Jill Russo Foster

Tips for Successful Personal Finances

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Credit Report Reminder from Jill Russo Foster: Start 2013 with good financial information

It’s January 2013! Time to start the year off right!

This month use Experian

credit_report_januaryHello, it’s Jill again, reminding you to get your finances in order for the New Year by checking your credit report.

Order your credit report from www.AnnualCreditReport.com. This is the ONLY authorized source for the no cost annual credit report that’s yours by law. You have the right to know. Exercise your rights! Learn more.

When ordering online:

  1. Select your state, then click Request Report.
  2. Fill out your information, then click Continue.
  3. When it asks you to select a service, select Experian.

Not comfortable ordering online? There are three ways you can order your report:

  • Order online at www.AnnualCreditReport.com. By ordering online you can have your report back in minutes!
  • Mail your postal order by downloading the form at www.AnnualCreditReport.com
  • Call in your order at 1-877-322-8228

It doesn’t matter how you get your report, the most important thing is that you do! Then…

  • Review it for accuracy!
  • Follow the instructions with the report to correct any errors.
  • And, always remember to keep copies for your records.

Were you hoping to get your credit score instead? Try CreditKarma.com. CreditKarma does not supply a FICO score, but it does provide scores from TransUnion and VantageScore. And, there’s no charge for you. CreditKarma funds their service through website advertising.

May you have a blessed and successful year!

Jill Russo Foster

P.S. I’ll give you another reminder in May and September to help you stay up-to-date on your credit throughout the year.

Get things done to start the year right!

NewYear-resolutionsThere are several things I do in January to make a fresh start for myself and my family.

I take the credit cards out of my wallet and put them in my copy machine. Why do I do this? So, I’ll have up-to-date information on my cards in case my wallet is lost or stolen. If you want to do this, too, make sure to spread your cards out on the paper so you’ll have room to hand-write the contact phone numbers found on the back of the cards. This serves a few purposes:

  1. You won’t have to go online or search past bills for contact numbers in case you need to cancel those cards in a hurry.
  2. You will know exactly which cards you need to call on, and,
  3. You’ll remember to take the credit cards off the copier.

I set new files for 2013.  This includes my accordion multi-pocket folder for this years’ tax information.  If I am organized at the start of the year, I will be all set for the accountant at year end.

I shred our paystubs when the W-2’s come in. Check to make sure they agree first!

We review last year’s bills. We really like to save money on every day expenses so we can afford the the things we really enjoy. So, we look at how we’ve spent our money in the past year to see if we can make any improvements.  In the past, we have deregulated our electric, lowered our cell phone package, and cut out TV channels we don’t watch.  We have made choices about what subscriptions to keep and what not to renew, keeping only the most useful magazines and memberships.

January is a month we plan our extra spending. These are the expenses that aren’t in the usual monthly budget, but are essential to our standard of living. If you want to plan your extra spending, here are some examples and tips:

  1. What do you want to do this year for fun?  We usually already have a vacation or two in mind.
  2. What big events are taking place for your family or circle of friends?  You usually know a year in advance if someone is planning a family reunion or getting married. Be sure to factor in travel costs.
  3. What home projects do you need or want?  With this past year’s weather, you may be thinking it’s time for that major improvement to your home.

If you need to spend money to have it, then it’s worth planning ahead.  It’s so much easier and less stressful to have the money saved than to try to figure out where can to get the money at the last minute.

Happy Holidays!

Wishing You a Peaceful Holiday Season
and a Prosperous New Year!

What Free Teleclasses Can I Offer You?

Take the survey and tell me what you need to know!

You will be entered into a drawing to win a free 30 minute coaching call with Jill Russo Foster. On the call, you can ask any financial question you need to know in complete privacy and confidentiality.
 
Thank You!We have some exciting things happening here for 2013. We’ll be offering free teleclasses with you in mind. The topics will be based on the answers you give in the survey and your suggestions.  This is your chance to make 2013 the best year for you and your finances.

Everyone who takes the survey will be entered into a drawing to win a free 30-minute coaching session. Feel free to share the survey with your friends and family and give them to a chance to win! You can spread the word by sharing the links to my Facebook, LinkedIn, and Twitter accounts or my blog.

Take the survey here!

Of Breakups and Closed Accounts

In our last issue, we discussed whether you should blend your finances when you get into a relationship. Money will be your biggest source of friction, and having boundaries doesn’t hurt. I listed some of the different financial relationships couples choose. There are different options besides “What’s mine is mine and never ‘ours’ or “It’s all or nothing or I’m out of here.”

Sometimes your best efforts to create a life together fail, and the relationship ends. Today, we’ll discuss how to unblend your finances. Whether you decided to share all of your accounts, or only share expenses, you should separate your finances as soon as possible, because you can be sure that someone’s name is on the wrong paperwork.

Take a look at your…

  • Rent or Mortgage: Who is on the lease agreement or loan? It should be the one who actually lives there. Ignore that piece of wisdom and risk having your home sold out from under you.
  • Utilities, cable, and cell phone: Whose name is on the accounts? They should be in the name of the person using them. If you don’t transfer ownership, you could have your utilities cut off without notice.
  • Insurance: This includes car, apartment, home, life, and medical. You don’t want to be without insurance, and you don’t want your money going to the wrong person if you don’t update your beneficiaries.
  • Credit cards and loans: Do you want to have your credit affected by charges that aren’t yours, or be forced to make payments on a car you don’t use?

“But Jill,” you say, “these all sound like things that happen in a hostile breakup. We’re not like that.”  Even if your breakup is friendly, and your ex is as trustworthy and competent as a super hero’s alter ego, you still need to separate your accounts to protect yourself in case something happens to one of you. If one of you dies, or is mentally incapacitated, the law won’t recognize verbal agreements or promises. They only see whose name is on a piece of paper.

Let’s talk about verbal agreements. Let’s say the house and car loan are in your name, but you want to be nice. You don’t need them, and your ex does. Your ex has agreed to make payments, so it’s no big deal, right?

Wrong. Your credit will take a hit with the first missed, or late, payment. And, you may not be able to get a new car or house for yourself because your debt to income ratio is too high. The bank won’t take verbal agreements with your ex into consideration when you apply for your loan.

Here’s something else to think about: Can you maintain your current lifestyle if you live separately?

If you end up with the house or the car, can you afford the payments? Can you pay for the utilities, the maintenance and the insurance? You may have to make tough decisions, because you could be without the things you need to live if you don’t plan ahead.

Too many people have  found themselves temporarily homeless, or had their credit ruined, after a breakup. Don’t let this happen to you.

Of Love and Shared Bank Accounts

love and money

I recently led a discussion about relationships and money: how to blend, and end, your finances with someone else. Questions were asked, and there were some interesting conversations going on in the room. Then, a few weeks ago, a long time reader of Quick Tips asked about shared bank accounts. I decided it was time to write about this subject again.

First of all, you may choose not to blend your finances at all. Many couples keep separate accounts and actually have happier and more successful partnerships because there are fewer arguments about who spent money on what and who overdrew the bank account. Others choose to handle their money and debts together, and they do just fine. The choice is yours.

Look at your habits and goals when you consider whether to combine your accounts or keep them separate:

  • How does each of you handle savings and debt repayment? Do you have similar philosophies, or are your bank balances mirror opposites, with one carrying a large debt balance and the other carrying a large savings balance?
  • Do you have the same financial goals? Or, is one of you saving mainly towards retirement, while the other wants to save for amazing vacations and a nice car.
  • Does one, or both, of you have any issues that you would bring into a blended financial arrangement? For example, are there any debts that are currently in collections or that were charged off; bankruptcy; judgments; wage garnishments; or tax liens?

Some people find this subject to be a touchy one. I even received an angry comment on my blog by someone who insisted that married people should share everything equally. But, keeping separate accounts isn’t about holding out, or being less in love. Sometimes, it’s about protecting each other and making decisions that will carry you furthest towards your mutual goals.

If You Have Separate Accounts, How Do You Split Expenses?

Most people assume 50/50, but there are other options. You could choose different percentages based on incomes, family size, habits and hobbies. For example, if you have shared custody of your 3 kids with a former partner, then you might pay a higher percentage of the food bill. If your hobby raises the electric bill (gaming, woodworking, sewing), then you might pay a higher percentage of the utilities. You don’t have to use percentages – you can divide up the bills, where one of you pays for this expense and the other pays for that expense. The choices are as varied as the couples who make them.

The bottom line is that you need to make informed choices that are right for you individually and as a couple. Money is the biggest source of friction in relationships. Have the conversation before you get married or move in together, so you know what to expect ahead of time. If you’re already living together, it’s not too late to make changes.

Next issue, I’ll talk about separating your finances after the relationship ends.

One if Full Price, Two If Black Friday

The holidays are coming! The holidays are coming! Guard your budgets and hold onto your wallets. You might be thinking I’m crazy, but the retailers have positioned their holiday displays to disarm you of your cash.

Now is the time to remember how you felt last year when you overspent.

Can you make this year different?  Can you stick to your list and not overspend?  You can if you make a detailed plan. Write down exactly what you will be buying and the dollar amount you plan to spend.

Here are some suggestions that should help you with your holiday budget list.

1. Gifts

  • How much for immediate family?
  • How much for extended family?
  • How much for friends and co-workers?
  • How much for people whose services you use?

2. Entertaining

  • How much will it cost when you host a gathering?
  • How much will you spend on hostess gifts when you attend a party?

3.  Travel

  • How much will it cost for local travel (gas, tolls, parking, etc)?
  • How much will it cost for long distance travel?
  • How much will it cost for vacation?

4. Traditions – this can be anything from an afternoon tea to a night on the town.

If you write it all down, you might realize you’re planning on spending $300-$500 on gifts for people who aren’t on your immediate family list. And hosting dinners can be expensive just because you want to put on a good appearance. Ever notice a big stain on the tablecloth and found yourself running to the store at the last minute to buy one full price?

Holiday fun can wreak havoc on your budget, but it doesn’t have to.  Now is the time to get a jump start on planning, and to put away money for the details that are important to you. Think of it as your own layaway plan. Take money out of each check, in addition to your regular savings deduction, to create your own holiday fund.

Doing this now will make January 2013 less stressful.

What I Learned about Money from Sitcoms

I love to watch old sitcoms on TV Land and Nick at Nite. They’re like comfort food for the brain. I’ve seen the episodes already so there’s no suspense, and I certainly don’t expect to learn anything.

But sometimes they surprise me.

A couple of weeks ago, I was watching reruns of The Nanny. In the episode “Close Shave”, Fran is having trouble paying her credit card bills.

Here’s the conversation between Fran and Niles:

  • Fran: I have to pay my American Express because if I buy a piece of gum, the S.WA.T. team storms the building. Meanwhile, I pay my MasterCard with my Discover Card, my Discover card with my Optima Card, My Optima Card with my City Trust Visa.
  • Niles: But doesn’t that leave a very high balance on your Visa?
  • Fran: Exactly! And that’s why they gave me an espresso machine which I sell to pay off my American Express, thank you.

This reminded me of the Cosby episode “Theo’s Holiday.” It’s the one where Theo wants to move out using money from a modeling career (that he doesn’t have). Cliff and the family show him the real costs of living on his own.


(Start at 3:32) To see the full episode watch Part 2 and Part 3

For sitcoms, these episodes are very realistic in the way they portray people who are uninformed about money. But, the solutions weren’t realistic at all. How nice would it be if we could solve our problems in 23 minutes just like they do on TV?

Now, imagine you’re a child watching the same episodes for the first time. What would you learn? There’s a telling discussion on TV.com.

How will your kids learn about money? Will they learn from TV, or because you took the time to teach them like Theo’s family taught him? What about yourself? You’re old enough to know that your problems won’t magically go away like Fran’s. Be informed and make informed choices that are right for you.

People want their finances to be perfect – like a TV show. But most of us don’t go from a plan to success by receiving a windfall. There’s usually a long journey and detours in the road.  What matters most is how you get yourself back on track.  Keep yourself moving forward towards your goal and you will accomplish it.

And, if you need a little comfort, try an old sitcom. They’re cheap, there are no calories and you might learn something… but don’t count on it.

Facts about College Kids that Scare Me

Magic ATM

Where do kids learn about banks and credit? I have gone into many schools and spoken with many teens about money. There are always a handful who say things that startle me.  I have heard things like…

  • Do I really need to pay credit cards back?
  • If paying bills bothers people, why don’t they just throw the bills away?
  • I know I have money left in my checking account because I still have checks.
  • Why do people need to work when they can get money anytime they want with an ATM card?

Sound unbelievable? Not only are these ideas commonly believed by kids, but there’s a logical thought process behind each one. If you don’t explain what you’re doing, your kids will make assumptions about money based on what they hear you say and what they see you do.

Take the idea that money from the ATM is free for you anytime you need it. The boy who believed that probably heard his parents complain about not having any money, then watched as they took money from the ATM. What other conclusion could he have drawn?

The idea that you don’t have to pay your bills back comes from a general assumption about the world based on ideas of fair play. You don’t have to run laps in gym if you have a sprained ankle. You can take a make-up test if you have a sick day. Why can’t you just put off the bills if you don’t have money because you got sick? If you can’t pay, they shouldn’t expect you to. That’s fair, right?

But kids grow out of these crazy ideas, don’t they. It’s not like they hold them onto them into adulthood. Trust me, they may not believe the exact same things, but their misconceptions and ignorance can still hurt them.

Here are some scary facts about college kids and credit cards from credit.com:

  • 91% of undergrads have at least 1 credit card
  • Undergrads have an average of 4-6 credit cards (that means more than half have more)
  • $3,173 is the average amount of undergrad credit card debt (that’s not including student loans)
  • 25% of undergrads have paid late fees
  • 15% of undergrads have paid over limit fees

Does this scare you?  It scares me!  Don’t let your kids make assumptions. Teach your child about money and credit by speaking with them. You don’t have to be perfect (no one is), but showing your child the process behind your decisions can be eye-opening.