The fact that since the first of the year crude oil has slid over 16% while the national average price of gasoline has fallen only 5% really bothers me. So, on that note, I've decided to do a little bit of research and a whole lot of math in order to try and figure out what the heck is going on.
First off, let's assume that we're working under the premise that the price of crude oil makes up about half of the price of gasoline. After doing some research, this seems to be a pretty standard and accepted idea.
On January 1, the national average gas price was $2.33 per gallon while the price of a barrel of crude oil was at $61.25. In sticking with the theory that the price of oil makes up half of the cost of gasoline, the $61.25 per barrel equaled $1.165 worth of gasoline.
As of January 16, the price of oil had fallen to $51.21 - 16.4% lower than the price on January 1. According to the above theory, the price of oil on January 16 should now equal $.974 worth of gasoline:
(1 - .164) * $1.165 = $.974
Assuming the non-oil 50% of gasoline (taxes, additives, advertising, salaries, etc.) was a fixed cost - not that unreasonable - the new price of gasoline should be $2.14 per gallon, roughly 8.2% lower than it was on January 1:
$1.165 + $.974 = $2.139
Unfortunately, the national average price of gasoline on January 16 was $2.22 - only 4.7% lower than what it was on January 1.
This leads me to one of two conclusions:
1. The "fixed" costs actually increased by 6.9% as oil prices went down, or
2. The system is rigged so there is enough lag time built in for oil and gasoline companies to take advantage of the arbitrage.
How Gas Credit Cards Work
Do you drive regularly? If you do, then you probably know how difficult it is to deal with the ever increasing price of gas. The fuel industry has become quite unstable because of the conflicts that often happen among major petroleum producing countries. Even the rumors of a possible conflict in the Middle East are enough to make the price of oil rise rapidly.
Many people became aware of the fragility of our energy infrastructure because of the problems with production and distribution capacity in recent years. This problem has also been highlighted by the natural disasters and malfunctions that are personnel and equipment based. Due to the instability of the fuel industry, people across the country have been forced to lessen the impact of the rising cost of fuel. They turn to gas credit cards, car pooling, use of public transportation and other similar techniques to save money on fuel.
You can also try some of these creative solutions to reduce the effect of high gas prices on your personal budget. Many people have turned to gas credit cards because they seem to be an enticing way to save money. However, you should first understand how gas credit cards work if you want to go by this route. You need to find out if you can really save money by using these credit cards.
If you are considering the idea of getting gas credit cards, then you should know that they usually charge much higher interest rates than standard credit cards. This means that you will to pay off all of the balances of your credit cards on time. You will not save money if the added finance charges are bigger than the savings that the credit cards offer.
You should also be aware that the issuers of gas credit cards may change the terms and conditions of your account at any time. It would be wise to read every piece of correspondence that you receive from your gas credit cards issuer. You can choose between negotiating special terms with the issuer and discontinuing the use of your credit card if the terms become problematic.
You can also get the gas credit cards that are offered by some oil companies. However, these credit cards offer gas credit cards only work at gas stations that use gas products supplied by that particular company. If you consistently buy gas from the same station, then you can benefit from these credit cards. However, these credit cards may not work for you if you travel a great deal. In this case, you have to make sure that your gas credit cards will work during your travels.
Many people became aware of the fragility of our energy infrastructure because of the problems with production and distribution capacity in recent years. This problem has also been highlighted by the natural disasters and malfunctions that are personnel and equipment based. Due to the instability of the fuel industry, people across the country have been forced to lessen the impact of the rising cost of fuel. They turn to gas credit cards, car pooling, use of public transportation and other similar techniques to save money on fuel.
You can also try some of these creative solutions to reduce the effect of high gas prices on your personal budget. Many people have turned to gas credit cards because they seem to be an enticing way to save money. However, you should first understand how gas credit cards work if you want to go by this route. You need to find out if you can really save money by using these credit cards.
If you are considering the idea of getting gas credit cards, then you should know that they usually charge much higher interest rates than standard credit cards. This means that you will to pay off all of the balances of your credit cards on time. You will not save money if the added finance charges are bigger than the savings that the credit cards offer.
You should also be aware that the issuers of gas credit cards may change the terms and conditions of your account at any time. It would be wise to read every piece of correspondence that you receive from your gas credit cards issuer. You can choose between negotiating special terms with the issuer and discontinuing the use of your credit card if the terms become problematic.
You can also get the gas credit cards that are offered by some oil companies. However, these credit cards offer gas credit cards only work at gas stations that use gas products supplied by that particular company. If you consistently buy gas from the same station, then you can benefit from these credit cards. However, these credit cards may not work for you if you travel a great deal. In this case, you have to make sure that your gas credit cards will work during your travels.
The Effects Of Interest Rate Hikes On You
An increase in the interest rate by the Bank of England always scares people until they work out exactly what affect the increase will have on their lives. The people who will suffer the most will be those people who have taken out loans that have left them financially stretched before the interest rate increase occurred. The actual amount of the increase isn’t as much of a problem as the psychological effects of the increase. People who can be hardest hit are those who own homes although they can sort out some of their problems by consolidating their debts. One of the problems is that the interest rate increase will affect people in a variety of different ways, not a single way.
Many people will be able to make plans to accommodate the increased interest rate on loans and mortgages, but may be unprepared for its effect on other general costs. To be hit on multiple sides with rising costs will greatly increase the pressure on those people who have loans outstanding. The burden of the loans will increase and the more stretched a person is financially before the increase, the more they will feel the effects of the increase. While the increase may be as little as a quarter of a percent, it can result in a increase of £20 pounds per month or more in monthly payments on a loan of 10 000 pounds.
The additional money will have to be taken from another aspect of the household budget, which in turn can have affects on people’s quality of life. Most people will deduct it from the amount of money allocated to leisure activities and non-essential aspects. This can be exacerbated by the fact that other bills may also be increased through the interest rate increase. This is coupled with the fact that council tax rates can be tied to interest rates and can increase in line with increases in the interest rates. This means that the person will have to cope with increased bills at a time when they are trying to reduce costs to pay off loans or mortgages that have been also increased.
Many people will be able to make plans to accommodate the increased interest rate on loans and mortgages, but may be unprepared for its effect on other general costs. To be hit on multiple sides with rising costs will greatly increase the pressure on those people who have loans outstanding. The burden of the loans will increase and the more stretched a person is financially before the increase, the more they will feel the effects of the increase. While the increase may be as little as a quarter of a percent, it can result in a increase of £20 pounds per month or more in monthly payments on a loan of 10 000 pounds.
The additional money will have to be taken from another aspect of the household budget, which in turn can have affects on people’s quality of life. Most people will deduct it from the amount of money allocated to leisure activities and non-essential aspects. This can be exacerbated by the fact that other bills may also be increased through the interest rate increase. This is coupled with the fact that council tax rates can be tied to interest rates and can increase in line with increases in the interest rates. This means that the person will have to cope with increased bills at a time when they are trying to reduce costs to pay off loans or mortgages that have been also increased.
Compare Car Insurance Quotes Online - You can Save Money
It is not surprising that statistics show that most Britons simply do not shop around to get the best deal on their car insurance. The choice of motor insurance policies, and insurance companies, is almost bewildering.
However, if you do accept the first quote you are given, whether you are an experienced driver or not, you are simply giving away your hard earned cash to your motor insurance company far too readily.
There are a huge amount of car insurance policies advertised online, in your local press, and a myriad of deals available from the larger retail supermarkets. Yes you want to save time and money, but if you target your requests for quotes properly, you could save hundreds in less than an hour online.
Many car insurance companies claim to offer policies for all types of drivers. Simply asking just any random insurance company for a quote, isn't going to save you money. If you are a new driver, a learner, a student, or a motorist with little driving history, you need to get a specialist number quotes.
So where do you find these companies?
You could start by using a search engine, asking a friend for a recommendation or phoning a company up for a quote, but before you do anything else -
Stop!
Decide what you want to achieve before you take any action.
Do you want a fancy car insurance policy with lots of extras? Policy add-ons that could cost you more are:
- Having a replacement courtesy car - Insisting on a protected no claims bonus - Extra Legal protection - Taking fully comprehensive insurance if you don't need it
There are other services on offer from insurance companies, but if you do not really need it, why bother.
So do you want a really cheap price in the least amount of time instead?
Yes, if you simply want a really cheap price, you're in good company because that's what over eighty seven per cent of people said in a recent survey.
Follow this simple three step plan to reduce your car insurance premiums online:
1. Set aside just one hour to request your motor insurance quotes online.
2. Get four car insurance quotes (use three price comparison sites and one specialist insurer).
3. After you have received your quotations, telephone the insurance company with the cheapest quote and ask them to beat your best online quote (you don't need to tell them where you obtained the quote).
The above three steps sound almost too easy, but using price comparison sites really is the most efficient way to begin your search for low prices.
There are a number of price crunching web sites online. To provide you with a rate, they will ask you some basic information about yourself, what level of cover you need, and then request quotes from up to 300 different car insurance companies in a single search.
However, if you do accept the first quote you are given, whether you are an experienced driver or not, you are simply giving away your hard earned cash to your motor insurance company far too readily.
There are a huge amount of car insurance policies advertised online, in your local press, and a myriad of deals available from the larger retail supermarkets. Yes you want to save time and money, but if you target your requests for quotes properly, you could save hundreds in less than an hour online.
Many car insurance companies claim to offer policies for all types of drivers. Simply asking just any random insurance company for a quote, isn't going to save you money. If you are a new driver, a learner, a student, or a motorist with little driving history, you need to get a specialist number quotes.
So where do you find these companies?
You could start by using a search engine, asking a friend for a recommendation or phoning a company up for a quote, but before you do anything else -
Stop!
Decide what you want to achieve before you take any action.
Do you want a fancy car insurance policy with lots of extras? Policy add-ons that could cost you more are:
- Having a replacement courtesy car - Insisting on a protected no claims bonus - Extra Legal protection - Taking fully comprehensive insurance if you don't need it
There are other services on offer from insurance companies, but if you do not really need it, why bother.
So do you want a really cheap price in the least amount of time instead?
Yes, if you simply want a really cheap price, you're in good company because that's what over eighty seven per cent of people said in a recent survey.
Follow this simple three step plan to reduce your car insurance premiums online:
1. Set aside just one hour to request your motor insurance quotes online.
2. Get four car insurance quotes (use three price comparison sites and one specialist insurer).
3. After you have received your quotations, telephone the insurance company with the cheapest quote and ask them to beat your best online quote (you don't need to tell them where you obtained the quote).
The above three steps sound almost too easy, but using price comparison sites really is the most efficient way to begin your search for low prices.
There are a number of price crunching web sites online. To provide you with a rate, they will ask you some basic information about yourself, what level of cover you need, and then request quotes from up to 300 different car insurance companies in a single search.
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
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
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.
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.
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.
10. Avoid expensive friends
Avoid friends who want to go for drinks all the time or suggest an evening at home. The money you spend on drinks and snacks, can buy something better, or go into your savings account. Also avoid friends who want to have supper at your house because you are a "good cook" what that really means is that they are saving money while you are grocery shopping.
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.
10. Avoid expensive friends
Avoid friends who want to go for drinks all the time or suggest an evening at home. The money you spend on drinks and snacks, can buy something better, or go into your savings account. Also avoid friends who want to have supper at your house because you are a "good cook" what that really means is that they are saving money while you are grocery shopping.
Setting New Financial Goals for the New Year
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.
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.
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