Today, I am doing a workshop, Money Make The World go Round at Empower Her for kids ages 8 to 11. We are going to discuss budgeting, wants, needs with the help of a fun game!
Summer is coming and that makes me think of vacations. You might be saying, here they go again! You may be right, but not yet. There are a couple planned for later this year.
• Noodles / Rafts / Tubes / Snorkel Gear
• Soft-sided cooler – we have one that the freeze pack is a part of the cooler
(one less thing to carry along)
• Entertainment – playing cards, games, etc.
When we travel to a destination, we try to reserve a unit with a kitchen or at least a fridge. This saves us so much money by being able to make and bring our own meals. You might be thinking cooking on vacation – ugh! This can be as simple as having breakfast, beverages and snacks from a grocery store versus paying restaurant or resort prices. Picking up a bottle of water at the store is much more cost effective than buying a bottle at pool side.
Here’s an example of what we do. We bring as much as possible, especially things you won’t finish, like steel wool, paper plates, herbs and more. Next, we place an online order (if that is possible) from the grocery store before we leave. Then we either pick up the order at the store or have it delivered to where we are staying. Having some or most of your meals at grocery store prices saves money. Yes, we still do go out for some meals – just not all.
Remember that you typically cannot bring meat, fruit or vegetables out of the US and into another country. Usually, you can bring sealed items in their original packaging. Here’s one of our suitcases.
If you want a copy of my food packing list, email firstname.lastname@example.org and I will share it with you.
Spring is a great time of year! One of my favorites, as the weather turns warmer and the days are longer. For us, it means more time outside and that can be from getting my garden planted and the thrill of fresh vegetables right in my backyard, to having meals outside; either just us or with friends and family. We can open the windows to air out the winter stale indoor air and sleep comfortably with the windows open all night. It means exploring the outdoors, maybe taking a walk in a new neighborhood or park, picnics and movies in the park.
With spring comes weddings and graduations – new beginnings. This can be true for all of us, even if we don’t have a milestone event coming up.
Traditionally, spring makes me think of spring cleaning and tackling the heavier cleaning throughout the house. We can do the same for our finances. For the graduate, you can start them off with the gift of good finances – being able to start to plan their money and finance proactively and make planned purchases versus impulse buying. A great way to start would be the gift of my book, Cash Credit and Your Finances: The Teen Years.
For those who want to get your own finances back on track, 111 Ways to Save or Thrive In Five: Take Charge of Your Finances in 5 Minutes a Day will give you the push you need to get your finances in order.
You can order my books through my website or by order form. If you use the order form, you have the option of me personalizing the book. Just print the order form, fill out the recipient information section, and mail it to the address on the form or fax it to 203-504-7995. For the month of June 2017, we are also offering free shipping on all book sales that are ordered with the order form via mail or fax.
The age-old question of payoff debt versus an emergency fund – which is more important?
If you have debt, then you know that the interest you are paying is a drain on your finances. You are correct, that interest is a waste of your hard-earned money. You know that you need an emergency fund and you have been meaning to start one, but you just don’t have the money.
Which should you tackle first? Let’s assume you have $500 in your budget to work with and we will look at a couple of scenarios.
#1 – You have debt totaling $10,000 and you are paying the minimum payment of $250 per month at an interest rate of 20%. It will take you 67 months (5+ years) and you will have paid back $16,750 ($6,750 in interest). That’s assuming you don’t take on more debt.
Then you put the remaining $250 to start your emergency fund.
#2 – You increase your payment on your debt to $500 per month. It will take you 25 months (just over 2 years) and you will have paid back $12,500.
You will not be starting your emergency fund until after the debt is paid. What would you do if an emergency expense happened? How would you pay for it?
As you can see, the answer is somewhere in the middle and you can think outside the box for faster results. You could look into reducing the interest rate on your debt – refinancing, balance transfer for a lower interest rate etc. The quicker you payoff the balance, the less you will pay in interest.
You need an emergency fund to be prepared for whatever happens in life. You will want to start to save something on a regular basis each and every month, even if you have debt.
Have you ever written down a budget to see where your money is going? Well, we did this earlier this month and everything looks fine, meaning that we make more than we spend.
That means we can pay our bills – great! That’s check one. Check two – are we saving enough? No, we we’re not, but where do we get the money? We won’t find extra money to save until we find out exactly where our money is going.
If you want to do this process with me, follow these steps:
1. Write down a couple of short and long term goals, so you’ll be inspired to do the work.
Short term goals can be planning for a vacation, buying a car, paying down debt, saving for something that you want, and starting an emergency fund.
Long term goals can be saving to purchase a home, saving for your children’s education, retirement planning, and paying off debt/mortgage. What are yours? Imagine what you want or need and write it down now.
2. Track every penny you spend. That means finding a way to record your spending as it happens.
Don’t wait until the end of the month and use your bank statement or receipts. A single store can fall under many spending categories and receipts don’t always list items by name (or by names that you can decipher). Don’t think for a minute that your grocery store trip can be lumped under food. You may buy your pet food there, as well as cleaning supplies, shampoo, or even magazines.
I know this sounds time consuming, but it’s worth it. You can carry a pen and pad with you and write down everything by hand. Another way to track your money is by using a phone app. Choose the way that works best for your lifestyle.
3. Write your totals in a budget worksheet to see where you stand.
Once you see a month’s worth of numbers, than you can begin to analyze what is going on. With this clear picture, you can make changes – lower bills to save money, get rid of unused services, check out the competition to switch etc.
Tell me what you have discovered with this exercise. Next issue, I will tell you what we have changed.
There are times in our lives that we are not able to pay all our bills. Maybe we have lost a job, had a medical illness or other life circumstance. Not being able to pay your bills is one more stresser added to the mix.
I will give you my advice, but please know that you should check with your professionals for what is best for you and your situation before taking any action.
There are several types of bills categories we have:
Utility Bills – You may have noticed that these typically don’t appear on your credit. Yes, you are correct. When your utilities are paid on time, they don’t appear on your credit report. When you are late, most utility company will report the delinquent payment information to the credit reporting agencies. Or even worse, they may send the account for collection and that will appear on your report.
Credit Cards – This is a double-sided question. You want to be able to have credit in case you need it but you can’t afford to pay the credit card. The best possible option when you can’t afford to pay your bills, is to be able to pay the minimum amount due on all your credit cards each and every month. If not, then you want to contact your credit card companies to work out an agreement. You don’t want your credit card companies to send your account to collections and/or small claims court. Both these options will negatively affect your credit.
Non-Credit Bills – These are debts you owe that don’t appear on your credit usually (i.e. your auto mechanic, cell phones, tax bills, medical etc.). You might be thinking that you can ignore these bills, but that’s not the case. Not paying these can lead to judgments and judgments have serious consequences on your credit report. Try to work out payment arrangements to keep this from happening.
In difficult times when money is tight, you may need to access your credit to get by. You will need to keep these tips in mind so that you have that option available to you. Even when you are unable to pay your bills as you have when you making more money, these tips will come in handy.
This newsletter, we are going to talk about spending too much! Personally, we upgraded the master bedroom and bath. In addition to the insurance deductible, we added on the additional expense of better bathroom fixtures – granite counter, higher end faucet, natural stone ceramic tile and more. Yes, we did spend more (maybe too much). With a new year beginning, we need to reign in our expenses and rebuild our savings.
If your 2017 goal is to track your expenses and come up with your actual budget, there is an exercise I like my clients to do when they have their budget created. Take out two different color highlighters. Use one color for your fixed expenses (amounts that can’t easily change) and then use the second color for expenses that you can adjust or eliminate. Typically, I see three areas for the adjust or eliminate category:
- Penalty fees (late fees, overdraft, over limit, etc.)
- Do it yourself fees – these are things that you pay others to do that you could do yourself and save money (lawn maintenance, snow removal, housecleaning, coffee, manicure / pedicure, laundry, trash pick-up, etc.)
- Life extras – these are the things that you do that you could reduce or live without (entertainment, movies, concerts, dinning out / take-out food, personal care, etc.)
Now make a list of five ways to reduce or eliminate specific items. For example, I could find a teen to shovel my snow versus paying a snow plowing service.I could download a movie for free (Hoopla) or borrow from the library versus renting and not returning on time and incurring a late fee. I could balance my checkbook regularly to know how much money I have available and not incur an overdraft fee. These are just a couple of ideas. Now make your list and track your savings. How much did you save this month? How much would that be in one year?
Are you getting the hang of it? Are there more ways to reduce or save on your expenses? Share what expenses you have reduced or eliminated by 5pm EST on March 10, 2017 as a comment below and you could win a copy of my new book 111 Ways To Save. Three winners will be selected randomly at the end of March.
Welcome to 2017. My goal for you is to keep you informed and assist you with your personal finances. Remember, that no one cares (or should care) about your finances as much as you should. This may be shocking to some, but it shouldn’t be. You have your best interests at heart.
From time to time I meet people who say that someone else handles the finances and they are uninformed. That’s not good enough. Every single person should know and understand their own finances individually and as a couple. So make this year the year that you make your personal finances your goal.
To get from where you are today to being in the know, step one is to make your finances a priority in your life. With that said, I don’t what to overwhelm you. Let’s start with a few easy questions, although the answers may be tough:
$ What do I earn? Sounds simple, but do you know the answer?
$ What do I own? These are your assets – your home, car, etc.
$ What do I owe? That’s a hard question for some to actually face.
I am going to give you a hint about the answers.
The first two questions should be upward moving numbers. What you earn now should be more than 10 years ago. The same with what you own. The last question should be downward moving number, unless you recently took on a mortgage.
These three simple but complex questions, are the start to being informed about your own finances.
Take some time to answer these questions and you will be more informed about your finances.
Stay tuned for more articles to get you aware of your finances.
The holidays are coming! The holidays are coming! You probably know this and the retail stores are starting the holidays off during the summer. From Labor Day weekend, I see the holidays all over the place in retail stores. I’m thinking the beach and heat and they are thinking December. While it’s not bad to plan ahead and be proactive, it’s too early for me, but it’s never too early to think about your budget.
Tipping is always something that comes up around this time of year. Here are my thoughts and what we do.
First, we don’t wait for the holidays. In my opinion, good service doesn’t have to wait until the end of the year. If someone goes out of their way or does an exceptional job, then by all means tip them. A while back we bought dining room chairs and the person in the store took the time to go out of his way. That deserved a tip then and there.
Second, give what you can afford. While it’s nice to give cash and to be able to give to everyone, that may not work for your budget. You can thank people verbally and express your gratitude with a conversation, special note in a card, contact the company or supervisor and express the great service you received, instead of cash. I have made calls to the airline to express how grateful we were for a particular person and the excellent service we received. Rarely do companies get calls like this and they can seem shocked at the call.
This is my plan of attack. Create a list people in your life and here are some examples:
Mail Carrier / Package Delivery
Personal Care (Hair, Nails, Massage)
Child & Elder Care
House Cleaner / Lawn Care / Snow Removal Care
Pet People (Groomers, Walkers etc.)
Doorman / Maintenance Workers
Assistants / Key Employees
Then make a plan. If you were to tip everyone in one week, you would break the bank. I like to start after Thanksgiving and end this by New Year. Now if you have decided on an actual tip, it can take the format of the cash or possibly a cash gift card, unless you know them well enough to pick a specific merchant’s general gift card. Spreading out the tipping, helps my budget. Plus, I like to do this in person. So when I have a service done, that’s the time I tip, and again throughout the year helps my budget as well.
Finally for cash tips, make a trip to the bank and get nice new crisp bills and have thank you or blank note cards. People who get many tips need to know who they received it from, so a short thoughtful note handwritten in the card works well. It always is so much nicer to give a tip with a good presentation. I feel that the recipient thinks you took the time to think about them versus handing them crumpled bills from your wallet.
Not sure how much to give? That’s entirely up to you. There are many guides on the internet to assist you, but ultimately it’s your choice. Make your plan now so that you check one thing off your holiday to do list.
Finances don’t have to be difficult, but there are things you need to think about when you get into a relationship. You have a way of handling your finances and it’s worked great for you and you like the system.Your partner has a way of handling their finances and it works for them. Seems simple enough. Then you find out that you do things totally opposite. Now what?
You have to come to a compromise that both of you are comfortable with. First, start by really listening to your partner and putting yourself in their shoes. It’s hard to do, but it’s really important. Listen to their reasoning and why they do what they do. Then have the same conversation with the roles reversed. Now come up with a negotiated and agreed upon game plan.
This will take multiple conversations and time. If you both agree to the plan, you have conquered the first hurdle. Here are some of the questions you need to come to an agreement on:
$ What are our goals / what do we want to achieve?
$ How do we get there?
$ Who is going to be responsible for what? Think bill paying, savings, spending, bank reconciliation, credit, debt, investments, retirement, and more.
I have seen this work in many different ways. Here are a few examples:
They keep everything separate. Each person keeps their own income in their own bank accounts.They have agreed to who pays for what bills. Each handles their own investments and goals.
One person handles the big/long term items of the finances and the other handles the day to day finances. So long term is for the future – investments, retirement, savings, college, home buying, etc. and short term are more of the daily finances – bill paying, household purchases, routine items that are in the day to day budget.
The do everything together philosophy. All happens with a meeting of the minds and each person is involved in all aspects of the family finances.
No matter what you choose and how you choose to handle your finances, it all starts with communication and a game plan. All people should know what is going on, where to find the information and how to access it. After my mother died, my father had a hard time figuring out the finances, as he wasn’t involved with them.
Make your joint choices and know that you have the option of trying and changing until you find what is right for the both of you.