Budgeting Tips
Tips for Keeping Personal Finances in Check During the Holidays
Guest post:
Developing a budget is the foundation for keeping your personal finances in check during the Christmas and New Year period. A budget provides a realistic way to see where your finances stand. Be prepared, though. Writing things down has a tendency to shed light on issues. You may be spending more money on items than you originally thought. So, take some time to figure out exactly what your income is, how much you need for your daily living expenses and what amount is available for recreational expenses. Recreational expenses mean the fun stuff like going to the movies, buying that extra gift or paying more for that family dining experience. Stay within your budget to keep your finances in check.
Pay cash as much as possible. Hopefully, by now you have weaned yourself from credit cards. Credit cards put you into a borrowing situation which can only harm you in the long run. As much as companies advertise special credit promotions, such as not paying until February, you are still entering into a legal obligation. February may seem like a long time away, but it will come sooner than you thought. And, you might not have the money then. So, paying cash for whatever you buy is your best bet. Paying cash also reduces your risks of credit card fraud.
If you absolutely must buy a high-end item that you cannot afford to pay cash for, check around for the best credit cards available. Some independent credit card companies do offer low-interest rate incentives to attract new customers. Just be certain you read the fine print. You do not want to enter into any contract that has a large payment after a certain amount of time or one that has a small-print clause stating the interest rate will go up for a number of reasons. Many reputable retail establishments have their own credit card to entice purchases. Some of these can be low or interest-free. Be safe and deal only with companies you feel comfortable with.
Hit the day after sales. Stores need to get rid of merchandise the day after Christmas. This can be a huge money-saver for customers. Some items can be marked down more than 50 percent. Check your local newspaper or go online to see what sales are available. It may be well worth your time, effort and pocketbook to buy that big-dollar item after Christmas instead of before. Be patient and you may reap the rewards. Start doing some comparison shopping. This time of the year, especially, retail establishments are vying for your business. All kinds of good deals abound. As much as that hold true, you can keep your personal finances in check during the Christmas and new year period by taking some time to comparison shop. You know what item you want to buy. Check to see which store offers the best price. Also check to see what the store’s return policy is in case the item does not work out for you or your gift recipient. And remember, driving across town to save a couple bucks on an item may not be worth it. You need to consider your commuting costs into the final cost of the item. Just like Santa likes making a list, you can benefit from making a list. Write down all the gifts you want to buy. Take that list with you on all shopping trips and stick with it. Once you buy a gift, cross it off your list. Crossing items off gives a feeling of accomplishment. Help your personal finances by using any number of these suggestions during the Christmas and New Year period.
Contributed by Daniel from Merlin Assurance, a Quebec insurance broker.
5 Ways to Stay Smart with Your Money
Money managing skills are not innate for most people. For some people, it even takes several
serious financial crises for them to really learn smart spending, saving, and investing practices.
But it doesn’t have to be that way.
Being wise with your money is more about self-control than anything else. Yes, there are some
traps to avoid, but for the most part, staying financially stable requires nothing more than the
ability to limit yourself and behave in a disciplined way with money. Still, this is not an easy
thing for a lot of people—especially young adults or teenagers—to do, if only because they don’t
know where to start.
Well, for those people that don’t want to have a crisis in the first place (or for those who want to
avoid a second or third one), the five following tips should be a good place to start.
1. Keep your credit card debt low. Credit cards in and of themselves are not evil or
dangerous. What is dangerous is the careless manner in which many people use credit
cards. When buying with credit, try to think of it as money that you don’t actually have.
Just because your credit limit is $2,500 doesn’t mean that you really have $2,500 to
spend wherever you want. You have to pay off your credit card because it is money you
are borrowing from a bank. The simple rule is: if you don’t have the money your bank
account, don’t spend it with a credit card. If this is difficult for you, try only paying in
cash for a month to impose a physical limit on your spending.
2. Start saving early. Investing your money in funds is a good way to prepare for the
future, and keep you from living in squalor after your retire, but if you choose to invest,
do it as early as you can. A 20 year-old investing $100 a month at a 10% interest rate
until he was 60, for example, could save at least $500,000 more than a 30 year-old
following the same strategy. Furthermore, have your investment money automatically
withdrawn from your account each month, so that you don’t spend so much that you
aren’t making a worthwhile investment. In other words, budget around your investment.
3. Don’t waste a 401(k) with a company match. Especially in these times, a 401(k) with
a company match is an uncommon thing, so if your company offers one, make sure to put
up as much as you can afford. This is as close as you’ll ever come to getting something
for nothing.
4. Be prepared for personal injury or damage to your possessions by insuring yourself
as fully as you can. Sometimes it makes more sense to remain uninsured, but for the
most part, you don’t want to risk the chance of something happening while you don’t have
enough money to pay for injuries or damages. These fees and expenses will compound
faster than you would believe, and can leave you financially crippled. Insuring yourself
is thinking for the long term.
5. Take out as little loan money as possible, and avoid co-signing loans. Obviously
there will be exceptions to this rule (if you are a student, or if you are a parent, for
example) but generally you want to pay as much of your own was as you can, and should
think very seriously before co-signing a loan. If someone needs you to co-sign, it’s
because banks don’t trust them by themselves, so if they don’t (or can’t) pay, that debt
comes to you.
It is certainly easier said than done with some of these tips, but if you start doing your best to
adhere to these guidelines as rules, and only break them when you absolutely must, you’ll start to
find yourself not only stable, but prospering.
Mariana Ashley is a freelance writer who particularly enjoys writing about online colleges. She
loves receiving reader feedback, which can be directed to mariana.ashley031 @gmail.com.
7 ways to save money in 2011
2011 is proving to be a difficult year to define. On one hand, we are tired of being recession-conscious, and many of us are ready to spend again. On the other hand, a fluctuating stock market and consistently high unemployment makes it seem like it might not be the best time for investment or indulgence. So how can you enjoy the things you love while still saving money in 2011?
1. Institute some “No Spending” days. You can allow yourself a few indulgences the rest of the week if you lock up your wallet for at least one or two days a week. That means bringing lunch from home, brewing your own coffee instead of Starbucks, and skipping the mall and happy hour on your way home. People report that “No Spend” days actually end up being more fun than they expect—no money spent means a cozy evening with a home-cooked dinner and catching up on reading instead of a dinner and movie out.
2. Realign your financial goals with your life’s goals. The point of having money is to pursue the things you love, right? Setting financial goals that are more about your personal and emotional fulfillment and less about pure material consumption can make it easier to save money on the little things and work towards your goal. For example, it can be easier to control your online-shopping habit when you know you are saving for a gorgeous set of wedding rings for your upcoming wedding, or for an unforgettable vacation for your next anniversary.
3. In 2011, there is no longer any excuse for not keeping track of your money. If you have a smartphone, make it live up to its name by downloading some smart apps that will help you manage your spending habits and budget, like Mint and MyBudget. Many larger banks, such as Chase and Bank of America, offer banking apps that can help you track your balance, make transfers, and even pay bills and cash checks!
4. Flash sale and social discount sites have never been bigger than they are in 2011. These sites, like The Foundary for home goods, Gilt Groupe for clothes and accessories, Groupon and Living Social for spa and dining, Zuliliy for children’s products, and Trippo for travel, promise amazing deals on some pretty hot products. You can save money buying from these sites, but you can also find yourself shelling out hundreds of dollars for hot deals on things you don’t need. Before purchasing from a flash sale site, ask yourself, is this something I would buy at full price? If the answer is no, even if it is a stunning necklace set with beautiful diamonds, it’s not a good deal for you.
5. Evaluate your current spending habits. You can keep tracking of daily petty cash spending ($168 at Starbucks? Really?) with a number of easy-to-use apps, but you shouldn’t leave it at that. Take a good look at your monthly subscription services, like cable TV, the gym, and Netflix, to see if you are really getting your money’s worth. Are you paying for cable but then watching most of your shows on Hulu? Are you paying for a gym membership and then choosing to jog whenever the weather is nice? You can cut down some of these fees or even cut some out entirely, leading to thousands of dollars in savings.
6. Cook at home. Grocery store prices are higher than ever, but guess what? That means restaurant prices are even more destructive to your bank account than ever too. Even if you buy relatively pricey ingredients, you will still save a bundle by eating at home most of the time. Stock your fridge with tasty, healthy ingredients so eating at home stays fun, and retain the social aspect of eating out by inviting friends over for casual dinners at least once a week.
7. Get rid of lingering debt. Although credit card debt has dropped sharply in the last few years, if you have a stable job and a balanced budget, you don’t need to reject credit cards altogether. Get rid of any lingering debt like old credit card debt or student loans by consolidating them and paying them off once and for all, and then use your credit card wisely by accruing valuable points and then paying your bill in full every month.
Guest post written by Houston jewelry store – Whiteflash.com.