Posted on

Tips for Staying On Top of Monthly Expenses

While “Mo Money Mo Problems” may be the anthem for famed rap stars, hotel heiresses and other multi-millionaires, the rest of America could use a little extra just to meet monthly expenses. These suggestions can help you manage your money and stay on top of your rent and bills:

Create a Budget
Whether you’re in debt or simply trying to stay on top of your bills each month, one of the first things you should do to get your monthly expenses in order is to create a budget. Begin by calculating your monthly income, then determine your expenses, including rent, utilities, student loans, credit card payments, food, toiletries, household items and other necessities.
You should also take your spending money into account, subtracting from your total income how much you spend on going out and other unnecessary costs. If you find that your outgoing money is more than your income, it’s time to cut something out or find a new way to make up for the gap. We attached a budget form to this email.

Ditch the Paper
Online banking isn’t the way of the future — it’s now. Rather than having your bills mailed to you at home where you’ll need to juggle and keep track of physical copies, have them sent straight to your email inbox. You can even create a folder in your email account that contains only your statements and bills.
Don’t forget to back up these documents by storing them on the cloud or a storage device in case there’s an issue with your email provider. Another big perk for the environmentally conscious is that going paperless significantly reduces your carbon footprint.
You can also ask your landlord about paying your rent electronically, which not only saves trees but can make it easier to pay on time every time, since you can do it from with convenience on your own laptop.

Set Up Auto-Pay
It can be hard to stay on top of your bills when you have so many. Fortunately, online banking technology has advanced to the point where you don’t even have to log on every week to pay your electric, gas, credit card and other bills.
Contact your financial institution to set up auto-pay, which generally requires that you provide each of the companies with your banking information. The money will then be automatically deducted from your account on the set dates.
Keep in mind that using your bank’s auto-pay feature doesn’t mean you don’t have to do any work — you’ll still need to manage a budget and ensure that there are enough funds available to cover the amount on each deduction date.

Give Yourself an Allowance
Limit the amount of money that can be spent on the non-essentials, such as going out on the weekends and small pleasures (coffee in the morning and Friday lunches with your coworkers can add up fast). Keeping your budget in mind, give yourself a specific amount that you are allowed to spend on these luxuries.
Be strict with yourself: If you use up the last of your spending money on ice cream after work Thursday evening, you must wait until your next allowance to start spending on non-essentials again, which may mean packing your lunches at home and skipping on Thursday night bowling. This tactic will not only help you control your spending, but it may also help you embrace those small pleasures even more.

Save for a Rainy Day
Last but certainly not least is adding to your savings account on a regular basis. You should think of your savings deposit as a necessary bill rather than an afterthought or something you do with extra income at the end of the month.
It can be hard to find ways to save money, especially for those on tight budgets or with high monthly expenses. However, setting aside a small percentage of your paycheck, even if it’s only $ 20 per month, can be an enormous help if something unexpected comes up, such as a medical bill or emergency car repair. This financial cushion also provides a little peace of mind.

Posted on

6 Ways to Build a Healthy Relationship With Money

Healthy relationships don’t just happen. They are built and maintained. This is true not only for your relationships with people, but with money too.
So how do you build and maintain a healthy relationship with money? Well, a good starting point is to build a good relationship with yourself.
Margarita Tartakovsky, M.S., Associate Editor at Psych Central wrote an article entitled “6 Ways You Can Have a Healthy Relationship with Yourself”
Let’s look at the six topics that she discusses in her article in terms of your relationship with money

1. Care for your needs.
Taking care of your physical needs includes things like getting enough sleep, eating nutritious meals, brushing your teeth, and exercising.
Taking care of your fiscal needs includes understanding the difference in the money you spend on your true “needs” like food, housing, childcare, healthcare, etc. from your “wants” like entertainment, restaurants, premium channels, and gourmet coffee.
2. Joy is important.
Engaging in activities that bring you joy, like taking a walk, eating a chocolate, volunteering at the food bank, reading or taking an exercise class, helps you recharge your emotional well-being.
Small purchases that bring you great joy, like buying a good book, or an occasional gourmet chocolate or coffee, or buying your child a special treat, is money well spent. Set aside money in your budget for those things that bring you joy. Similarly, giving money to causes in which you believe (within your budget), like nonprofit charities, religious organizations, medical and scientific research, or the arts, helps to remind us that money is a means to an end, not an end in itself.
3. Focus on your inner world.
Focusing on your inner world of thoughts and emotion can help you become more self-aware. Self-awareness helps you understand what you are really feeling, and why you are feeling that way. Self-awareness also helps you understand your own actions and reactions to various situations.
Financial self-awareness is important as well. Knowing yourself and your financial condition is critical when you are faced with questions about changing jobs, working more or less hours, buying a new car, taking a vacation, or buying a house.
4. Regularly make time for yourself.
You can’t become more self-aware if you don’t set aside time for yourself. Even a few quiet minutes in the morning enjoying a cup of coffee, or reading a good book or article can be beneficial to your self-awareness.
Likewise, you can’t become financially self-aware if you don’t set aside time. You need to designate a regular time (e.g., like monthly) to review your financial situation.
5. Meditate.
Meditation is a method that many people use to gain peace of mind and perspective during that time that they have set aside to focus on their inner world.
Use your regular financial review time to think about your financial situation and to set some goals, even small ones. Think about how good you will feel next month when your credit card balance goes down by that extra $100 payment that you decided to make.
6. Be your own best friend.
When you are being hard on yourself for some perceived shortcoming, think about how you would treat your best friend or a close family member. Chances are that you would be supportive and forgiving. Do the same for yourself.
Be a best friend to your financial self, too. Don’t be overly critical if you stumble, but be honest with yourself. Spend time to understand your financial condition and set goals to improve your situation.
A healthy relationship with yourself, your friends, your family, and your money require time and effort. The reward is a happier, healthier, and more fulfilling life for you.

Posted on

Five Practical Tips That Will Help You Stay Out of Debt

Staying out of debt should be the goal of every consumer. The problem is that staying out of debt has been given the bad reputation of being no fun. Many consumers associate the concept of financial responsibility with denying themselves the things they want in life. The truth is that using practical tips to stay out of debt can help you to better understand how to have the things you want in life without damaging your financial situation.

Personal financial planning is a two-step process. The first step is to develop the spending and saving policies that will dictate how you handle your finances. Once you have your policies in place, you need to develop the dedication necessary to stay with those policies and learn from them. Rather than fighting the urge to spend money, you should be taking the time to understand how good spending policies lead to the opportunity to live the life you want without falling deep into debt.

The second step in good personal financial planning is turning those policies into habits. If you stay dedicated to making your spending and saving policies a part of your every day decision-making process, then they begin to become second nature. You start to make decisions based on what is best for your personal finances, and you begin to develop the real understanding you need to stay out of debt.

To help you get started, there are five practical tips you can use that will help you avoid debt. Some pieces of advice are not as easy to follow as others. But when you put them together, you get a plan that can help you gain control of your finances and always have your head above water.

1. Budget Your Money

Monitor your spending for two months by keeping a log and collecting receipts. Then segment your spending into expense categories such as entertainment and food. Once you have that information, you combine it with your monthly bills to get a clear picture of your monthly spending habits. Before you start to develop a budget, analyze your spending to find ways to reduce your expenses and free up more money for savings and paying off bills.
Write your bills into a checklist and compare that to your monthly income. As you pay bills or use up expenses, check it off your list. Make your savings accounts bills that you pay every month. Vacations, holiday spending and an emergency savings account should all get something put into them to make sure you have the money when you need it. Any extra money you have at the end of the month goes into the savings account or is applied to paying down the balance of a credit account.
Remember to create expense items for your weekly entertainment, food and gas for your car. Anticipate one-time bills each month and account for them in your budget. Do not deny yourself money for going to the movies each week, but rather you should keep track of it and limit your spending to make sure you have money for important bills and expenses.

2. Make More Money

Is it practical to lower your monthly food budget or put off paying credit card accounts to try and apply that money to other things? No, that is not a practical solution. If you find yourself falling short on your budget each month, then the practical approach is to take on an extra part-time job, pay your bills down and then get your finances under control.
One of the difficult things about budgeting money and being practical with your personal finances is that you need to objectively look at your situation and make hard decisions. If you put yourself in a financial hole, then develop the initiative to get yourself out of that hole by making more money. If you can spend more money, then it is practical to expect yourself to also be able to make more money.
Even if you have a balanced budget and no money problems, if you have the time, then it may not be a bad idea to get an extra part-time job anyways. You can put the money you make into your various savings account and strengthen your financial situation even further. It can be difficult to anticipate the future, and that is why it is always a good idea to take prudent financial action when you are able. Adding money to your savings accounts when you do not feel you need it will create more available funding when you do need it.

3. Credit Cards

A discussion of credit cards is part of practical financial planning because credit cards can offer several benefits that a person with good spending habits can take advantage of. When you are applying for a credit card, look for one that fits your situation. If you travel a lot, then get a card that offers discounts in travel, hotels and rental cars. Look for the card with the best cash-back feature to help you put extra money into your pocket during the course of the year.
The most practical way to use a credit card that offers rewards and cash back is for items that you know you have the cash for in the first place. For example, if you use your credit card to buy groceries, then you can get the benefits of travel miles and cash back while you pay off your entire credit card balance with the grocery money set aside in your budget. Regular expenses that you know you have covered by cash are excellent candidates for credit card spending because you will not be carrying the balance from month to month, but you will still get the rewards credits.
Credit cards are also necessary when it comes to renting a car and doing other activities while traveling or on vacation. Once again, it is practical to have the cash ready to pay the credit card bill when you get it in 30 days. But if you can continue to rack up cash-back payments for spending cash that you have on hand, then that is a good financial move. If you pay the balance within 30 days, then you reduce your interest debt to almost nothing. Learn how to use credit cards responsibly to benefit from them.

4. Save Rather Than Spend

One of the ways that retailers convince people to make large purchases is to entice consumers with low monthly payments on financing. If you know that you can easily make a monthly payment on a financed item, then you should also be able to save the money needed to buy that item in cash.
For example, if you are not in a hurry to get a new television, then you should do some research and find out how much the television you want will cost. Then you can develop a savings plan that will help you to save the money you will need to purchase the item. Look at it as making payments on a finance account for an item you do not own yet. Once you reach your goal, you can purchase the item outright without having to pay interest and finance charges.
Saving money for purchases is always preferable to opening a finance account for the practical consumer. You may have to wait a few extra months for the item but, if the item is not a critical need, then saving for it will allow you to have the things you want without putting yourself into debt.

5. Do It Yourself

Spend time learning how to do tasks that you would normally pay a contractor or professional to do. For example, you can save some money each year by changing your own oil and taking the old oil to a local auto mechanic for disposal. If you have an interest in home remodeling, then start researching ways to do projects on your own rather than paying extra for a contractor to do them.
Any time you get a chance to save money by doing something yourself, the practical approach is to take that opportunity. If you go out to a company party at a facility where there is valet parking, then look to see if you can park your vehicle yourself to save the valet charges. Wash your vehicle each week in your driveway with your own water and supplies to avoid paying for a car wash.
Do not take the “do it yourself” approach to dangerous levels. If a family member needs medical attention, then get to a doctor. But if you find practical ways to save money by doing something on your own, then you should take the chance to save money and avoid putting yourself deeper into debt.
These were our best five tips to easily stay out of debt. Of course these aren’t the only things you could do to stay financially healthy! You can find more effective tips on these links we bundled for you. They’re a great addition to our relatively small website. Good luck!

Posted on

IRS Tax Scheme

We certainly understand if the latest IRS imposter scam makes you queasy: it involves a fake IRS tax notice that claims you owe money as a result of the Affordable Care Act.

The IRS says the fake notices are designed to look like real IRS CP2000 notices, which the agency sends if information it receives about your income doesn’t match the information reported on your tax return. The IRS says many people have gotten the bogus notices, which usually claim you owe money for the previous tax year under the Affordable Care Act.

It’s one of many IRS imposter scams that have popped up. As tax season nears, we’ll see more. The good news? There are red-flag warnings that can help you avoid becoming a victim. For example, the IRS will never:

  • Initiate contact with you by email or through social media.
  • Ask you to pay using a gift card, pre-paid debit card, or wire transfer.
  • Request personal or financial information by email, texts, or social media.
  • Threaten to immediately have you arrested or deported for not paying.

In the new scam, the fake CP2000 notices often arrive as an attachment to an email — a red-flag — or by U.S. mail. Other telltale signs of this fraud:

  • There may be a “payment” link within the email. Scam emails can link you to sites that steal your personal information, take your money, or infect your computer with malware. Don’t click on the link.
  • The notices request that a check be made out to “I.R.S.” Real CP2000s ask taxpayers to make their checks out to “United States Treasury” if they agree they owe taxes.

In the version we saw, a payment voucher refers to letter number LTR0105C, and requests that checks be sent to the “Austin Processing Center” in Texas. But scammers are crafty. They could send messages with a variety of return addresses.