Jill Russo Foster

Understanding How Credit Works In Your Life

Let’s talk about credit.

First, loans / credit cards are when you use someone’s else’s money (borrowing). You are receiving goods or services now that you have agreed to pay for later (either in full or with a series of payments). This will help you to establish or re-establish your credit. This is different from a debit card, which is using your own money and not building your credit.

Now that we have that straight, credit is an extremely important part of your finances. It gives you that ability to purchase goods or services when you need it and pay for it later. Sometimes life requires you to make a purchase now (even when you don’t have the funds of your own to do it now). Last month, I came home from work to find our smoke and carbon monoxide detectors beeping – not a good thing. It wasn’t the batteries, which meant it had been 10 years since we replaced them. Ugh! There was an immediate need to have the electrician come and replace all 11 smokes and carbon monoxide detectors now. It wasn’t something we planned on in our July budget, but it needed to be done now. That’s where credit comes in. They were replaced and we will pay the bill in August.

Credit is something you will find you need in your life, whether it be for emergencies or planned purchases. Having good credit will be an asset to you in your time of need. Having good credit will give you more favorable terms (lower interest rate) for your repayment terms. The higher your credit, score the better chances of getting credit at the best terms. Putting it a different way, your credit score is as important to your finances as your GPA is to getting into college – both numbers are an important in your life.

To have the best credit, you need to use it but not abuse it. It’s easier said than done. You need to use your credit and make purchases as needed, but only purchase what you can afford. You need to make your payments on time and not max out your debt.

In my next newsletter, I’ll talk about credit and some frequently asked questions.

Simplification Month

If you have been following my posts in July, you see what we have done to simplify our lives. This is always a priority for me.

Did any of tips inspire you to make a change? What have you done? What did you do that we haven’t yet? I am always learning something new from my readers.

I would love to hear from you. Tell me what you’ve done. Tell me what you like to learn more about with your finances.

Simplifying By Making Choices

This stay at home time, we have made changes to our routine. Bills are still coming in and some are higher, but income stayed the same or was even reduced. Something had to change.

For our electric bill that went up (even more now with summer air conditioning), we unplugged. Think shutting the strips on the TV ‘s when not in use, unplugging the computers and printers when not is use, unplugging the kitchen appliances, and more. By doing this we have reduce our bill by about $15 a month. AARP has an article on lowering your electric bill during summer.

Previously, we have reduced our cable bill, by reducing it to basic TV service and internet. Now we add whatever paid service that works for us – and only one at a time. We have smart TV’s and can access programming through the internet apps that are free. We use our local library’s digital collection for free. Right now, we are using Sling TV for other channels. In total, we spend about $110 a month total, by reducing the cord. Hopefully, one day we can totally cut the cord!

We have also not renewed most magazine subscriptions and cancelled memberships. For our warehouse club, I had to go into our profile and uncheck automatic renewal. If you do this, remember to check that you are not being automatically being changed when you shouldn’t be.

Simplifying Buying When Not Needed

How many times have you gone out and made a purchase only to come home to find out that you already had the item? This used to be us.

Simplifying the kitchen is good thing makes what we need easier to locate when needed. Simplifying and organizing has been our mission. Now our kitchen cabinets and grouped together – one shelf for condiments, one for soups and other canned goods, one for pastas, etc. Kitchen cabinets a mess. Items put on any shelf and not grouped together.

Now it’s so much easier to see what is needed before going shopping and not may unnecessary purchases (all while saving money).

Simplifying One Times Use Items

Next, we are simplifying by getting iod of items the are one-time use items.

What items are in our kitchen that we only use for one purpose. These are taking up space and we can do without these. Think apple slicer, we can cut the apple with a knife. Think popsicle molds, how many times have I used them. I can only think of one time. We are working our way through the cabinets and drawers in our home. How many of these items do you have in your home?

Items are piling up and will be ready to donate soon.

Simplification – Duplicates Be Gone

Simplifying the kitchen is good thing and makes what we need easier to locate when needed. spring cleaning

During this stay at home time, we have begun getting rid of duplicates. Really, how many potato peelers can one kitchen need? Not to mention the hamburger flippers, ladles and more.

We have begun going through the process of cleaning out the kitchen cabinets and drawers. I can’t believe how much we have accumulated over the years. Maybe, its time to pretend we are moving and do a deep cleaning? Think about all the money we have wasted with buying these items! It’s time to think save money instead of buying another item.

Simplifying By Doing It Ourselves

We have made choices in our lives to do things ourselves and not pay for the service. It’s a personal choice that we are happy with.

With that in mind, I want to share with you what we personally don’t spend money or reduce our spending on in our household.

Our Home:

Yard work
Spring and fall yard clean up
Snow shoveling
Gutter cleaning
Power washing
Trash / recycle – would have to ay a trash hauler as our town doesn’t provide this service
Rain barrel – we collect rain water and use this to water the garden and plants
Compost Bin – our town has a goal to go waste free, so we are able to take our food waste to the town for compositing

By doing these things ourselves, we save money each and every month that we can use in a variety of ways (reduce debt, increase savings).

Simplifying Home Improvements

If you have followed my blog, you know that we do projects around our home all the time. We typically a yearly list to do.

With more time on our hands and being a homeowner, means there is always a project / improvement that needs to be done, some by us and others by professionals.

Our first project this year was to replace the grass between the road and sidewalk with plants. Delivery trucks parking on the sidewalk and the salt from the winter storms always made this grassy area a mess. Our hosta plants needed to be split, so this solved the problem. We removed the grass and placed weed block down, added the plants and completed it with mulch. No cost to us, just labor over two weekends.

Next, we starting to replace fence panels. We are still doing this ourselves, by replacing a panels or two when we have a few hours and the weather cooperates. We’ll do what we can and at a slow pace. It sounds easier than it is, because it’s not only replacing the panel, we need to breakdown and transport the old panel to the town’s transfer waste station.

As you know, home improvement projects and maintenance are easier to do now versus having a major emergency home improvement project later.

Simplifying By Reducing

With more time on my hands, I got to thinking about what I could reduce or eliminate to save money. Honestly, I always think about this. For me, it comes down to spend that money now on something or save it for later.

What items do I purchase that I could use another option? Here are some of the things I have changed in our house:

Swapped out a magnetic white board monthly calendar for buying a yearly calendar.
Used my cell phone sharable calendar instead of the paper planner.
Changed from plastic containers to glass jars and from plastic bags to silicone reusable bags.
Using essential oils to make my own cleaners versus buying individual cleaners for parts of my home.

How much can you save by making small changes?

Simplifying Our Entertainment

Being home meant more time on my hands. For me, this could lead to more spending and I (or my budget) wasn’t going to allow that.

For us, we have reduced our cable TV to basic and have one streaming service. That’s all we have and I wasn’t going to pay for any more.

We have kept ourselves entertained with free stuff. We have watched movies on the channels that we have. I was able to watch the movie Hidden Figures that I had wanted to. I highly recommend it if you haven’t watched it. We explored a variety of free services. We have always used Hoopla from the library for free movies. We’ve toured places what we haven’t been to, such as virtual tours of museums and national parks. I’ve read many books that I was planning on reading that I never got to. We broke out our board games and played for entertainment. We have explorer new locations for our daily walks. All this without spending a penny.

If we can do this, you can too.