The first step in managing your money is having financial goals. The New Year is the ideal time to review your financial goals.
Your goals help you to guide your finances on a daily basis. You have something that you are working towards every day. You plan and follow a budget, using your goals as your map.
Without your financial goals, you don't really have the proper motivation to get out there and save. Without a plan, you aren't getting anywhere. If you don't set financial goals, you may never see financial independence.
If you've never set yourself any financial goals, you need to sit down with a pen and paper and look at what you want to accomplish. There is a reason you want to change your finances. Make a list of the things you want.
Your list will probably start with getting out of debt, starting a retirement account, saving to buy a home and the basics. But don't let that hold you back. Include everything you want to get out of your money to your list. If you want new furniture or a trip to Europe, include them. These are money goals that you can work towards.
Prioritize your list. While getting out of debt is a top priority, going to Europe would be something that could wait. Some goals you will be consistently working on at the same time. Others will wait until something else is accomplished.
Look at each of your goals and set yourself time limits. For example, you may know that you have 25 years to prepare for retirement. You might want to be debt-free in 6 years. Set these goals reasonably and remember that they can always be modified if necessary.
Paying Your Bills on Time
Many people walk a thin line when it comes to paying their bills. They've figured out that they won't have a negative report on their credit history if they pay before the bill is 30 days late.
However, missing your payment by even a few hours can result in late fees and even over-the-limit fees. These can run up to $40 per incident, so you are looking at $80 for simply paying a bit late. This can cost you quite a bit of money if you do it with several bills throughout the year. Even though your credit score is safe, you are spending too much money on your late payment habit.
One way to avoid late payments is to pay your bills on the day you get them. This works for people who are not organized. As soon as the bill comes in the mail, you write a check or pay it online. Many people skip the bother and simply have the bills paid automatically from their checking account on the day before they are due. Many lenders offer a percentage rate decrease for having your payment automatically withdrawn from your checking.
If you are an organized person, it often helps to have a centralized calendar where you mark all of your appointments. Keep it in a place that you will look at every day. You simply mark all of your due dates for each of your bills on your calendar in bold ink. If you mail your bills, you should send them at least 2 weeks before they are due. This will insure that they arrive on time. If you pay your bills online, you should still try to add a couple of days to make sure that everything works out in time.
You can work with most creditors to establish a due date that works for you. For example, if you pay your mortgage on the 1rst of the month, you may not be able to pay your other bills for a couple of weeks. You can call your creditors and request that your due dates be rescheduled to the 20th of the month. Tell them that this would help you to pay each bill on time.
An added bonus is that when you have your bills due on the same date, you can sit down and pay them all at once and get it over with. You don't have to worry about multiple due dates. Make sure that you watch your bills to make sure that the due dates are what you requested.
You can also use a computer software program, such as Quicken or Money, to track your bills, due date and payment amount. These programs can be set to remind you to pay a bill. You have a list that you simply go down and check off as you pay.
You can use a listing method without having a computer. Simply purchase a spiral notebook or journal to use as your bill book. Write the month at the top of the page. Then list the due date, bill and amount owed. You prefill in the next couple of months. When unexpected monthly bills arrive, you add them to the bottom of the list. When you pay bills, you simply go down the list marking them off. That way, you know what has been paid and what hasn't.
However, missing your payment by even a few hours can result in late fees and even over-the-limit fees. These can run up to $40 per incident, so you are looking at $80 for simply paying a bit late. This can cost you quite a bit of money if you do it with several bills throughout the year. Even though your credit score is safe, you are spending too much money on your late payment habit.
One way to avoid late payments is to pay your bills on the day you get them. This works for people who are not organized. As soon as the bill comes in the mail, you write a check or pay it online. Many people skip the bother and simply have the bills paid automatically from their checking account on the day before they are due. Many lenders offer a percentage rate decrease for having your payment automatically withdrawn from your checking.
If you are an organized person, it often helps to have a centralized calendar where you mark all of your appointments. Keep it in a place that you will look at every day. You simply mark all of your due dates for each of your bills on your calendar in bold ink. If you mail your bills, you should send them at least 2 weeks before they are due. This will insure that they arrive on time. If you pay your bills online, you should still try to add a couple of days to make sure that everything works out in time.
You can work with most creditors to establish a due date that works for you. For example, if you pay your mortgage on the 1rst of the month, you may not be able to pay your other bills for a couple of weeks. You can call your creditors and request that your due dates be rescheduled to the 20th of the month. Tell them that this would help you to pay each bill on time.
An added bonus is that when you have your bills due on the same date, you can sit down and pay them all at once and get it over with. You don't have to worry about multiple due dates. Make sure that you watch your bills to make sure that the due dates are what you requested.
You can also use a computer software program, such as Quicken or Money, to track your bills, due date and payment amount. These programs can be set to remind you to pay a bill. You have a list that you simply go down and check off as you pay.
You can use a listing method without having a computer. Simply purchase a spiral notebook or journal to use as your bill book. Write the month at the top of the page. Then list the due date, bill and amount owed. You prefill in the next couple of months. When unexpected monthly bills arrive, you add them to the bottom of the list. When you pay bills, you simply go down the list marking them off. That way, you know what has been paid and what hasn't.
Control Your Impulses
Sometimes it can be hard to walk away from a really good deal. Many impulse shoppers just can't stop shopping. Like any addiction, it has to be faced before it can be conquered.
How do you know if you have a shopping problem? Ask yourself the following questions:
* Are you surprised when you credit card bill arrives?
* Do you have no idea how much money you owe or have?
* Do you hide purchases from your spouse?
* Do you have more items than you can fit in your closets?
* Do you have things that you have never used?
* Do you come home from the store with things you never intended to purchase?
* Do you justify your purchases by saying that they were on sale or a great deal?
If you answered yes to the above questions, you probably are an impulse shopper.
Impulse shopping is a serious issue. When people are unable to save for the things that are important to them -- a house, retirement, a new car -- impulse shopping is often the root of the problem. It causes serious debt and can even lead to bankruptcy.
One of the best ways to counter the urge to splurge is to set specific financial goals that you can work towards. By working to create a budget and saving for your future you can gain control of more than just your finances. You gain control of your life.
But you don't have to totally deprive yourself. Once you have developed a working budget and are taking the steps to realize your goals, you can set aside money for occasional spending. This is your splurging fund and is just for you. Consider it a reward for taking back the control of your money.
Impuse spending can affect more than just your finances. It can take over your entire life. When you are looking to overcome the spending urge, you have to learn to differentiate your needs from your wants. This is a hard thing to do. We are so bombarded with messages that appeal to our psychological needs that we are often unable to realize that we don't "need" something.
One way to control your spending is to carry a small notepad in your wallet or purse. When you see an item you really want, write it on the card. Wait a week. If you still want the item and can find money in your budget for it, you can go back and purchase it.
Never keep more than three items at a time on your list. If you want to add another item, you must remove one first.
You can avoid temptation by simply not going into the store. If you are not going in with a list for specific items that you need, you shouldn't even go in at all. A lot of impulse spending is simply recreational spending -- something to do. You can avoid this spending by never putting yourself in the situation to begin with.
Use cash whenever possible. For example, when you go grocery shopping, leave your credit cards at home. Don't take in your wallet or checkbook. Carry only the cash you have allotted for groceries. This will prevent you from spending more than you have.
Controlling your impulses to spend simply takes practice. Your goals are essential. Every time you make a purchase decision, ask yourself how the purchase affects your goals. If you take the time, you can change your spending habits and afford the things you really want in life.
How do you know if you have a shopping problem? Ask yourself the following questions:
* Are you surprised when you credit card bill arrives?
* Do you have no idea how much money you owe or have?
* Do you hide purchases from your spouse?
* Do you have more items than you can fit in your closets?
* Do you have things that you have never used?
* Do you come home from the store with things you never intended to purchase?
* Do you justify your purchases by saying that they were on sale or a great deal?
If you answered yes to the above questions, you probably are an impulse shopper.
Impulse shopping is a serious issue. When people are unable to save for the things that are important to them -- a house, retirement, a new car -- impulse shopping is often the root of the problem. It causes serious debt and can even lead to bankruptcy.
One of the best ways to counter the urge to splurge is to set specific financial goals that you can work towards. By working to create a budget and saving for your future you can gain control of more than just your finances. You gain control of your life.
But you don't have to totally deprive yourself. Once you have developed a working budget and are taking the steps to realize your goals, you can set aside money for occasional spending. This is your splurging fund and is just for you. Consider it a reward for taking back the control of your money.
Impuse spending can affect more than just your finances. It can take over your entire life. When you are looking to overcome the spending urge, you have to learn to differentiate your needs from your wants. This is a hard thing to do. We are so bombarded with messages that appeal to our psychological needs that we are often unable to realize that we don't "need" something.
One way to control your spending is to carry a small notepad in your wallet or purse. When you see an item you really want, write it on the card. Wait a week. If you still want the item and can find money in your budget for it, you can go back and purchase it.
Never keep more than three items at a time on your list. If you want to add another item, you must remove one first.
You can avoid temptation by simply not going into the store. If you are not going in with a list for specific items that you need, you shouldn't even go in at all. A lot of impulse spending is simply recreational spending -- something to do. You can avoid this spending by never putting yourself in the situation to begin with.
Use cash whenever possible. For example, when you go grocery shopping, leave your credit cards at home. Don't take in your wallet or checkbook. Carry only the cash you have allotted for groceries. This will prevent you from spending more than you have.
Controlling your impulses to spend simply takes practice. Your goals are essential. Every time you make a purchase decision, ask yourself how the purchase affects your goals. If you take the time, you can change your spending habits and afford the things you really want in life.
Saving for Your Future
We all know that we should save money. But something so easy to say can be quite difficult to actually do.
Saving money is the basis of building your financial future. However, many consumers are putting it off one more day. Those days turn quickly into years of lost money. Without savings, the chances of meeting long-term financial goals and achieving financial security are quite miniscule.
In order to save money, you have to control your finances. Saving has nothing to do with how much you make. It has everything to do with how you control your money. If you have lots of credit card debt and live paycheck to paycheck, you are not in control of your money. And you aren't saving for the future either.
You have to spend less and save more. The two are tied together. In order to save, you have to start spending less.
And it all really isn't that difficult if you just start doing it.
First, sit down and write down your financial goals. Just ask yourself what you want from your money. Perhaps you would like to have a downpayment for your first home. Maybe you need a new car. Make long-term goals, such as retirement, and short-term goals, such as new living room furniture.
Give each goal a dollar amount and a time frame. In order to save, you have to know what you are saving for. You have to have a reason to put your money aside.
You will need to set up a seperate savings account. You probably know that leaving the money in your checking simply won't work -- you will spend it. Have a savings account that you can easily deposit or transfer money into. Many banks will set up an automatic withdrawal to your savings each month. This is a easy way to set it and forget it. It is paid just like any other bill.
Over time, you will see your money start to grow. This is rewarding and exciting. Most people become motivated to save even more. Saving and investing can become addicting in a good way.
You will find that a written budget is almost essential for saving money. You need to know where your money is going in order to make changes to the way you spend. A budget not only tells you where you are spending, but it can help you plan how you spend. Include into your budget a debt reduction plan, and your budget will make the most of your dollars. Budgeting is simple and doesn't require you to sacrifice your entire lifestyle. It is just a plan to get where you are going.
If you do have a lot of credit card debt, you should focus spending your saving money on eliminating that debt. It would be wise to put a small amount aside for emergencies, but the vast majority of the money you are saving right now needs to be going to your debt. The reason why is simple. Why pay 20% interest on a credit card debt when your savings are earning 2% to 10% in interest. You are spending more than necessary. Wipe out that credit card debt first. It will save you more in the long run.
Saving money is the basis of building your financial future. However, many consumers are putting it off one more day. Those days turn quickly into years of lost money. Without savings, the chances of meeting long-term financial goals and achieving financial security are quite miniscule.
In order to save money, you have to control your finances. Saving has nothing to do with how much you make. It has everything to do with how you control your money. If you have lots of credit card debt and live paycheck to paycheck, you are not in control of your money. And you aren't saving for the future either.
You have to spend less and save more. The two are tied together. In order to save, you have to start spending less.
And it all really isn't that difficult if you just start doing it.
First, sit down and write down your financial goals. Just ask yourself what you want from your money. Perhaps you would like to have a downpayment for your first home. Maybe you need a new car. Make long-term goals, such as retirement, and short-term goals, such as new living room furniture.
Give each goal a dollar amount and a time frame. In order to save, you have to know what you are saving for. You have to have a reason to put your money aside.
You will need to set up a seperate savings account. You probably know that leaving the money in your checking simply won't work -- you will spend it. Have a savings account that you can easily deposit or transfer money into. Many banks will set up an automatic withdrawal to your savings each month. This is a easy way to set it and forget it. It is paid just like any other bill.
Over time, you will see your money start to grow. This is rewarding and exciting. Most people become motivated to save even more. Saving and investing can become addicting in a good way.
You will find that a written budget is almost essential for saving money. You need to know where your money is going in order to make changes to the way you spend. A budget not only tells you where you are spending, but it can help you plan how you spend. Include into your budget a debt reduction plan, and your budget will make the most of your dollars. Budgeting is simple and doesn't require you to sacrifice your entire lifestyle. It is just a plan to get where you are going.
If you do have a lot of credit card debt, you should focus spending your saving money on eliminating that debt. It would be wise to put a small amount aside for emergencies, but the vast majority of the money you are saving right now needs to be going to your debt. The reason why is simple. Why pay 20% interest on a credit card debt when your savings are earning 2% to 10% in interest. You are spending more than necessary. Wipe out that credit card debt first. It will save you more in the long run.
Protect Your Budget With An Emergency Fund
Doesn't it always seem like when everything is starting to go your way, something breaks down? You start to get your feet back under you and then something knocks you down again. When it happens, it always costs you money.
An emergency fund can save you and your budget from disaster. Think about how the little emergencies affect your monthly budget. That $300 repair bill on your vehicle, a new $600 refrigerator, an unexpected trip out of town -- each one can hurt your ability to pay your bills if you are on a tight leash financially.
Think about what a larger emergency would do to you financially. What if you lost your job, became ill or disabled? What if you couldn't work for several months? What if your child became ill and you had large medical bills to face? What about major home repairs or a new engine in a vehicle?
Without an emergency fund, you could be forced to use a credit card. While this is an option that you may have to fall back on, it will take you years to pay it off and will cost you thousands in interest. Plus, you don't want to purchase daily items, such as groceries and gasoline, on your credit card. If you don't pay it back at the end of the month, you could pay for those groceries for the next three years.
If you have an emergency fund, you are able to survive an emergency with your finances in tact. Yes, you spend what you saved, but that is what it is there for.
Ideally, you should have three to six months worth of living expenses in your savings. Just start and keep working your way up. Personally, I don't believe that you can have too much in your emergency savings account. Or too little. So don't hold off because you don't have a lot to put back right now. Every penny will help in an emergency.
Keep your emergency savings in a separate account from your regular savings or checking. We keep ours in a different bank. This eliminates the temptation to withdraw some money for something we don't need. Keeping it separate makes it easier to forget about it until you need it.
An emergency fund can save you and your budget from disaster. Think about how the little emergencies affect your monthly budget. That $300 repair bill on your vehicle, a new $600 refrigerator, an unexpected trip out of town -- each one can hurt your ability to pay your bills if you are on a tight leash financially.
Think about what a larger emergency would do to you financially. What if you lost your job, became ill or disabled? What if you couldn't work for several months? What if your child became ill and you had large medical bills to face? What about major home repairs or a new engine in a vehicle?
Without an emergency fund, you could be forced to use a credit card. While this is an option that you may have to fall back on, it will take you years to pay it off and will cost you thousands in interest. Plus, you don't want to purchase daily items, such as groceries and gasoline, on your credit card. If you don't pay it back at the end of the month, you could pay for those groceries for the next three years.
If you have an emergency fund, you are able to survive an emergency with your finances in tact. Yes, you spend what you saved, but that is what it is there for.
Ideally, you should have three to six months worth of living expenses in your savings. Just start and keep working your way up. Personally, I don't believe that you can have too much in your emergency savings account. Or too little. So don't hold off because you don't have a lot to put back right now. Every penny will help in an emergency.
Keep your emergency savings in a separate account from your regular savings or checking. We keep ours in a different bank. This eliminates the temptation to withdraw some money for something we don't need. Keeping it separate makes it easier to forget about it until you need it.
Is There A Way To Get Out From Debt
Are you burdened with debts? Are you finding it harder each month to meet the payments on your debts? Is your frequency of late payment or miss payment increased? These are the signs of financial crisis; you need to do something to avoid dragging yourself into this finance disaster where your unbearable debts may course bankruptcy in the worst case.
While there may not be any instant debt solution, there are a number of things that you can do to improve your debt situation; let look at a few things which you can start immediately to improve your debt situation:
Change Your Behavior of Spending
The more you spend, the more you incur in debt. Like most of people, you may about to spend a lot of money for the holiday season. To get rid of debt, the first to do is to change your behavior of spending; this is the time to give yourself some deep though to the ways you spend your money, and to think about your financial priorities.
We live in a world where every retailer and marketer will try to extract every last penny from us, especially during the holiday season, retailers and marketer with their holiday's special offers are actually create a lot of impulse purchase of their consumer, you will actually spend more if your impulse purchases are not what your really needs. That's why we often find ourselves in debt.
If you can save up several hundred dollars over a period of time by controlling unnecessary spending, you can use the money to pay your debt and reduce your debt balance over the time and get rid of it in a predetermined period of time.
Budget Plan As Part Of Your Debt Solution
Budget plan is one of the important elements for debt solution, if you have a budget plan in place and you follow it strictly, you will have a better control on your money and your spending behavior.
You can start with looking at how much your current lifestyle has been costing you. Seeing how you have spent your money in the last year or two can help guide your budget plan for this year.
While there may not be any instant debt solution, there are a number of things that you can do to improve your debt situation; let look at a few things which you can start immediately to improve your debt situation:
Change Your Behavior of Spending
The more you spend, the more you incur in debt. Like most of people, you may about to spend a lot of money for the holiday season. To get rid of debt, the first to do is to change your behavior of spending; this is the time to give yourself some deep though to the ways you spend your money, and to think about your financial priorities.
We live in a world where every retailer and marketer will try to extract every last penny from us, especially during the holiday season, retailers and marketer with their holiday's special offers are actually create a lot of impulse purchase of their consumer, you will actually spend more if your impulse purchases are not what your really needs. That's why we often find ourselves in debt.
If you can save up several hundred dollars over a period of time by controlling unnecessary spending, you can use the money to pay your debt and reduce your debt balance over the time and get rid of it in a predetermined period of time.
Budget Plan As Part Of Your Debt Solution
Budget plan is one of the important elements for debt solution, if you have a budget plan in place and you follow it strictly, you will have a better control on your money and your spending behavior.
You can start with looking at how much your current lifestyle has been costing you. Seeing how you have spent your money in the last year or two can help guide your budget plan for this year.
Obtaining A Mortgage Can Be Simpler Than You Might Think
People obtain mortgages for various different reasons: for some, a mortgage is a form of investment or financial security, while for others it's a way to better manage their money or cut their outgoings. But whatever the motive, a mortgage is often a daunting financial venture - and one which should be considered with utmost precision.
Ask yourself what you want out of a mortgage plan: is your objective to manage debt or simply to raise capital for future financial security? Are you interested in enhancing a significant 'short-term' financial venture, or are your monetary aspirations more long-term? A foundation of reasoning will help you wade through the process of obtaining a mortgage - particularly in its early stages.
When you're ready to begin looking into mortgage plans, it's important to take your time and consider your options. To begin with, endeavour to understand what each type of mortgage offers; in doing so, you'll also find tailored - and potentially beneficial - plans within each 'type' of mortgage. Capital raising re-mortgages, for instance, suit people who require a short-term financial solution, while a debt-consolidation re-mortgage can help someone with significant debt get back on track with their finances. Whatever your needs, there's a suitable plan for you - all you need is to gain a bit of familiarity with the market.
Ask yourself what you want out of a mortgage plan: is your objective to manage debt or simply to raise capital for future financial security? Are you interested in enhancing a significant 'short-term' financial venture, or are your monetary aspirations more long-term? A foundation of reasoning will help you wade through the process of obtaining a mortgage - particularly in its early stages.
When you're ready to begin looking into mortgage plans, it's important to take your time and consider your options. To begin with, endeavour to understand what each type of mortgage offers; in doing so, you'll also find tailored - and potentially beneficial - plans within each 'type' of mortgage. Capital raising re-mortgages, for instance, suit people who require a short-term financial solution, while a debt-consolidation re-mortgage can help someone with significant debt get back on track with their finances. Whatever your needs, there's a suitable plan for you - all you need is to gain a bit of familiarity with the market.
Mortgage Calculators Easy As 1,2,3
First Mortgage Trust have developed a number of diverse calculators over the years not only to improve the quality of their clients online experience but also in response to client, consumer and third party requests. Among the calculators are Mortgage Payment Protection, Bridging Loans, Secured Loans, Buy To Let Rental and Mortgage Calculator, Affordability and budget, How much can I borrow, monthly mortgage payments for both interest only and repayment, flexible mortgage calculator and three conveyancing calculators for purchase, sale and purchase and remortgage.
The benefit of online mortgage related calculators are many and varied. First Mortgage Trust's extensive collection of online calculators allow client retention and leaves them in complete control. not only to compare current outgoings but also for anticipated costs and savings. Every cost associated with selling, purchasing and remortgaging is available and for the client to interact with. Mortgage calculators help to create a sticky website.
Calculators are of benefit to solicitors, Independent Financial Advisers, mortgage brokers and those involved in residential and commercial real Estate. The calculators can be used both online and offline for ease of reference to professionals. Other benefits are client and consumer retention as website visitors no longer have to leave a professionals site to confirm or check figures.
For Financial services web designers, webmasters and search engine optimization this becomes invaluable keyword rich content and is an essential must have for any associated site. With around 500,000 searches every month in the US & UK for 'mortgage calculator' this confirms the demand for information required by online clients.
First Mortgage Trust's conveyancing purchase and sale & purchase calculators include a database of approximately three hundred and seventy local authority search fees. First Mortgage Trust update this database annually. Although local search indemnity insurance is now popular amongst conveyancing solicitors it must be remembered that not all lenders will allow this and may well insist on a local authority search. Clients can also work out stamp duty, another substantial cost in the home buying process along with many other functions.
With the ever changing landscape of lending and underwriting criteria it is important that the consumer have calculators available to them. Many lenders have now increased income multiples to as much as 5.6 joint for high credit score, high earners. Before a client proceeds with a mortgage it is important that they have an idea of borrowing capacity, after establishing borrowing capacity they can further confirm monthly figures to confirm affordability.
The benefit of online mortgage related calculators are many and varied. First Mortgage Trust's extensive collection of online calculators allow client retention and leaves them in complete control. not only to compare current outgoings but also for anticipated costs and savings. Every cost associated with selling, purchasing and remortgaging is available and for the client to interact with. Mortgage calculators help to create a sticky website.
Calculators are of benefit to solicitors, Independent Financial Advisers, mortgage brokers and those involved in residential and commercial real Estate. The calculators can be used both online and offline for ease of reference to professionals. Other benefits are client and consumer retention as website visitors no longer have to leave a professionals site to confirm or check figures.
For Financial services web designers, webmasters and search engine optimization this becomes invaluable keyword rich content and is an essential must have for any associated site. With around 500,000 searches every month in the US & UK for 'mortgage calculator' this confirms the demand for information required by online clients.
First Mortgage Trust's conveyancing purchase and sale & purchase calculators include a database of approximately three hundred and seventy local authority search fees. First Mortgage Trust update this database annually. Although local search indemnity insurance is now popular amongst conveyancing solicitors it must be remembered that not all lenders will allow this and may well insist on a local authority search. Clients can also work out stamp duty, another substantial cost in the home buying process along with many other functions.
With the ever changing landscape of lending and underwriting criteria it is important that the consumer have calculators available to them. Many lenders have now increased income multiples to as much as 5.6 joint for high credit score, high earners. Before a client proceeds with a mortgage it is important that they have an idea of borrowing capacity, after establishing borrowing capacity they can further confirm monthly figures to confirm affordability.
Are Guaranteed Approval Credit Cards Right for You
Not a lot of people have heard about guaranteed approval credit cards. This is because these cards are a rather new idea when it comes to credit cards for people with bad credit or no credit. Those who have tried to get credit for the first time or tried to get credit with a bad credit history are aware that it is a difficult, if not impossible task.
Credit card companies offer cards to those who are most likely to pay for them because they do not like to risk the chance of not getting paid. Fortunately, they came up with guaranteed approval credit cards to help those who are in need of credit.
Traditional credit cards and guaranteed approval credit cards are quite similar. Both of these types of cards have a major credit card company logo and can be used wherever the companies’ credit cards are accepted. Unlike secured credit cards, these cards do not require a deposit or the person to open a savings account.
A person usually has to agree to upfront fees and charges made to the credit card in order to get a guaranteed credit card. The person also has to agree to let the credit card company charge a processing fee and annual fee to their card.
The initial credit limit is usually low and the remaining balance will be less than $75, once these fees are charged to the card. This entails that a card holder has to pay off these fees in order to really be able to charge much to this type of credit card.
Credit card companies offer cards to those who are most likely to pay for them because they do not like to risk the chance of not getting paid. Fortunately, they came up with guaranteed approval credit cards to help those who are in need of credit.
Traditional credit cards and guaranteed approval credit cards are quite similar. Both of these types of cards have a major credit card company logo and can be used wherever the companies’ credit cards are accepted. Unlike secured credit cards, these cards do not require a deposit or the person to open a savings account.
A person usually has to agree to upfront fees and charges made to the credit card in order to get a guaranteed credit card. The person also has to agree to let the credit card company charge a processing fee and annual fee to their card.
The initial credit limit is usually low and the remaining balance will be less than $75, once these fees are charged to the card. This entails that a card holder has to pay off these fees in order to really be able to charge much to this type of credit card.
Quiz: Are You A Shopaholic?
A lot of people enjoy shopping, but for some people the enjoyment of shopping goes beyond mere bargain hunting and can be part of an addiction. There are many names for this addiction.
Excessive spending is known as compulsive spending, spending addiction or being a shopaholic. What it boils down to is recognising whether your spending habits are out of control. If you get urges to spend that you are unable to control then you may be a shopaholic or spending addict.
Shopaholic Quiz:
Read the following list and count the number of statements that apply:
* Being unable to pass up a "bargain"
* Making impulsive purchases on a regular basis
* Leaving price tags on clothes so they can be returned
* Not using items you've purchased
* Lying about the cost of purchases
* Using shopping as a "pick me up"
* Buying luxuries before necessities
* Trying unsuccessfully to curb shopping impulses
* Spending more time or money shopping than you intend
* Devoting a large amount of time shopping and planning future shopping expeditions
* Spending to an extent that interferes with your life (excessive debt) or relationships
* Experiencing withdrawal symptoms from shopping
* Giving up other social or recreational activities to shop
Results:
So how did you go?
If you agreed with 5 or more statements, it's highly likely you are a compulsive shopper or shopaholic. If you agreed with 3 or 4 statements, then you are potentially at risk. Now is a good time to monitor your spending!
If you believe that shopping is in anyway causing self-harm or statement 11 is true (shopping interferes with your life), seek help.
Excessive spending is known as compulsive spending, spending addiction or being a shopaholic. What it boils down to is recognising whether your spending habits are out of control. If you get urges to spend that you are unable to control then you may be a shopaholic or spending addict.
Shopaholic Quiz:
Read the following list and count the number of statements that apply:
* Being unable to pass up a "bargain"
* Making impulsive purchases on a regular basis
* Leaving price tags on clothes so they can be returned
* Not using items you've purchased
* Lying about the cost of purchases
* Using shopping as a "pick me up"
* Buying luxuries before necessities
* Trying unsuccessfully to curb shopping impulses
* Spending more time or money shopping than you intend
* Devoting a large amount of time shopping and planning future shopping expeditions
* Spending to an extent that interferes with your life (excessive debt) or relationships
* Experiencing withdrawal symptoms from shopping
* Giving up other social or recreational activities to shop
Results:
So how did you go?
If you agreed with 5 or more statements, it's highly likely you are a compulsive shopper or shopaholic. If you agreed with 3 or 4 statements, then you are potentially at risk. Now is a good time to monitor your spending!
If you believe that shopping is in anyway causing self-harm or statement 11 is true (shopping interferes with your life), seek help.
Balancing Your Checkbook
Balancing your checkbook is little more than making certain you and the bank both agree on what's happened to your bank account each month.
The bank provides a monthly statement of all transactions during the period. It is important that you balance your checkbook by comparing your checkbook register to the bank statement in a timely manner in order to:
* correct errors by the bank;
* find your own errors and know how much money you actually have
Reconciling your account register to the bank statement is a matter of comparing deposits and withdrawals and adjusting the bank statement for outstanding items not yet reflected by the bank. This process will go more quickly and smoothly if you make sure your bank register is up to date. Be sure all of your transactions are entered -- including direct deposit, ATM transactions, and debit charges -- before you start trying to reconcile to the bank statement. Here is a step by step:
* 1. Start with the bank balance from the bank statement
* 2. Determine if you have made any deposits that do not appear yet on the bank statement. List and total these "deposits in transit."
* 3. Determine if you have any outstanding checks (checks you have written and recorded in your checkbook but have not yet come through the bank). Make a check mark by each item that has cleared the bank as you match them up. When you finish going through the checks, the ones without a check mark are your outstanding checks. List them in the blanks under "outstanding checks" on the form and total the amount.
* 4. Add the bank balance (step 1) to the total deposits in transit (step 2), and subtract the outstanding checks (step 3). This is your adjusted bank balance. If it matches your checkbook register ending balance, you are finished.
* 5. If adjusted bank balance does not match your checkbook register, it may differ by bank fees or interest payments shown on the bank statement that are not yet entered in your checkbook. You will need to enter those in your checkbook now and list them below your adjusted bank balance above. Update your adjusted bank balance and see that it matches your check register ending balance. If they do, you are finished.
* 6. If you still don’t balance, you have missed something. You could be missing a transaction that the bank shows, have a transaction the bank does not show, or your transaction amount could be different from the amount the bank has for a transaction. You could even have a math error in your balance. Go back and check it all out again.
The bank provides a monthly statement of all transactions during the period. It is important that you balance your checkbook by comparing your checkbook register to the bank statement in a timely manner in order to:
* correct errors by the bank;
* find your own errors and know how much money you actually have
Reconciling your account register to the bank statement is a matter of comparing deposits and withdrawals and adjusting the bank statement for outstanding items not yet reflected by the bank. This process will go more quickly and smoothly if you make sure your bank register is up to date. Be sure all of your transactions are entered -- including direct deposit, ATM transactions, and debit charges -- before you start trying to reconcile to the bank statement. Here is a step by step:
* 1. Start with the bank balance from the bank statement
* 2. Determine if you have made any deposits that do not appear yet on the bank statement. List and total these "deposits in transit."
* 3. Determine if you have any outstanding checks (checks you have written and recorded in your checkbook but have not yet come through the bank). Make a check mark by each item that has cleared the bank as you match them up. When you finish going through the checks, the ones without a check mark are your outstanding checks. List them in the blanks under "outstanding checks" on the form and total the amount.
* 4. Add the bank balance (step 1) to the total deposits in transit (step 2), and subtract the outstanding checks (step 3). This is your adjusted bank balance. If it matches your checkbook register ending balance, you are finished.
* 5. If adjusted bank balance does not match your checkbook register, it may differ by bank fees or interest payments shown on the bank statement that are not yet entered in your checkbook. You will need to enter those in your checkbook now and list them below your adjusted bank balance above. Update your adjusted bank balance and see that it matches your check register ending balance. If they do, you are finished.
* 6. If you still don’t balance, you have missed something. You could be missing a transaction that the bank shows, have a transaction the bank does not show, or your transaction amount could be different from the amount the bank has for a transaction. You could even have a math error in your balance. Go back and check it all out again.
14 Household Budgeting Tips
1. Stay busy after work
One "easy" way to avoid overspending and thus stay within your budget is to have something else to do after work. Get a second job that is fun, go to school, volunteer or get into great physical shape. The more you do, the less you will spend!
2. Watch those miscellaneous categories
Make sure you have enough well-defined categories to capture your true spending. Putting too much into a miscellaneous category makes it harder to track what you have spent and harder to control, especially the splurges!
3. Need
If you did not know you need it, you probably do not. Do not buy things just because they are on sale. If you had no use or want for it before you saw it on sale, then you will have no use for it later.
5. Don't Forget to Budget for Special Occasions
When forecasting your expenses, remember to include gift-giving occasions. Mother's Day, Valentine's Day, birthdays, Christmas, and anniversaries are good examples. If you plan to spend money on these occasions, remember to include this in your budget.
6. Don't use a debt to get out of another debt
Do not take out a consolidation loan to pay off your other debts. The point is to get out of it, not to squeeze them together and end up paying interest on the loan while paying off your debts. Try consulting a "free" debt counselor service first.
7. Remember To Budget Time As Well
We have all heard "time is money." Well-spent time can be an investment. Take a few minutes to plan ways to save on bills - 15 or 20 min. researching lower rates on electricity or long distance can pay off. You will know when time spent is not worth it.
8. The envelope system
Total yearly/monthly bills, divide each into 12 months. Divide monthly amount into bi-weekly payments. Use envelope for each bill; put in cash every 2 weeks. Use only the cash in envelope till it is gone. Do not touch your account/debt card! Envelopes ONLY!
9. Good teeth cheaper
You can go to a dental school to have your teeth cleaned, filled, orthodontic work done, etc. The cost is approximately half what you would usually pay. Note: Make sure you have some extra time as this takes a little longer.
One "easy" way to avoid overspending and thus stay within your budget is to have something else to do after work. Get a second job that is fun, go to school, volunteer or get into great physical shape. The more you do, the less you will spend!
2. Watch those miscellaneous categories
Make sure you have enough well-defined categories to capture your true spending. Putting too much into a miscellaneous category makes it harder to track what you have spent and harder to control, especially the splurges!
3. Need
If you did not know you need it, you probably do not. Do not buy things just because they are on sale. If you had no use or want for it before you saw it on sale, then you will have no use for it later.
5. Don't Forget to Budget for Special Occasions
When forecasting your expenses, remember to include gift-giving occasions. Mother's Day, Valentine's Day, birthdays, Christmas, and anniversaries are good examples. If you plan to spend money on these occasions, remember to include this in your budget.
6. Don't use a debt to get out of another debt
Do not take out a consolidation loan to pay off your other debts. The point is to get out of it, not to squeeze them together and end up paying interest on the loan while paying off your debts. Try consulting a "free" debt counselor service first.
7. Remember To Budget Time As Well
We have all heard "time is money." Well-spent time can be an investment. Take a few minutes to plan ways to save on bills - 15 or 20 min. researching lower rates on electricity or long distance can pay off. You will know when time spent is not worth it.
8. The envelope system
Total yearly/monthly bills, divide each into 12 months. Divide monthly amount into bi-weekly payments. Use envelope for each bill; put in cash every 2 weeks. Use only the cash in envelope till it is gone. Do not touch your account/debt card! Envelopes ONLY!
9. Good teeth cheaper
You can go to a dental school to have your teeth cleaned, filled, orthodontic work done, etc. The cost is approximately half what you would usually pay. Note: Make sure you have some extra time as this takes a little longer.
How to Build Wealth
Building wealth is technically easy, but many find it to be practically challenging. This is understandable, with all of the distractions that everyday life throws at us. The solution to this problem is as simple as taking an active interest in your personal finances. You must become genuinely interested in securing your financial future. A sound wealth-building plan that will lead you to a comfortable early retirement is not hard to implement, no matter what your current situation is. After all, how many things are more important?
Well, many would say that living for today is just as important, and that saving for their kid's college education is of primary concern. I couldn't agree more! Those things simply must be handled. But they needn't compromise a well thought-out wealth building strategy. In fact, the success of such a strategy is in no small way dependant on those other important things also being taken care of. Everything in your financial life must integrate well or your progress will surely suffer.
The critical components of an organized financial plan that focuses on building wealth are as follows: First off, an emergency fund must be in place for life's unforeseen circumstances. A good figure is 3-6 months living expenses. Secondly, spending and consumer debt must be under control. Get those credit cards paid off and don't carry balances on them. Third, automatically be building savings through traditional investment vehicles. Max out contributions to your 401K or an IRA account, have automatic deductions made into a college savings account. Finally, allocate a steady monthly stream into an aggressive investing account that seeks to make 30% annual returns or more. This can be done manually or by having a managed trading account.
OK, so your first question undoubtedly has something to do with, "How much?" How much is it going to cost you now, how much are you going to get back, and when? A compound calculator can help answer those questions. It's all up to you of course, but the important thing is that you make regular monthly contributions into an investment vehicle that is earning an average 30%+ annual return, and is compounding monthly. If you can't free up enough from your existing income, then start a new part-time business.
Consider that an account size of just $700 with a $300 additional monthly deposit will become over $432,000 in 12 years with a 30% annual rate of return. This figure disregards tax consequences, but such a feat could be accomplished inside of a tax-protected vehicle such as an IRA or the American Skandia variable annuities (which allow aggressive mutual fund trading). A $10,000 starting account with $500 added monthly will be worth over $1.8 million in 15 years time if averaging a 30% annual return.
The number one objection I hear when presenting this concept is that a 30% annual return isn't possible to earn. That is simply not true. You can achieve this by learning aggressive trading strategies, some of which are allowed inside of tax-deferred accounts. There is a lot to choose from, so you should go with something that appeals to you. Some examples include: Market timing strategies, option trading strategies, swing trading, and covered call writing. As a last resort you can always go with a managed account or a trading advisory service, but shop very carefully if that is your chosen vehicle.
The other big objection is that there just isn't enough income available to make that kind of monthly deposit commitment. Fortunately, that situation can be fixed by a combination of reducing your expenses and increasing your income. If you are straightening out your finances first, as described at the beginning of this article (which is a must), you will find ways to do this. If necessary, you can start a new part-time business that you can run by spending just a few hours a week at your computer terminal.
Well, many would say that living for today is just as important, and that saving for their kid's college education is of primary concern. I couldn't agree more! Those things simply must be handled. But they needn't compromise a well thought-out wealth building strategy. In fact, the success of such a strategy is in no small way dependant on those other important things also being taken care of. Everything in your financial life must integrate well or your progress will surely suffer.
The critical components of an organized financial plan that focuses on building wealth are as follows: First off, an emergency fund must be in place for life's unforeseen circumstances. A good figure is 3-6 months living expenses. Secondly, spending and consumer debt must be under control. Get those credit cards paid off and don't carry balances on them. Third, automatically be building savings through traditional investment vehicles. Max out contributions to your 401K or an IRA account, have automatic deductions made into a college savings account. Finally, allocate a steady monthly stream into an aggressive investing account that seeks to make 30% annual returns or more. This can be done manually or by having a managed trading account.
OK, so your first question undoubtedly has something to do with, "How much?" How much is it going to cost you now, how much are you going to get back, and when? A compound calculator can help answer those questions. It's all up to you of course, but the important thing is that you make regular monthly contributions into an investment vehicle that is earning an average 30%+ annual return, and is compounding monthly. If you can't free up enough from your existing income, then start a new part-time business.
Consider that an account size of just $700 with a $300 additional monthly deposit will become over $432,000 in 12 years with a 30% annual rate of return. This figure disregards tax consequences, but such a feat could be accomplished inside of a tax-protected vehicle such as an IRA or the American Skandia variable annuities (which allow aggressive mutual fund trading). A $10,000 starting account with $500 added monthly will be worth over $1.8 million in 15 years time if averaging a 30% annual return.
The number one objection I hear when presenting this concept is that a 30% annual return isn't possible to earn. That is simply not true. You can achieve this by learning aggressive trading strategies, some of which are allowed inside of tax-deferred accounts. There is a lot to choose from, so you should go with something that appeals to you. Some examples include: Market timing strategies, option trading strategies, swing trading, and covered call writing. As a last resort you can always go with a managed account or a trading advisory service, but shop very carefully if that is your chosen vehicle.
The other big objection is that there just isn't enough income available to make that kind of monthly deposit commitment. Fortunately, that situation can be fixed by a combination of reducing your expenses and increasing your income. If you are straightening out your finances first, as described at the beginning of this article (which is a must), you will find ways to do this. If necessary, you can start a new part-time business that you can run by spending just a few hours a week at your computer terminal.
What To Do When You Come Into A Million
Coming into a million happens to be a dream for a lot of people. But those who do come into a sudden windfall confirm that it is not exactly roses and confetti. Not least, the kind of problems that comes with it.
The most important thing about sudden wealth, whether you inherit it, win it, or make it, is not what to do with it but how to ensure it fits smoothly into your current life without wrecking it. Call me biased, but even as a wealth mentor I’ve always believed that money should fit in smoothly with your life, and not take over, or wreck your life.
So what do you do with your sudden windfall?
1. Firstly, consult a good tax attorney to explore what trusts to set up for your dependants, if any, and how best to protect yourself and future income from predators, such as ‘Uncle Sam’. Seek the best tax attorney; you can afford it.
2. Put a certain portion of the money, about 25% into a diversified portfolio of high interest savings accounts and bonds of varying maturities and grades, that will provide the highest after-tax yield.
3. Buy a bigger house, big enough to ensure that the cost of maintaining it will not be a strain on the income from your bond portfolio.
4. Put a portion of the money, about 25% into a diversified portfolio of selected stocks, shares.
5. Invest most of the rest say another 25% into a well-planned investment property portfolio of buy-to-let residential properties, or commercial properties, whichever suits you best.
6. Make or update your will to reflect your change in circumstances.
7. Now relax and enjoy yourself and forget about the whole shebang. Review your investments once a year, and make changes only when necessary.
This type of structure must give you peace of mind, security and a good residual income for years to come.
That’s what I would do if I came into a windfall today, and ...because of my personal beliefs I would also give away 10%.
What else would you do? You may leave your comments in the comments box here => 'Leave A Comment'
In the meantime life is not about wishing and hoping. Your best bet is to start practically planning for your future wealth while you wait for the million to drop from the sky.
More wealthy people today concede to the fact that the self-satisfaction and sense of achievement that comes from making your first million yourself is incomparable. At the very least, it is a far better way to spend your time than waiting and wishing. Much more fun than simply aspiring!
The most important thing about sudden wealth, whether you inherit it, win it, or make it, is not what to do with it but how to ensure it fits smoothly into your current life without wrecking it. Call me biased, but even as a wealth mentor I’ve always believed that money should fit in smoothly with your life, and not take over, or wreck your life.
So what do you do with your sudden windfall?
1. Firstly, consult a good tax attorney to explore what trusts to set up for your dependants, if any, and how best to protect yourself and future income from predators, such as ‘Uncle Sam’. Seek the best tax attorney; you can afford it.
2. Put a certain portion of the money, about 25% into a diversified portfolio of high interest savings accounts and bonds of varying maturities and grades, that will provide the highest after-tax yield.
3. Buy a bigger house, big enough to ensure that the cost of maintaining it will not be a strain on the income from your bond portfolio.
4. Put a portion of the money, about 25% into a diversified portfolio of selected stocks, shares.
5. Invest most of the rest say another 25% into a well-planned investment property portfolio of buy-to-let residential properties, or commercial properties, whichever suits you best.
6. Make or update your will to reflect your change in circumstances.
7. Now relax and enjoy yourself and forget about the whole shebang. Review your investments once a year, and make changes only when necessary.
This type of structure must give you peace of mind, security and a good residual income for years to come.
That’s what I would do if I came into a windfall today, and ...because of my personal beliefs I would also give away 10%.
What else would you do? You may leave your comments in the comments box here => 'Leave A Comment'
In the meantime life is not about wishing and hoping. Your best bet is to start practically planning for your future wealth while you wait for the million to drop from the sky.
More wealthy people today concede to the fact that the self-satisfaction and sense of achievement that comes from making your first million yourself is incomparable. At the very least, it is a far better way to spend your time than waiting and wishing. Much more fun than simply aspiring!
The Ideal Retirement is Debt-Free
When it comes to retirement, most of us can't wait to get there. However, so many workers aren't taking the necessary steps to get there.
Retirement is when you can relax and enjoy life for a while. Or at least, it is supposed to be. However, if you aren't prepared, your retirement could be something much different than what you had in mind.
Yes, financial advisors will tell you that you need less money in retirement, because you have fewer job-related expenses. But you will probably replace these expenses with other expenses.
On average, it is estimated that you will need approximately 70% of your current yearly income when you are in retirement. For example, if you make $50,000 a year, you can expect to need at least $35,000 a year in retirement. However, this can change with different circumstances.
Your medical expenses will be higher. Insurance will cost more as you age. You often have increased medical issues. It is recommended that you take care of your insurance needs while you are young, in order to help keep your premiums down later.
You will also want to spend more money on hobbies, vacations and other activities. You know have time to do the things you always wanted to do.
If you enter retirement debt-free, you are reducing the amount of money you need each month. This may free up money for the things you want to do.
Start with taking the time to eliminate your credit cards. You should try to pay off all of your credit cards before you retire. It is estimated that 30 million Americans have bad credit due to excessive credit card debt. You want to enter retirement with options. If you have bad credit and have maxed out all of your credit cards, you have very few options. Remember, credit card debt can grow on you rather quickly. What is just $20 a month now, can turn into $200 a month in a short amount of time.
Move on to making sure that you do not have any auto loans at retirement. A dependable car is necessary, but you should try to pay it off as quickly as possible. Choose a reliable, reasonably priced automobile. You don't have to buy new and you don't have to spend every last cent you can afford.
Retirement is when you can relax and enjoy life for a while. Or at least, it is supposed to be. However, if you aren't prepared, your retirement could be something much different than what you had in mind.
Yes, financial advisors will tell you that you need less money in retirement, because you have fewer job-related expenses. But you will probably replace these expenses with other expenses.
On average, it is estimated that you will need approximately 70% of your current yearly income when you are in retirement. For example, if you make $50,000 a year, you can expect to need at least $35,000 a year in retirement. However, this can change with different circumstances.
Your medical expenses will be higher. Insurance will cost more as you age. You often have increased medical issues. It is recommended that you take care of your insurance needs while you are young, in order to help keep your premiums down later.
You will also want to spend more money on hobbies, vacations and other activities. You know have time to do the things you always wanted to do.
If you enter retirement debt-free, you are reducing the amount of money you need each month. This may free up money for the things you want to do.
Start with taking the time to eliminate your credit cards. You should try to pay off all of your credit cards before you retire. It is estimated that 30 million Americans have bad credit due to excessive credit card debt. You want to enter retirement with options. If you have bad credit and have maxed out all of your credit cards, you have very few options. Remember, credit card debt can grow on you rather quickly. What is just $20 a month now, can turn into $200 a month in a short amount of time.
Move on to making sure that you do not have any auto loans at retirement. A dependable car is necessary, but you should try to pay it off as quickly as possible. Choose a reliable, reasonably priced automobile. You don't have to buy new and you don't have to spend every last cent you can afford.
Don't Charge the Holidays
When it comes to the holidays, so many people start getting out their credit cards. After all, it is just once a year, for the ones you love and you'll pay it back in a couple of months. So we are generous.
Without realizing that we will pay on those gifts for the next year or more. They will cost up to 20% more than what we purchased them for, due to interest.
Most people do this every year. It has become a holiday tradition for many consumers. However, buying holiday gifts, dinners and travel isn't a good use of your credit. You are increasing your debt and reducing your monthly budget. While it may seem great right now, later it will start to pile up on you.
Most financial advisors will recommend that you save small amounts of money throughout the year in a special holiday savings account. All you have to do is know how much you plan to spend and then divide it by 12. Deposit the resulting amount in the account each month. That is your holiday spending.
Or if you find it difficult to put this money into savings, have it put there for you by your bank. Many banks and credit unions have Christmas clubs that allow you to put so much a month into a savings account. They will often automatically deduct it for you.
I recommend a unique approach to many people. Have a year-long shopping session. Yes, you will still need to save for your food and travel, but the gifts will be taken care of. Simply dedicate each month to finding certain people's gifts. For example, in January, I purchase my mother's gift. In February, I look for my sister's gift. This allows me to take advantages of sales and other bargains. If something is on sale that fits my sister better than my mom, I might swap their months. The idea is that I spread my shopping out over 12 months. I love to shop and am not great at saving, so this works perfectly.
The holidays are truly a season of giving. But don't give away your future. By charging up your credit cards, you are spending next year's savings. Your budget will be stretched even more. Look to the consequences instead of just the benefits of spending a lot of money on your holidays. Be creative and give from the heart instead.
There are many frugal holiday gift ideas out there. You can make things for those you love. Many families draw names, limiting the amount they have to spend. Others don't allow themselves to give gifts that they have purchased. They have to pass on or make something. These are nice traditions. They take the focus off of the shopping and put it back on the thought that goes into the present.
Without realizing that we will pay on those gifts for the next year or more. They will cost up to 20% more than what we purchased them for, due to interest.
Most people do this every year. It has become a holiday tradition for many consumers. However, buying holiday gifts, dinners and travel isn't a good use of your credit. You are increasing your debt and reducing your monthly budget. While it may seem great right now, later it will start to pile up on you.
Most financial advisors will recommend that you save small amounts of money throughout the year in a special holiday savings account. All you have to do is know how much you plan to spend and then divide it by 12. Deposit the resulting amount in the account each month. That is your holiday spending.
Or if you find it difficult to put this money into savings, have it put there for you by your bank. Many banks and credit unions have Christmas clubs that allow you to put so much a month into a savings account. They will often automatically deduct it for you.
I recommend a unique approach to many people. Have a year-long shopping session. Yes, you will still need to save for your food and travel, but the gifts will be taken care of. Simply dedicate each month to finding certain people's gifts. For example, in January, I purchase my mother's gift. In February, I look for my sister's gift. This allows me to take advantages of sales and other bargains. If something is on sale that fits my sister better than my mom, I might swap their months. The idea is that I spread my shopping out over 12 months. I love to shop and am not great at saving, so this works perfectly.
The holidays are truly a season of giving. But don't give away your future. By charging up your credit cards, you are spending next year's savings. Your budget will be stretched even more. Look to the consequences instead of just the benefits of spending a lot of money on your holidays. Be creative and give from the heart instead.
There are many frugal holiday gift ideas out there. You can make things for those you love. Many families draw names, limiting the amount they have to spend. Others don't allow themselves to give gifts that they have purchased. They have to pass on or make something. These are nice traditions. They take the focus off of the shopping and put it back on the thought that goes into the present.
Avoiding Gift Card Scams
Gift cards are a popular holiday gift, but be careful. Gift card scams are the new fad out there in the world of financial frauds.
The National Retail Federation says that gift card sales increase in the billions each year. Most people spend $30 or more on gift cards that they give as holiday presents. Many people don't realize that the gift they are giving might be part of a scam.
One very popular scam involves people copying the gift card numbers that are hanging on the store racks. They then call the retailer's 800 number to check on the balances for the card numbers they have copied. When the cards are purchased and activated, the thief uses the card number to buy items online.
There are also many fake gift cards floating around out there. These have been stolen. You buy them online and give them as a gift only to find that they had never been activated.
The National Retail Federation says that gift card sales increase in the billions each year. Most people spend $30 or more on gift cards that they give as holiday presents. Many people don't realize that the gift they are giving might be part of a scam.
One very popular scam involves people copying the gift card numbers that are hanging on the store racks. They then call the retailer's 800 number to check on the balances for the card numbers they have copied. When the cards are purchased and activated, the thief uses the card number to buy items online.
There are also many fake gift cards floating around out there. These have been stolen. You buy them online and give them as a gift only to find that they had never been activated.
Budgeting for Your Future
Your budget will guide you through the financial processes that build financial freedom and personal wealth. This guide will help you build security and independence. Without it, you are wandering aimlessly in the dark.
The budget is the main requirement for financial planning. Without it, you can dream all you want, but you will not know how to make dreams into reality. Budgeting helps you organize both your current financial information and your long-term financial picture.
It is vital that you plan for a secure financial future. By setting goals and knowing what you are working towards, budgeting becomes a great tool.
Any good budget will address your entire financial picture, not just your day to day spending. It should manage what you make and what you spend. It should track your spending, showing you were you can cut back. It will help you prepare for emergencies. And most importantly, it can help you fulfill your savings and investment goals. It will not only make today financially peaceful, but will secure your independent life in the future.
I know that it is easy to forget about the long-run, so we don't budget at all. Even I have a lapse in financial judgement every now and then. But budgeting will take you farther and benefit you throughout your life. A budget will keep you moving towards were you need to be going. You are reviewing your goals on a regular basis, which keeps them on the top of your priority list. Budgeting will allow you to live today and save for the future at the same time.
When you are budgeting, it is easy to identify the areas in your life where you are overspending. You are able to spot financial problems before they attack you. With a budget, you find the ways to eliminate your debt and start saving for your goals. Debt is often the result of overspending and poor money management. If you have a budget, you are taking control of your finances -- which is beneficial in halting the debt accumulation. Personal finance plans can effectively allow you to manage your credit in a responsible manner.
By reviewing your budget on a regular basis, you are able to see your progress towards achieving your goals. Without a budget to review, you are simply flying blindly. Many Americans are unable to tell you how much money they have in their checking, investments and debts. If you don't know what your financial situation is at any given moment, how can you make any financial decisions during the day.
A budget simply assists you in getting your mind prepared to make financial decisions. You are able to properly assess the situation and make an informed decision in regards to where you money goes and who it is going to.
With a budget, you can build wealth, attain personal goals and prepare for your future. Manage your money right now, don't let it manage you.
The budget is the main requirement for financial planning. Without it, you can dream all you want, but you will not know how to make dreams into reality. Budgeting helps you organize both your current financial information and your long-term financial picture.
It is vital that you plan for a secure financial future. By setting goals and knowing what you are working towards, budgeting becomes a great tool.
Any good budget will address your entire financial picture, not just your day to day spending. It should manage what you make and what you spend. It should track your spending, showing you were you can cut back. It will help you prepare for emergencies. And most importantly, it can help you fulfill your savings and investment goals. It will not only make today financially peaceful, but will secure your independent life in the future.
I know that it is easy to forget about the long-run, so we don't budget at all. Even I have a lapse in financial judgement every now and then. But budgeting will take you farther and benefit you throughout your life. A budget will keep you moving towards were you need to be going. You are reviewing your goals on a regular basis, which keeps them on the top of your priority list. Budgeting will allow you to live today and save for the future at the same time.
When you are budgeting, it is easy to identify the areas in your life where you are overspending. You are able to spot financial problems before they attack you. With a budget, you find the ways to eliminate your debt and start saving for your goals. Debt is often the result of overspending and poor money management. If you have a budget, you are taking control of your finances -- which is beneficial in halting the debt accumulation. Personal finance plans can effectively allow you to manage your credit in a responsible manner.
By reviewing your budget on a regular basis, you are able to see your progress towards achieving your goals. Without a budget to review, you are simply flying blindly. Many Americans are unable to tell you how much money they have in their checking, investments and debts. If you don't know what your financial situation is at any given moment, how can you make any financial decisions during the day.
A budget simply assists you in getting your mind prepared to make financial decisions. You are able to properly assess the situation and make an informed decision in regards to where you money goes and who it is going to.
With a budget, you can build wealth, attain personal goals and prepare for your future. Manage your money right now, don't let it manage you.
Mortgage Life Insurance: Tips To Help You Get The Cover You Need
Having enough life insurance to not only cover the loss of income, but also your family's other debts (such as house, car, credit cards, etc.) is a wise move. Even though it may feel like a struggle at the time if you have to scrape the funds together to cover the premium.
In the event the unthinkable happen, the house (and perhaps other debts) would be paid for and your family would have one less burden to worry about. Or, if you have mortgage insurance that is triggered by your disability or being unable to work (or disability insurance), then your family is covered if something should happen.
When you take out the loan on your house, the company financing your home will often insist that you include mortgage insurance as part of the arrangement. While this may seem like an unnecessary addition to your already full expenditure list, it does make financial sense for the mortgage company but also for you. However, just because you are buying mortgage insurance from one company doesn't mean that you need use that same company for your other insurance needs.
Take, for example, the case of Jane Dodd. Jane and her husband Eric worked hard to raise a down payment to buy a home. The Dodd family had three children, and they both decided that Jane should stay home with the kids. Eric had a good job and a solid paycheck so it wasn't a strain. But when Eric was tragically killed in car crash, Jane was left to support her family without an income.
In the event the unthinkable happen, the house (and perhaps other debts) would be paid for and your family would have one less burden to worry about. Or, if you have mortgage insurance that is triggered by your disability or being unable to work (or disability insurance), then your family is covered if something should happen.
When you take out the loan on your house, the company financing your home will often insist that you include mortgage insurance as part of the arrangement. While this may seem like an unnecessary addition to your already full expenditure list, it does make financial sense for the mortgage company but also for you. However, just because you are buying mortgage insurance from one company doesn't mean that you need use that same company for your other insurance needs.
Take, for example, the case of Jane Dodd. Jane and her husband Eric worked hard to raise a down payment to buy a home. The Dodd family had three children, and they both decided that Jane should stay home with the kids. Eric had a good job and a solid paycheck so it wasn't a strain. But when Eric was tragically killed in car crash, Jane was left to support her family without an income.
Diversify Your Retirement Income
Diversification, it's not just for income any more. Let's talk about the importance of not putting all of your retirement funds into one solution. Maybe you work for a company that offers a defined benefit pension plan. Defined benefit plans are really on the way out. Companies such as Boeing, GM, and Ford have such huge pension plan obligations that they can no longer continue to fund them.
United Airlines declared bankruptcy and got out from under their huge pension plan obligations. As a result, retired employees saw their monthly benefit drop by about 50%.
I would expect that GM and Ford would be following in United's footsteps in the very near future.
For those of us who are expecting Social Security to provide us with a comfortable retirement, think again. In the next 10 years, the bulk of the baby boomers will be receiving social security and for the first time in the history of the plan, Social Security will be paying out more than they take in. The government will have to make up the difference.
This is why it is vital that you do not rely on only one source of retirement income in your plans.
United Airlines declared bankruptcy and got out from under their huge pension plan obligations. As a result, retired employees saw their monthly benefit drop by about 50%.
I would expect that GM and Ford would be following in United's footsteps in the very near future.
For those of us who are expecting Social Security to provide us with a comfortable retirement, think again. In the next 10 years, the bulk of the baby boomers will be receiving social security and for the first time in the history of the plan, Social Security will be paying out more than they take in. The government will have to make up the difference.
This is why it is vital that you do not rely on only one source of retirement income in your plans.
10 Reasons to Choose Direct Deposit over Paper Checks - ANYDAY!
More than half of employees (Over 70%) have converted to Direct Deposit as their preferred method of payment. As more people come to the realization that Direct Deposit is simply safer and more convenient, these numbers continue to rise - rapidly. Let's review ten reasons why Direct Deposit is rapidly ripping paper checks to shreds:
1. Direct Deposit Saves You Time
* Funds are conveniently deposited in your account electronically - saving you trips to the bank and helping you avoid long lines at tellers or ATMs.
* No more waiting for checks to clear... Funds clear instantly!
2. Your Money is Safer and More Secure
* You'll never have to worry about lost or stolen checks and can avoid the risk of carrying cash.
* Direct Deposit is more confidential. Since deposits are transferred electronically it passes through fewer hands than a paper check. This helps protect you from becoming a victim of identity theft.
3. It's Wiser
* You can access your money earlier - No more waiting for checks to clear. (Usually at the strike of 12:01a.m. on payday funds are available for use).
* Puts you in complete control of your money... You can automatically divide your funds amongst different accounts with ease.
* You're always a step ahead! - Employers will issue you a paper stub, in advance, so that you'll already know the amount of your direct deposit before it hits (including taxes, insurance, and any other deductions).
* Financial planners recommend Direct Deposit as a proactive step toward gaining control of your finances.
4. It's Simpler
* Once you sign-up for Direct Deposit you don't have to worry about it anymore. Your money is deposited on time, every time... regardless of where you are. Try that with paper checks.
5. Saves You Money
* Avoid check cashing fees
* Save gas money from traveling back and forth to the bank or check-cashing store.
* Avoid bounced check fees because you can always rely on your funds being cleared and in your account in a timely manner.
* Helps you to better manage and budget your money to avoid OVERspending.
1. Direct Deposit Saves You Time
* Funds are conveniently deposited in your account electronically - saving you trips to the bank and helping you avoid long lines at tellers or ATMs.
* No more waiting for checks to clear... Funds clear instantly!
2. Your Money is Safer and More Secure
* You'll never have to worry about lost or stolen checks and can avoid the risk of carrying cash.
* Direct Deposit is more confidential. Since deposits are transferred electronically it passes through fewer hands than a paper check. This helps protect you from becoming a victim of identity theft.
3. It's Wiser
* You can access your money earlier - No more waiting for checks to clear. (Usually at the strike of 12:01a.m. on payday funds are available for use).
* Puts you in complete control of your money... You can automatically divide your funds amongst different accounts with ease.
* You're always a step ahead! - Employers will issue you a paper stub, in advance, so that you'll already know the amount of your direct deposit before it hits (including taxes, insurance, and any other deductions).
* Financial planners recommend Direct Deposit as a proactive step toward gaining control of your finances.
4. It's Simpler
* Once you sign-up for Direct Deposit you don't have to worry about it anymore. Your money is deposited on time, every time... regardless of where you are. Try that with paper checks.
5. Saves You Money
* Avoid check cashing fees
* Save gas money from traveling back and forth to the bank or check-cashing store.
* Avoid bounced check fees because you can always rely on your funds being cleared and in your account in a timely manner.
* Helps you to better manage and budget your money to avoid OVERspending.
Credit Cards and Your Personal Budget
Many people will tell you that credit cards are evil, that you shouldn't use them, that you should destroy them all or lock them in a drawer. In some cases, this might be true.
If you don't have a budget that you use regularly, credit cards might be a big risk for you. If you can't keep yourself from spending money you don't have, credit cards might be a big risk for you. If you carry a balance and don't pay it in full each month, credit cards might be a big risk for you.
But if you are the type of person that has the discipline to use credit cards without getting yourself in debt, you may still have some issues getting your card to work with your budget. Credit cards can provide a lot of utility to your life, like easy spending records, fraud protection, and kickbacks like frequent flier miles or cash back.
The key to successfully using your credit card in conjunction with your budget is exactly the opposite of how you handle savings: you consider your credit card to be a part of your account. What does this mean? It means that when you charge something on your credit card, you immediately count that money as "spent" in your budget. So if you've charged $500 on your credit card by the end of the month, you should have a corresponding $500 counted against your budget categories.
In this way, you're never spending more than you should be. You're keeping to your budget. Then at the end of the month (it's best to try to align your credit card's payment date with your budgeting cycle if possible), when you make the payment to your credit card, the payment itself doesn't show up in your budget at all. As far as your budget is concerned, your credit card is just a part of your regular account.
If you don't have a budget that you use regularly, credit cards might be a big risk for you. If you can't keep yourself from spending money you don't have, credit cards might be a big risk for you. If you carry a balance and don't pay it in full each month, credit cards might be a big risk for you.
But if you are the type of person that has the discipline to use credit cards without getting yourself in debt, you may still have some issues getting your card to work with your budget. Credit cards can provide a lot of utility to your life, like easy spending records, fraud protection, and kickbacks like frequent flier miles or cash back.
The key to successfully using your credit card in conjunction with your budget is exactly the opposite of how you handle savings: you consider your credit card to be a part of your account. What does this mean? It means that when you charge something on your credit card, you immediately count that money as "spent" in your budget. So if you've charged $500 on your credit card by the end of the month, you should have a corresponding $500 counted against your budget categories.
In this way, you're never spending more than you should be. You're keeping to your budget. Then at the end of the month (it's best to try to align your credit card's payment date with your budgeting cycle if possible), when you make the payment to your credit card, the payment itself doesn't show up in your budget at all. As far as your budget is concerned, your credit card is just a part of your regular account.
Learn Money, Take Control, and Become Wealthy
Personally, I believe the ONLY long term debt help solution is to increase your financial education. When it comes to getting yourself debt help, your greatest asset is time. The greatest investment you can make is to invest your time into increasing your financial education.
When it comes to money, wherever you stop learning, you stop earning. See, it does not take money to make money...it takes knowledge and experience to make money. The more knowledge and experience you have, the less money and risk are involved.
Most people are discouraged from taking control of their financial situation because they believe it is too complicated for them to handle. Nothing could be further from the truth! This is a perception encouraged within society to help keep you in your place. The first step is to believe you can do it.
The next big spot where many people fail...they do not find the right information soon enough. This becomes another group of people who end up discouraged. In our schools today, you will learn reading, writing, math, and science, but you will never be given a financial education. You might get a lesson on how to balance a checkbook, or how supply and demand work, but you will never be given the right information...the simple lessons that could change your financial position for the rest of your life.
When it comes to money, wherever you stop learning, you stop earning. See, it does not take money to make money...it takes knowledge and experience to make money. The more knowledge and experience you have, the less money and risk are involved.
Most people are discouraged from taking control of their financial situation because they believe it is too complicated for them to handle. Nothing could be further from the truth! This is a perception encouraged within society to help keep you in your place. The first step is to believe you can do it.
The next big spot where many people fail...they do not find the right information soon enough. This becomes another group of people who end up discouraged. In our schools today, you will learn reading, writing, math, and science, but you will never be given a financial education. You might get a lesson on how to balance a checkbook, or how supply and demand work, but you will never be given the right information...the simple lessons that could change your financial position for the rest of your life.
Simple Steps to Living Frugally
Living frugally isn't difficult, you simply have to take a few steps. They aren't large steps, in fact, they are baby steps. The difficult part is staying on the path.
Step One: Know your destination.
You can't stay on the path towards your goals if you don't even know what your goals are. Have you ever gone into a grocery store without a list? You wander up and down the aisles, not really knowing if you are getting what you need. This is a lot like your frugal living. You have to know where you are going and what you need in order to follow the correct path.
Step Two: Don't take every path.
You will quickly find that if you follow every single frugal path that you encounter, you will go crazy! It just isn't possible. Not everything works for every person. For example, the busy mom with five small children is not going to have time to make homemade bread and everyone's clothes. She might simply focus on shopping wisely and reducing the utility bills. The retired homemaker may have time in which to make her own laudnry soap and plant a garden. It simply depends on where you are at in your life -- and how much you want to take on. There are some things that are just worth it.
Step Three: Keep searching for new paths.
You know your destination, but you don't always know how to get there. Frugal living is an ongoing challenge. There is no end to it. You keep learning and you keep pushing yourself to save a little bit more.
Step Four: Budgeting is your gasoline.
You have to know where you are spending your money in order to spend less. It often helps to track every penny that you spend. Right down to the penny. Don't cheat. Those small expenditures can really add up.
Your budget will keep you working towards your goal and spending less each month. This is where you can really sit down and see what is necessary and what isn't. When everything is on paper, it is easy to see the changes that could be made.
Step One: Know your destination.
You can't stay on the path towards your goals if you don't even know what your goals are. Have you ever gone into a grocery store without a list? You wander up and down the aisles, not really knowing if you are getting what you need. This is a lot like your frugal living. You have to know where you are going and what you need in order to follow the correct path.
Step Two: Don't take every path.
You will quickly find that if you follow every single frugal path that you encounter, you will go crazy! It just isn't possible. Not everything works for every person. For example, the busy mom with five small children is not going to have time to make homemade bread and everyone's clothes. She might simply focus on shopping wisely and reducing the utility bills. The retired homemaker may have time in which to make her own laudnry soap and plant a garden. It simply depends on where you are at in your life -- and how much you want to take on. There are some things that are just worth it.
Step Three: Keep searching for new paths.
You know your destination, but you don't always know how to get there. Frugal living is an ongoing challenge. There is no end to it. You keep learning and you keep pushing yourself to save a little bit more.
Step Four: Budgeting is your gasoline.
You have to know where you are spending your money in order to spend less. It often helps to track every penny that you spend. Right down to the penny. Don't cheat. Those small expenditures can really add up.
Your budget will keep you working towards your goal and spending less each month. This is where you can really sit down and see what is necessary and what isn't. When everything is on paper, it is easy to see the changes that could be made.
Preparing for Retirement
When it comes to retirement, there is more to consider than your retirement account. Preparing for retirement requires more than simply putting money away. While it is essential that you start as young as possible when working towards your retirement savings, you should work on other areas as well.
When we are young, we often think that we have plenty of time. So many people start their retirement investments late in life. This means that they will retire later with less money in their retirement funds. It also means that they will have to invest a larger portion of their monthly income in order to meet their retirement goals.
One of the most important things you should do to protect you into retirement is to remain healthy. Medical concerns are a top problem facing the elderly and their income situations. Getting older happens, but you can work at remaining healthy.
Start with taking care of your health by exercising, eating right and getting enough sleep. Learn to handle stress appropriately and handle health concerns immediately.
No matter how healthy you are, you will find that your medical expenses and insurance premiums will increase as you age. It can often be very difficult to purchase reasonable insurance when you are older. If you purchase your insurance now, in most cases you will be able to keep it so that it will be there when you are older.
You can't simply fall back on Medicare, which requires you be 65 years of age (except in special cases). If you have a major health problem at 63 without insurance, you will find that your entire retirement fund could be depleted rather quickly. Even if you qualify for Medicare, it doesn't cover everything. In most cases supplemental insurance is great for taking up the slack.
Don't think of Social Security as a retirement fund. This may have been true at one time for some people, but things have changed. In most cases, Social Security simply covers the basics, but not an excellent lifestyle. You should have retirement savings to fall back on, whether they be an IRA, 401(k) or other form of investment. In addition, if you are young there may be no Social Security when it comes time for you to retire.
When we are young, we often think that we have plenty of time. So many people start their retirement investments late in life. This means that they will retire later with less money in their retirement funds. It also means that they will have to invest a larger portion of their monthly income in order to meet their retirement goals.
One of the most important things you should do to protect you into retirement is to remain healthy. Medical concerns are a top problem facing the elderly and their income situations. Getting older happens, but you can work at remaining healthy.
Start with taking care of your health by exercising, eating right and getting enough sleep. Learn to handle stress appropriately and handle health concerns immediately.
No matter how healthy you are, you will find that your medical expenses and insurance premiums will increase as you age. It can often be very difficult to purchase reasonable insurance when you are older. If you purchase your insurance now, in most cases you will be able to keep it so that it will be there when you are older.
You can't simply fall back on Medicare, which requires you be 65 years of age (except in special cases). If you have a major health problem at 63 without insurance, you will find that your entire retirement fund could be depleted rather quickly. Even if you qualify for Medicare, it doesn't cover everything. In most cases supplemental insurance is great for taking up the slack.
Don't think of Social Security as a retirement fund. This may have been true at one time for some people, but things have changed. In most cases, Social Security simply covers the basics, but not an excellent lifestyle. You should have retirement savings to fall back on, whether they be an IRA, 401(k) or other form of investment. In addition, if you are young there may be no Social Security when it comes time for you to retire.
Critical Protection Issues - How To Get The Right Level of Personal Protection
Having looked at the quality of cover, we now turn our attention to:
How to get the right level of protection
Using our example again, Dr Cureall has a clear idea now on the quality of protection he wants, and now needs to make a decision regarding the level of cover he requires.
He is a family man in his late thirties, his wife, 3 years younger, is not working, and they have two children, Mat and Laura aged four and two.
We suggested to him that he should follow a simple process to work out how much cover he should buy:
- Find out what income they need to create
- Work out what they already have
- Decide on the time period to be covered
We asked Dr Cureall to fill in a detailed spending plan of what his wife would need if he had died yesterday – and vice versa.
This is to ensure that they would have enough income between now and retirement and into old age, should either of them die prematurely.
The Solution
Mortgage – it is decided to fully cover the interest only £200,000 mortgage with level term assurance over the 20 years of the loan. Since it is only slightly more in premiums, Dr Cureall decides on two single life policies instead of one joint life plan. This would mean on either death, the surviving partner would still have their cover intact.
Since the strategy we have created for him involves overpaying on the mortgage (he has a flexible mortgage) we could have used decreasing term assurance to mirror the reducing debt. However, Dr Cureall feels he may not reduce the debt all the time, and will reduce the sum assured on the level term assurance when he feels it is appropriate.
Dr Cureall already has sufficient critical illness cover therefore no additional cover was required.
So, on either death, the surviving partner would be free of debt.
What’s next?
Living expenses – this is where the spending plan comes in. This, together with a forecastig tool we use, Dr Cureall is able to see how the next 50 years will look on the scenario of either/both deaths.
Clearly their main priority is to provide for the children. This means being able to give them the life they would have had if the grim reaper had not called. So any school and university fees are built in as well as holidays and general living expenses.
Due to the children’s ages and university costs being anticipated, the Curealls look at their projections (‘financial map’) and decide on 22 years as the optimum time period. This also would give Mrs Cureall enough to live on into her old age.
The projection takes into account all NHS benefits, which are considerable now that Dr Cureall has 14 years service, including spouse and child payments. (In addition we recommend that the NHS death in service benefit is placed into trust which will potentially save the family £60,000 in Inheritance Tax).
Because we have built in these NHS payments, the amount of cover required on Dr Curealls life is nowhere near what he expected. They decide on more lump sum cover, with the balance to be provided by Family Income Benefit (pays out an annual income).
This time instead of level protection, the Curealls decide on indexed cover to protect against inflation. After all we can’t plan when we are going to die, and in payment the amounts would increase as well.
We recommend all these policies are written in trust to minimise Inheritance Tax, as well as ensure the monies are paid to the right people quickly on death.
How to get the right level of protection
Using our example again, Dr Cureall has a clear idea now on the quality of protection he wants, and now needs to make a decision regarding the level of cover he requires.
He is a family man in his late thirties, his wife, 3 years younger, is not working, and they have two children, Mat and Laura aged four and two.
We suggested to him that he should follow a simple process to work out how much cover he should buy:
- Find out what income they need to create
- Work out what they already have
- Decide on the time period to be covered
We asked Dr Cureall to fill in a detailed spending plan of what his wife would need if he had died yesterday – and vice versa.
This is to ensure that they would have enough income between now and retirement and into old age, should either of them die prematurely.
The Solution
Mortgage – it is decided to fully cover the interest only £200,000 mortgage with level term assurance over the 20 years of the loan. Since it is only slightly more in premiums, Dr Cureall decides on two single life policies instead of one joint life plan. This would mean on either death, the surviving partner would still have their cover intact.
Since the strategy we have created for him involves overpaying on the mortgage (he has a flexible mortgage) we could have used decreasing term assurance to mirror the reducing debt. However, Dr Cureall feels he may not reduce the debt all the time, and will reduce the sum assured on the level term assurance when he feels it is appropriate.
Dr Cureall already has sufficient critical illness cover therefore no additional cover was required.
So, on either death, the surviving partner would be free of debt.
What’s next?
Living expenses – this is where the spending plan comes in. This, together with a forecastig tool we use, Dr Cureall is able to see how the next 50 years will look on the scenario of either/both deaths.
Clearly their main priority is to provide for the children. This means being able to give them the life they would have had if the grim reaper had not called. So any school and university fees are built in as well as holidays and general living expenses.
Due to the children’s ages and university costs being anticipated, the Curealls look at their projections (‘financial map’) and decide on 22 years as the optimum time period. This also would give Mrs Cureall enough to live on into her old age.
The projection takes into account all NHS benefits, which are considerable now that Dr Cureall has 14 years service, including spouse and child payments. (In addition we recommend that the NHS death in service benefit is placed into trust which will potentially save the family £60,000 in Inheritance Tax).
Because we have built in these NHS payments, the amount of cover required on Dr Curealls life is nowhere near what he expected. They decide on more lump sum cover, with the balance to be provided by Family Income Benefit (pays out an annual income).
This time instead of level protection, the Curealls decide on indexed cover to protect against inflation. After all we can’t plan when we are going to die, and in payment the amounts would increase as well.
We recommend all these policies are written in trust to minimise Inheritance Tax, as well as ensure the monies are paid to the right people quickly on death.
Strategies in Personal Finance: Basic Investment Principles for Today and Tomorrow
This book is not a quick "how-to" but rather a substantive text intended for undergraduate course in financial planning and investments management. Material is arranged in sections relevant to people in their accumulation years (ages 20 through 60) and their retirement years; the first two sections address management and investment tools and opportunities, and the third focuses on management decisions. An extended case study, end-of-chapter questions, a glossary, suggested readings (including relevant "Getting Going" columns by Jonathan Clements of the Wall Street Journal, and website and other resources are included. Keith V. Smith is a business writer formerly associated with Krannert School of Business at Purdue University, and Jane A. Smith is a consultant for small businesses.
Very personal finance: when love is gone and paradise is lost, one question remains: who gets the toaster?
You've decided to slap on the ol' bail and chain. Great! Just remember, the whole "Till death do you part" thing can fall apart in a Britney minute, so you better protect yourself financially, Rockefeller. Here are our tips on discussing finances before shacking up or walking down the aisle--and what to do if things torn ugly.
PRE-SHACK-UPS
Before she gets too comfy on the couch, have a sit-down to divide fiscal responsibilities. "When you start spending together, you need to talk money" says Wall Street Journal columnist Jeff D. Opdyke, author of Love and Money. Maybe she pays electric and you cover cable. But Opdyke draws the line at sharing checking accounts, credit cards, and mortgages while dating. There's nothing to stop one partner from raiding the joint checking account, he says, or going on a spending spree after finding the other in bed with the personal trainer. "No joint assets," he rules.
Before she takes your name, consider getting her to sign on the dotted line. Both parties can benefit from a prenup, says Opdyke. It could even be good for your wife-to-be if, say, she's a player on Wall Street, while you're a mere haiku writer. Meanwhile, you'd want to make sure Nana's silverware stays in your family should wifey suddenly find your union irreparably tarnished. The key: "Approach this as a business decision," says Opdyke, "not a statement on the longevity of the marriage."
POSTNUPS (AND THE BIG "D")
Never got a prenup? Try "postnups," which are contracts made after you've tied the knot. And if she's already grabbed her yoga mat and split, hire a lawyer. Just make sure you keep your emotions in check. "People, in general, are greedy at heart," says Opdyke. "I've seen couples fight over salt and pepper shakers?' Better to hand over the china with a smile--that way she won't squawk as much about the plasma TV.
PRE-SHACK-UPS
Before she gets too comfy on the couch, have a sit-down to divide fiscal responsibilities. "When you start spending together, you need to talk money" says Wall Street Journal columnist Jeff D. Opdyke, author of Love and Money. Maybe she pays electric and you cover cable. But Opdyke draws the line at sharing checking accounts, credit cards, and mortgages while dating. There's nothing to stop one partner from raiding the joint checking account, he says, or going on a spending spree after finding the other in bed with the personal trainer. "No joint assets," he rules.
Before she takes your name, consider getting her to sign on the dotted line. Both parties can benefit from a prenup, says Opdyke. It could even be good for your wife-to-be if, say, she's a player on Wall Street, while you're a mere haiku writer. Meanwhile, you'd want to make sure Nana's silverware stays in your family should wifey suddenly find your union irreparably tarnished. The key: "Approach this as a business decision," says Opdyke, "not a statement on the longevity of the marriage."
POSTNUPS (AND THE BIG "D")
Never got a prenup? Try "postnups," which are contracts made after you've tied the knot. And if she's already grabbed her yoga mat and split, hire a lawyer. Just make sure you keep your emotions in check. "People, in general, are greedy at heart," says Opdyke. "I've seen couples fight over salt and pepper shakers?' Better to hand over the china with a smile--that way she won't squawk as much about the plasma TV.
How low? With new tax brackets, now's the time to lower your withholding - Personal Finance
Barrels of media ink have been spilled over the 25 million checks Uncle Sam mailed out as advance refunds on the 2003 child tax credit. Plenty of attention has been given to other aspects of the so-called Jobs and Growth Tax Relief Reconciliation Act of 2003, too, including dividend and capital gains cuts and increased, deductions for business owners. But little notice has been paid to the one thing that almost all taxpayers can do immediately to take advantage of the legislation--change the withholding from their paychecks to reflect new, lower marginal tax brackets.
The tax bracket changes are relatively small, so the extra money in each paycheck won't be enough to overcome fiscal inertia in many households or to get the nation's financial advisers clamoring about the oversight. Still, if you don't make the change, you're paying the government too much money and will have to wait for your tax refund to get it back.
Under the new law, the 38.6 percent income bracket drops to 35 percent; the 35 percent bracket falls to 33 percent; 30 percent dips to 28 percent; and 27 percent goes to 25 percent. Plus, the basic standard deduction jumps for millions of taxpayers. Granted, it doesn't sound like a lot, but for a married couple filing jointly and making $75,000 per year (in the new 25 percent bracket), a tweak in the withholding could add $125 per month to take-home pay.
For certified financial planner Rick Fingerman, president of Financial Planning Solutions Inc. in Medford, Massachusetts, it's an easy call. "More money in your pocket now is better than more money left to Uncle Sam until refund time. "The exceptions, he says, are people who can't seem to save other than through withholding and couples with self-employment income whose taxes tend to get a little fuzzy each year.
Even the forced savings component tends to be overstated, Fingerman says. Surveys have shown for years that most people spend their refunds rather than tuck them into retirement funds or use them to prepay the mortgage. (Although, to be fair, a substantial minority does pay debts with the yearly windfall.) Instead, put that $125 extra from each paycheck in the 401(k) plan, Junior's education fund, or a more sizable payment on that nagging credit card balance, and the immediate difference for your finances can be significant.
The tax bracket changes are relatively small, so the extra money in each paycheck won't be enough to overcome fiscal inertia in many households or to get the nation's financial advisers clamoring about the oversight. Still, if you don't make the change, you're paying the government too much money and will have to wait for your tax refund to get it back.
Under the new law, the 38.6 percent income bracket drops to 35 percent; the 35 percent bracket falls to 33 percent; 30 percent dips to 28 percent; and 27 percent goes to 25 percent. Plus, the basic standard deduction jumps for millions of taxpayers. Granted, it doesn't sound like a lot, but for a married couple filing jointly and making $75,000 per year (in the new 25 percent bracket), a tweak in the withholding could add $125 per month to take-home pay.
For certified financial planner Rick Fingerman, president of Financial Planning Solutions Inc. in Medford, Massachusetts, it's an easy call. "More money in your pocket now is better than more money left to Uncle Sam until refund time. "The exceptions, he says, are people who can't seem to save other than through withholding and couples with self-employment income whose taxes tend to get a little fuzzy each year.
Even the forced savings component tends to be overstated, Fingerman says. Surveys have shown for years that most people spend their refunds rather than tuck them into retirement funds or use them to prepay the mortgage. (Although, to be fair, a substantial minority does pay debts with the yearly windfall.) Instead, put that $125 extra from each paycheck in the 401(k) plan, Junior's education fund, or a more sizable payment on that nagging credit card balance, and the immediate difference for your finances can be significant.
A Frugal Christmas
Most people don't like to think of watching their budget at Christmas. Money may be tight, but they don't want to admit that they can't afford to give expensive gifts. Remember, if a nice gift gets you into debt, then it isn't worth it to buy. You have to draw the line in the sand and say "I'm not going to borrow money anymore."
If you are paying off debt, don't let Christmas be an excuse to go back into debt. Making a budget for the big holiday is crucial to not spending too much. You should start saving a few months in advance, but since we're past that time, if you haven't started a budget, then you have to get creative. Don't buy something so expensive that you are still paying for it in March ... in fact, don't buy ANYTHING that you can't afford! It's time to break the cycle of spending more than you make.
One way to do this, especially if you have a large family, is to draw names for gift-giving instead of buying for everyone. Everyone will still get a gift, and no one will have to overspend to do it. Set a dollar limit so people don't go overboard on spending.
Look for deals. There are plenty of Web sites out there that advertise great deals on used items. Take into account that "used" doesn't mean "cheap quality". There are plenty of times when someone buys clothes and either doesn't like them or they don't fit. Then they want to sell them. People can also get bored with toys, musical instruments and all sorts of things and want to get rid of them. Take advantage of deals!
Just remember ... it's the thought that counts. And many times, the right thought can translate into a gift that will really make the day of the person to whom you give it. Making someone's favorite dinner can be a great and inexpensive gift. It also is something that you put effort into, which holds more meaning than just stopping at a store and buying something. Try it! Get creative with gift-giving and it can be more fun than receiving gifts.
If you are paying off debt, don't let Christmas be an excuse to go back into debt. Making a budget for the big holiday is crucial to not spending too much. You should start saving a few months in advance, but since we're past that time, if you haven't started a budget, then you have to get creative. Don't buy something so expensive that you are still paying for it in March ... in fact, don't buy ANYTHING that you can't afford! It's time to break the cycle of spending more than you make.
One way to do this, especially if you have a large family, is to draw names for gift-giving instead of buying for everyone. Everyone will still get a gift, and no one will have to overspend to do it. Set a dollar limit so people don't go overboard on spending.
Look for deals. There are plenty of Web sites out there that advertise great deals on used items. Take into account that "used" doesn't mean "cheap quality". There are plenty of times when someone buys clothes and either doesn't like them or they don't fit. Then they want to sell them. People can also get bored with toys, musical instruments and all sorts of things and want to get rid of them. Take advantage of deals!
Just remember ... it's the thought that counts. And many times, the right thought can translate into a gift that will really make the day of the person to whom you give it. Making someone's favorite dinner can be a great and inexpensive gift. It also is something that you put effort into, which holds more meaning than just stopping at a store and buying something. Try it! Get creative with gift-giving and it can be more fun than receiving gifts.
Personal Finance - How To Reduce Your Monthly Expenses
Everyone has fixed expenses which are the basic of needs for our daily living. There is no way to eliminate the fixed expenses but with some innovative budgeting, you could save some good money from this practice. If you have debt problem, a good practice in expense control and budgeting can help you to free up enough money to pay down your debt and may prevent you from bankruptcy. Of course, to accomplish your goal, you might have to live a very austere existence and scarification.
This article will list down some ideas on how to lower your expenses. While reading this article, you can make a list of you own ideas to cutting down your expenses.
Ways To Save Money
1. Reduce the Number Of Credit Cards
For many people, owning a credit card is the style of life and there are people holding 5 to 10 credit cards. It's so convenient to make payment with credit cards and you many overlook your budget. Although to terminate all credit cards are not possible for many people, you could reduce the number of credit cards in hand.
2. Ask for a Lower Credit Card Interest Rate
A major consumer group conducted a study to find out how easy it is to get a lower credit card interest rate. Fifty-seven percent (57%) of those who simply telephoned their credit card company and asked for a lower interest rate got one instantly.Getting your credit card interest rate lowered depends on various factors. Normally the bank will approve your request if you meet the following conditions:
* You have a good credit rating -- meaning no late pay notations on your credit report and a good credit score;
* You do not have a high debt-to-income ratio and you do not carry a big balance on your credit card;
* You do not send in just the minimum payment required each month;
* You have an excellent payment record with that particular creditor;
* The credit card is not one that is categorized as "sub-prime", meaning it is not a secured credit card or one marketed exclusively to those with bad credit.
When you call and ask for a lower interest rate, your reasoning should be based on the argument that you deserve it because you're an excellent customer or you're getting better offers from other credit card banks.
3. Always Buy Classic Style on Clothing
Clothing fads come and go so quickly and it will become out of fashion after a season.Instead, buy only good quality classic clothing that you can wear five years from now if you haven't worn it out by then. This will help you to reduce the frequency of buy new cloths.
4. Know Your Budget on Food
According to some survey, people who do not know how much they spend on groceries each month are twenty times more likely to be over their heads in debt than those who know exactly how much they spend on food each month. A lot of money can be saved by with below practices:
* Stop eating outside - Dinners you prepare at home is significantly less expensive than meals you pay someone else to prepare.
* Don't buy what you don't really need - Good examples are soft drinks, sugary snacks and other sweets. Giving them up will improve your health, reduce your medical and dental-related expenses and fatten your wallet.
* Get the best price by comparing supermarkets -- Don't shop at the closest supermarket just because it's more convenient. Driving a mile or two down the road can save you as much as $50 per week on groceries.
5. Car pool with your neighbors
If you have neighbors who work close to your company, you can car pooling with them to save gasoline and transportation cost.
This article will list down some ideas on how to lower your expenses. While reading this article, you can make a list of you own ideas to cutting down your expenses.
Ways To Save Money
1. Reduce the Number Of Credit Cards
For many people, owning a credit card is the style of life and there are people holding 5 to 10 credit cards. It's so convenient to make payment with credit cards and you many overlook your budget. Although to terminate all credit cards are not possible for many people, you could reduce the number of credit cards in hand.
2. Ask for a Lower Credit Card Interest Rate
A major consumer group conducted a study to find out how easy it is to get a lower credit card interest rate. Fifty-seven percent (57%) of those who simply telephoned their credit card company and asked for a lower interest rate got one instantly.Getting your credit card interest rate lowered depends on various factors. Normally the bank will approve your request if you meet the following conditions:
* You have a good credit rating -- meaning no late pay notations on your credit report and a good credit score;
* You do not have a high debt-to-income ratio and you do not carry a big balance on your credit card;
* You do not send in just the minimum payment required each month;
* You have an excellent payment record with that particular creditor;
* The credit card is not one that is categorized as "sub-prime", meaning it is not a secured credit card or one marketed exclusively to those with bad credit.
When you call and ask for a lower interest rate, your reasoning should be based on the argument that you deserve it because you're an excellent customer or you're getting better offers from other credit card banks.
3. Always Buy Classic Style on Clothing
Clothing fads come and go so quickly and it will become out of fashion after a season.Instead, buy only good quality classic clothing that you can wear five years from now if you haven't worn it out by then. This will help you to reduce the frequency of buy new cloths.
4. Know Your Budget on Food
According to some survey, people who do not know how much they spend on groceries each month are twenty times more likely to be over their heads in debt than those who know exactly how much they spend on food each month. A lot of money can be saved by with below practices:
* Stop eating outside - Dinners you prepare at home is significantly less expensive than meals you pay someone else to prepare.
* Don't buy what you don't really need - Good examples are soft drinks, sugary snacks and other sweets. Giving them up will improve your health, reduce your medical and dental-related expenses and fatten your wallet.
* Get the best price by comparing supermarkets -- Don't shop at the closest supermarket just because it's more convenient. Driving a mile or two down the road can save you as much as $50 per week on groceries.
5. Car pool with your neighbors
If you have neighbors who work close to your company, you can car pooling with them to save gasoline and transportation cost.
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