expenses http://www.wisebread.com/taxonomy/term/11371/all en-US 5 Steps to Successful Budgeting http://www.wisebread.com/5-steps-to-successful-budgeting <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-steps-to-successful-budgeting" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/building_a_tight_household_budget_0.jpg" alt="Building a tight household budget" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Budgeting is one of the most important tenets of personal finance, and it's no small thing. Everyone should know exactly what goes into making a budget &mdash; it dictates your current living situation, and determines how much you can save to support your future living situation. Follow these five steps to get started.</p> <h2>Step 1: Automate essential, recurring living expenses</h2> <p>Let's start with the basics: Add up all monthly household income and make a list of all necessary monthly expenses, like housing, utilities, and groceries. Since these are nonnegotiable expenses, take time to set up automatic payments to cover as many of these items as you can. In many cases, you can even choose the day you'd like your bills to be debited from your account, so consider when you get paid each month. Arrange to have your bills automatically deducted when you know you'll have cash available.</p> <p>Next, subtract your bills from your income. If there's no money left over after paying your bills, or you're not able to cover your bills, there are only a few viable options: Make more money, get another job, or spend less. If you've got extra money after paying your bills, move on to step two. (See also: <a href="http://www.wisebread.com/build-your-first-budget-in-5-easy-steps?ref=seealso" target="_blank">Build Your First Budget in 5 Easy Steps</a>)</p> <h2>Step 2: Automate savings</h2> <p>Generally, you'd like to get your personal savings rate to 15 percent of your gross income. If you're saving for other big-ticket items, like a home or college education, in addition to retirement, you may need to save more. Yes, everyone's situation is different and everyone is at a different point in their lives &mdash; but if you have available cash, you should be saving <em>something</em>. Set up automatic transfers from your checking account to your savings account on the same schedule as your other essential bills. (See also: <a href="http://www.wisebread.com/5-ways-to-automate-your-finances?ref=seealso" target="_blank">5 Ways to Automate Your Finances</a>)</p> <h2>Step 3: Establish a debt reduction plan</h2> <p>Debt and credit are vital aspects of our financial system and allow individuals to accomplish their dreams, like owning a home or paying for college. But high levels of consumer debt, including student loans and credit cards, can stunt your ability to save and can negatively affect your borrowing ability. One common benchmark is to limit your consumer debt repayment to 20 percent or less of your <em>net </em>monthly income.</p> <p>If you're having a hard time meeting your financial obligations and goals because of a heavy debt load, make a list of all outstanding debts owed, including the total amount due, monthly payment, and interest rate. Always make at least the minimum payment due on all accounts to remain in good credit standing. (See also: <a href="http://www.wisebread.com/5-day-debt-reduction-plan-pay-it-off?ref=seealso" target="_blank">5-Day Debt Reduction Plan: Pay It Off</a>)</p> <p>Next, focus on one debt &mdash; either the lowest balance or the highest interest rate &mdash; and send any extra money that you may have toward that debt. When that debt is paid off, take the money you were sending to that paid-off debt and redirect it toward the next debt in line. Continue this process until all debts are paid in full. If you're struggling to come up with a workable repayment plan, check out PowerPay.org, which offers a free tool that you can use to run various payback scenarios that can illustrate how to best utilize any extra funds you have to pay off your debt. (See also: <a href="http://www.wisebread.com/snowballs-or-avalanches-which-debt-reduction-strategy-is-best-for-you?ref=seealso" target="_blank">Snowballs or Avalanches: Which Debt Reduction Strategy Is Best for You?</a>)</p> <h2>Step 4: Commit to a spending plan</h2> <p>Once you've met your financial obligations for the month, including bills, savings, and debt, your lifestyle expenses are dictated by your remaining balance &mdash; not the other way around. After tracking your spending over a period of time, you should have a clearer picture of your money habits as well as where your money is going and where you can make cuts. Start with your monthly bills and look for ways to trim some easy expenses, like your TV or phone services, or setting a tighter food budget.</p> <p>Then examine your lifestyle spending. If you find that you overspend in certain areas, try using an <a href="http://www.wisebread.com/a-comprehensive-guide-to-the-envelope-system?ref=internal" target="_blank">envelope saving method</a>, whereby each month you take out a set amount of money for a specific expense &mdash; like eating out &mdash; and put cash in an envelope marked specifically for that expense. Spend only what's in that envelope and when it's empty, there is no more spending on that area for the month.</p> <p>There are various recommended spending and saving plans out there, but I'd argue that as long as you're meeting the obligations in steps one through three, you can go ahead and spend the rest of your cash flow however you'd like.</p> <h2>Step 5: Account for irregular expenses</h2> <p>This may be one area that everyone overlooks. We all have a few bills that come only once or twice a year. Whether it's an insurance premium or a property tax bill, these infrequent yet yearly expenses can ruin a budget fast if you don't plan for them. Setting up a cash cushion in your checking account or keeping a separate reserve fund can help prevent you from having to dip into your emergency savings to cover these bills.</p> <p>One straightforward way to account for these expenses is to divide the total amount of irregular yearly bills by 12 and set that amount aside every month as part of the cash buffer in your checking account.</p> <p>Irregular expenses also include special occasions, like birthdays and holidays. Here's a neat idea I heard about recently: Choose an amount of money you'd like to have saved for something; for example, Christmas. Divide that number by 12, and every month, buy a store gift card for that amount. This probably works best if you choose one or two stores that you can buy various gifts from, like Target. By the time Christmas comes along, go ahead and spend only what you have saved on the gift cards. It can be a somewhat painless way to save a good amount of money, and by using the store cards, it can protect your savings account from overspending during this time. (See also: <a href="http://www.wisebread.com/5-common-budget-mistakes-you-can-fix-right-now?ref=seealso" target="_blank">5 Common Budget Mistakes You Can Fix Right Now</a>)</p> <p>Your budget is your personal financial blueprint; it determines where you are and where you're going. That's why getting it right should be a priority for everyone.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-steps-to-successful-budgeting&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Steps%2520to%2520Successful%2520Budgeting.jpg&amp;description=5%20Steps%20to%20Successful%20Budgeting"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Steps%20to%20Successful%20Budgeting.jpg" alt="5 Steps to Successful Budgeting" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/alicia-rose-hudnett">Alicia Rose Hudnett</a> of <a href="http://www.wisebread.com/5-steps-to-successful-budgeting">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-money-fixes-you-can-make-when-youre-stuck-inside-because-of-the-weather">7 Money Fixes You Can Make When You&#039;re Stuck Inside Because of the Weather</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-budgeting-skills-everyone-should-master">11 Budgeting Skills Everyone Should Master</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-budget-mistakes-you-can-fix-right-now">5 Common Budget Mistakes You Can Fix Right Now</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-an-all-cash-diet-right-for-you">Is an All-Cash Diet Right for You?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/easy-budgeting-for-people-who-hate-math">Easy Budgeting for People Who Hate Math</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting automating avalanche method bills debt repayment Envelope system expense tracking expenses organization snowball method spending plan Fri, 15 Jun 2018 08:00:21 +0000 Alicia Rose Hudnett 2148338 at http://www.wisebread.com 5 Things to Consider When Buying a Larger Home http://www.wisebread.com/5-things-to-consider-when-buying-a-larger-home <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-things-to-consider-when-buying-a-larger-home" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/family_holding_keys_to_new_home.jpg" alt="Family holding keys to new home" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>That two-bedroom home near the heart of the city was perfect when you and your partner first bought it. But ever since you started a family, that once quaint home feels crowded. It's time to upsize to a larger residence. This is a big move with plenty of factors you need to consider before you make an offer on a sprawling home in the middle of the suburbs.</p> <p>Are you financially ready for the extra expense that comes with a larger home? And what are you willing to sacrifice to get that extra square footage? If you want that new home purchase to be the right one, you need to consider some key questions.</p> <h2>1. Can you afford it?</h2> <p>Bigger homes come with bigger price tags. But the sales price isn't the only inflated cost you'll face when upsizing.</p> <p>Bigger houses come with bigger property tax bills. You'll also have to spend more in homeowners' insurance to protect that home. Then there are the utility bills. A larger home costs more to heat and cool than a smaller one. If your big home comes with a sprawling front and backyard, will you mow the grass yourself or pay for a landscaping crew?</p> <p>Before making an offer on an upsized home, consider all the extra costs that come with it. Study your existing household budget and determine if the actual costs of a bigger home fit in. (See also: <a href="http://www.wisebread.com/7-added-costs-that-come-with-a-bigger-house?ref=seealso" target="_blank">7 Added Costs That Come With a Bigger House</a>)</p> <h2>2. How much space do you really need?</h2> <p>You might just need an extra bedroom or two, but not a three-car garage or an added office space. If you'd never use that extra room or space, it'd just be a waste of money.</p> <p>When looking at homes for sale, consider the way your family lives. If you don't do much cooking, you probably don't need a huge, state-of-the-art kitchen. If no one works from home, you likely don't need a home office. You can save money by buying a home that only includes the space your family needs, or will need as you add children. If your family is growing, having extra bedrooms is key. If you have young children, extra outdoor space is another plus. (See also: <a href="http://www.wisebread.com/5-best-neighborhood-features-for-new-families?ref=seealso" target="_blank">5 Best Neighborhood Features for New Families</a>)</p> <h2>3. What are you willing to give up?</h2> <p>You might love living in or near the city, but finding larger homes in an urban neighborhood can be difficult. And when you do find a bigger home in the city, it's likely to come with a sky-high price tag. You might have to move to a new neighborhood in a more suburban area if you want to find a bigger home that fits your budget.</p> <p>Are you willing to make that trade-off? Moving farther from the city could mean a longer daily commute to work. It might also mean you spend more time in the car to get to your favorite restaurants and shopping centers.</p> <p>Extra space often comes with trade-offs. You might gain extra bedrooms, a luxurious bathroom suite, and a bigger backyard, but you might lose the convenience and excitement of living in a big city. Be sure to consider those compromises before you move. (See also: <a href="http://www.wisebread.com/how-to-research-a-homes-location-before-you-buy?ref=seealso" target="_blank">How to Research a Home's Location Before You Buy</a>)</p> <h2>4. What happens when it's time to sell?</h2> <p>You may plan on living in your bigger house forever, but plans change. Your family might continue to grow. Your employer might transfer you to a new city. You might want to downsize as you age and your children move out. When it's time to sell, will your bigger home be attractive to potential buyers?</p> <p>You always need to keep resale value in mind when shopping for a new home. Yes, you want a home that's big enough for you and your family. And, yes, you want one that you will enjoy. But if you buy a house with features that might turn away a high percentage of potential buyers &mdash; maybe it boasts a large theater designed exclusively for cinephiles or an extravagant indoor pool that costs money to maintain and clean &mdash; you'll struggle to sell it for the price you need to turn a profit.</p> <h2>5. How long will you need that extra space?</h2> <p>Your home might be cramped now, but is this a permanent or temporary condition? Say your oldest children are only a few years away from heading off to college. Could you live with the crowded conditions until they move out? That way, you won't have to bother with shopping for a new home, applying for a mortgage, and hiring a mover only to find that your new, larger house feels empty once your older children are out of the home for good.</p> <p>What if your home feels small because in-laws are living with you, or your adult children have moved back home? If both of these situations are temporary, you can again save plenty of stress and money by waiting them out.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-things-to-consider-when-buying-a-larger-home&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Things%2520to%2520Consider%2520When%2520Buying%2520a%2520Larger%2520Home.jpg&amp;description=5%20Things%20to%20Consider%20When%20Buying%20a%20Larger%20Home"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Things%20to%20Consider%20When%20Buying%20a%20Larger%20Home.jpg" alt="5 Things to Consider When Buying a Larger Home" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/5-things-to-consider-when-buying-a-larger-home">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-added-costs-that-come-with-a-bigger-house">7 Added Costs That Come With a Bigger House</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/yes-you-need-home-title-insurance-heres-why">Yes, You Need Home Title Insurance — Here&#039;s Why</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-your-house-is-not-an-investment">Stop Thinking of Your House as an Investment</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-common-homebuying-myths-debunked">6 Common Homebuying Myths, Debunked</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-worst-reasons-to-buy-a-house">4 Worst Reasons to Buy a House</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing bigger house expenses extra space family homeownership mortgages property taxes upsizing Fri, 01 Jun 2018 08:30:20 +0000 Dan Rafter 2144958 at http://www.wisebread.com 7 Modern Ways to Balance Your Checkbook http://www.wisebread.com/7-modern-ways-to-balance-your-checkbook <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-modern-ways-to-balance-your-checkbook" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/happy_businesswoman_using_phone.jpg" alt="Happy businesswoman using phone" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>I remember watching my mom sit at the kitchen table at the end of each month, examining a checkbook ledger and paper statement from the bank. It was time to balance the checkbook &mdash; an essential task for any family looking to accurately track spending, avoid overdrafts, and stay on budget.</p> <p>Balancing your checkbook is still practiced in some circles. It's akin to how some people still listen to compact discs or carry around flip phones. But these days, balancing your checkbook manually isn't nearly as essential due to advancements in technology and changes to our financial habits.</p> <p>It's still necessary to make sure you're tracking withdrawals and deposits and staying on top of your checking account balance. So how do we do it? Check out these ways to balance your checkbook in the modern age.</p> <h2>1. Use online banking</h2> <p>These days, every bank encourages you to sign up for their online banking service. In fact, many modern banks don't have physical branches at all. Online banking gives you a real-time look at your money, so you know if payments and deposits are processed correctly. It's easy to check balances, transfer funds, and pay bills. There's no waiting around for monthly statements; you can look immediately to see if a transaction cleared, and you'll notice any errors immediately. (See also: <a href="http://www.wisebread.com/5-best-online-savings-accounts?ref=seealso" target="_blank">5 Best Online Savings Accounts</a>)</p> <h2>2. Use smartphone apps</h2> <p>If you have online banking, most banks also offer smartphone apps with the same functionality as their websites. Many of them also allow you to deposit checks by sharing an image. Other apps like Clarity Money and Wally will also help you track spending money so you know precisely what's going in and out at any given time. (See also: <a href="http://www.wisebread.com/these-5-apps-will-help-you-finally-organize-your-money?ref=seealso" target="_blank">These 5 Apps Will Help You Finally Organize Your Money</a>)</p> <h2>3. Get text alerts</h2> <p>If you really want to stay on top of every dollar that goes in and out, you can use online banking apps to set up text alerts for when transactions post. You can get text alerts for when your balance dips below a certain limit, or when you face a possible overdraft charge. You'll know the very second when a check clears or when a bill is paid, so you're never confused about where you stand financially. It's also possible to get fraud alerts via text.</p> <h2>4. Automate everything</h2> <p>It's possible these days to send paychecks directly to your bank account through direct deposit, and also set up bills to pay automatically as well. It's may not be possible to automate everything, but the bulk of your income and most of your major bills (mortgage, loan payments, utilities, etc.) can all be sent directly from your bank account with no check required.</p> <p>You can even select the dates when you want money to go out. This means you will never miss a bill, and the possibility of error is very small. Automate enough, and you may be able to &quot;set and forget&quot; a lot of your monthly transactions. (See also: <a href="http://www.wisebread.com/5-ways-to-automate-your-finances?ref=seealso" target="_blank">5 Ways to Automate Your Finances</a>)</p> <h2>5. Use an account aggregator</h2> <p>If you want to see your full financial picture in one place, websites and apps such as Mint.com and Personal Capital will let you aggregate your accounts into a single view. These sites let you see everything from bank accounts to investment portfolios, loans, and even college savings accounts. Did you transfer money from your checking account to your brokerage account? Did you pull money from your online savings account to make an extra mortgage payment? These sites don't miss a thing.</p> <h2>6. Use Quicken or similar programs</h2> <p>If you still want to feel directly engaged with your finances by entering transactions, you can do so on the computer online through any number of accounting programs. Quicken may be the most popular, but there are other tools such as GnuCash and You Need a Budget that have similar capabilities.</p> <h2>7. Avoid checks if possible</h2> <p>One of the key reasons people have balanced checkbooks manually in the past is that it allowed them to keep track of checks that had not yet cleared. But if you never use checks to pay for things, this is not as much of an issue. Nowadays, you can use credit or debit cards for many purchases, or use services such as PayPal or Venmo that allow for instant transfers of cash.&nbsp;</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-modern-ways-to-balance-your-checkbook&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Modern%2520Ways%2520to%2520Balance%2520Your%2520Checkbook.jpg&amp;description=7%20Modern%20Ways%20to%20Balance%20Your%20Checkbook"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Modern%20Ways%20to%20Balance%20Your%20Checkbook.jpg" alt="7 Modern Ways to Balance Your Checkbook" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/7-modern-ways-to-balance-your-checkbook">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/financial-iq-test-how-healthy-is-your-budget">FINANCIAL IQ TEST: How Healthy Is Your Budget?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/boost-your-savings-by-making-your-money-harder-to-spend">Boost Your Savings by Making Your Money Harder to Spend</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-fine-art-of-negotiating-with-your-financial-institution">The Fine Art of Negotiating With Your Financial Institution</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/take-control-with-these-easy-5-minute-money-fixes">Take Control With These Easy 5-Minute Money Fixes</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-signs-your-identity-was-stolen">9 Signs Your Identity Was Stolen</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance accounting balancing checkbook banking checking expenses ledger tracking Thu, 24 May 2018 08:00:46 +0000 Tim Lemke 2142706 at http://www.wisebread.com How to Prepare When Your Unemployment Is Ending http://www.wisebread.com/how-to-prepare-when-your-unemployment-is-ending <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-prepare-when-your-unemployment-is-ending" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/young_man_handled_household_expenses.jpg" alt="Young man handled household expenses" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Losing a job can be devastating. It can throw your life into a tailspin and severely delay or even kill your progress and plans for the future. Once you receive a little help through unemployment compensation, you may find yourself right back where you started when the benefit ends.</p> <p>You may have been blindsided when you first lost your job, but losing unemployment before you've found a replacement job can also be a sucker-punch. As difficult as it all is, you still have to will yourself into being proactive. Here are a few things you should do to prepare for the end of unemployment compensation.</p> <h2>Begin with the end in mind</h2> <p>The best thing to do immediately after you receive your first unemployment check is to plan on not receiving it. It is a great aid that can help keep you afloat until you find work. But, you must keep the fact that it is only temporary in the forefront of your mind. During normal economic times, unemployment lasts 26 weeks, or six months. (See also: <a href="http://www.wisebread.com/how-long-can-you-really-live-on-unemployment?ref=seealso" target="_blank">How Long Can You Really Live on Unemployment?</a>)</p> <p>Reduce your spending and live off as little as possible. And do your best not to depend on the benefit. The benefit itself makes this easier because it usually isn't enough to cover all of your living expenses. It is only assistance &mdash; similar to someone helping you up when you trip and fall. They help you to your feet. They don't carry you.</p> <p>You have to find a way to cover the shortfall and generate your own income as quickly as possible. Put yourself on a shoestring budget. Establish spending and payment priorities, because some things may have to go unpaid. Call your creditors now and alert them to the situation and try to maintain a good relationship with them throughout the process. Downsize. Sell stuff. Get a side gig and do odd jobs. Unemployment can temporarily stop or at least slow the bleeding, but remember &mdash; it's only temporary. (See also: <a href="http://www.wisebread.com/5-budget-overhaul-tricks-for-the-recently-unemployed?ref=seealso" target="_blank">5 Budget Overhaul Tricks for the Recently Unemployed</a>)</p> <h2>Make getting a job your top priority</h2> <p>Job loss is so devastating because it is a loss &mdash; economically and emotionally. Dealing with the hurt, betrayal, and disappointment is a massive task by itself. Add to that coping with money issues and the instability it causes, and you've got a deep hole to climb out of. This can make looking for another job seem like a herculean effort. Try and view your unemployment compensation as a safety net and springboard. It helps ease the financial burden and it should propel you to action.</p> <p>As the six-month period begins winding down, try adjusting your employment search to include jobs you wouldn't normally consider. Think outside the box. You may even have to get two jobs temporarily to help stay afloat. The closer you get to the benefit expiration date, the less picky you should become. Get training, attend job fairs, and leverage your networks and professional relationships to assist you during your hunt. You have to be aggressive, persistent, and diligent. (See also: <a href="http://www.wisebread.com/7-networking-tips-for-the-recently-unemployed?ref=seealso" target="_blank">7 Networking Tips for the Recently Unemployed</a>)</p> <h2>Get help</h2> <p>Federal and state-funded assistance programs are available specifically to help you through this period. Sadly, these programs' processes can be slow, bureaucratic, and inefficient, which is why it is imperative that you start the process ASAP. Benefits and programs vary by location, so be sure to check with your state's local agencies to understand requirements and procedures.</p> <h3>Supplemental Nutrition Assistance Program (SNAP)</h3> <p>Formerly known as the Food Stamp Program, <a href="https://www.fns.usda.gov/snap/supplemental-nutrition-assistance-program-snap" target="_blank">SNAP</a> provides food purchasing assistance to families in need. The amount you receive is based on your household size, income, and expenses. If you qualify, this could be a great way of ensuring your family is fed. It can also free up some cash enabling you to repurpose the grocery money and use it for another need. The benefit can be used at a host of traditional grocery stores, convenience stores, and even at your local farmers market.</p> <h3>Self-Employment Assistance Program (SEAP)</h3> <p>Have you ever heard the saying, &quot;If you can't find a job, create one?&quot; That's exactly what SEAP is designed to help you do. <a href="https://workforcesecurity.doleta.gov/unemploy/self.asp" target="_blank">SEAP</a> is a state-funded grant program specifically designed to train individuals receiving unemployment the basics of launching their own small business. And the best part about this program is that in most states, participants are not required to look for a job. The training program is your employment seeking activity. To find out if you qualify, check with your local unemployment office.</p> <h3>Housing assistance</h3> <p>If you foresee yourself struggling to pay rent or your mortgage, help is available. The Department of Housing and Urban Development (HUD) offers a number of <a href="https://www.hud.gov/topics/rental_assistance" target="_blank">rental assistance programs</a> including the Housing Choice Voucher Program. This voucher program provides assistance by paying all or a portion of your rent, if you qualify. Most states also have some sort of Emergency Rental Assistance Program which provides short-term, income-based assistance. And the federal government offers assistance to those in rural areas through its <a href="https://www.benefits.gov/benefits/benefit-details/396" target="_blank">Rural Rental Assistance Program</a>.</p> <p>If you are struggling to make mortgage payments, the <a href="https://www.ftc.gov/tips-advice/business-center/guidance/mortgage-assistance-relief-services-rule-compliance-guide" target="_blank">Federal Trade Commission</a> offers protection for distressed homeowners from predatory and unscrupulous lending practices. There are a lot of private and nonprofit agencies that can help you refinance, negotiate a short sale, and/or keep your home if you fall behind. The key is to do your research. Understand what you are signing. And don't make decisions out of fear or under pressure. You have options. Breathe, consult an objective expert, and move forward with what works best for your situation.</p> <h3>Nonprofit and social service agencies</h3> <p>Every state has a different suite of services and resource offerings for those in need. Finding those resources can be difficult &mdash; especially when you don't know where to look. <a href="http://www.211.org/" target="_blank">211.org</a> was established to address this need. It is a repository of information containing resource offerings for every state and parts of Canada. It is a free service that can help you find federal, state, local, nonprofit, and (small) fee-for-service assistance. It doesn't matter if you get help from family and friends, your church, or a federal or state source, as long as you get help.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-prepare-when-your-unemployment-is-ending&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Prepare%2520When%2520Your%2520Unemployment%2520Is%2520Ending.jpg&amp;description=How%20to%20Prepare%20When%20Your%20Unemployment%20Is%20Ending"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20to%20Prepare%20When%20Your%20Unemployment%20Is%20Ending.jpg" alt="How to Prepare When Your Unemployment Is Ending" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="http://www.wisebread.com/how-to-prepare-when-your-unemployment-is-ending">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-for-retirement-when-you-are-unemployed">How to Save for Retirement When You Are Unemployed</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-handle-a-sudden-loss-of-income">How to Handle a Sudden Loss of Income</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-surprising-ways-a-college-education-will-improve-your-life">10 Surprising Ways a College Education Will Improve Your Life</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-what-you-can-and-cant-buy-with-snap">Here&#039;s What You Can (And Can&#039;t) Buy With SNAP</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-get-laid-off-a-step-by-step-guide">How to Get Laid Off: A Step-By-Step Guide</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Career Building aid assistance benefits expenses food stamps job loss loss of income mortgage assistance rent assistance snap unemployed unemployment Mon, 21 May 2018 08:31:21 +0000 Denise Hill 2140345 at http://www.wisebread.com How to Become a Minimalist With Your Money http://www.wisebread.com/how-to-become-a-minimalist-with-your-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-become-a-minimalist-with-your-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/young_woman_with_a_piggy_bank_3.jpg" alt="Young woman with a piggy bank" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Minimalism is a way of living that centers on finding contentment with <em>less</em>. Becoming a minimalist can benefit many aspects of your life, including your finances. You may be inspired to purchase less stuff, consider quality over quantity, and declutter to create systems that keep you organized.</p> <p>If you are interested in taking on a minimalist approach with your money, here are a few tips to get you started.</p> <h2>Establish your personal and financial priorities</h2> <p>Everyone has different values. What is important to one person might not be important to you. Your values should drive your spending. If you are working to become more of a minimalist, you'll need to be very specific about what is valuable to you and cut out everything else.</p> <p>Often, people spend money on things that are of little to no value to them. This is partly because of the world around you, which can influence your money decisions if you aren't careful. Aggressive marketing on television, social media, and other platforms is constantly trying to convince you to purchase something. Unfortunately, many people fall into this trap and end up spending money on things that add no real value to their lives.</p> <p>What's truly important to you and your finances? For instance, some common financial priorities include paying off debt, saving for retirement, or putting 20 percent of your income aside for savings. By setting your priorities, you can better determine how you should be spending your money.</p> <h2>Simplify your budget</h2> <p>Now that you have a better understanding of your financial priorities, the next step is to take a hard look at your budget. Where is your money going?</p> <p>Carefully observe your spending patterns. Do all of your purchases align with your financial priorities?</p> <p>After analyzing your expenses, you are likely to find you are spending money on material things that you don't really need or for experiences that aren't adding value to your life. For instance, is shopping or eating out every week really bringing you joy? Would you be just as happy if you cut back on some of your spending in these areas?</p> <p>Don't forget to consider the value of your typical expenses. When you are billed for something every month, it is easy to accept that it is a bill you will always have. All too frequently, people find themselves paying regular monthly fees for things that are not truly important to them. Maybe you're paying for a membership to a club you no longer participate in, or you're paying for subscription cable that you don't watch. Take the time to cancel those subscriptions now to help simplify your financial picture. (See also: <a href="http://www.wisebread.com/build-your-first-budget-in-5-easy-steps?ref=seealso" target="_blank">Build Your First Budget in 5 Easy Steps</a>)</p> <h2>Limit shopping trips and consider every purchase</h2> <p>One tactic to avoid overspending on needless purchases is to limit how often you go to the store. By doing this, you can better plan for what you actually need and remove a lot of the temptation to spend altogether. It can also help you save time, which is always a welcome benefit. (See also: <a href="http://www.wisebread.com/how-to-shop-for-food-once-a-month-and-save-big?ref=seealso" target="_blank">How to Shop for Food Once a Month and Save Big</a>)</p> <p>If shopping is your weakness, try limiting your visits to the grocery store to once a week and your trips to the mall to once a month. Purchase everything you need in one trip. Any time you want to buy an item, ask yourself if it is really worth it. It is an absolute necessity? Will it add value to your life? Is it useful? Do you really love it?</p> <p>Often, when you take the time to honestly think about each purchase, you'll find the answer to these questions is no.</p> <p>If you forget something during your planned shopping trip, wait until the next planned trip to make the purchase. By then, you may discover that you can live without it. (See also: <a href="http://www.wisebread.com/7-effortless-ways-to-prevent-budget-busting-impulse-buys?ref=seealso" target="_blank">7 Effortless Ways to Prevent Budget-Busting Impulse Buys</a>)</p> <h2>Clean out your home</h2> <p>What's the best way to become a minimalist in all areas of your life? Start by cleaning out your home. Sort through all of your drawers, closets, and cupboards. Sell or donate anything you don't like or that you don't use anymore.</p> <p>You'll likely find that you can live with much less stuff than what you've been holding on to. This step is important because clearing out your home will also help you to better evaluate future purchases. In order to prevent cluttering your home again, you're more likely to evaluate an item before buying it to decide if it's something you really need.</p> <h2>Push your savings goals</h2> <p>One simple way to spend less is to encourage yourself to save more money. By creating lofty savings goals, you may find that you are more likely to consider the opportunity cost of a potential expense. When you are thinking about buying something new, you'll not only have to consider if you truly need it and how much you'll use it, but you'll also need to think about whether or not the purchase is worth putting less into your savings account.</p> <h2>Automate your bills</h2> <p>Bills piling up on the counter do nothing but contribute to the disorganization of your home and your money. If you're constantly losing bills, missing payments, and racking up fees and penalties, take some time to set up e-statements and autopay for all of your accounts. When the statement comes due, the money will come straight out of your bank account without you having to think about it. This doesn't mean you shouldn't check to make sure everything looks correct, but autopay can be a huge help in a minimalist approach to money management. (See also: <a href="http://www.wisebread.com/5-ways-to-automate-your-finances?ref=seealso" target="_blank">5 Ways to Automate Your Finances</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-become-a-minimalist-with-your-money&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Become%2520a%2520Minimalist%2520With%2520Your%2520Money.jpg&amp;description=How%20to%20Become%20a%20Minimalist%20With%20Your%20Money"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20to%20Become%20a%20Minimalist%20With%20Your%20Money.jpg" alt="How to Become a Minimalist With Your Money" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/rachel-slifka">Rachel Slifka</a> of <a href="http://www.wisebread.com/how-to-become-a-minimalist-with-your-money">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-come-up-with-1000-in-the-next-30-days">How to Come Up With $1,000 in the Next 30 Days</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/youve-been-saving-money-all-wrong-heres-why">You&#039;ve Been Saving Money All Wrong. Here&#039;s Why</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0">6 Ways You Can Cut Costs Right Before You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/25-money-saving-strategies-that-are-actually-hurting-you">25 Money-Saving Strategies That Are Actually Hurting You</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-online-forums-thatll-help-you-reach-your-financial-goals">9 Online Forums That&#039;ll Help You Reach Your Financial Goals</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance autopay budgeting cutting costs expenses goals minimalism organizing saving money simplify Thu, 17 May 2018 08:00:48 +0000 Rachel Slifka 2138236 at http://www.wisebread.com 6 Parts Every Successful Budget Needs http://www.wisebread.com/6-parts-every-successful-budget-needs <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-parts-every-successful-budget-needs" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/building_a_tight_household_budget.jpg" alt="Building a tight household budget" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Budgets aren't perfect. No matter how much you plan, it's impossible to predict every single expense, which can make it challenging to stick to your plan. Fortunately, you can weather any financial storm by making sure your budget has these at least these components.</p> <h2>1. Emergency fund</h2> <p>A car repair, medical expense, or sudden job loss can all wreak havoc on your normal monthly budget. Instead of panicking and going into debt after an emergency, you can give yourself peace of mind by starting an emergency fund.</p> <p>How much money should you keep in an emergency fund? Well, the answer depends on many things, including the cost of your daily expenses, how hard your job would be to replace, and any other unique circumstances. One savings guideline is to save at least three to six months' worth of daily living expenses, though some people may need more. That way, if you ever suffer a job loss, you would be covered for a few months until you found another job.</p> <p>To prevent yourself from using the money you are saving for a rainy day, it's a good idea to stash your cash in a separate savings account. You can start building your emergency fund by having money automatically deposited from every paycheck. (See also: <a href="http://www.wisebread.com/5-minute-finance-start-an-emergency-fund?ref=seealso" target="_blank">5-Minute Finance: Start an Emergency Fund</a>)</p> <h2>2. Debt repayment</h2> <p>Debt can add up quickly and become overwhelming if you do not have a repayment plan in place. Whether you have a mortgage, car loan, student debt, or a credit card balance, it's your responsibility to manage your debt.</p> <p>You can take away the burden of debt repayment by tallying up the payments you owe and putting them into your monthly budget. This will keep you on track, accountable, and working to hit your repayment goals. To make more progress, aim to free up extra dollars every month and put that toward your debt. (See also: <a href="http://www.wisebread.com/7-easy-first-steps-to-paying-off-debt?ref=seealso" target="_blank">7 Easy First Steps to Paying Off Debt</a>)</p> <h2>3. Retirement fund</h2> <p>Do you have a plan to take care of your future? If not, it's time to start a retirement savings plan.</p> <p>Retirement might seem like a long ways away, but failing to save now can have dire consequences later. The more you save while you're still young, the longer you'll have to earn compound interest on your investments. The longer you wait to save, the harder it will be to catch up. Retirement savings needs to be a line item in your budget every single month.</p> <p>If you work for a traditional employer, you likely have a company 401(k) or IRA plan you are eligible to participate in. Most employers can set up paycheck deductions, making it incredibly easy to start contributing to the account ASAP. In addition, check with your employer to see if they offer any company match. As part of your benefits package, many employers will match a percentage of what you contribute to your retirement account. Failing to at least meet the requirements for a match is leaving free money on the table, so make sure you take advantage of it. (See also: <a href="http://www.wisebread.com/7-retirement-planning-steps-late-starters-must-make?ref=seealso" target="_blank">7 Retirement Planning Steps Late Starters Must Make</a>)</p> <h2>4. Fun money</h2> <p>You can't have all work and no play. Allow yourself a break and start putting money into a vacation or fun fund. Whether you prefer to take a trip, play a round of golf, or spend the day at the spa, you can treat yourself guilt-free by budgeting for it in advance. (See also: <a href="http://www.wisebread.com/yes-you-need-fun-money-in-your-budget?ref=seealso" target="_blank">Yes, You Need &quot;Fun Money&quot; in Your Budget</a>)</p> <h2>5. Funds for irregular expenses</h2> <p>Not every expense is billed monthly. Most people find they have at least a few quarterly or even annual expenses, such as HOA fees, insurance premiums, club membership dues, and more.</p> <p>Since they aren't regular bills, it can be easy to forget that they are coming due. Don't panic &mdash; you can still budget for them and ensure you always have the cash for odd expenses.</p> <p>An easy way to handle these types of bills is to create an irregular expense savings account. Calculate what you owe in total irregular expenses for the year and divide it by 12. That's how much you should save every month to cover irregular expenses. Just remember to start saving before your first bill is due so you can ensure you have enough to cover what you owe.</p> <p>It may also be helpful to keep a financial calendar. You can mark when each bill is due throughout the year, so no quarterly or annual bill will come as a surprise.</p> <h2>6. Regular review</h2> <p>Circumstances change, and your budget should change accordingly. By regularly reviewing your budget, you can see what's working and what isn't. Are there areas where you are constantly going over the amount you budgeted for? Areas where you are spending less? Has your income changed? Do you need to set aside more for savings?</p> <p>Review your budget at least once a month. If you have a significant other, sit down together and discuss your financial goals. By making small tweaks as you go, you will discover how to use your money most effectively.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-parts-every-successful-budget-needs&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%2520Parts%2520Every%2520Successful%2520Budget%2520Needs.jpg&amp;description=6%20Parts%20Every%20Successful%20Budget%20Needs"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/6%20Parts%20Every%20Successful%20Budget%20Needs.jpg" alt="6 Parts Every Successful Budget Needs" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/rachel-slifka">Rachel Slifka</a> of <a href="http://www.wisebread.com/6-parts-every-successful-budget-needs">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-signs-you-arent-prepared-for-an-emergency">8 Signs You Aren&#039;t Prepared for an Emergency</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-money-goals-you-can-achieve-this-summer">5 Money Goals You Can Achieve This Summer</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0">6 Ways You Can Cut Costs Right Before You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/25-money-saving-strategies-that-are-actually-hurting-you">25 Money-Saving Strategies That Are Actually Hurting You</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-budgeting-skills-everyone-should-master">11 Budgeting Skills Everyone Should Master</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting buffer debt emergency fund expenses fun money insurance line items retirement saving money Wed, 16 May 2018 09:00:26 +0000 Rachel Slifka 2138312 at http://www.wisebread.com 5 Myths About Money in Retirement http://www.wisebread.com/5-myths-about-money-in-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-myths-about-money-in-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/retirement_plan_concept_0.jpg" alt="Retirement plan concept" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Retiring is an amorphous and complicated goal &mdash; which means retirement planning attracts more than its fair share of plausible-sounding myths. Unfortunately, these myths, misconceptions, mistakes, and misbegotten rules of thumb can seriously lead you astray on your path to a well-funded and fulfilling retirement.</p> <p>Don't fall for any of the following common myths about money in retirement.</p> <h2>1. You need $1 million to retire comfortably</h2> <p>This particular myth holds a unique distinction in that it is wrong in both directions: $1 million is both not nearly enough money for the retirement you're dreaming of, and way too high a number for most people to achieve.</p> <p>How is that possible?</p> <p>On one hand, $1 million doesn't go nearly as far as it once did. If you plan for a grand retirement that involves traveling, fine dining, entertainment, and general living-it-up, you will probably find that a $1 million nest egg will not cover all you want to do. In fact, depending on your cost of living and other circumstances, it's entirely possible you could exhaust $1 million with relatively modest retirement spending.</p> <p>On the other hand, $1 million is a number that is out of reach for the majority of workers. According to a 2016 GoBankingRates survey, 33 percent of Americans have <em>nothing</em> saved for retirement at all. For most Americans, the idea of saving $1 million for retirement may sound too overwhelming to even think about, and they may give up on the idea of saving altogether.</p> <p>The problem with this myth is that it is slapping a blanket generalization over a very idiosyncratic process &mdash; preparing for retirement. Instead of focusing on a nice, round number, calculate your best estimate of how much your own dream retirement will cost. Make adjustments to your dream or the number as necessary. (See also: <a href="http://www.wisebread.com/how-to-retire-with-less-than-1-million-in-savings?ref=seealso" target="_blank">How to Retire With Less Than $1 Million in Savings</a>)</p> <h2>2. The 4 percent rule</h2> <p>This myth actually has a specific start date. Financial adviser William Bengen proposed this rule in 1994 as a potentially safe withdrawal rate for retirees to make sure their money would comfortably last for the rest of their lives. He based his proposal on historical market data and predictions over where the markets would go in the next 20 years.</p> <p>Here's how the rule works: Historically, the rate of return on stocks generally hovers around 10 percent. That means a retiree can take 4 percent of their assets each year to live on, without ever touching the principal and still seeing growth each year. For a retiree with a $1 million nest egg, that means $40,000 would be available each year for living expenses, without ever dipping into the $1 million itself.</p> <p>There is no problem with the 4 percent rule when the market is doing well. The problem with this rule is that it doesn't work during market downturns. In 2008, the market saw a 30 percent decrease overall. Any withdrawals a retiree made during that time took a permanent bite out of their nest egg. Such a retiree either had to accept that permanent bite, or learn to live on less (or nothing) until the market bounced back.</p> <p>This is why it's a good idea to diversify so that you have some more stable and liquid investments you can count on in bad years, as well as long-term investments that can continue to grow (and recover) over time.</p> <h2>3. Social Security will cover your basic expenses</h2> <p>After paying into Social Security all your life, it's natural to expect the benefits to take care of you in retirement. But Social Security benefits are not now and were never meant to be a primary source of income in retirement. The program was begun in order to provide a safety net to keep seniors from abject poverty.</p> <p>The average monthly Social Security benefit in 2018 is $1,404 &mdash; which is barely enough to cover basic expenses in most areas of the country. It is far better to consider Social Security a supplement to your retirement income than count on it for living expenses. (See also: <a href="http://www.wisebread.com/6-smart-ways-to-boost-your-social-security-payout-before-retirement?ref=seealso" target="_blank">6 Smart Ways to Boost Your Social Security Payout Before Retirement</a>)</p> <h2>4. Medicare will take care of your health needs</h2> <p>Something that comes as a nasty surprise to retirees is the fact that Medicare covers less than you might think &mdash; and health care in retirement costs more than you might realize.</p> <p>Specifically, Medicare does not cover the following needs:</p> <ul> <li> <p>Long-term care (the nonmedical help that an otherwise healthy senior might need for daily living).</p> </li> <li> <p>Self-administered prescription drugs.</p> </li> <li> <p>Routine dental or eye care.</p> </li> <li> <p>Dentures.</p> </li> <li> <p>Hearing aids and exams for fitting them.</p> </li> <li> <p>Routine foot care.</p> </li> </ul> <p>Of these coverage gaps, long-term care can be the most devastating because the costs for such care can add up so quickly. It is in part because of the cost of long-term care that Fidelity calculated the average cost of lifetime medical expenses for a 65-year-old couple retiring in 2017 to be $275,000. (See also: <a href="http://www.wisebread.com/how-to-make-sense-of-the-different-parts-of-medicare?ref=seealso" target="_blank">How to Make Sense of the Different Parts of Medicare</a>)</p> <h2>5. Your taxes will be lower in retirement</h2> <p>One of the few benefits of no longer drawing a paycheck is the fact that you don't have to see Uncle Sam take a cut from it. You may think that once you're retired, all your money is yours free and clear, and the taxman will finally leave you alone.</p> <p>It doesn't quite work that way.</p> <p>First, you are going to owe taxes on any money you take out from tax-deferred retirement accounts. Since retirees often have fewer federal deductions and dependents to claim, that means you could be paying a greater percentage of your income to taxes. And don't forget that once you reach age 70&frac12;, you will have to take <a href="http://www.wisebread.com/what-every-retirement-saver-should-know-about-required-minimum-distributions?ref=internal" target="_blank">required minimum distributions</a>, which means the size of your distribution (and therefore the size of the tax bite) isn't entirely up to you.</p> <p>In addition, depending on your retirement income, you may also owe taxes on your Social Security benefits. Altogether, it's good to remember that the taxman always cometh for you.</p> <h2>The truth will set you free</h2> <p>The myths about money in retirement are generally more pleasant than the reality. But as tough as it may be to swallow the truth about how much you need, how much you can withdraw, and how much the government plans to giveth and taketh away, it is far better to be clear-eyed and prepared.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-myths-about-money-in-retirement&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Myths%2520About%2520Money%2520in%2520Retirement.jpg&amp;description=5%20Myths%20About%20Money%20in%20Retirement"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Myths%20About%20Money%20in%20Retirement.jpg" alt="5 Myths About Money in Retirement" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/5-myths-about-money-in-retirement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-retirement-struggles-nobody-talks-about-and-how-to-beat-them">5 Retirement Struggles Nobody Talks About — And How to Beat Them</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-you-should-budget-your-social-security-checks">Here&#039;s How You Should Budget Your Social Security Checks</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-face-these-7-scary-facts-about-retirement-saving">How to Face These 7 Scary Facts About Retirement Saving</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-overcome-these-4-common-retirement-fears">How to Overcome These 4 Common Retirement Fears</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement 4 percent rule expenses health care medicare myths social security taxes withdrawal rate Fri, 11 May 2018 08:00:21 +0000 Emily Guy Birken 2133918 at http://www.wisebread.com 25 Money-Saving Strategies That Are Actually Hurting You http://www.wisebread.com/25-money-saving-strategies-that-are-actually-hurting-you <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/25-money-saving-strategies-that-are-actually-hurting-you" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple_calling_insurance_for_home_leaks.jpg" alt="Couple calling insurance for home leaks" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Taking action to save money can be a great way to get your finances on track. But some of the ways we try to cut costs are actually harmful to our financial well-being. Here are all the money-saving strategies that can backfire on us.</p> <h2>1. Skipping college</h2> <p>College is expensive, so you may think the best plan of action is to skip it and save the money. That's the smarter move, right? Maybe not. Depending on your chosen career field, a degree can mean the difference of more than $1 million in income over the lifetime of your career. So while college is expensive, you'll also probably earn a lot more with a college degree, even considering the salary you miss out on during the years you are in school. (See also: <a href="http://www.wisebread.com/my-kid-got-accepted-to-an-expensive-private-college-now-what?ref=seealso" target="_blank">My Kid Got Accepted to an Expensive Private College &mdash; Now What?</a>)</p> <h2>2. Not participating in your 401(k) plan</h2> <p>Your paycheck is already hit with taxes, Social Security, FICA, and other expenses before you get your money. Your natural reaction may be to try to keep your paycheck as fat as possible by not contributing to your employer-sponsored retirement plan. In the long run, this move is almost guaranteed to backfire. Not only are you hurting your own financial future, but 401(k) contributions are tax-advantaged, and if you keep the money in your paycheck, you are more likely to spend it. (See also: <a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make?ref=seealso" target="_blank">5 Dumb 401(k) Mistakes Smart People Make</a>)</p> <h2>3. Buying food in bulk</h2> <p>Food waste is a big problem, and this can be exacerbated when you buy food in bulk. It can seem smart to load up with bulk food at low cost-per-pound prices, but how many pounds of oats are you <em>really</em> going to eat before they go stale?</p> <h2>4. Not investing in yourself</h2> <p>Reducing expenses is important to stay within your budget and move forward in your financial goals. But obsessing over saving money can result in missing out on opportunities to better your life or invest in yourself. For example, you might skip out on spending $400 for a new suit or $1,000 for career training that would help you land job that pays $20,000 more per year.</p> <h2>5. Deferring expenses</h2> <p>Sometimes getting by cheaply now results in big expenses down the road. For example, you could buy a cheap house with lots of serious issues and benefit now from lower payments, but you may end up pouring money into it later to keep it livable or to get the house in a condition so you can sell it. (See also: <a href="http://www.wisebread.com/23-hidden-costs-of-buying-an-old-house?ref=seealso" target="_blank">23 Hidden Costs of Buying an Old House</a>)</p> <h2>6. Buying minimal car insurance</h2> <p>You can save money on insurance payments every month by purchasing minimal car insurance. But if you have an accident that results in major damage or injury, minimal insurance could leave you with big bills and cost you more in the long run.</p> <h2>7. Saving to spend</h2> <p>It feels good to save up some money and watch your savings account grow. But if you are saving up a big pot of money with the sole intention of spending it, having funds in a savings account can actually result in spending more money, not less. Examples of this include saving up for expensive items that don't retain value such as a recreational vehicle or new car.</p> <h2>8. Doing-it-yourself</h2> <p>You can save a lot of money doing projects yourself instead of hiring a professional, but DIY projects still cost a lot of money for materials, not to mention time and effort. And if you do something wrong, you may need to hire a professional anyway to fix your mistake. Before you take on a project, make sure it is worth doing. (See also: <a href="http://www.wisebread.com/how-to-keep-diy-projects-from-ruining-your-life?ref=seealso" target="_blank">How to Keep DIY Projects From Ruining Your Life</a>)</p> <h2>9. Buying items on sale that you don't need</h2> <p>Buying things on sale can be a good way to save money, but this only works if you need the items in the first place and will actually use them within a reasonable period of time. If you buy stuff you don't need <em>just </em>because it's on sale &mdash; no matter how cheap it is &mdash; you are wasting money.</p> <h2>10. Skipping meals</h2> <p>Skipping meals occasionally can save you money on food. However, this savings can be offset by reduced productivity and by the potential for making poor spending and financial decisions while hungry.</p> <h2>11. Eating cheap food</h2> <p>Eating junk food such as soda, chips, and fast food will provide your daily caloric requirements for a minimal amount of money, but you are likely to end up overweight and miss out on key vitamins and minerals that you need to stay healthy. If you want to find affordable healthy food, check out this list of <a href="http://www.wisebread.com/25-low-cost-foods-packed-with-nutrition" target="_blank">cheap foods that are packed with nutrition</a>.</p> <h2>12. Using coupons</h2> <p>How did using coupons end up on a list of money-saving strategies that can hurt you? Stores give out coupons for a reason. They know that coupons can lead you to buy stuff you normally wouldn't buy, and that results in more profit for the store. Using coupons for items you would buy anyway makes sense, but resist buying extra items only because you have a coupon. (See also: <a href="http://www.wisebread.com/the-6-shopping-mistakes-keeping-you-from-a-great-deal?ref=seealso" target="_blank">The 6 Shopping Mistakes Keeping You From a Great Deal</a>)</p> <h2>13. Ignoring home maintenance</h2> <p>Sometimes you need to take on home repairs right away to avoid expensive damage. If you notice water leaking from a roof, or a leaky pipe, you might think that ignoring the problem costs no money while calling in someone to make a repair could cost hundreds of dollars. While it is true that repairs can be expensive, ignoring routine maintenance can be even more expensive down the road if more extensive repairs are needed for cumulative damage.</p> <h2>14. Supersizing</h2> <p>Why not pay 49 cents extra to upgrade from a medium size drink and fries to a large? This &quot;deal&quot; feeds into temptation and poor impulse control, and again, paying extra for something you don't need or didn't originally want is not a way to save money. This strategy can hurt your waistline as well as your wallet. (See also: <a href="http://www.wisebread.com/7-effortless-ways-to-prevent-budget-busting-impulse-buys?ref=seealso" target="_blank">7 Effortless Ways to Prevent Budget-Busting Impulse Buys</a>)</p> <h2>15. Leasing a car</h2> <p>The monthly payments for leasing a car are often lower than for purchasing a car, so it might seem like you can save money by leasing instead of buying. The problem with leasing is that you make all of the payments on the vehicle during the time when it depreciates the most, but you don't end up owning the car at the end of the lease. You end up with nothing! If you purchase a car, you can pay it off and go for years without making payments after you own the vehicle. (See also: <a href="http://www.wisebread.com/what-you-need-to-know-before-leasing-a-car?ref=seealso" target="_blank">What You Need to Know Before Leasing a Car</a>)</p> <h2>16. Making minimum payments on credit cards</h2> <p>When is it good to pay more than you are charged? When your credit card bill comes. Making minimum payments on a credit card seems like a way to spend the least amount possible, but interest charges pile up and it can take decades to pay off a credit card by making minimum payments. (See also: <a href="http://www.wisebread.com/all-the-ways-minimum-payments-are-evil?ref=seealso" target="_blank">All the Ways Minimum Payments Are Evil</a>)</p> <h2>17. Repairing old appliances and vehicles</h2> <p>You can often repair an old appliance or vehicle for less than the cost of replacing it, which can seem like a good strategy to save money. But if the repair cost exceeds the value of the item, you might come out ahead by replacing it, even if it costs more in the short term. Instead of sinking money into an older item that has a limited life expectancy and will likely need additional repairs soon, you can apply the money toward buying a newer item that should be trouble-free for many years.</p> <h2>18. Hanging on to unneeded things because they are paid for</h2> <p>After you buy something, its value typically declines over time. This means that you will never be able to get your full money back by selling your things. So, you might decide to hang on to everything that you have paid for instead of selling it at a loss. This strategy may make financial sense, but you can end up with lots of clutter from things you don't use, and some items require costly maintenance. Even if it's paid for, if you don't use it, get rid of it.</p> <h2>19. Not boosting your productivity</h2> <p>For years, I used an old laptop that was barely functional. It took hours to accomplish things that should have taken a few minutes due to laggy performance and system crashes. I finally bought a refurbished laptop to replace my aging computer, and I was able to pay for it within a couple months due to increased productivity. (See also: <a href="http://www.wisebread.com/how-to-buy-a-new-computer-without-breaking-your-budget?ref=seealso" target="_blank">How to Buy a New Computer Without Breaking Your Budget</a>)</p> <h2>20. Skipping a worthwhile project to save money</h2> <p>Although it may seem like the best money strategy is to minimize expenses, sometimes you have to spend money to make money. For example, you could decide to skip the expense of seed packets, tools, and fertilizer to plant a garden. But a garden can pay for itself many times over with its produce. Plus you can reuse many garden tools and supplies for years after the initial purchase.</p> <h2>21. Skipping vehicle maintenance</h2> <p>You can try to save money by not getting regular oil changes and other routine maintenance on your vehicle, but this strategy will cost more than it saves. Keeping up with maintenance on your vehicle will extend its life, lower the likelihood of an expensive breakdown, and can make your vehicle run more efficiently so you reduce fuel costs. (See also: <a href="http://www.wisebread.com/bookmark-this-save-money-with-an-easy-to-follow-car-maintenance-checklist?ref=seealso" target="_blank">Bookmark This: Save Money With an Easy to Follow Car Maintenance Checklist</a>)</p> <h2>22. Skipping vet appointments</h2> <p>Vet bills for routine vaccinations and checkups can be expensive, but skipping these appointments can be even more costly. Not taking pets to the vet regularly can result in more expensive treatments down the road, plus your pet's health can suffer. (See also: <a href="http://www.wisebread.com/8-ways-to-lower-your-vet-bills?ref=seealso" target="_blank">8 Ways to Lower Your Vet Bills</a>)</p> <h2>23. Wearing cheap shoes</h2> <p>A good pair of shoes is expensive, so why not save some money by getting cheap shoes instead? A good pair of shoes can last for years, while a cheap pair of shoes may only last a few months before wearing out. Buying a good pair of shoes can be less expensive in the long run, and you can walk all you want in comfort without getting sore feet or back pain.</p> <h2>24. Not having a comfortable bed</h2> <p>You can avoid some expenses for bedding through long-term couch surfing or by using a mattress forever even after it is worn out and no longer comfortable. But not getting a good night's sleep will lower your productivity and you are more likely to make poor spending and financial decisions when you have not gotten enough sleep.</p> <h2>25. Skipping medical and dental appointments</h2> <p>Visits to the doctor or dentist can be unpleasant and expensive, but you are better off taking care of your health the way you are supposed to. Failing to go for routine health screenings and teeth cleanings can lead to more expensive problems down the line. (See also: <a href="http://www.wisebread.com/8-expenses-you-should-never-cut?ref=seealso" target="_blank">8 Expenses You Should Never Cut</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F25-money-saving-strategies-that-are-actually-hurting-you&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F25%2520Money-Saving%2520Strategies%2520That%2520Are%2520Actually%2520Hurting%2520You.jpg&amp;description=25%20Money-Saving%20Strategies%20That%20Are%20Actually%20Hurting%20You"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/25%20Money-Saving%20Strategies%20That%20Are%20Actually%20Hurting%20You.jpg" alt="25 Money-Saving Strategies That Are Actually Hurting You" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dr-penny-pincher">Dr Penny Pincher</a> of <a href="http://www.wisebread.com/25-money-saving-strategies-that-are-actually-hurting-you">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-start-a-family-before-reaching-these-5-money-goals">Don&#039;t Start a Family Before Reaching These 5 Money Goals</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-saving-money-is-harder-today">Why Saving Money Is Harder Today</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0">6 Ways You Can Cut Costs Right Before You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-build-an-emergency-fund-by-the-end-of-summer">How to Build an Emergency Fund By the End of Summer</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-become-a-minimalist-with-your-money">How to Become a Minimalist With Your Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Frugal Living backfire college cutting costs expenses health care maintenance retirement saving money shopping Spending Money too frugal Tue, 08 May 2018 08:00:18 +0000 Dr Penny Pincher 2136177 at http://www.wisebread.com 5 Signs Your Budget Needs a Makeover (And How to Do It) http://www.wisebread.com/5-signs-your-budget-needs-a-makeover-and-how-to-do-it <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-signs-your-budget-needs-a-makeover-and-how-to-do-it" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/young_asian_woman_working_at_her_desk.jpg" alt="Young Asian woman working at her desk" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You've been trying to use a budget, but it isn't going so well. Don't give up just yet: Before you throw in the towel, see if any of the following five issues (and remedies!) might pertain to your situation. If so, a budget makeover may be in the cards.</p> <h2>1. You keep busting your budget</h2> <p>The first step in creating a budget is setting targets for each spending category &mdash; how much you'll save, give, and spend on everything from groceries to gifts. If you're new to budgeting, it's pretty common to get to the end of a month only to discover how drastically different your real-world spending is from your planned spending.</p> <p>Don't despair. Either you set unrealistic targets, or there may be ways to better manage your spending. Very likely, making your budget balance will require some of both.</p> <p>What to do? Give yourself some slack. See the first few months of using a budget as a time of learning. If you're tracking your spending for the first time, this is a great opportunity to find out how much you really do typically spend in each category. Don't beat yourself up about it; learn from it.</p> <p>In some categories, such as groceries, there's a certain reality to how much it costs to feed a family your size. If you're a family of five, $400 a month for groceries probably isn't enough. In other categories, there may be opportunities to be more intentional and creative in finding ways to spend less.</p> <p>Accept the fact that it usually takes several months to figure out realistic spending targets and build new money-saving spending habits. (See also: <a href="http://www.wisebread.com/stop-using-these-5-excuses-not-to-budget?ref=seealso" target="_blank">Stop Using These 5 Excuses Not to Budget</a>)</p> <h2>2. You don't realize you're busting your budget until it's too late</h2> <p>A common budgeting mistake is only reviewing how you're doing at the end of each month. By then, it's too late for course corrections.</p> <p>An important key to successful budgeting is managing to the numbers. That requires looking at how your actual spending compares to your planned spending throughout the month. Before heading to the grocery store, it helps a lot to know how much of this month's food budget you've already spent. If it's getting tight, you can focus on buying only the essentials.</p> <p>It's the same with every category. Knowing where you are with your entertainment budget can help you make budget-appropriate plans for the weekend. Got plenty of room left? Make dinner reservations at that new restaurant you've wanted to try. Getting close to your limit? Rent a movie and stay in. (See also: <a href="http://www.wisebread.com/5-common-budget-mistakes-you-can-fix-right-now?ref=seealso" target="_blank">5 Common Budget Mistakes You Can Fix Right Now</a>)</p> <h2>3. Maintenance and repair costs are busting your budget</h2> <p>Two expenses that commonly catch people by surprise are home maintenance or repairs and car maintenance or repairs. Many people don't even have these categories in their budget.</p> <p>While expenses vary, depending on the age and condition of your home and car, some good general guidelines are to budget $75 per vehicle per month and $200 per month for your home. Some months, you'll spend far less in these categories, but some months you'll spend a lot more. Putting these amounts in your budget will help make sure you have money available when the need arises.</p> <p>In those months when you don't spend your full budgeted amounts, you could let the money build up in your checking account. Or, consider them periodic expenses, as described next. (See also: <a href="http://www.wisebread.com/where-to-find-emergency-funds-when-you-dont-have-an-emergency-fund?ref=seealso" target="_blank">Where to Find Emergency Funds When You Don't Have an Emergency Fund</a>)</p> <h2>4. Periodic expenses are busting your budget</h2> <p>Everyone has expenses &mdash; sometimes, big expenses &mdash; that don't occur every month, but do occur sometime throughout the year. Examples include an annual life insurance premium, a semiannual vehicle insurance premium, vacations, and end-of-year holiday gifts. If you haven't planned ahead, they can really mess with your budget.</p> <p>To avoid that, estimate how much you're likely to spend in each periodic expense category on an annual basis, divide by 12, and transfer the total of all such expenses into a dedicated savings account each month. That will help ensure the money is there when needed. (See also: <a href="http://www.wisebread.com/stop-making-these-7-basic-budget-mistakes?ref=seealso" target="_blank">Stop Making These 7 Basic Budget Mistakes</a>)</p> <h2>5. Your spouse is busting your budget</h2> <p>With many couples, one person is usually more interested in using a budget than the other. It's OK for that person to take the lead in designing and managing the household budget. But some budget-minded spouses take this too far and leave their spouse out of all budgetary matters completely. That's a recipe for a busted budget, and probably a lot of arguments.</p> <p>After all, how can a spouse who had no say in deciding how much to spend on groceries or clothing or anything else be expected to manage to those numbers? That's why it's important to make sure you're on the same page as your spouse. Work together to decide what financial goals to pursue and how that translates into monthly spending priorities. (See also: <a href="http://www.wisebread.com/how-to-put-your-spouse-on-a-budget-without-ruining-your-marriage?ref=seealso" target="_blank">How to Put Your Spouse on a Budget Without Ruining Your Marriage</a>)</p> <h2>Wrapping up</h2> <p>Budgeting is not a perfect science. Goals and circumstances change, so build in some flexibility and grace, and give it some time. Expecting to hit some snags along the way can help you stick with your budget long enough to get it running smoothly.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-signs-your-budget-needs-a-makeover-and-how-to-do-it&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Signs%2520Your%2520Budget%2520Needs%2520a%2520Makeover%2520%2528And%2520How%2520to%2520Do%2520It%2529.jpg&amp;description=5%20Signs%20Your%20Budget%20Needs%20a%20Makeover%20(And%20How%20to%20Do%20It)"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Signs%20Your%20Budget%20Needs%20a%20Makeover%20%28And%20How%20to%20Do%20It%29.jpg" alt="5 Signs Your Budget Needs a Makeover (And How to Do It)" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/matt-bell">Matt Bell</a> of <a href="http://www.wisebread.com/5-signs-your-budget-needs-a-makeover-and-how-to-do-it">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-budget-mistakes-you-can-fix-right-now">5 Common Budget Mistakes You Can Fix Right Now</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-minute-finance-track-your-spending">5-Minute Finance: Track Your Spending</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-budgeting-skills-everyone-should-master">11 Budgeting Skills Everyone Should Master</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-sites-and-apps-to-help-you-track-your-spending-and-stick-to-your-budget">10 Sites and Apps to Help You Track Your Spending and Stick to Your Budget</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-added-costs-that-come-with-a-bigger-house">7 Added Costs That Come With a Bigger House</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting budget makeover budget mistakes expenses maintenance periodic expenses repairs spending spouse tracking Tue, 24 Apr 2018 08:30:10 +0000 Matt Bell 2130617 at http://www.wisebread.com This Japanese Budgeting System Could Be the Key to Saving Big Bucks http://www.wisebread.com/this-japanese-budgeting-system-could-be-the-key-to-saving-big-bucks <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/this-japanese-budgeting-system-could-be-the-key-to-saving-big-bucks" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/student_writing_in_diary_while_lying_at_park.jpg" alt="Student writing in diary while lying at park" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Forget apps that track your expenses for you. Forget Excel spreadsheets that require meticulous data entry. Forget email notifications of your bank balance.</p> <p>What you need to get your bills under control, save money, and finally feel some financial peace of mind is a 100-year-old Japanese organizational system that lets you turn your financial life into a journal that doubles as a work of art.</p> <p>Welcome to the mindful art of <a href="https://monininja.com/kakeibo-art-saving/" target="_blank"><em>kakeibo</em></a>.</p> <h2>What is kakeibo?</h2> <p>Back in 1905, Motoko Hani, the first female journalist in Japan, published an accounting book for household finances (known in Japanese as a kakeibo) in a women's magazine. Hani believed that financial stability was important for happiness, and she wanted every family to be able to get control of their finances. Some 113 years later, Hani's original kakeibo book is still sold all over Japan.</p> <p>As with any budgeting system, the basic practice of kakeibo is about recording your income and your expenses. However, this program has users think about their money a little differently.</p> <p>To start, at the beginning of each month, once you have recorded your fixed income and expenses, you are asked to make a savings goal for the month, as well as a promise to yourself for the month. For instance, you might make it your goal to set aside an additional $100 that month for an upcoming vacation, and you might promise yourself that you will brown bag your lunch at least four days a week.</p> <p>After you have done your beginning-of-the-month accounting, goal-setting, and promise-setting, you need to record your expenses during the month. The system has you categorize each of your expenses under one of four spending pillars. These four pillars are:</p> <ul> <li> <p>Survival: This covers everything you need to survive, such as rent or mortgage, groceries, medical expenses, etc.</p> </li> </ul> <ul> <li> <p>Optional: This is for things you don't need to do, such as restaurant dining, going out for drinks, shopping, convenience purchases, and the like.</p> </li> </ul> <ul> <li> <p>Culture: This is for the costs incurred for cultural experiences, which includes your Netflix subscription, theater tickets, books, and magazines.</p> </li> </ul> <ul> <li> <p>Extra: This covers any unanticipated or one-time expenses, like birthday gifts, car repairs, or furniture.</p> </li> </ul> <p>In addition to categorizing each purchase you make under these four pillars, at the end of every month you also need to write down the answers to the following questions:</p> <ul> <li> <p>How much money do you have?</p> </li> <li> <p>How much money would you like to save?</p> </li> <li> <p>How much are you actually spending?</p> </li> <li> <p>How can you improve on that?</p> </li> </ul> <p>The original kakeibo books from Japan also include some fun details like images of the &quot;savings pig&quot; and the &quot;expenses wolf&quot; who are battling over your finances. Each time you track your finances, you get another opportunity to help the savings pig win out over the expenses wolf. At the end of the month, you subtract the wolf's total from the pig's total to see who won.</p> <h2>Why kakeibo works</h2> <p>You might be wondering why you would want to use paper and pen to get your finances in order when financial technology exists. As a matter of fact, there are a couple of very important benefits that kakeibo offers that no finance app ever will.</p> <p>To begin with, we remember things better when we write them down. So the very act of recording your expenses in a journal means you are less likely to forget that you spent $30 at happy hour and another $40 at the movies and accidentally overdraw your account.</p> <p>In addition, having to reconcile your goals and promises with your actual expenses each month will force a kind of mindfulness when it comes to spending. If you've promised yourself to brown bag your lunch at least Monday through Thursday, it will make the invitation to go out for tacos on a Tuesday less tempting because you know you will have to write it down &mdash; and face the fact that you broke your promise to yourself.</p> <p>Finally, the fact that you have a physical book that shows your progress throughout each month can offer a kind of motivation that electronic budgeting doesn't necessarily provide. Not only do you have the chance to look back over your progress, but using colorful pens, markers, stickers, pretty handwritten fonts, and a pig and wolf in a pitched battle can all make budgeting something you look forward to doing instead of a dreaded chore. (See also: <a href="http://www.wisebread.com/6-old-school-tools-to-help-you-stay-on-budget?ref=seealso" target="_blank">6 Old School Tools to Help You Stay on Budget</a>)</p> <h2>Getting started with kakeibo</h2> <p>While Motoko Hani's original kakeibo book is still being sold in Japan, it is difficult to find a dedicated, English-language kakeibo for American budgeters. However, this is an easy practice to fold into <a href="http://www.wisebread.com/this-simple-journal-may-be-the-fix-for-your-finances?ref=internal" target="_blank">bullet journaling</a> if you are already a bujo enthusiast &mdash; and an easy one to pick up even if you're not.</p> <p>To start practicing kakeibo, create a monthly spread for your financial journaling. Include a spot for each of the following elements:</p> <ul> <li> <p>Your income.</p> </li> <li> <p>Your monthly goal.</p> </li> <li> <p>Your monthly promise.</p> </li> <li> <p>The four pillars of expenses.</p> </li> <li> <p>The four end-of-month questions.</p> </li> <li> <p>The battle between the savings pig and the expenses wolf.</p> </li> </ul> <p>From there, you can have fun with the details and artwork on each monthly spread, so that you are excited to open up that page and work on it.</p> <h2>Sometimes the old ways are the best</h2> <p>While apps, websites, digital reminders, and spreadsheets all have their place in budgeting, sometimes going old school is the best way. Committing to the art of kakeibo budgeting will give you a chance to be both more mindful of your finances <em>and</em> make budgeting something you genuinely look forward to doing.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fthis-japanese-budgeting-system-could-be-the-key-to-saving-big-bucks&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FThis%2520Japanese%2520Budgeting%2520System%2520Could%2520Be%2520the%2520Key%2520to%2520Saving%2520Big%2520Bucks.jpg&amp;description=This%20Japanese%20Budgeting%20System%20Could%20Be%20the%20Key%20to%20Saving%20Big%20Bucks"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/This%20Japanese%20Budgeting%20System%20Could%20Be%20the%20Key%20to%20Saving%20Big%20Bucks.jpg" alt="This Japanese Budgeting System Could Be the Key to Saving Big Bucks" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/this-japanese-budgeting-system-could-be-the-key-to-saving-big-bucks">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-day-debt-reduction-plan-dont-ever-stop">5-Day Debt Reduction Plan: Don&#039;t Ever Stop</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-minute-finance-track-your-spending">5-Minute Finance: Track Your Spending</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-easy-ways-to-budget-for-summer-vacation">7 Easy Ways to Budget for Summer Vacation</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-budgeting-skills-everyone-should-master">11 Budgeting Skills Everyone Should Master</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-build-your-best-travel-budget">How to Build Your Best Travel Budget</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting bullet journaling cash flow expenses japanese budgeting kakeibo saving money tracking Fri, 20 Apr 2018 08:00:07 +0000 Emily Guy Birken 2129349 at http://www.wisebread.com 5-Minute Finance: Track Your Spending http://www.wisebread.com/5-minute-finance-track-your-spending <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-minute-finance-track-your-spending" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_hand_pressing_calculator_and_doing_finance.jpg" alt="Woman hand pressing calculator and doing finance" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>How often do you find yourself in the red at the end of each month, wondering where all your money went? If you're like many Americans, living paycheck to paycheck with too much debt and too little savings is your normal. But it doesn't have to be. There is a solution that can pull you out of your mindless spending habits, and it's a simple one; tracking your money.</p> <h2>What is tracking?</h2> <p>Tracking your finances is the act of writing down or digitally logging everything you spend for the month. This includes every expense, big and small, from your mortgage payment to that $2 soda you bought on a whim.</p> <p>The goal is to find out how much you are spending compared to how much income you are bringing home. If you spend more than your monthly paychecks, you are probably relying on credit cards to fill the gap, which is driving you further into debt. If you are spending exactly what you make, you are not leaving yourself enough room in your budget to build an emergency fund, save for retirement, or pay down debt.</p> <p>Think of tracking as a checkup for your finances. You need to see what your current financial state is so that you can improve it.</p> <h2>Why you should track your spending</h2> <p>If you constantly feel that you don't have enough cash each month, tracking solves the mystery of where your money is going. It'll show you the areas of your life where you are overspending or spending foolishly. Knowing where your money is going will allow you to address poor spending habits and get serious about financial goals, whether that be saving money for a down payment on a home or paying off your vehicles early.</p> <p>There is a chance that you will discover that you cannot afford your current lifestyle. If you are only spending on the essentials and still don't have enough money to cover everything, you will either need to find a job that earns more money, take on a second job, or downgrade your current lifestyle. You may have to move into a smaller home, take your children out of private school or their costly extracurricular activities, or trade in pricey vehicles for more affordable ones. This is not the enjoyable side of tracking, but ignoring the facts will not make your situation easier or better.</p> <h2>How to start tracking your spending</h2> <p>There are several ways to track your spending, either with pen and paper, with simple computer programs like Excel, or with an app designed for tracking. The best method is the one you will use diligently.</p> <h3>For paper tracking</h3> <p>Any journal or notebook will work. You can also purchase an affordable <a href="https://amzn.to/2ujiCmS" target="_blank">expense tracker</a> with designated pages that make it easier to keep track of bills and spending. Free tracking printables are available at <a href="http://www.queenoffree.net/free-printables/free-printable-budget-forms/" target="_blank">Queen of Free</a> and <a href="https://www.simplyunscripted.com/2018-budget-binder/" target="_blank">Simply Unscripted</a>.</p> <h3>For computer tracking</h3> <p>A free Excel spreadsheet template may be all you need. <a href="https://www.smartsheet.com/top-excel-budget-templates" target="_blank">Smart Sheets</a> and <a href="https://christianpf.com/10-free-household-budget-spreadsheets/" target="_blank">SeedTime</a> have free downloadable templates you can use.</p> <p>If you prefer software to help you do your tracking, <a href="https://www.youneedabudget.com/" target="_blank">You Need a Budget</a> is easy to use and allows you to input expenses manually. It does cost $83.99 a year, but you can try it free for 34 days. <a href="https://www.personalcapital.com/" target="_blank">Personal Capital</a> is a free program that connects to your financial accounts directly and shows you how much money you are spending in certain areas.</p> <h3>For mobile tracking</h3> <p><a href="https://www.mint.com/" target="_blank">Mint</a> is a popular free app that pulls info from your financial accounts automatically to make tracking easier. It also comes with a computer interface if you prefer to use it that way.</p> <p>The <a href="https://budgt.ch/" target="_blank">BUDGT</a> app is designed for those on small budgets and helps them get a better picture of their day by day spending.</p> <h2>Next steps</h2> <p>Once you know how much you are spending each month, you can find areas of your budget where you can make cuts. Cutting back on unnecessary spending will give you some breathing room to devote more money to debt, establish an emergency fund, or build a savings account.</p> <h2>Additional resources</h2> <ul> <li> <p><a href="http://www.wisebread.com/these-5-apps-will-help-you-finally-organize-your-money?ref=seealso" target="_blank">These 5 Apps Will Help You Finally Organize Your Money</a></p> </li> <li> <p><a href="http://www.wisebread.com/5-online-tools-to-manage-your-money-in-under-10-minutes-a-week?ref=seealso" target="_blank">5 Online Tools to Manage Your Money in Under 10 Minutes a Week</a></p> </li> <li> <p><a href="http://www.wisebread.com/stop-using-these-5-excuses-not-to-budget?ref=seealso" target="_blank">Stop Using These 5 Excuses Not to Budget</a></p> </li> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-minute-finance-track-your-spending&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5-Minute%2520Finance_%2520Track%2520Your%2520Spending.jpg&amp;description=5-Minute%20Finance%3A%20Track%20Your%20Spending"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> </ul> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5-Minute%20Finance_%20Track%20Your%20Spending.jpg" alt="5-Minute Finance: Track Your Spending" width="250" height="374" /></p> <p>&nbsp;</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-eneriz">Ashley Eneriz</a> of <a href="http://www.wisebread.com/5-minute-finance-track-your-spending">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-budgeting-skills-everyone-should-master">11 Budgeting Skills Everyone Should Master</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-japanese-budgeting-system-could-be-the-key-to-saving-big-bucks">This Japanese Budgeting System Could Be the Key to Saving Big Bucks</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-signs-your-budget-needs-a-makeover-and-how-to-do-it">5 Signs Your Budget Needs a Makeover (And How to Do It)</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-manage-your-money-no-budgeting-required">How to Manage Your Money — No Budgeting Required</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/these-5-apps-can-fix-your-finances">These 5 Apps Can Fix Your Finances</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting 5 minute finance apps expenses mint saving money spending tracking Wed, 11 Apr 2018 09:00:06 +0000 Ashley Eneriz 2127659 at http://www.wisebread.com The High Cost of Planning for the End of the World http://www.wisebread.com/the-high-cost-of-planning-for-the-end-of-the-world <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-high-cost-of-planning-for-the-end-of-the-world" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/secret_agent_terrorist_or_businessman_of_apocalypse.jpg" alt="Secret agent, terrorist or businessman of apocalypse" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>I love reading and watching dystopian stories about what happens to humanity after a global apocalypse. From <em>Mad Max</em> to Octavia Butler's <em>Parable of the Sower</em>, and from <em>The Walking Dead</em> to Stephen King's <em>The Stand</em>, I love the creative ideas behind the post-apocalyptic quest for survival in literature and film.</p> <p>But there are many people out there who do more than just enjoy stories about surviving an apocalypse. For these preppers, planning for how and where they will &quot;bug out&quot; on the day the stuff hits the fan is an important part of planning for their futures. The problem is that preparing for a coming global apocalypse is not cheap. Getting ready for the end of the world as we know it costs a pretty penny &mdash; which can cause major financial problems if the nuclear annihilation, newly-risen zombies, and/or cataclysmic comet never actually arrive.</p> <p>Here's how much planning for the end of the world could cost you &mdash; and why it might make sense to plan for a more optimistic future instead.</p> <h2>Your basic post-apocalyptic needs</h2> <p>Human needs are all the same, whether you're living in a stable democracy or a barren, post-apocalyptic hellscape. No matter one's current living situation, all humans require:</p> <ul> <li> <p>Shelter.</p> </li> <li> <p>Fresh water.</p> </li> <li> <p>Food.</p> </li> <li> <p>Clothing.</p> </li> <li> <p>Energy/heat.</p> </li> <li> <p>Waste management.</p> </li> </ul> <p>If you are actively planning for the end of the world, however, you probably assume that the current way you meet these needs will no longer be sufficient. Which means that in addition to spending your hard-earned money on your current home, food, clothing, and utilities, you will also need to purchase post-doomsday-ready items to meet those needs after the end comes. (See also: <a href="http://www.wisebread.com/13-essentials-every-emergency-bag-should-have?ref=seealso" target="_blank">13 Essentials Every Emergency Bag Should Have</a>)</p> <h2>The cost of building a bunker</h2> <p>Underground bunkers are a staple of apocalyptic fiction for a reason &mdash; they offer protection from many different kinds of doomsday scenarios.</p> <p>At the low end, it is possible to DIY a bunker out of a <a href="http://www.askaprepper.com/how-much-does-a-nuclear-bunker-cost/" target="_blank">$1,500 shipping container</a>, but even that inexpensive option can get spendy pretty quickly. You have to add the cost of reinforcing the container's sides (since these containers are not built to withstand the weight of soil), plus the cost of installation, which includes hiring an excavator and building a staircase and exit.</p> <p>All together, you can expect to spend between $3,000 and $6,000 on your shipping container bunker, which you still have not set up for comfortable habitation. Adding fresh water, an energy source, waste management, and sufficient food for your long wait for normality to return will add even more money and time to this &quot;inexpensive&quot; option for prepping.</p> <p>At the other end of the spectrum, you can purchase an underground luxury apartment in an abandoned missile silo for between $1.5 and $4.5 million. This will allow you and your fellow 1 percenters to wait out the worst of the post-apocalyptic unrest without having to deal with pesky radiation poisoning or the hoi polloi. These kinds of luxury bunkers come pre-equipped with food, power, and even amenities like swimming pools.</p> <h2>Understand the real risks</h2> <p>Whether you are digging up the backyard to install a shipping container while filing your swimming pool with tilapia, or you are throwing money at the potential end-of-the-world problem by buying real estate in a luxury bunker, it's important to ask yourself if you're preparing for the right kind of catastrophe.</p> <p>There is absolutely nothing wrong with preparing for the worst &mdash; but it's important to remember that some future problems are far more likely than others. The possibility that you will not have enough money for retirement is much higher than the possibility that there will be a nuclear strike in your neighborhood. The nuclear strike (or volcanic eruption, or civil war, or walking corpses) may be more interesting to think about &mdash; and therefore more likely to end up in a movie or novel &mdash; but it's much more likely that you'll run out of cash in retirement and be stuck eating ketchup sandwiches.</p> <p>This is especially true if you invest your money in end-of-the-world preparation, rather than invest it in your retirement. While you are spending money on underground lairs, water purifiers, MREs, radiation-resistant clothing, and enough axes to behead every zombie in a 10-mile radius, you are not building your financial bunker against the vagaries of job loss and old age &mdash; and you've purchased items that are difficult to resell, to boot.</p> <h2>Be prepared without bugging out</h2> <p>While it is entirely possible that we may experience some sort of extinction-level event in our lifetimes, there is absolutely no way to know if it will happen &mdash; and what form it would take if it does.</p> <p>That means that preparing for the end of the world requires far less stockpiling than the prepper websites would have you believe. It makes much more sense to prepare for a number of potential catastrophes by <a href="http://www.wisebread.com/7-easy-ways-to-build-an-emergency-fund-from-0?ref=internal" target="_blank">building a robust emergency fund</a> and retirement nest egg. That way, you have the agility to handle any number of unexpected catastrophes, whether they are the vanilla types of problems that most emergency funds are built to withstand, or they are truly world-ending changes. (See also: <a href="http://www.wisebread.com/7-retirement-planning-steps-late-starters-must-make?ref=seealso" target="_blank">7 Retirement Planning Steps Late Starters Must Make</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fthe-high-cost-of-planning-for-the-end-of-the-world&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FThe%2520High%2520Cost%2520of%2520Planning%2520for%2520the%2520End%2520of%2520the%2520World.jpg&amp;description=The%20High%20Cost%20of%20Planning%20for%20the%20End%20of%20the%20World"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/The%20High%20Cost%20of%20Planning%20for%20the%20End%20of%20the%20World.jpg" alt="The High Cost of Planning for the End of the World" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/the-high-cost-of-planning-for-the-end-of-the-world">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-ways-to-reverse-lifestyle-creep">9 Ways to Reverse Lifestyle Creep</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-simple-ways-to-split-bills-with-your-spouse">3 Simple Ways to Split Bills With Your Spouse</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-build-financial-stability-after-divorce">How to Build Financial Stability After Divorce</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-expenses-to-ditch-after-age-30">5 Expenses to Ditch After Age 30</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-getting-rich-quick-is-unlikely-and-always-will-be">5 Reasons Getting Rich Quick Is Unlikely and Always Will Be</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Lifestyle apocalypse disaster planning emergencies end of the world expenses preppers riskis Mon, 26 Mar 2018 10:00:06 +0000 Emily Guy Birken 2121989 at http://www.wisebread.com 5-Minute Finance: Start an Emergency Fund http://www.wisebread.com/5-minute-finance-start-an-emergency-fund <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-minute-finance-start-an-emergency-fund" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/piggy_bank_in_a_lifebuoy.jpg" alt="Piggy bank in a life buoy" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>According to a <a href="https://www.bankrate.com/banking/savings/financial-security-0118/" target="_blank">recent study by Bankrate</a>, most Americans are drastically unprepared when it comes to emergencies. Only 39 percent of respondents claimed to have enough money in savings to cover an unexpected $1,000 expense.</p> <p>You can protect yourself from tragedy by starting an emergency fund today. It takes less than five minutes to set one up, and the practice of stocking your emergency fund can ensure you are always financially protected, even in the worst of situations.</p> <p>Here's everything you need to know about emergency funds and how to set one up in five minutes or less.</p> <h2>What is an emergency fund?</h2> <p>When disaster strikes, will you be ready for it? An emergency fund can protect you. In short, an emergency fund is money set aside specifically for emergencies or unexpected expenses you wouldn't have budgeted for otherwise. For instance, a medical bill, job loss, or major car repair could be considered an emergency expense.</p> <p>Instead of dipping deep into savings or putting an emergency on a credit card, with an emergency fund, you are already prepared with cash in hand in the event of an unexpected, urgent cost. There is no set amount that constitutes the perfect sized emergency fund, though many finance experts agree you should strive to save between three and six months' worth of regular living expenses.</p> <h2>Why you should start an emergency fund</h2> <p>By starting an emergency fund, you are protecting yourself and your family from disaster and/or debt. If an emergency situation arises, you know you will always have the means to pay for the service or good you need. The last thing you want to be worried about is money.</p> <p>Failing to have an emergency fund can come with a big cost. Many people, having no other options, put the expense on credit cards, which can take years to pay off. Others try to file for a hardship withdrawal from their employer-sponsored 401(k), which has major tax implications. In the most dire of cases, people even file for bankruptcy. If they would have just built up an emergency fund, many of these cases could have been prevented.</p> <h2>How to start an emergency fund</h2> <p>It only takes a few minutes to start your own emergency fund. Simply open up a new savings account and deposit whatever money you can. Keep in mind, it's a good idea to keep your emergency fund separate from your regular savings account so you lessen the temptation to spend the money on everyday items.</p> <p>After you have started to save money, leave the cash alone. It may be tempting to spend the money on a more immediate expense, but remember, this money should be socked away for true emergencies only.</p> <h2>Next steps</h2> <p>To build your emergency fund more quickly, you can enroll in an automatic savings plan, which is an option at most banks. With this plan, you can choose to have money automatically deducted from your regular savings or checking account and put straight into your emergency savings. Automatic savings plans are a great option for anyone who may be tempted to spend the money otherwise, or who likes to automate their finances as much as possible.</p> <h2>Additional resources</h2> <ul> <li> <p><a href="http://www.wisebread.com/6-fast-ways-to-restock-an-emergency-fund-after-an-emergency?ref=5minute" target="_blank">6 Fast Ways to Restock an Emergency Fund After an Emergency</a></p> </li> <li> <p><a href="http://www.wisebread.com/how-to-earn-money-with-your-emergency-fund?ref=5minute" target="_blank">How to Earn Money With Your Emergency Fund</a></p> </li> <li> <p><a href="http://www.wisebread.com/7-easy-ways-to-build-an-emergency-fund-from-0?ref=5minute" target="_blank">7 Easy Ways to Build an Emergency Fund From $0</a></p> </li> <li> <p><a href="http://www.wisebread.com/8-ways-to-decide-if-its-a-fund-worthy-emergency?ref=5minute" target="_blank">8 Ways to Decide if It's a &quot;Fund-Worthy&quot; Emergency</a></p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> </li> </ul> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5-Minute%20Finance_%20Start%20an%20Emergency%20Fund.jpg" alt="5-Minute Finance: Start an Emergency Fund" width="250" height="374" /></p> <p>&nbsp;</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/rachel-slifka">Rachel Slifka</a> of <a href="http://www.wisebread.com/5-minute-finance-start-an-emergency-fund">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-boost-your-financial-resilience">5 Ways to Boost Your Financial Resilience</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-start-a-family-before-reaching-these-5-money-goals">Don&#039;t Start a Family Before Reaching These 5 Money Goals</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-find-the-savings-strategy-that-works-for-you">How to Find the Savings Strategy That Works For You</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-new-reasons-you-need-an-emergency-fund">4 New Reasons You Need an Emergency Fund</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-expect-after-these-5-personal-financial-disasters">What to Expect After These 5 Personal Financial Disasters</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance 5 minute finance automated savings disaster emergency funds expenses job loss medical bills saving money Thu, 22 Mar 2018 09:00:06 +0000 Rachel Slifka 2116589 at http://www.wisebread.com 9 Ways to Reverse Lifestyle Creep http://www.wisebread.com/9-ways-to-reverse-lifestyle-creep <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-ways-to-reverse-lifestyle-creep" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/paying_online_with_credit_card.jpg" alt="Paying online with credit card" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As time goes on, you may find that you are earning more money than you were previously. Congratulations! That's a good thing. Unfortunately, new income often means new spending. You use higher paychecks to boost your standard of living with a bigger house, pricier cars, more costly meals, and luxury items. This is called lifestyle creep.</p> <p>The problem with lifestyle creep is that things can crash down on you if your income drops. And it's not particularly easy to dial back your cost of living quickly.</p> <p>If you find that you are spending more than you have in the past, it may be time to evaluate whether you are the victim of lifestyle creep. Here are some tips on getting that &quot;creep&quot; headed in the other direction. (See also: <a href="http://www.wisebread.com/9-signs-youre-suffering-from-lifestyle-inflation?ref=seealso" target="_blank">9 Signs You're Suffering From Lifestyle Inflation</a>)</p> <h2>1. Track your spending</h2> <p>Sometimes we just don't realize how much we are spending. We spend unconsciously, assuming that we're not doing anything different from what we've done in the past. We pay our credit card bills without reviewing them, barely glancing at the record of what we purchased in the previous month. This lack of attention can gradually lead to lifestyle creep.</p> <p>If you begin a practice of tracking every dollar and reviewing that record on a regular basis, you'll recognize where you're making careless spending choices, and you can do something about it.</p> <p>Reviewing credit card bills and bank statements is a good way to start. There are also online tools such as Mint.com and Personal Capital that allow you to aggregate accounts and see all your income and spending in one view.</p> <h2>2. Practice mindful spending</h2> <p>This goes hand-in-hand with tracking your spending. It's important to be aware of <em>how</em> you are spending your money. Try to get in the habit of making purchases deliberately rather than impulsively. When you intend to buy an item, ask yourself questions like, &quot;Do I really need this?&quot; and, &quot;Can I get this for a better price?&quot; Do extensive research before buying any large items. In this day and age, there's plenty of information available online about any product.</p> <p>Mindful spending may even involve switching from credit cards to cash, so that when you buy something, you actually feel money going out of your hands. That sting alone can make you less likely to spend. (See also: <a href="http://www.wisebread.com/how-one-nice-thing-can-ruin-your-whole-budget?ref=seealso" target="_blank">How One Nice Thing Can Ruin Your Whole Budget</a>)</p> <h2>3. Identify wants and needs</h2> <p>Lifestyle creep happens when you start spending money on things you want rather than things you truly can't live without. You need food and shelter. You need school books for the kids. You don't need cable television, designer clothes, or vacations in Bali. You don't need Netflix, no matter how much you've convinced yourself that you do.</p> <p>If you focus on spending money on things you need and ridding yourself of things you don't, you'll find your lifestyle creeping back down. (See also: <a href="http://www.wisebread.com/how-to-resist-lifestyle-creep-and-still-have-everything-you-want?ref=seealso" target="_blank">How to Resist Lifestyle Creep and Still Have Everything You Want</a>)</p> <h2>4. Seek value over luxury</h2> <p>Reducing lifestyle creep is not about bringing spending down to zero, or even purchasing the cheapest version of any item you buy. It's about spending money in the most efficient way possible. When you seek to make purchases that are a good &quot;value,&quot; it means you are trying to find the perfect balance between quality and price.</p> <p>Let's say you need a new refrigerator. You found one at the store with the lowest price, but the reviews suggest it has poor reliability and uses too much energy. Meanwhile, you may have found a fridge that's highly-rated in terms of quality, but its price is three times higher and has features and components you don't need. The best value fridge for you is somewhere in the middle.</p> <p>Finding value can come into play with any purchase, from homes, to cars, and even college educations.</p> <h2>5. Focus on maxing out retirement contributions</h2> <p>If you have a 401(k) plan, you are allowed to contribute up to $18,500 each year to help you save for retirement. If you have an IRA, you can contribute up to $5,500 annually. In both cases, you can contribute even more if you are over 50. It should be your goal to hit these maximum contributions.</p> <p>It's hard to hit these limits when you are young and perhaps not making a lot of money. But as you earn more, it becomes possible. If you set a goal of maxing out these contributions, you are more likely to put any new money you get into retirement accounts than spend it.</p> <p>Bottom line: Don't expand your lifestyle until you've put as much into retirement accounts as you can. If you are not maximizing the potential of your retirement accounts, you should not be upgrading your car, buying a bigger house, or doing other things that make your life more expensive. (See also: <a href="http://www.wisebread.com/6-ways-meeting-the-2018-401k-contribution-limits-will-brighten-your-future?ref=seealso" target="_blank">6 Ways Meeting the 2018 401(k) Contribution Limits Will Brighten Your Future</a>)</p> <h2>6. Don't go after more credit than you need</h2> <p>One of the ironic things about being financially responsible is that companies will make it easier for you to spend more. Credit card companies will keep your interest rate low, thus making it easier for you to borrow. They will raise your credit limits so you can more easily buy big-ticket items. If this happens, you must avoid the temptation to spend more just because you can.</p> <p>It's also just as important to avoid any special efforts to expand your purchasing power, unless you have a dire need to do so. If you have a couple of credit cards with reasonable credit limits, be content with what you have. If you have a $5,000 credit limit on one card, there's no need to request a $10,000 limit just because you can. That extra $5,000 will simply serve as a temptation to spend money on items you don't need.</p> <h2>7. Ignore everyone else</h2> <p>You've heard the term <em>keeping up with the Joneses</em>. You may have a neighbor or friend who always seems to be getting the newest thing: a new house, a new car, expensive camps, and top-of-the-line sporting equipment for the kids. It is common for people to expand their lifestyle to keep up with friends and neighbors, and they may not even realize they are doing it.</p> <p>Never forget that your money is yours alone. You must make financial decisions that make sense for you and your family. Paying attention to the spending habits of others accomplishes very little. Keep in mind, too, that while other people may appear to be living the high life, they may actually be deeply in debt with no focus on saving for retirement or other goals. (See also: <a href="http://www.wisebread.com/4-money-lessons-you-can-learn-from-the-joneses?ref=seealso" target="_blank">4 Money Lessons You Can Learn From the Joneses</a>)</p> <h2>8. Become more aware of marketing</h2> <p>Whether we realize it or not, there are billions of dollars being spent every day in an effort to get you to part with your money. Commercials on television and radio, ads on the internet, and even social media posts are all working to get us to buy products and services. Granted, this is part of how capitalism and free markets work. But we don't need to fall victim to it.</p> <p>It's possible to avoid making unneeded purchases simply by become more cognizant of when companies are advertising. Your buying decisions should be based on your needs, and timed according to when you are most comfortable. It's important to be stoic, even cynical, in the face of marketing efforts.</p> <h2>9. Change your thinking when it comes to trade-offs</h2> <p>As our life circumstances change, we are often forced to accept trade-offs. But we often make the wrong trade-off from a financial standpoint. We purchase a larger, more expensive house and are willing to forgo retirement savings to make it work. We accept high monthly payments and credit card debt as a trade-off for driving two brand-new cars.</p> <p>Life is about trade-offs, but financial freedom is about making trade-offs that benefit your wallet rather than your ego. You desire to maximize your retirement accounts, so you are willing to avoid the $5 daily coffees to help make it happen. You don't want your children saddled with student loans, so you're happy driving the Honda Civic with 200,000 miles on it. You don't want to increase your mortgage payment, so you invest in bunk beds instead of a new house when your second kid is born. These kinds of trade-offs prevent lifestyle inflation from creeping in and taking control.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F9-ways-to-reverse-lifestyle-creep&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F9%2520Ways%2520to%2520Reverse%2520Lifestyle%2520Creep.jpg&amp;description=9%20Ways%20to%20Reverse%20Lifestyle%20Creep"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/9%20Ways%20to%20Reverse%20Lifestyle%20Creep.jpg" alt="9 Ways to Reverse Lifestyle Creep" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/9-ways-to-reverse-lifestyle-creep">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-types-of-friends-who-are-costing-you-money">10 Types of Friends Who Are Costing You Money</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-meditation-can-make-you-a-money-master">6 Ways Meditation Can Make You a Money Master</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-things-your-boomer-parents-could-afford-that-you-cant">8 Things Your Boomer Parents Could Afford That You Can&#039;t</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-your-emotions-costing-you-money-take-this-quiz">Are Your Emotions Costing You Money? Take This Quiz</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Lifestyle cutting costs diderot effect expenses inflation keeping up with the joneses lifestyle creep saving spending Wed, 07 Mar 2018 10:01:05 +0000 Tim Lemke 2112924 at http://www.wisebread.com 7 Added Costs That Come With a Bigger House http://www.wisebread.com/7-added-costs-that-come-with-a-bigger-house <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-added-costs-that-come-with-a-bigger-house" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/model_of_a_small_and_a_big_house.jpg" alt="Model of a small and a big house" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Like most things in America, the size of our homes is expanding. According to data collected by Zillow, the median size of a detached single-family home has grown 24 percent since the late 1990s (from 2,100 square feet to about 2,600 square feet).</p> <p>The trend isn't surprising. After all, <em>bigger, better, more</em> is part of our national identity &mdash; along with reality TV, free refills, and sweatpants that look like jeans. However, if you're thinking about buying a bigger home, proceed with caution. The added expenses go far beyond a steeper mortgage. Here are the extra costs that come with a bigger house.</p> <h2>1. Property taxes</h2> <p>There's usually a correlation between home size and home value. And since more valuable homes are assessed higher property taxes, expect to pay more. While tax rates vary by jurisdiction, most homeowners pay about 1.2 to 2 percent of the property's assessed value in taxes each year.</p> <h2>2. Homeowners insurance</h2> <p>Again, assuming that larger homes are worth more, expect your insurance premium to grow with the size of your space. Though there are many variables and deductions, plan on paying about $4 in premiums for every $1,000 in appraised value. For example, a home that's worth $200,000 could be insured for approximately $800 annually. (See also: <a href="http://www.wisebread.com/7-other-kinds-of-insurance-you-may-need-to-buy-for-your-home?ref=seealso" target="_blank">7 Other Kinds of Insurance You May Need to Buy for Your Home</a>)</p> <h2>3. Utilities</h2> <p>Don't forget about those frigid winters and sweltering summers. With more space to heat and cool, your utility costs are likely to rise. Before you buy, have your real estate agent ask the current owners what they typically pay for electricity and gas during peak months. This will give you an idea of how much you can expect to see those costs jump. (See also: <a href="http://www.wisebread.com/34-smart-ways-to-cut-your-electric-bill?ref=seealso" target="_blank">34 Smart Ways to Cut Your Electric Bill</a>)</p> <h2>4. Maintenance and lawn care</h2> <p>Larger houses are usually situated on larger lots, and that equates to higher landscaping and lawn care bills (or more time and more tools if you do it yourself). Additionally, maintaining a larger home can be more expensive &mdash; think more rooms to clean, more windows to wash, and more exterior surface to scrape and paint. Be ready to commit a significant portion of your days or your dollars to keeping the new place looking sharp.</p> <h2>5. Repairs</h2> <p>What grows with the size of your home? Your repair budget. More bathrooms mean more toilets to back up and more dripping faucets to fix. Have a foundation problem, electrical issue, or a roof to replace? Get ready to upsize your spending. (See also: <a href="http://www.wisebread.com/10-simple-household-repairs-every-frugal-person-should-master?ref=seealso" target="_blank">10 Simple Household Repairs Every Frugal Person Should Master</a>)</p> <h2>6. Furnishings</h2> <p>Unless your style is &quot;empty chic,&quot; more house means more square footage to furnish and decorate. Artwork, window treatments, rugs, sofas, and beds (oh my!) &mdash; they can all add up to a few thousand dollars in no time.</p> <h2>7. Expectations</h2> <p>A curious thing happens when people move into larger homes: It's expected that they'll entertain more, host holiday parties, and serve as the hub for every family gathering. All that merriment costs money. Whether those ballooning expectations are internal or external, plan on adding a few extra bucks to the &quot;entertainment&quot; column of your budget.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-added-costs-that-come-with-a-bigger-house&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Added%2520Costs%2520That%2520Come%2520With%2520a%2520Bigger%2520House.jpg&amp;description=7%20Added%20Costs%20That%20Come%20With%20a%20Bigger%20House"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Added%20Costs%20That%20Come%20With%20a%20Bigger%20House.jpg" alt="7 Added Costs That Come With a Bigger House" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kentin-waits">Kentin Waits</a> of <a href="http://www.wisebread.com/7-added-costs-that-come-with-a-bigger-house">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-things-to-consider-when-buying-a-larger-home">5 Things to Consider When Buying a Larger Home</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-questions-to-ask-during-an-open-house">20+ Questions to Ask During an Open House</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-your-house-is-not-an-investment">Stop Thinking of Your House as an Investment</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-buy-a-house-with-a-pool-until-you-can-answer-these-7-questions">Don&#039;t Buy a House With a Pool Until You Can Answer These 7 Questions</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-unexpected-costs-of-living-in-a-tiny-house">5 Unexpected Costs of Living in a Tiny House</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing bigger houses costs expenses homeownership maintenance property taxes repairs upsizing utilities Thu, 01 Mar 2018 09:00:06 +0000 Kentin Waits 2108284 at http://www.wisebread.com