Monthly Archives: November 2016

Saving Money Tips

Having a baby is one of the greatest joys in one’s life.

However, it also brings about a monumental change in our responsibilities, which can appear daunting and intimidating if not planned well in advance.

“Easy making money tips”

So here’s a short and sweet 10-point check-list to make sure that the transition into parenthood is both smooth and joyful.

1. Start by creating a short-term kitty to take care of both the delivery expenses and the numerous items you will need for your kid… from baby-pram and baby-toys to baby-cot and baby-seats.

2. Don’t be hesitant to use hand-me-downs. As any baby outgrows the clothes, toys etc. very fast, it makes no sense to buy everything new. All this money saved would be more useful for other critical needs such as debt-reduction, education, etc.

3. Check out the maternity (and now in some cases even paternity) leave and other benefits, if any, offered by your employer(s). Accordingly, you can derive maximum gains from these benefits.

4. Include your baby’s name in your health insurance policy. And if your employer is also providing medical insurance for your family, don’t forget to furnish the updated family details.

5. Your life is now precious to one more person. So, enhance your life insurance cover. To reiterate the obvious, term policy is the simplest, cheapest, easiest and the best way to do so.

6. Monthly budgets would have to be redrawn so that you can comfortably accommodate the increase in expenses on baby feeds, baby powders, baby clothes, baby doctor and so on. And, in a few months after the baby’s birth, once the mother goes back to her job, day-care and baby-sitting expenses will become a critical part of your monthly expenses.

7. Use your bonuses and other lump sum inflows to part prepay your loans and slash down your debt burden. You will sleep more peacefully, just like your baby.

8. Though still years away, education is becoming quite expensive. So “now” is the time to start building a suitable education fund for your child. By the way, don’t be lured by the terrible insurance plans. Go for pure-investment products ONLY.

Budgeting Money Tips

Money is known to be one of the major causes of tension in a relationship. So, try something new. Follow a few simple guidelines that can help you keep the fireworks in the relationship from exploding out of control.

1. Understand your Motivations and Goals

Traditionally individuals and couples will earn an income and automatically adjust their lifestyles to that income level. It’s nice to have the finer things in life such as home, new cars, vacations, etc. Very little thought, however, goes into motivations or values. It’s an important first step to understand what’s most important to you (your values) and from there you can set some specific financial goals.

Spending some time alone AND together and WRITING out your individual motivators (or values) and goals can be enlightening. Give it a try separately at first and then compare with your spouse or significant other. You’ll be well on your path to understanding each other better and set up for fruitful communications.

Once you’ve agreed on some goals, be realistic about the amount and timeframes. For example, if a goal is to buy your first home, calculate how long it will take you to save for a 30% down payment. Anything less than 30% down in this real estate market is very risky should you need to sell in the next few years.

2. Understand Your Current Financial Situation

Take some time to organize your records: Assets, Liabilities, and Income (ALI). Make a page for each ALI and list all the items in that group. For example, for the Assets group you would list home, cars, savings accounts, investments, and other major property items.

On the debt page, list all debts such as mortgage, car payments, outstanding credit card balances, student loans, etc. Do the same for all your sources of Income such as wages, alimony, child support, rental income, investments, etc.

Writing this all down will help you gain a big picture understanding your current situation. Once that is understood, you can work as a team to figure out how to achieve those financial goals you listed in step 1.

Remember, your financial information is your ALI!

3. Work Together as a Team

Work out your monthly budget as a team. Each of you will have a different value system or set of motivators that cause you to place emphasis on certain budget categories. Learn to work with each other and compromise where you disagree. Set up pre-set spending limits by budget category so that you are living within your means. When you disagree, you have your values and financial goals as your foundation. Keep coming back to revisit those. Make sure your spending plan supports those!

To help resolve conflicts, put in terms of “Needs vs Wants.” Once you think in those terms, many of your “wants” may need to be eliminated in order to achieve one of your financial goals. Remember, you based those on your life motivators or values, so those are much more important than some of your daily “wants,” i.e. a daily Starbucks budget category!

Set aside 30 minutes per month to work out your differences. Communicating your concerns lovingly and working through to the benefit of “one team” will help you maintain your financial goals and keep those fireworks going too!

4. Start Where You Are

Even if your financial picture looks grim, do not despair. Even if you are 50+, do not give up hope. You will probably live into your 80’s or 90’s, so there’s a lot of time to recover from past financial mistakes or just simply a late start. There’s a great book by Chris Gardner called “Start Where You Are.” If you need any inspiration at all, this book is a must read. Chris was a homeless single father of a small child and made a tremendous comeback to build a successful business. The book is full of inspiring techniques that will help you get started, no matter what your current situation is.

My advice is to start your financial plan within 24 hours of reading this. Studies show that a new thought, idea, or writing (such as this blog) should be implemented within 24 hours or the new thought, idea, or writing will NOT happen. So start planning now. Talk to your spouse or significant other today and encourage each other to take some ACTION.

5. It’s All About the LOVE!

Working together on your financial plan and making progress toward your life goals will bring harmony to your relationship. There’s nothing more comforting than knowing you are a blessing to someone else. When you put yourself on a mission to LOVE, you will be pleasantly surprised how good it will make YOU feel too!

As you work through your financial plan together and you start reaching those life goals, stretch yourself out – spread the LOVE even farther. What can you do to give back to the community, to your church, to your value system? When you start to think in terms of others and what life impact you can have on them, your own troubles start to disappear.

Saving Money Tip

To get ahead financially the statement “live within your income” is one of most critical fundamental steps you can take on board. I cannot stress enough how important it is to get your finances in control and to have you living within the amount of money you earn.

I know it is easy to think that you don’t live beyond your means, but often you can be doing this without even realising it. Some questions to ask yourself to establish whether or not you do “live within your income” are:

  • Do you pay cash for your purchases?
  • Are your debts going upward instead of downward?
  • Is your home loan increasing instead of decreasing?
  • Do you have more credit cards than you did a couple of years ago?
  • Do you have large amounts of debt owing for personal purchases such as cars, boats, renovations?
  • Are you behind with some of your bills?
  • Do you struggle to afford your bills when they come in?
  • Are you always running out of money before your next pay day?
  • Do you owe money to your family / friends / work colleagues?
  • Do you have a lot of ‘interest free’ loans for purchases such a whitegoods, furniture, household items

If you answered yes to any of these questions, then it appears that you might be living beyond your means or could soon be heading that way if you aren’t careful.

The money you earn can only go so far. No matter how much you earn this is what you have to start to learn to live on. Be happy with your salary and rather than spending your time and energy yearning to earn that bit extra, concentrate your energies on working solutions to manage your money efficiently so you do live on what you earn.

The answer to any money problem isn’t going out and earning more money. If you have bad money habits, no matter how much you earn you will still find a way of spending more as you will just lift your level of lifestyle to absorb the extra money being received in each week. Get used to your salary and start to manage your money at this level. If you are then fortunate to get a pay rise, the smart thing to do with the extra money is to put that money aside for savings.

Some clues to start living within your income:

  1. Do up a budget

Work out exactly how much money you have coming in to your household and how much money you are required to spend for fixed bills and commitments. This will give you some indication of how much money you have over for discretionary spending. If you find you don’t have any money over, then you need to look at ways to either increase your income or reduce your expenses. Budgeting is as simple as that.

  1. Stick to a budget :

After you have written your budget, you must work out a plan to stick to your budget. There is no point just writing down a whole lot of figures on paper or plugging them into a spreadsheet if you don’t do anything with them. Use different accounts / money jars / envelopes to cover different spending purposes and start to manage your money accordingly. Put money aside so you have sufficient funds to pay for your upcoming bills and aren’t having to live from pay to pay or borrow off friends / family.

  1. Say no to borrowing money :

To stop living beyond your means one of the most critical steps is to start saying no to debt no matter how attractive the purchase looks or how easy it is to get finance. The spiral of debt generally works in a downward direction. You can get pulled further and further into the core as the masses of debt around you grow and grow. Once in this spiral, it is very hard to get out.

Debt is something that can take over our lives and start controlling us if we aren’t careful of what we do and if we aren’t disciplined enough to say no to ourselves every now and then. If you can’t afford the item now without borrowing money, how do you think you can afford it with interest and loan charges loaded on top? If you can’t afford it, you have to start to say ‘no’.

  1. Ignore interest free marketing campaigns :

Another measure you can adopt is to not be tempted by smart advertising campaigns such as pay nothing for 36 months. You still have to pay the item back at some stage and all you are doing is delaying the pain.

  1. Leave the credit card at home :

Credit cards are a trap. They can entice you to go on spending sprees without really realising how much you are spending. It isn’t until you get the monthly statement that you get that rude shock and say gee “how can I have spent that much?”. By that time it is too late. If you want to go shopping set yourself a spending limit that suits your budget and available cash funds.

  1. Take regular notice of your financial position :

Taking an interest of your financial position and noticing if your accounts are going upward or downwards is also a key to living within your income. Many times people don’t know their situation as they don’t look at it. I have had many clients over the years come to me and it isn’t until I point out to them that their home loans (generally set up as lines of credit) are going upward instead of downwards that they become aware of their situation. Many also think they are paying off their credit cards but don’t realise that they are spending more per month than they are paying off so the debt is actually going upwards instead of downwards. Take notice of your credit card balances, loan balances and records of your savings. Keep an eye on these on a regular basis.

  1. Be careful how you justify borrowing money :

It is easy to say I need a new this or a new that and as I don’t have the money I will go out and get a personal loan for that item. This can be an easier solution to sticking it out for several months and saving the money to pay cash, especially if we are talking about the bigger ticket items such as cars, boats, home renovations, household appliances etc. However many people don’t realise the total cost they will incur on the item after they have included the payment of interest and bank fees on the loan over the next 5-7 years. Plus, you need to consider depreciation on the item and how little it will be worth by the time you have eventually paid the loan off. If you can stick it out and pay cash for something then you are going to be much better off.

Also, it can be easier to say yes when considering buying something when the deal can be done and dusted in less than 30 mins if the store provides you with instant finance at your finger tips. If you know you have to save hard for several months before buying something, you might make the decision to look for cheaper and alternative measures or you might decide that you don’t really need the item after all.

Stay Out Of The Red With Our Money Tips

America seems to have a high ignorance when it comes to personal finance. In this article, you will learn some basic financial concepts that will help you get the most from your money. You will see how to make your money go further, and find out how to supplement your income with side projects.

Replace old incandescent light bulbs with CFL light bulbs. Changing to more efficient light bulbs will decrease your electric bill and help the environment. CFL bulbs also last much longer than traditional light bulbs. Buying bulbs less frequently can help you save money.

Financial issues can come up suddenly, without warning, so it’s always good to be prepared. You should find out now what fees and penalties you will face for late or missed payments, so you can prepare for the worst. Do not commit to a lease without knowing this information.

Check your credit report regularly. There are more than a couple of ways that you can see your credit report at no cost. Make sure that this is done two times a year to make sure that there aren’t any unauthorized changes done to your report, and that someone hasn’t committed identity theft by using your information and name.

If you do not want to hash out your monthly finances with pen, paper, and check register, take your budgeting and checkbook-balancing tasks online. These programs can track your income and expenses, as well as creating a budget plan for you with minimal effort.

You shouldn’t take out too much credit if you want your finances to be healthy. If you have more credit extended to you than you should your credit will be affected negatively, which will cost you a great deal of money over time on higher interest rates.

Don’t sell if the time is not right for you. If you are getting money from one stock more than another, let that one stay. If you have stocks in your portfolio that are not performing well, you may wish to change them up a bit.

Do not deal with a broker you cannot trust. Check their references, and ensure that they tell you everything you want to know. Being a beginner means you’ll have to take extra care to find a broker who understands your personal needs.

Every time you receive a check, always save some money. Do not expect to save money if you simply plan to save what is left. With the money actually being stored away safe and secure, you have a much lower chance of spending the money on something trivial or impulse-driven.

For small purchases, you should have 10 dollars on a debit card, or in cash, readily available. Laws that were passed recently on credit cards allow a merchant to include a minimum amount you can purchase.