budgeting. It reduces one of the most significant causes of stress and it puts you in control of your money and your future.
Monday, September 15, 2008
Create an Achievable "Get Out of Debt" Plan
When you have an overabundance of debt, it's natural to want to get rid of it as quickly as possible. Interest costs can really add up, and having too much debt makes it difficult or impossible to take on debt for things you need. But when we're faced with more debt than we can handle, it is important not to panic.
Getting out of debt on one's own is best if it's possible. But many debtors make the mistake of trying to pay their debts off too quickly. They set unrealistic goals, and when they can't achieve them they become discouraged. This often ends with them filing bankruptcy, because they feel that there is no way around it.
The best course of action is to be realistic. Make a budget, and include everything that you spend money on each month. Then find what you can realistically do without, and put the money you save on those things toward paying off your debt. Here are some things we can often cut out of the budget:
Getting out of debt on one's own is best if it's possible. But many debtors make the mistake of trying to pay their debts off too quickly. They set unrealistic goals, and when they can't achieve them they become discouraged. This often ends with them filing bankruptcy, because they feel that there is no way around it.
The best course of action is to be realistic. Make a budget, and include everything that you spend money on each month. Then find what you can realistically do without, and put the money you save on those things toward paying off your debt. Here are some things we can often cut out of the budget:
- Eating out. Whether you pick up fast food for lunch when you're working, or go out to eat with friends at a fancy restaurant once a week, you can cut costs here. Take your lunch to work, and have dinner with your friends once a month instead of once a week. Or better yet, suggest a less expensive activity that you can do together.
- Vices. Cigarettes, lattes, and other things we buy as a matter of habit are good places to cut back. Quitting smoking is good for you anyway, and switching to regular coffee, made at home with some flavored creamer, would be less expensive. Every little bit helps.
- Entertainment. No one's saying that you have to sit at home and be bored all of the time. Just examine your entertainment budget and see if there are ways you could cut back. If you rent a lot of movies, for example, consider signing up for an unlimited plan.
- Travel. With gas prices usually going up instead of down, cutting back on travel can be a real money saver. Carpooling, and combining trips as much as possible, are two ways that can save you a substantial amount of money on travel.
Wednesday, September 10, 2008
Do You Need to Eat Out Every Day?
This is a question we need to seriously think about. It’s fun to eat out with co-workers, but can our budget handle it? Following the group could be part of the problem that is siphoning our hard earned money each payday.
No one wants to be left out. Eating lunch together is a way to bond away from the office. Besides it’s only six dollars, right?
This scenario demonstrates how we think when it comes to spending money on food. Food and good times seem to go together in our culture. Eating out is not the only way to bond over food.
When setting up a budget, a category is created for groceries. A weekly or biweekly shopping trip to the grocery store brings enough groceries in the house to feed the family. Buying lunch when there is food in the house blows the budget.
Ask co-workers to try bringing in their own lunch at least three times a week. Make a plan to eat in the break room together or outside at a picnic table for lunch. They will save money also.
When you eat out, you probably choose the same one or two places. Make some of your favorite dishes at home and take them for lunch. The grocery trips are not just for breakfast and dinner items. Buy foods that are good in a packed lunch. Most workplaces have a microwave and/or a toaster oven. You can prepare your food and eat it piping hot.
If you have a group of co-workers that you spend most of your time with, why not start a lunch club. Each person takes a day and fixes something for the others in the group to enjoy. No one has to prepare a meal more than once a week and they will know in advance when it is their turn.
The extra food can be figured into the grocery bill. The lunch club idea may catch on and more people will want to join. The more people are involved, the less often each person has to contribute a meal. The meals don’t have to be elaborate. There are many delicious meals that require only a few ingredients.
You can still eat out once a week or maybe even twice. Add it to your budget. Pay for your meal in cash. This eliminates the temptation to overspend that can happen when using a credit card. Eating lunch out means that dinner will have to be eaten at home to balance spending habits.
Lastly, if the group still wants to eat out more often that your budget allows, opt out. Tell them politely that you can’t go and brown bag it. They’ll still be your friendly co-workers, and you’ll have learned a valuable lesson about resisting the temptation to follow the crowd at the expense of your money.
No one wants to be left out. Eating lunch together is a way to bond away from the office. Besides it’s only six dollars, right?
This scenario demonstrates how we think when it comes to spending money on food. Food and good times seem to go together in our culture. Eating out is not the only way to bond over food.
When setting up a budget, a category is created for groceries. A weekly or biweekly shopping trip to the grocery store brings enough groceries in the house to feed the family. Buying lunch when there is food in the house blows the budget.
Ask co-workers to try bringing in their own lunch at least three times a week. Make a plan to eat in the break room together or outside at a picnic table for lunch. They will save money also.
When you eat out, you probably choose the same one or two places. Make some of your favorite dishes at home and take them for lunch. The grocery trips are not just for breakfast and dinner items. Buy foods that are good in a packed lunch. Most workplaces have a microwave and/or a toaster oven. You can prepare your food and eat it piping hot.
If you have a group of co-workers that you spend most of your time with, why not start a lunch club. Each person takes a day and fixes something for the others in the group to enjoy. No one has to prepare a meal more than once a week and they will know in advance when it is their turn.
The extra food can be figured into the grocery bill. The lunch club idea may catch on and more people will want to join. The more people are involved, the less often each person has to contribute a meal. The meals don’t have to be elaborate. There are many delicious meals that require only a few ingredients.
You can still eat out once a week or maybe even twice. Add it to your budget. Pay for your meal in cash. This eliminates the temptation to overspend that can happen when using a credit card. Eating lunch out means that dinner will have to be eaten at home to balance spending habits.
Lastly, if the group still wants to eat out more often that your budget allows, opt out. Tell them politely that you can’t go and brown bag it. They’ll still be your friendly co-workers, and you’ll have learned a valuable lesson about resisting the temptation to follow the crowd at the expense of your money.
Saturday, August 30, 2008
How to Plan for Future Expenses
Many people live from paycheck to paycheck, never quite sure if they have enough money to cover their bills. Living this kind of lifestyle makes planning for future expenses like emergencies or a new car extremely difficult. However, these big expenses do pop up from time to time and if you’re not prepared, it can be an extremely stressful event. Here are some tips on how to plan for the future and save money for the little and the big expenses.
- Step 1: Create a budget, or call it a spending plan if you prefer. A budget simply tells you how much you are spending on certain items in your life. It gives you control over your spending and cash flow, and helps you know where you can cut back.
- Step 2: Create spending goals. How much you spend on the majority of expenses in your life is up to you. You don’t have to spend $1000 a month on going to the movies. When you create a spending goal, you begin to control your money in a positive way.
- Step 3: Create savings goals. Include both short-term and long-term savings goals. Short-term goals give you more immediate satisfaction, like saving for a new coat or a vacation. Long-term goals like college fees or retirement are important too. Both types of goals will have time lines and a planned amount to save each month. For example, if you’re saving for a family vacation your goal may be to put away $200 every month for two years.
- Step 4: Create a separate savings account for your goals. If your savings and your checking mingle, then you run the risk of using your savings to pay for bills or things you want to buy.
- Step 5: Put away money for emergencies. This is particularly important in this day and age where people can get laid off from their jobs, or businesses can go under without notice. And if you’re self-employed, a savings is particularly important. Experts advise to have a minimum of six months salary set aside just in case.
Sunday, August 24, 2008
Creating a Personal Budget
Where does all that money go each month? Everyone wants to know but no one wants to tackle the one thing that can answer the questions: create a personal budget. For some, you might as well be strapping the handcuffs on them. A personal budget is tedious at the outset, but once it is in place, you’ll be glad you did it.
Let’s start with the basics. A personal budget needs to have a listing of all the money coming into the house on a monthly basis. This includes salaries from work, child support, alimony, income from real estate investments, and pensions. All of these sources make up your monthly income that can be used towards household expenses.
Add these up. This is the amount you have to start with. You probably can’t believe you have that much money coming into the household when you open your wallet at the end of the month and nothing but moths fly out.
Now we tackle the debt. What are the expenses that you pay each month? This includes mortgages, utility bills, other loan payments, child support, alimony, credit card payments, child care, entertainment bills, car insurance, and car payments. If the price of these bills stays the same each month your budget will be easier to figure out.
Money also needs to be allocated for variable expenses. Clothing, food, gas, medical co-pays, and entertainment fall in this group. This type of entertainment includes going to the movies, a play, or out to dinner. Monthly cable television bills would go in with the recurring bills.
Add up all of the recurring debt and subtract that from your income. The remainder will create monthly allowances for the variable expenses. People who send money to their savings account each month can record that amount as an expense. If you are having trouble saving, this is the perfect time to allocate an amount for that purpose.
Keep a log such as a check register, or use finance software aids in tracking where the money goes. One way that money disappears is through the ATM machine. It is easy, convenient, and the number one way to ruin your budgeting efforts.
Creating a personal budget is a family affair. Parents don’t have to go it alone. Let everyone in the house contribute to the final product. After all, each person will be governed by it in some way. Children can benefit from the financial habits that they see you implement in your daily life.
Budgets are not quick fixes. Just like any other habit it will take time to become second nature. Before it is all said and done, you may find that you have to change the original budget several times until it fits your lifestyle. An ideal budget should allow wiggle room but provide structure to keep to your goals.
Let’s start with the basics. A personal budget needs to have a listing of all the money coming into the house on a monthly basis. This includes salaries from work, child support, alimony, income from real estate investments, and pensions. All of these sources make up your monthly income that can be used towards household expenses.
Add these up. This is the amount you have to start with. You probably can’t believe you have that much money coming into the household when you open your wallet at the end of the month and nothing but moths fly out.
Now we tackle the debt. What are the expenses that you pay each month? This includes mortgages, utility bills, other loan payments, child support, alimony, credit card payments, child care, entertainment bills, car insurance, and car payments. If the price of these bills stays the same each month your budget will be easier to figure out.
Money also needs to be allocated for variable expenses. Clothing, food, gas, medical co-pays, and entertainment fall in this group. This type of entertainment includes going to the movies, a play, or out to dinner. Monthly cable television bills would go in with the recurring bills.
Add up all of the recurring debt and subtract that from your income. The remainder will create monthly allowances for the variable expenses. People who send money to their savings account each month can record that amount as an expense. If you are having trouble saving, this is the perfect time to allocate an amount for that purpose.
Keep a log such as a check register, or use finance software aids in tracking where the money goes. One way that money disappears is through the ATM machine. It is easy, convenient, and the number one way to ruin your budgeting efforts.
Creating a personal budget is a family affair. Parents don’t have to go it alone. Let everyone in the house contribute to the final product. After all, each person will be governed by it in some way. Children can benefit from the financial habits that they see you implement in your daily life.
Budgets are not quick fixes. Just like any other habit it will take time to become second nature. Before it is all said and done, you may find that you have to change the original budget several times until it fits your lifestyle. An ideal budget should allow wiggle room but provide structure to keep to your goals.
Friday, August 15, 2008
Budget is Not a Bad Word...
Sit amongst a group of friends and associates and mention the word budget, and suddenly everyone has somewhere else they need to be. Usually no one wants to talk about budgets, no one wants to think about budgets, and no one wants to follow a budget. However, when looked at with open eyes a budget is actually a fantastic thing. Here are three reasons why budget may become your favorite word:
Reason #1: A budget puts you in control of your money instead of your money controlling you. What did you spend your last $100 on? You may not remember. Maybe it was a pizza, or stickers for your children, maybe it went to piano lessons or a new pair of boots. The point is, many people have no idea where their money goes. When you set, and follow, a realistic budget your cash is freed up so you can spend your money on things that are important to you and your family rather than spending it on purchases you won’t remember buying ten minutes later.
Reason #2: A budget can improve your relationships. There’s little worse than the stress money can cause. Debt causes tremendous stress and so does the fear that you won’t be able to pay your bills. It can ruin your health and it can destroy relationships. When you form a financial plan with your family you work together as a team to reach your goals. The lines of communication are opened and the stress is eliminated because you have a plan and a team of support. Additionally, when you’re all on the same page financially there are no arguments about money, which makes better relationships with your spouse and your children.
Reason #3: Most people would agree that it is better to live within your means than to get into debt. However, some people don’t realize they’re living beyond their means until it is too late and the debt has become overwhelming – and stressful. A sound budget keeps you living within your means and prevents or eliminates debt. A structured and realistic budget prevents the “Oops I spent too much on my credit card this month” mistake that we often make month after month until we’re paying more on our minimum balance than on our mortgage. If this applies to you, don’t let it get to this point. Take advantage of the power of a budget and gain control over your financial life.
There is absolutely no downside to forming a budget and we’ve only scratched the surface of the benefits they provide. Take a few minutes to realistically analyze your spending habits, your income, and your financial goals. I promise you’ll be glad you did.
Reason #1: A budget puts you in control of your money instead of your money controlling you. What did you spend your last $100 on? You may not remember. Maybe it was a pizza, or stickers for your children, maybe it went to piano lessons or a new pair of boots. The point is, many people have no idea where their money goes. When you set, and follow, a realistic budget your cash is freed up so you can spend your money on things that are important to you and your family rather than spending it on purchases you won’t remember buying ten minutes later.
Reason #2: A budget can improve your relationships. There’s little worse than the stress money can cause. Debt causes tremendous stress and so does the fear that you won’t be able to pay your bills. It can ruin your health and it can destroy relationships. When you form a financial plan with your family you work together as a team to reach your goals. The lines of communication are opened and the stress is eliminated because you have a plan and a team of support. Additionally, when you’re all on the same page financially there are no arguments about money, which makes better relationships with your spouse and your children.
Reason #3: Most people would agree that it is better to live within your means than to get into debt. However, some people don’t realize they’re living beyond their means until it is too late and the debt has become overwhelming – and stressful. A sound budget keeps you living within your means and prevents or eliminates debt. A structured and realistic budget prevents the “Oops I spent too much on my credit card this month” mistake that we often make month after month until we’re paying more on our minimum balance than on our mortgage. If this applies to you, don’t let it get to this point. Take advantage of the power of a budget and gain control over your financial life.
There is absolutely no downside to forming a budget and we’ve only scratched the surface of the benefits they provide. Take a few minutes to realistically analyze your spending habits, your income, and your financial goals. I promise you’ll be glad you did.
Wednesday, August 06, 2008
Live and Spend Within Your Means...
Living within your means is a liberating way to live your life. It means no debt – debt is one of the most common causes of relationship stress. Living within your means gives you the freedom to save money for special things rather than always scrimping to pay your bills.
Unfortunately, many people don’t live within their means. They live above it, way above it. This happens for many reasons. Maybe they just don’t track their expenses, and purchases are made without thinking. Maybe they’re trying to keep up with their friends and family. Maybe shopping is a misguided form of therapy. Whatever the reason, the end result isn’t a happy one.
If you feel that you could do more to live within your means, here are a few tips to help keep your life on track and your financial status right where it belongs:
Tip #1: Keep track of your spending. It is important to know where your money goes. Once you have an idea of what you’re spending your money on, you can begin to control it.
Tip #2: Buy a used car or at least keep your new car for more than a couple years. A new car depreciates the moment you drive it off the lot. Sometimes it depreciates as much as 50%. A used car already has that depreciation figured into the cost.
Tip #3: Don’t be afraid to grocery shop with coupons or stock up on items for sale. Personally I love it when the grocery offers "buy one get one free items", particularly when the items are large ticket items like meats. Not only do I save tons of money but when I can’t figure out what to make for dinner, I can just open my freezer and I have options.
Tip #4: Do buy quality clothing items, not quantity. When you’re shopping for yourself, don’t make whimsical clothing purchases or follow the latest trend. What’s better? Spending $100 on a pair of jeans that will be out of style next season, or spending $150 on a pair of jeans you can wear for five years?
Tip #5: If you have a credit card debt, develop a plan to get out of it. A debt elimination plan begins with reducing your interest rate. A phone call to your creditor can usually start the process. Next, stop the charging on those credit cards and get busy paying them down. Pay more than the minimum balance or you’ll never get it done. A great way to manage the process is to develop a monthly budget. Your budget will contain your income, expenses including debt and your savings.
Living within your means is possible! It is empowering to have complete control over your money and your finances, certainly less stressful than letting your money control you!
Unfortunately, many people don’t live within their means. They live above it, way above it. This happens for many reasons. Maybe they just don’t track their expenses, and purchases are made without thinking. Maybe they’re trying to keep up with their friends and family. Maybe shopping is a misguided form of therapy. Whatever the reason, the end result isn’t a happy one.
If you feel that you could do more to live within your means, here are a few tips to help keep your life on track and your financial status right where it belongs:
Tip #1: Keep track of your spending. It is important to know where your money goes. Once you have an idea of what you’re spending your money on, you can begin to control it.
Tip #2: Buy a used car or at least keep your new car for more than a couple years. A new car depreciates the moment you drive it off the lot. Sometimes it depreciates as much as 50%. A used car already has that depreciation figured into the cost.
Tip #3: Don’t be afraid to grocery shop with coupons or stock up on items for sale. Personally I love it when the grocery offers "buy one get one free items", particularly when the items are large ticket items like meats. Not only do I save tons of money but when I can’t figure out what to make for dinner, I can just open my freezer and I have options.
Tip #4: Do buy quality clothing items, not quantity. When you’re shopping for yourself, don’t make whimsical clothing purchases or follow the latest trend. What’s better? Spending $100 on a pair of jeans that will be out of style next season, or spending $150 on a pair of jeans you can wear for five years?
Tip #5: If you have a credit card debt, develop a plan to get out of it. A debt elimination plan begins with reducing your interest rate. A phone call to your creditor can usually start the process. Next, stop the charging on those credit cards and get busy paying them down. Pay more than the minimum balance or you’ll never get it done. A great way to manage the process is to develop a monthly budget. Your budget will contain your income, expenses including debt and your savings.
Living within your means is possible! It is empowering to have complete control over your money and your finances, certainly less stressful than letting your money control you!
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