Foundations For Financial Freedom

Many people are living pay check to pay check and can’t understand why. Maybe you would like to enjoy your money more. 

My first question is what are you trying to achieve by getting in control of your finances?

If you don’t see an actual value in gaining control over your personal finances you won’t succeed in doing so.

Slide1.jpg

 

The foundation of good personal finances is one, or hopefully, multiple goals.

What are your goals and do you have them written down? Goals can be small or large and once one goal has been completed there is room for more. Whether your goal is to become independent from your parents, travel more, or make a large purchase such as a house or car — get in the habit of creating and keeping track of your goals.

The next step is education.

We know that most schools and even colleges do not educate people on personal finances. It’s up to you to seek the knowledge. Information about personal finances can be found easily with Google search. Podcasts, Youtube, Blogs etc. all offer free and useful information.

 

An even better way to learn is to seek out and speak to the people who have reached the financial goals that you want for yourself. For example if you want to buy a home, speak to homeowners. Ask them not only how they achieved the goal but also what were the mistakes they made along the way. Knowing what they did wrong can help you know what to avoid.

 

BUDGET         BUDGET         BUDGET         BUDGET         BUDGET         BUDGET

BUDGET         BUDGET         BUDGET         BUDGET         BUDGET         BUDGET

BUDGET         BUDGET         BUDGET         BUDGET         BUDGET         BUDGET

BUDGET         BUDGET         BUDGET         BUDGET         BUDGET         BUDGET

 

A budget does not require limited spending! Budgeting is a tool that you can use to be more aware of your spending habits. Once you know where you spend most of your money you can plan accordingly and make better decisions about spending.

Many people don’t realize how many small purchases they make and how quickly they add up. Ever go to the 99-cent store and spend way more than anticipated after picking up things because it only cost a dollar? The same happens between paychecks as we make several small purchases that we don’t view as making a dent in our cash flow. Plan ahead. Why not allocate a specific amount for specific expenses?

 homer simpson marge simpson season 16 episode 13 budget GIF

Another major component to achieve success at anything is accountability.

Maybe you’ve applied these tenets before and failed. Did you have a means of holding yourself accountable? There are several methods you can use to hold yourself accountable. One way is to find ways to make it harder to go against your plan. Another way is to set up reminders about what you planned to do. You can do this electronically using apps or personal alarms.

Another option is to pair with another person who is working towards better personal finances. Find someone you can trust and speak openly about the changes you need to make. Then check in with each other periodically to ensure that you’re following through.

 

 

Why You Can’t Pay Your Bills On Time – Some Tips on How You Can

Every one wants to get their finances in order. A great place to start is paying your bills on time. This is also a great way to build and increase your credit score. Here are a few tips to help you take charge of your finances and pay your bills on time.

 

Screen Shot 2017-03-23 at 8.35.07 PM.png

Set Calendar Reminders

Don’t be a dumb person with a smart-phone. Even the most basic cell phones have a calendar app. You can even set a repeat reminder. Make a monthly for each bill.  

Screen Shot 2017-03-23 at 7.55.58 PM.png

Choose Your Own Due Date 

This is an easy way to take control of your own finances.

Many people don’t realize it only takes a phone call to change the date of most payments. Do you g4et paid bi-weekly, the first and the fifteenth? Why not set the due date for your bills on two days that are most convenient for you?

Set up an Auto Pay

Again, one phone call can mean one less thing to keep track of once you set the payment to be automatically taken out each month. After auto-pay has been in effect a few months or years it’s easy to forget that it will come out– set a phone reminder to make sure you have funds in the accounts the bill will be taken from.

Pre-Pay

This is another option for the extra-responsible persom. As mentioned in my recent blog post What to do with your Tax Return paying off your bill a few months in advanced can be a great way to help you avoid thinking about a bill each month.

Secret Saving Strategies

Save by a percentage

1487932781910.jpg

You ever look at your paycheck and just think… “nah next week” ? We’ve all been there whether it be you got sick or took a few vacation days. What about when you get a lump sum of unexpected money — tax returns, lawsuit settlement or a family member blesses you. It’s easy to see a sum of money and want to spend it all. My advice is to come up with a number that you can use as a percent to be saved.

You might want to have two different numbers for different forms of income. For instance 15% of money from employment and 30% of unexpected cash flow. (Adjust up or down accordingly) Write down these numbers and make a commitment to save that percent each time. You’ll never be able to say you don’t have enough. If you have more bills than you do income, perhaps it’s time to level up OR maybe you can make adjustments in the way you spend your money

 

Have a Written or Electronic budget & Stick to it

Spend a month documenting ALL purchases. Aft the end of the month, come up with some categories for your spending. If you know that you need to begin saving money, look at some of the expenses you can avoid.

A budget can be created with pen and paper but why not create a google doc so that you can update your spending habits on the go from anywhere you are? There are also templates for budgets already available free in google sheets.

Once you have a written pledge for your amount to be saved, SET UP AUTOMATIC DEPOSITS. Ask your job for a direct deposit form and fill it out adding the amount you want to save each pay period.

Hide your money

Credit unions are a smaller and smarter option for a savings account. They usually do not charge any monthly fees and since they are smaller institutions, they have less locations and are thus harder to access. When it comes to saving this is an easy way to hide your money. With a Chase bank on every corner, accessing a savings account with them is much easier and may lead to impulse withdrawals. The easiest way to save money is to forget it exists. Stop hiding your money under the mattress

Secrets to keeping your credit card bill low

Credit cards are one of the easiest ways to build credit if you know what you’re doing. Did you know that in order to maintain a higher credit score you should only use one third of your maximum spending limit? Here are some ways to stay disciplined and keep your balance low Make your credit […]

Credit cards are one of the easiest ways to build credit if you know what you’re doing. Did you know that in order to maintain a higher credit score you should only use one third of your maximum spending limit? Here are some ways to stay disciplined and keep your balance low

Make your credit card harder to access.

This might include hiding the physical cards and getting rid of your easiest ways to access the card number. Samsung Pay, Apple Watches and other apps make it ridiculously easy to spend money you don’t actually have because you don’t need the physical card. Do you also have the card information saved on Amazon? I would recommend deleting these sorts of apps and only using the card for emergencies.

Plan ahead for credit card use.

“When you fail to plan, you plan to fail.”

If you’re serious about building your credit, credit cards should not be used for random items or emergencies. To really make ‘flight mile’ or ‘cash back’ card work for you, choose a high or moderately priced bill to pay every month on your credit card. Then use your checking account to pay the bill off right away. This method will show the credit bureau that you are responsible and will likely get you better credit options in the future.

Always pay more than the minimum balance.

If you’re not paying more than the minimum balance then:

Here’s why:

When you run your credit card bill up thousands of dollars and the company only asks you to pay 25 to 35 dollars a month, it seems like a great deal. Over time however you are giving away much more money to the credit company than you actually borrowed.

For example if you carry $1100.00 on a credit card that charges you 25.40% interest each. Your amount due may only be $25.00 a month but you are also adding $23.00 to your debt each month. By the end of the year you have given your credit card company $276.00 of your hard earned money.

What to do with your Tax Return

The W2′s have been printed! Most returns are on their way if not received already. Rather than blow your refund on a shopping spree or trip to D.R. here are some ideas that will benefit you throughout the year.

Open a Savings Account or Other Long Term investment

Your local credit union more than likely offers a better interest rate than a popular bank such as TD. Open a savings account and put in a percentage of your return. Then LEAVE IT until the following year (at least). Depending on how much you put in, you may be surprised at the amount of interest earned. This money can also be used as a rainy day fund.

Pay off a bill for the year

A great way to build credit is to set up an automatic payment for one of your bills. Call the companies that you pay each month and inquire about whether they offer bank accounts. Often there’s a benefit to setting up an auto-pay account with the company you owe.

For example, my auto loan is automatically pulled from an account with the same company that financed my car. Each year I put the amount needed to pay the bill for the next 12 months. In return the company gives me a lower interest rate for my car payment. They also report to the credit bureau that I pay my bill on time each month- which increases my credit score.

Online accounts are a little harder to access (which can be a great thing!) but they often come with great perks such as ATM reimbursements.

Pay off Debt

I personally hate to owe money. Usually the more money you owe, the more you are charged. Before spending a lump sum of money on clothes or shoes, pay back money owed – It will save you money in the future.

For example if you carry $1100.00 on a credit card that charges you 25.40% interest each. Your amount due may only be $25.00 a month but you are also adding $23.00 to your debt each month. By the end of the year you have given your credit card company $276.00 of your hard earned money.