spending http://www.wisebread.com/taxonomy/term/247/all en-US 5 Reasons to Keep Your Money Separated After Marriage http://www.wisebread.com/5-reasons-to-keep-your-money-separated-after-marriage <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-to-keep-your-money-separated-after-marriage" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/wedding_married_couple_000059191426.jpg" alt="Couple learning reasons to keep money separate after marriage" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Money may not be the root of <em>all</em> evil &mdash; but it's the clincher in a great many relationships gone haywire. Research shows that arguing about money is by far the top predictor of divorce. &quot;It's not children, sex, in-laws, or anything else. It's money &mdash; for both men and women,&quot; says Sonya Britt, an assistant professor at Kansas State University who <a href="https://www.k-state.edu/media/newsreleases/jul13/predictingdivorce71113.html">conducted a study</a> of 4,500 couples about the interplay between financial arguments and relationship satisfaction.</p> <p>We all have deeply ingrained beliefs about how money should be spent, when it's appropriate to splurge, and how much we should have stowed away in savings. And it can be difficult to the point of deal-breaking to try and mesh our own attitudes about money with another person's financial beliefs, which very well may differ drastically from our own. That's why a large number of financial advisers urge couples to remain financially independent.</p> <p>Read on for our roundup of the top reasons why it pays to keep money matters separate in your relationship. (See also:&nbsp;<a href="http://www.wisebread.com/6-ways-regular-budget-meetings-might-save-your-marriage?ref=seealso" target="_blank">6 Ways Regular Budget Meetings Might Save Your Marriage</a>)</p> <h2>1. You'll Avoid a Power Imbalance</h2> <p>Merging finances means there's no more &quot;yours&quot; and &quot;mine&quot; in the money department. The divisions blur and it all goes into the same piggy bank. But what if your partner earns much more than you, and now you're suddenly living a lifestyle you can afford only with your partner's assist? What if the opposite is true, and you're subsidizing your partner's income with your own earnings? When your relationship is healthy and sparkling, you might not be bothered by either of these scenarios. But what about in the wake of a blowout fight?</p> <p>Or let's say you're the breadwinner in the relationship and you subsidize a good chunk of your partner's lifestyle because he or she isn't earning enough to keep up. Then, suddenly, you lose your job and your partner's income isn't enough to pick up the slack. Would you feel resentful? How would you cope with that? This is the kind of financial imbalance that has a tendency to instigate the fights that ultimately tear couples apart. Luckily, you can avoid them by keeping your financials separate from your sweetie's.</p> <h2>2. We're More Accustomed to Financial Independence Than Ever</h2> <p>Young adults are <a href="http://www.census.gov/hhes/families/data/marital.html">delaying marriage longer than ever</a> before. The average age of people at their first marriage in the U.S. today is about 27, which means many people rack up six or more years of complete financial independence before saying their vows. The money habits we develop during our years as single adults become so deeply ingrained in us that it's difficult to shift them in an attempt to mesh with the financial habits of our partner.</p> <p>And, unfortunately, finding common ground on financial matters is not necessarily something that gets better with practice. When asked how much they will need to save to maintain their current lifestyle in retirement, for example, nearly <a href="https://www.fidelity.com/about-fidelity/individual-investing/fidelity-couples-study">half of all couples are in disagreement</a> about the amount needed. This level of disagreement is highest, however, among those who are closest to retirement.</p> <h2>3. It Promotes Healthy Spending Habits</h2> <p>Financially independent couples tend to practice better discipline when it comes to paying off their own debts. And that makes for a healthy relationship. When one partner starts to feel like their partner's pockets are deep enough to offset the burden of their own financial risks, they sometimes become irresponsible in their spending and saving habits. And that can create the kind of friction that could start a fiery argument later on down the road.</p> <h2>4. It Balances the Burden of Money Stress</h2> <p>When one partner becomes the sole organizer of a couple's fiscal matters, he or she runs the risk of becoming overwhelmed by the responsibility &mdash; and that can throw an entire relationship off balance. But when both partners take charge of their separate finances and contribute to mutual expenses fairly, any money stress that arises is shared, making it much more manageable to find relief as a team.</p> <h2>5. A Breakup Won't Mean Financial Chaos</h2> <p>When you maintain financial independence, you avoid the risk of your personal financial situation falling apart just because your relationship did. Paying your fair share in a relationship also makes for a cleaner emotional break if you one day decide to split. When one partner consistently treats the other to dinners and vacations, or pays the majority of the bills, resentment is bound to brew during a breakup. The partner who paid more might even feel entitled to reimbursement.</p> <p><em>Separate or apart &mdash; how do you manage money with your partner? </em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/5-reasons-to-keep-your-money-separated-after-marriage">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/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-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/americans-spend-more-than-other-countries-on-these-10-things">Americans Spend More Than Other Countries On These 10 Things</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-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-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/financial-independence-is-more-than-just-a-number">Financial Independence Is More Than Just a Number</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Lifestyle couples financial independence marriage power imbalances sharing money spending Wed, 20 Apr 2016 09:30:21 +0000 Brittany Lyte 1690618 at http://www.wisebread.com The Only 6 Rules of Frugal Living You Need to Know http://www.wisebread.com/the-only-6-rules-of-frugal-living-you-need-to-know <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-only-6-rules-of-frugal-living-you-need-to-know" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_blueprints_piggy_bank_000031080438.jpg" alt="Woman learning only rules of frugal living she needs to know" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We humans have a knack for complicating the simplest of ideas. Our lives are filled with shortcuts that aren't short, tips and tricks that trip us up, and helpful hints that are anything but. The same is true when it comes to frugality. Let's scrap all the circular talk and bottom-line it. Here are the only six rules of frugal living you need to know.</p> <h2>1. Know Your Money</h2> <p>By whatever means necessary, become ridiculously well-acquainted with how much you earn, how much you spend, and where every dollar goes. It's the foundation of frugal living. Without this baseline knowledge, successful budgeting and saving will always be out of reach.</p> <h2>2. Live Below Your Means</h2> <p>Living within your means is a great start, but living <em>below</em> your means is where the real magic happens. The surplus it generates is the capital for saving and investing and the fuel behind long-term wealth building. If you're unable to run a surplus a majority of the time &mdash; either by cutting expenses or growing your income &mdash; you'll never get ahead of the game.</p> <h2>3. Know the Difference Between Spending and Investing</h2> <p>Spending and investing might feel like the same thing, but they're completely different animals.</p> <p>Investing is the outlay of cash in exchange for a tangible asset (think job training, a primary residence, or shares in a mutual fund). Spending, on the other hand, is the outlay of cash for something that will likely depreciate in value and not provide any long-term benefit (think dinners out or a new summer wardrobe).</p> <p>Being frugal doesn't mean you always have choose investing over spending (after all, spending is part of living), but it does require that you understand the difference and know how to put your income to work a majority of the time.</p> <h2>4. Buy for Quality</h2> <p>Frugality isn't about always buying the cheapest product; it's about diligently seeking out the best value. Sometimes that means <a href="http://www.wisebread.com/quality-over-price-15-items-to-spend-more-on">choosing quality over price</a>. A pair of shoes that cost $20 might seem like a great deal, but they're not if you have to replace them every three months. A $75 pair that will last two or three years will be a far better value in the long run.</p> <h2>5. Avoid Consumer Debt</h2> <p>Frugal folks know it: Interest on consumer debt is a tax people pay for living beyond their means. And while a credit card can save the day from time-to-time, embracing easy credit as a way to pad your lifestyle can have disastrous consequences. Interest and other charges will bleed your budget and choke your chances at real financial security. (See also: <a href="http://www.wisebread.com/the-fastest-method-to-eliminate-credit-card-debt?ref=seealso">The Fastest Method to Eliminate Credit Card Debt</a>)</p> <h2>6. Know the Difference Between a <em>Want</em> and a <em>Need</em></h2> <p>As I write this, there are throngs of advertisers plotting new ways to help consumers confuse wants and needs. It's big business. In reality, our needs are fairly straightforward (nourishing food, secure shelter, good healthcare, etc.).</p> <p>But what about that self-cleaning, solar-powered, lavender-infused kitty litter box that you can control with your smartphone? What sort of primitive existence would you be reduced to without this life-changing gadget?</p> <p>Let's face it: Being able to distinguish what we want from what we need is a prerequisite for making wise buying decisions. If you can't master this skill, your needs will be endless and your paycheck will never keep up. (See also: <a href="http://www.wisebread.com/25-products-you-think-you-need-but-really-don-t?ref=seealso">25 Products You Think You Need, But Really Don't</a>)</p> <p>Here's the curious thing: Today, when we talk about the rules of frugal living, aren't we really talking about basic financial literacy? It seems over the past couple of generations, common fiscal sense has been reframed as an extreme lifestyle. Maybe it's time to change the conversation about saving and managing money &mdash; and make frugal living a far more fundamental skill.</p> <p><em>Are you frugal-living pro? Which rules were the hardest for you to learn? Which have we missed?</em></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/the-only-6-rules-of-frugal-living-you-need-to-know">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-do-a-spending-fast-in-16-easy-steps">How to Do a Spending Fast in 16 (Easy!) Steps</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/pets-old-cars-and-3-other-common-money-pits">Pets, Old Cars, and 3 Other Common Money Pits</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-many-reasons-to-make-do-with-less">The Many Reasons to Make Do with Less</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/are-your-financial-habits-just-bad">Are Your Financial Habits Just Bad?</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-youre-suffering-from-lifestyle-inflation">9 Signs You&#039;re Suffering From Lifestyle Inflation</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living debt investing lifestyle living below means money needs spending wants Fri, 08 Apr 2016 10:00:14 +0000 Kentin Waits 1683756 at http://www.wisebread.com 4 Purchases With Financing Options That Depreciate Fast http://www.wisebread.com/4-purchases-with-financing-options-that-depreciate-fast <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-purchases-with-financing-options-that-depreciate-fast" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_gift_diamond_000015409595.jpg" alt="Woman finding purchases with financing options that depreciate" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's refund season. Unfortunately, the first thing most people do when they receive their tax refund is purchase big ticket items that often depreciate in value. Far worse, sometimes the refund is used as a down payment, and the purchase still requires financing. Or, it's bought before the money actually arrives and carried as a credit card balance &mdash; believing you'll use your refund to pay it off. (See also: <a href="http://www.wisebread.com/8-smart-things-to-do-with-your-tax-refund?ref=seealso">8 Smart Things to Do With Your Tax Refund</a>)</p> <p>Investing your tax refund in smart, long-lasting purchases you really need is one thing. But using the money on big-ticket items that are certain to depreciate is a losing financial proposition. Consider avoiding these depreciating purchases:</p> <h2>1. Jewelry</h2> <p>Suze Orman likes to point out that she always <a href="http://business.inquirer.net/47387/before-buying-anything-read-this-first">wears the same jewelry</a>. I'm the same way. Unless it's for a truly special occasion &mdash; such as an engagement ring, wedding band, or anniversary gift &mdash; jewelry isn't something you should buy often. Precious stones, in particular, tend to depreciate hard and fast. Ira Weissman, a 10-year veteran in the diamond business, says diamonds are a terrible waste of your money because <a href="http://www.huffingtonpost.com/ira-weissman/7-reasons-why-you-shouldn_b_1720870.html">their value often drops</a> to less than half after your purchase.</p> <h2>2. Automobiles</h2> <p>You've heard that cars lose their value the moment you drive off the lot. So, why pump so much money into something that will never appreciate in value, will only cost more money over time, and ultimately need to be replaced? And worse, why would you finance a new vehicle &mdash; taking on additional debt on top of a depreciating asset &mdash; if you don't really <em>need </em>a new car?</p> <p>The good news is, consumers have wised up to the truth about auto financing. And the automobile industry has caught on to the fact they can no longer convince people to run out and buy new cars every two to three years. But they still want your money. So, they've created an alternative scheme to traditional three to five year financing. It's an auto lease, where if you use the car for work (individual or business), you can deduct up to as much as 100% of monthly payments and other expenses. While it's not right for everyone, in some situations, it's a good alternative to taking on new car debt. Of course, the best option is still to pay for cars in cash, buying a vehicle only when you really need it.</p> <h2>3. Electronics</h2> <p>In our nation's consumer-driven economy, the sale of goods is the backbone of business. So, some businesses no longer have an incentive to make quality products that last, because consumers want the latest release with updated features. Since electronics are a necessary &mdash; and rapidly depreciating &mdash; evil, your best bet is to buy only what you need, get an extended warranty on it (if possible), insure it, and hang onto it for years to come. Help drive down the excessive costs of these expensive gadgets by simply refusing to trade them in every year.</p> <h2>4. Furniture</h2> <p>Used furniture is only as valuable as what someone is willing pay, and that's often far less than what you paid originally. Even designer furniture in good condition only fetches a small fraction of its original price. If you're in the market for furniture, buy high-quality, durable pieces if you can. Budget and plan for their purchase and acquire them over time. If you can't quite afford those high-quality items yet, consider buying them used and let someone else take the depreciation hit, instead.</p> <p><em>Are there other quickly depreciating buys we've missed? Please share in comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/qiana-chavaia">Qiana Chavaia</a> of <a href="http://www.wisebread.com/4-purchases-with-financing-options-that-depreciate-fast">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/47-simple-ways-to-waste-money">47 Simple Ways To Waste 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/4-warranties-that-arent-worth-it">4 Warranties That Aren&#039;t Worth It</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/longtime-mac-users-punished-for-loyalty">Longtime Mac Users Punished for Loyalty</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/frugal-tip-do-not-spend-when-you-are-sad">Frugal Tip: Do Not Spend When You Are Sad</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/a-used-car-salesman-reveals-dirty-tricks-and-how-to-beat-them">A Used Car Salesman Reveals Dirty Tricks (and How to Beat Them)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Shopping bad investments Cars depreciation electronics furniture jewelry spending value Wed, 02 Mar 2016 11:30:07 +0000 Qiana Chavaia 1664147 at http://www.wisebread.com 21 Times Spending More Will Save You Money http://www.wisebread.com/21-times-spending-more-will-save-you-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/21-times-spending-more-will-save-you-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_dressed_up_000082458281.jpg" alt="Man spending more money and saving money" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Even though I usually focus on spending less money in order to save money, sometimes spending <em>more </em>will actually help you save. Here are 21 times when dishing out a few extra bucks can help you be frugal in the long-run.</p> <h2>Spending to Reduce Everyday Expenses</h2> <p>There are lots of inexpensive items you can buy that will quickly pay for themselves and save you more money down the road.</p> <h3>1. Hair Trimmer</h3> <p>Buy a <a href="http://amzn.to/1WXRg9I">hair trimmer kit</a> for about $20 and get free haircuts at home. I haven't paid for a haircut since 2008!</p> <h3>2. Coffee Maker</h3> <p>Buy your own coffee making equipment for under $100 and save hundreds by making your brew at home instead of getting it at the coffee shop. I bought a <a href="http://amzn.to/1WXRGgx">coffee bean grinder</a>, <a href="http://amzn.to/1WXRwFL">coffee maker</a> with cone filter and thermal carafe, and a nice <a href="http://amzn.to/1nAgKhc">thermal travel mug</a>.</p> <h3>3. Lunchbox</h3> <p>Buy a large <a href="http://amzn.to/1WXRWMi">insulated lunch box</a> and pack your lunch every day. I use my giant lunchbox so I can easily pack leftovers or even larger items like full-sized boxes of cereal.</p> <h3>4. HDTV Antenna</h3> <p>Buy an indoor <a href="http://amzn.to/1nAh27N">HDTV antenna</a> and get free TV forever! You won't get as many channels over the air as you do with cable or satellite TV, but free is hard to beat. You can pay a reasonable one-time price for an antenna instead of paying over $100 every month for cable or satellite TV.</p> <h3>5. Garden</h3> <p>Spend some money to plant a garden. Grow your own food, and even sell or trade your extra produce. Even a few productive plants can provide a lot of healthy &mdash; and cheap &mdash; vegetables.</p> <h3>6. Car Wash Kit</h3> <p>Equip yourself to do car washes at home, and avoid paying up to $10 at the drive-through carwash. You'll need soap, sponges, a hose, and sprayer nozzle.</p> <h3>7. eReader</h3> <p>Buy an <a href="http://amzn.to/1So6Tsd">eReader</a> and pay less for your books. The electronic version of books are less expensive than paper, and you don't need bookshelves.</p> <h3>8. Filtered Water</h3> <p>Buy a water filter and a <a href="http://amzn.to/1nAhmDt">reusable bottle</a>, and stop wasting money on packs of plastic water bottles at the store. You can get a <a href="http://amzn.to/1nAhoLs">water pitcher</a> with a built-in filter to keep in your refrigerator, or even get a water filter for your refrigerator water dispenser.</p> <h3>9. Reusable Items</h3> <p>Buy reusable items instead of disposable items. Use rags instead of paper towels, <a href="http://amzn.to/1WXSF05">reusable glass</a> or <a href="http://amzn.to/1WXSIZT">plastic food storage containers</a> instead of baggies, etc. You'll save money with the reusable items, and you'll be putting less waste in the landfill as well.</p> <h3>10. Crock-Pot</h3> <p>Buy a <a href="http://amzn.to/1nAhLWw">Crock-Pot</a> and put dinner on autopilot. Load up the Crock-Pot and turn it on when you leave for work in the morning, and you'll have dinner waiting for you when you come home. If you can avoid going out for dinner a few times, the Crock-Pot will pay for itself.</p> <h2>Spending to Save Money on Energy</h2> <p>If you can spend money once to reduce your energy consumption, this can add up to lots of savings as you use less energy every day.</p> <h3>11. LED Bulbs</h3> <p>Buy energy-efficient lighting to reduce your electric bill. I am upgrading to <a href="http://amzn.to/1WXT6Yl">LED lightbulbs</a> that use much less electricity and last many times longer than incandescent or compact fluorescent bulbs. Most of the lights in my house are LED now, and I am saving money every month.</p> <h3>12. Home Insulation</h3> <p>Insulating will help reduce your energy bill. Spend some time and money on caulk, weatherstripping, and fiberglass insulation, and save money on every utility bill for years to come.</p> <h3>13. Energy-Efficient Appliances</h3> <p>Some appliances use a lot of energy, such as your furnace, central A/C, water heater, and refrigerator. Get the most energy-efficient appliances available and save hundreds per year on lower energy bills. Over time, the energy savings will offset the increased initial cost of the energy-efficient appliances.</p> <h3>14. Programmable Thermostat</h3> <p>Upgrade to a <a href="http://amzn.to/1PMP3IC">programmable thermostat</a> to downgrade your utility bills. I recently replaced my old thermostat with a modern programmable unit. A programmable thermostat automatically adjusts the temperature setting based on your schedule, so you can use less energy heating and cooling the house when no one is home.</p> <h2>Spending to Invest in Yourself</h2> <p>Spending money to increase your earnings can result in a lot of additional income.</p> <h3>15. 401K Matching</h3> <p>If your employer offers a 401K program that matches funds, spend some money to get the free contributions that will boost your retirement investment.</p> <h3>16. Business Attire</h3> <p>You will need a suit to wear to job interviews if you want to step up your income with a higher paying career. A good suit can last for many years and support a number of career upgrades.</p> <h3>17. Higher Education</h3> <p>A lot of people are talking about high levels of student loan debt that many college graduates are facing, but a college degree in a high paying field can be worth over a million of dollars in additional income over your career. Even if you borrow money to finish school, investing to get into a high paying career can be a great financial strategy.</p> <h3>18. Learning New Skills</h3> <p>I recently spent about $20 to buy a writer's market book to find new places to sell my articles. If I can sell <em>just on</em>e extra article, this will more than pay for this investment in myself. Spend a little to learn a new skill or way to make money on the side.</p> <h2>Spending on Preventive Maintenance</h2> <p>Pay a little bit now for preventive maintenance, or pay a lot later for expensive repairs.</p> <h3>19. Car Maintenance</h3> <p>Spend money on oil changes and routine maintenance to keep you car going for years and avoid the expense of replacing your entire vehicle prematurely.</p> <h3>20. Dental Visits</h3> <p>Even though you don't want to, go in for dental cleanings. Pay a little now to keep your teeth in good shape and avoid much bigger expenses later.</p> <h3>21. Furnace Filters</h3> <p>Spend $10 or so to change your furnace filter every few months. A clean <a href="http://amzn.to/1So7J8x">furnace filter</a> increases the efficiency of your heating and cooling system and helps reduce wear and tear. Write down the size of furnace filter you need and keep it in your wallet so you know which size to get.</p> <p><em>What do you spend money on that saves you money?</em></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/21-times-spending-more-will-save-you-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/save-100s-next-month-with-these-10-grocery-shopping-tips">Save $100s Next Month With These 10 Grocery Shopping Tips</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/13-creative-ways-to-avoid-spending-money">13 Creative Ways to Avoid Spending Money</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/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</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-psychological-traps-preventing-you-from-saving-and-how-to-fix-them">4 Psychological Traps Preventing You From Saving — And How to Fix Them</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/14-pricey-things-you-shouldnt-buy-and-what-to-get-instead">14 Pricey Things You Shouldn&#039;t Buy (And What to Get Instead)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Shopping education everyday expenses maintenance saving money spending Tue, 16 Feb 2016 10:00:05 +0000 Dr Penny Pincher 1654793 at http://www.wisebread.com 25 Ways to Save on a Shoestring http://www.wisebread.com/25-ways-to-save-on-a-shoestring <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/25-ways-to-save-on-a-shoestring" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_piggy_bank_000064441061.jpg" alt="Woman finding ways to save on a shoestring" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Ask a financial expert how people can save money and you're likely to hear the phrase &quot;pay yourself first.&quot; This means immediately setting aside money, when you earn it, rather than waiting to see if anything is left at the end of the month. With PYF, savings gets top priority in your budget, like rent or a loan payment.</p> <p>What if you don't have money to save? You get creative and find it! Below are 25 tips from my book <a href="http://www.amazon.com/Saving-Shoestring-Expenses-Reduce-Stash/dp/0793111188/ref=sr_1_1?s=books&amp;ie=UTF8&amp;qid=1454020290&amp;sr=1-1&amp;keywords=saving+on+a+shoestring">Saving on a Shoestring</a>.</p> <h2>Savings Strategies</h2> <p>Saving more doesn't have to be complicated or painful, but it does need to be intentional.</p> <h3>1. Automate It</h3> <p>Use an automatic deposit plan such as an employer 401K or 403B plan, mutual fund automatic investment plan, or credit union paycheck deduction to put money into savings before you miss it.</p> <h3>2. Grab Free Money</h3> <p>Take the savings that your employer offers. Some employers match workers' 401K savings twenty-five cents, fifty cents, or even a dollar for every dollar saved. This is &quot;free money&quot; that should not be missed.</p> <h3>3. Up Current Savings</h3> <p>Kick your existing savings up a notch (e.g., from 2% to 3% of pay). The best time to do this is when you receive a raise or a household expense (e.g., loan payment or child care) ends.</p> <h3>4. Bank Your Windfalls</h3> <p>Save all or part of &quot;windfalls&quot; you receive &mdash;&nbsp;retroactive pay, lucrative &quot;side hustles,&quot; prizes, or gifts.</p> <h3>5. Bank Your IRS Refund</h3> <p>Save all or part of your income tax refund. Earmark savings automatically on your tax return by using IRS Form 8888 or save it yourself after your refund arrives.</p> <h3>6. Start &mdash; and Finish &mdash; Savings Challenges</h3> <p>Complete a savings challenge that gradually ramps up savings deposits over time. Try any of these <a href="http://www.slideshare.net/BarbaraONeill/four-savings-challenges-for-new-year-0116">four challenges</a>.</p> <h3>7. Bank Your Pocket Change</h3> <p>Save your pocket change. Throw it into a clear jar (so you can see your savings) and label the jar with a savings goal for added motivation. Ramp up to $1 to $5 a day, plus loose change, for added savings.</p> <h3>8. Build a Budget</h3> <p>Develop a spending plan (budget). Include savings for emergencies and future financial goals as fixed &quot;expenses.&quot; Then automate savings deposits so they don't require ongoing self-control.</p> <h3>9. Keep Making Those Payments</h3> <p>Keep making monthly &quot;payments&quot; for soon-to-be paid-off loans &mdash; to yourself. You're already used to living without this money (e.g., a $280 monthly car loan payment), so put it into savings.</p> <h3>10. Commit Half of Your Raise</h3> <p>Save half of your next pay increase (e.g., raise, bonus, overtime, freelance income, or additional income from changing jobs). Your net pay will still go up and the additional savings will be painless.</p> <h3>11. Save Your Extra Paychecks</h3> <p>Save part of your &quot;extra&quot; paychecks. Workers paid weekly have four months with five paychecks, instead of four, and those paid bi-weekly have two months with three paychecks, instead of two.</p> <h3>12. Bank Supermarket Savings</h3> <p>Save the amount of money you save at the supermarket by using &quot;shopper cards,&quot; sales, and coupons. Your receipt will show how much you saved. If you save $20 a week, that's over $1,000 a year!</p> <h3>13. Snowball or PowerPay Your Debt</h3> <p>PowerPay your way out of debt. Visit <a href="http://www.powerpay.org/">PowerPay</a> to calculate the time and interest savings available from faster debt repayment. As each debt is repaid, remaining debts receive larger payments until all debts are zeroed out. Afterwards, the money that you spent on debt can be saved.</p> <h3>14. Bank on Your Health</h3> <p>Take care of yourself by eating healthy meals and getting adequate physical activity and sleep. The greatest wealth is health, so take care of yourself and protect your ability to earn money and save.</p> <p><a href="http://www.amazon.com/Saving-Shoestring-Expenses-Reduce-Stash/dp/0793111188/ref=sr_1_1?s=books&amp;ie=UTF8&amp;qid=1454020290&amp;sr=1-1&amp;keywords=saving+on+a+shoestring"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/51D9XNCQGJL.jpg" width="318" height="475" alt="" /></a></p> <h2>Expense Reduction Tips</h2> <p>Cutting costs is the quickest way to find more cash to save.</p> <h3>15. Cut 10% From Extras</h3> <p>Adopt the 10 Percent Solution: find ways to cut 10% of current spending for variable expenses such as food, utilities, gifts, entertainment, and transportation.</p> <h3>16. Buy Only the Necessities</h3> <p>&quot;Crash save&quot; by deciding, for a month or two, to buy only absolute necessities and save the difference.</p> <h3>17. Take Aim at Big Expenses</h3> <p>Reduce large expenses such as housing (e.g., refinancing mortgage), income taxes (e.g., tax credits and tax-deferred investments), and insurance (e.g., policy discounts).</p> <h3>18. Brown Bag It</h3> <p>&quot;Brown bag&quot; lunch to work on most days, instead of eating out, and buy packages of soda or bottled water on sale instead of using expensive vending machines.</p> <h3>19. Skip the Boutique</h3> <p>&quot;Step down&quot; when buying clothing, from high-end to moderately priced department stores to discount stores, factory outlets, consignment stores, and thrift shops. The more steps down, the greater the savings.</p> <h3>20. Plug Your Spending Leaks</h3> <p>Add up what you're spending on &quot;little things&quot; such as snacks, coffee, soda, candy, fast food, lottery tickets, magazines, take-out dinners, beverages, and more. If you can &quot;find&quot; $5 per day from reduced spending, that adds up to $1,825 of savings per year and even more with interest.</p> <h3>21. Use Employee Discounts</h3> <p>Take advantage of rebates, discounts, and/or wellness incentive programs provided through your employer. Talk to your boss or human resources office to find out what perks your company offers.</p> <h3>22. Don't Smoke</h3> <p>Quit smoking, or don't start. Assume a pack of cigarettes costs $6. Multiply $6 by 365 days and you could save $2,190 a year, plus interest (not to mention all of the positive health effects!).</p> <h3>23. Cut Home Energy Costs</h3> <p>Save on home energy costs. Check weather stripping and caulking for leaks, upgrade attic insulation, shift energy use during &quot;off-peak&quot; hours, and turn the thermostat down a degree or two.</p> <h3>24. Be Smart About Smartphones</h3> <p>Choose a cell phone plan that best meets your needs (e.g., number of monthly minutes and texts, data usage, number of linked callers) or use low-cost prepaid telephone calling cards as needed.</p> <h3>25. Find Free Entertainment</h3> <p>Seek out free or low-cost community resources such as summer concerts, health fairs, state parks, rabies clinics for pets, and inexpensive adult education classes such as those offered by Cooperative Extension.</p> <p>Even small amounts of savings will grow to significant sums with compound interest over time. When there's a will, there's a way. Consider combining several of the above savings strategies for greater impact. It is also important to have a reason to save. Write down one or more specific financial goals (e.g., a new car in 2019). Having an eventual use for your money in mind will increase your motivation to save.</p> <p><em>How are you saving more and spending less?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dr-barbara-oneill">Dr. Barbara O&#039;Neill</a> of <a href="http://www.wisebread.com/25-ways-to-save-on-a-shoestring">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/the-10-most-low-effort-ways-to-save-money-ever">The 10 Most Low Effort Ways to Save Money Ever</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/73-easy-ways-to-save-money-today">73 Easy Ways to Save Money 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/10-simple-ways-to-start-living-on-less-today">10 Simple Ways to Start Living on Less Today</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/15-personal-finance-rules-you-should-be-breaking">15 Personal Finance Rules You Should Be Breaking</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/8-reasons-the-easter-bunny-should-give-money-instead-of-candy">8 Reasons the Easter Bunny Should Give Money Instead of Candy</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living budgeting Health saving saving strategies spending Mon, 15 Feb 2016 11:00:04 +0000 Dr. Barbara O'Neill 1654795 at http://www.wisebread.com Americans Spend More Than Other Countries On These 10 Things http://www.wisebread.com/americans-spend-more-than-other-countries-on-these-10-things <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/americans-spend-more-than-other-countries-on-these-10-things" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/american_flags_000047277396.jpg" alt="Americans spending more than other countries do" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>In America, we're known for our indulgences &mdash; home appliances, electronics, vacations, cars. So how does our spending stack up against Europeans, or folks in Asia? Read on for our analysis of the most uniquely American spendings habits out there.</p> <h2>1. The Lottery</h2> <p>Americans spend more money <a href="http://www.theatlantic.com/business/archive/2015/05/lotteries-americas-70-billion-shame/392870/">playing the lotto</a> than on books, video games, and movie and sporting event tickets combined. In 2014, lottery spending in the U.S. totaled a whopping $70 billion. (See also:&nbsp;<a href="http://www.wisebread.com/6-ways-of-improving-your-lottery-odds">6 Ways of Improving Your Lottery Odds</a>)</p> <h2>2. Doctors and Dentists</h2> <p>The U.S. spends more <a href="http://www.commonwealthfund.org/publications/issue-briefs/2015/oct/us-health-care-from-a-global-perspective">public dollars on healthcare</a> than all but two countries. There are a couple of reasons for that. First, healthcare services are notably higher in the U.S. than in most other nations. And secondly, Americans are greater users of expensive medical treatments and technologies, such as MRI machines.</p> <h2>3. Housing</h2> <p>Americans spend more money on housing than people in Canada, the United Kingdom, and Japan. In a 2009 study, Americans funneled an average <a href="http://www.bls.gov/opub/focus/volume2_number16/cex_2_16.htm">26% of their expenditures</a> toward shelter.</p> <h2>4. Taxis, Planes, and Trains</h2> <p>The same study showed Americans also spend more on private transit, other than automobiles, than folks in Canada, the United Kingdom, and Japan.</p> <h2>5. Education</h2> <p>The U.S. <a href="http://www.cbsnews.com/news/us-education-spending-tops-global-list-study-shows/">spends more on education</a> than any other developed nation, and most of the funding comes from the pockets of parents and private foundations. Total spending per student in the U.S. tops $15,000. For perspective's sake, Switzerland spends nearly $15,000 and Mexico pays about $3,000. Despite big spending, American students still lag behind comparable nations on international tests.</p> <h2>6. Prescription Drugs</h2> <p>Americans spend far more on <a href="http://www.pbs.org/newshour/updates/americans-spend-much-pharmaceuticals/">prescription drugs</a> &mdash; almost $1,000 per person per year &mdash; than residents of any other country. For some perspective: Americans spend 40% more than the next highest spenders, Canadians.</p> <h2>7. Politics</h2> <p>Americans spend more on <a href="https://sunlightfoundation.com/blog/2014/11/10/u-s-political-finance-americans-spend-more-on-elections-but-they-lead-from-behind/">political campaigns</a> than any other country. To compare, India spent $5 billion in its last general election. That's one billion dollars less than Americans spent in the 2012 general election.</p> <h2>8. Tourism</h2> <p>When traveling abroad, Americans <a href="http://www.businessinsider.com/tourists-from-these-countries-spend-the-most-when-traveling-abroad-2015-4">outspend vacationers</a> from most other countries. In 2014, Americans abroad spent $112 billion &mdash; more than Germany, the United Kingdom, and Russia. The big out-spender, however, was China. Chinese abroad spent $165 billion that same year.</p> <h2>9. Christmas</h2> <p>Americans are more likely than residents of any European nation to go into debt to pay for Christmas presents. One in five Americans used credit to <a href="http://www.ing.com/Newsroom/All-news/UK-and-Romania-top-international-Christmas-spending-league.htm">cover holiday spending</a> in 2014.</p> <h2>10. Chocolate Bars</h2> <p>The U.S. leads global spending on <a href="http://www.theguardian.com/news/datablog/2015/jul/19/which-country-spends-the-most-on-chocolate-bars">chocolate bars</a>, topping out at nearly $3 billion per year. That shakes out to an average annual chocolate expenditure of $57 per American.</p> <p><em>Do any of these expenditures look familiar to you?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/americans-spend-more-than-other-countries-on-these-10-things">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/americans-spend-less-than-other-countries-on-these-9-items">Americans Spend Less Than Other Countries on These 9 Items</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/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</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/14-pricey-things-you-shouldnt-buy-and-what-to-get-instead">14 Pricey Things You Shouldn&#039;t Buy (And What to Get Instead)</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/are-your-five-senses-tricking-you-to-spend-more">Are Your Five Senses Tricking You to Spend More?</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-to-keep-your-money-separated-after-marriage">5 Reasons to Keep Your Money Separated After Marriage</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Lifestyle Shopping americans Asia Europe habits spending united states Tue, 19 Jan 2016 18:00:04 +0000 Brittany Lyte 1638139 at http://www.wisebread.com The 7 Best Credit Card Debt Elimination Strategies http://www.wisebread.com/the-7-best-credit-card-debt-elimination-strategies <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-7-best-credit-card-debt-elimination-strategies" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000064784921.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Burdened with thousands of dollars of consumer debt? Do you dread reading your credit card statements each month? There is hope. You can pay down your credit card debt fast. But first, you have to stop using your cards to make new purchases.</p> <p>And before you start paying off that debt, know this: You're far from alone. It can be difficult to track down just how much credit card debt the average cardholder is paying off, but in the spring of 2015, CardHub released a study showing that those households that carry a balance on their credit cards have an average debt of almost $7,200.</p> <p>How do you remove yourself from this statistic, and do it (fairly) quickly? Here are seven tools you can try.</p> <h2>1. Stop Charging</h2> <p>No debt repayment plan will work if you keep adding to your credit card balances. So make a vow to stop charging gas, groceries, or clothes. Buy only what you can afford to purchase in cash. Breaking the credit card habit can be challenging, but doing so will give your efforts to eliminate your consumer debt a huge boost.</p> <h2>2. Pay More Than the Minimum</h2> <p>You can't just pay the minimum monthly required payments on your credit cards if you want to eliminate your debt quickly. You'll simply be paying a ton of interest while whittling away at that debt.</p> <p>Here's an example. Say your credit card balance is $6,000, your card's interest rate is 18.9% percent, and your minimum required payment each month is 4% of your balance. If you only pay that minimum each month, it will take you 144 months &mdash; or 12 years &mdash; to pay off your debt, and that's only if you never make any additional charges with that card. While paying this debt off, you'll pay a total of about $9,750, or about $3,750 in total interest.</p> <p>The lesson here is obvious: No matter how you choose to tackle your debt, always pay more than the minimum each month.</p> <h2>3. Choose a Repayment Method</h2> <p>There are two good ways to approach paying off debt, and both can help you eliminate your credit card balances quickly.</p> <h3>Snowball Method</h3> <p>This is when you pay the minimum required monthly payment on all of your credit cards <em>except for one</em>. Use the majority of the money you have each month for paying down your debt on this last card. How you choose this card is up to you: Some consumers will pick the card with the lowest balance so that they can quickly pay it off. Others will choose the card with the highest interest rate so that they can eliminate their debt that grows the quickest each month.</p> <p>But once you pay off your targeted card, repeat the process: Pick another card to spend most of your debt-reducing dollars on and pay the minimum on the rest of them. If you stay at this long enough, you'll eventually eliminate all of your credit card debt.</p> <h3>Debt Ladder Method</h3> <p>In the debt ladder method, you'll list all your credit cards from the one with the highest interest rate to the one with the lowest. Then, much like with the snowball method, you'll spend most of your money each month paying down the card with the highest interest rate while paying the minimum required monthly payment on the rest of your cards.</p> <p>Once you pay off the card with the highest interest, you'll then move to the next card on your list, spending most of your money on that debt until it, too, is paid off.</p> <p>The difference between the snowball and debt ladder methods is subtle: With the debt ladder method, you'll always target the card with the highest interest rate. In the snowball method, you might do this, but you might also go after the cards with the lowest balance first so that you can more quickly snowball the dollars you have available for other accounts.</p> <h2>4. Take Out a Home Equity Loan</h2> <p>Do you own a home? Do you have equity in it? If so, you might consider taking out a home equity loan to pay off all or most of your high-interest-rate credit card debt.</p> <p>If your home is worth $250,000 and you owe $180,000 on your mortgage loan, you have $70,000 worth of equity. A mortgage lender might give you a home equity loan of, say, $50,000. You can then use that $50,000 to pay off credit card debt.</p> <p>The benefit of a home equity loan &mdash; or a home equity line of credit, which is similar but works more like a credit card than a standard loan &mdash; is that such loans come with lower interest rates. It makes sense to swap low-interest debt for high-interest credit card debt. But be sure to pay your home equity loan back on time. If you don't, you could lose your home.</p> <h2>5. Use Your Savings</h2> <p>It's important to have savings. Your savings account can act as an emergency fund, one that can help you cover the costs of unexpected expenses such as a furnace that suddenly conks out in the middle of winter.</p> <p>But if you have thousands of dollars in savings and are paying off thousands of dollars of credit card debt, it might make sense to use those savings to eliminate your high-interest debt. Think of it this way: Your credit card debt might have an interest rate of 19% or higher. The odds are that your savings account is paying you interest of less than 1%. It makes sense to get rid of that credit card debt that is growing so quickly each month. (See also: <a href="http://www.wisebread.com/when-to-use-savings-to-pay-off-debt?ref=seealso">When to Use Savings to Pay Off Debt</a>)</p> <p>Once you do erase your credit card debt, though, build your savings back up each month. You don't want to be without an emergency fund for too long.</p> <h2>6. Do a Balance Transfer to a 0% APR Card</h2> <p>A key factor in repaying your credit card debt expediently is your interest rate, since a lower rate reduces not only your minimum monthly payments, but also the total amount you'll repay on the debt. A common technique for obtaining a lower rate is transferring your credit card balances to a card with a 0% APR. There are a few caveats worth considering, however. (See also: <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?ref=seealso">When to Do a Balance Transfer to Pay Off Credit Card Debt</a>)</p> <p>First, most 0% APR credit card offers are for a limited period &mdash; say, six or 12 or 15 months. Therefore, you should only transfer the amount of balance that you expect to be able to repay in that amount of time. After the introductory 0% APR period expires, the interest rate on your new card &mdash; and any remaining transferred balance &mdash; will rise, leaving you again with a higher interest rate. So make it a priority to pay off all the transferred balance during the 0% APR period. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=seealso">Best 0% Balance Transfer Credit Cards</a>)</p> <p>Second, it's important to understand that balance transfers often come with a fee, usually expressed as a percentage of the amount transferred. (The <a href="http://www.wisebread.com/chase-slate-visa-review">Chase Slate</a> card is a rare one that has zero intro balance transfer fee as well as a 0% Intro APR.) So, any savings you achieve by transferring to a zero percent card should exceed the total of the fees. If you meet these two conditions, however, a balance transfer can help you reduce your repayment time significantly.</p> <h2>7. Get a Personal Loan With a Lower APR</h2> <p>Another means for lowering your interest rate involves paying off part or all of your balance using a personal loan with a lower APR than your card offers. A variety of lenders, ranging from your local credit union or bank to online lenders, such as LendingClub can potentially offer rates below your credit card's. (See also: <a href="http://www.wisebread.com/should-you-use-peer-to-peer-lending-to-pay-down-credit-card-debt?ref=seealso">Should You Use Peer-to-Peer Lending to Pay Down Credit Card Debt?</a>)</p> <p>However, it's again worth noting the terms of the loan. Are there any fees associated with a personal loan that might make it less economical? Can you afford the repayment schedule and terms (the higher your credit score, the better these will be)? If you can't, you may just be trading one type of debt for another. But if the personal loan's terms are favorable, you'll likely have an opportunity to repay your debt faster &mdash; and save significantly in the process.</p> <p><em>Did you retire a mountain of credit card debt? How'd you do it?</em></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/the-7-best-credit-card-debt-elimination-strategies">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/why-you-can-t-stick-with-a-budget">Why You Can&#039;t Stick with a 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/5-inspiring-people-who-each-paid-off-over-100000-in-debt">5 Inspiring People Who Each Paid Off Over $100,000 in Debt</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-fastest-method-to-eliminate-credit-card-debt">The Fastest Method to Eliminate Credit Card Debt</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/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</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/10-tricks-to-save-money-with-credit-cards">10 Tricks to Save Money with Credit Cards</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Debt Management debt home equity loans minimum balance savings spending Thu, 17 Dec 2015 14:00:04 +0000 Dan Rafter 1622170 at http://www.wisebread.com 6 Easy Ways to Use Technology to Save on Christmas Shopping http://www.wisebread.com/6-easy-ways-to-use-technology-to-save-on-christmas-shopping <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-easy-ways-to-use-technology-to-save-on-christmas-shopping" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_texting_winter_000047883380.jpg" alt="Woman using technology to save on Christmas shopping" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>There's no arguing that technology can make life a little sweeter in terms of saving us time and money &mdash; both things that tend to be at a premium during the holidays. Whether it's using free apps on your smartphone, or taking advantage of online shopping tricks to score the best deal, you should definitely consider using tech to lower your <a href="http://www.wisebread.com/december-deals-that-are-better-than-black-friday">shopping bill in December</a> and beyond. Here are a few ideas to get you started.</p> <h2>1. Use a Christmas Shopping App</h2> <p>Since most of us are walking around with very powerful computers in our pockets, it makes sense to use our smartphones to manage our Christmas shopping. My favorite app is the free for iOS&nbsp;<a href="https://itunes.apple.com/us/app/santas-bag-christmas-gift/id397698040">Santa's Bag</a>, which allows you to create gift lists, import recipients, and most importantly, set a budget to keep your spending in check. The app interface is very intuitive and quickly gives you access to the gifts you have bought for each person along with how much of your budget is left for each recipient.</p> <p>Another app worth downloading to help with your Christmas shopping is the free<a href="http://shopsavvy.com/"> ShopSavvy</a> (for iOS and Android). This app allows you to scan the barcode of the product you're considering purchasing and instantly find out if another store has it cheaper &mdash; or if it's available at a lower price online. If you use it consistently, it can easily save you 15%&ndash;20% off your shopping bill this year.</p> <h2>2. Social Media Is Santa's Best Friend</h2> <p>The next time you're standing in line waiting to purchase a couple Christmas gifts, pull out your smartphone and check the social media feeds of the retailer. Many are starting to proactively promote exclusive coupons and deals on Facebook, Pinterest, and Twitter. Often it will only require you to show the coupon on your phone to the cashier, which they will scan, and you'll collect the savings. Make it a healthy frugal habit whenever you're waiting at the register.</p> <h2>3. Hit Up Live Chat and Negotiate a Deal</h2> <p>While you may be able to ask a live chat operator for a coupon, are you aware that you can actually negotiate a lower price on certain items? This works best for laptops, HDTVs, and higher-end electronics. On a whim, I recently started a chat session with Dell.com and saved a quick $50 on a new laptop simply by asking if there was any wiggle room in the price. Be sure to negotiate the price before you add any coupon codes to your online order, as you're less likely to get a price reduction if the operator notices you're already getting a discount. Besides Dell, online retailers where this has been known to work include Hewlett Packard, Kohl's, JCPenney, and even Target.</p> <h2>4. Buy Gift Cards for Cheap</h2> <p>If you're planning on buying a gift card or two this year, be sure to first stop by a website like GiftCardGranny or Raise.com and purchase one for less than face value. These sites purchase unwanted gift cards from folks and then sell them back to you for a small profit. For example, you may find a $100 TJ Maxx gift card for $85, or a $50 JCPenney gift card for less than $45.</p> <p>Also, if you're a little less tech savvy, be sure to try your local Costco. Not only do they have gift cards for big-box retailers, but they also have cards for local restaurants and attractions. Be aware that you'll typically have to buy a pack of three or four gift cards to save, but the savings is usually in the 15&ndash;20% range. The larger quantity can actually come in handy when buying for teachers and friends.</p> <h2>5. Always Seek Out a Coupon Code</h2> <p>If you're not seeking out a coupon code when shopping online, you're leaving significant money on the table. Make it a smart frugal habit to do a quick Google search for &quot;[store name] coupons&quot; and you stand a great chance of finding a money-saving code you can plug in while checking out from the retailer's website.</p> <h2>6. Stack Coupons at Target</h2> <p>Target has fairly competitive pricing to begin with, but be sure to stack coupons for some incredible savings. They'll actually let you stack a manufacturer coupon, a Target store coupon, and a Cartwheel offer on a single product. The best way to make this work is to first find a manufacturer coupon at CouponMom.com or Coupons.com, then print a&nbsp;<a href="http://coupons.target.com/">Target-specific coupon</a> from their site, then download the&nbsp;<a href="http://cartwheel.target.com/">Cartwheel app</a> and use one of their offers as well. If you can stack all three when shopping in-store, you can easily save 40%&ndash;65% off individual items.</p> <p><em>What is your strategy to keep your spending in check and save money this time of year?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/kyle-james">Kyle James</a> of <a href="http://www.wisebread.com/6-easy-ways-to-use-technology-to-save-on-christmas-shopping">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/the-10-best-couponing-apps">The 10 Best Couponing Apps</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/4-ways-to-spot-and-avoid-a-fake-sale">4 Ways to Spot and Avoid a Fake Sale</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/30-cash-back-sites-to-earn-you-thousands-per-year">30+ Cash Back Sites to Earn You Thousands Per Year</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-ways-to-score-a-last-minute-coupon">6 Ways to Score a Last-Minute Coupon</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/the-8-shopping-apps-thatll-actually-save-you-money-in-2016">The 8 Shopping Apps That&#039;ll Actually Save You Money in 2016</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Shopping apps coupons discounts gift buying gift cards Holidays spending Mon, 14 Dec 2015 16:00:07 +0000 Kyle James 1619709 at http://www.wisebread.com 6 Ways to Keep Holiday Spending From Blowing Debt Repayment http://www.wisebread.com/6-ways-to-keep-holiday-spending-from-blowing-debt-repayment <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-ways-to-keep-holiday-spending-from-blowing-debt-repayment" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_money_christmas_gift_000027797353.jpg" alt="Woman learning to balance holiday spending and debt repayment" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The holidays can be stressful, and not just from family or too much junk food. Money is a huge factor, too. In fact, last year, people added an average of $986 to their debt over the holidays.</p> <p>Rather than increasing your debt this holiday season, you can instead balance your spending with your repayment plan. It takes a little work, some creativity, and some juggling, but it's completely within the realm of possibility.</p> <h2>1. Prioritize Minimum Payments</h2> <p>Before you plan any holiday spending, make sure you can at least make the minimum payments on any debt repayment you currently have going.</p> <p>Sure, you want to pay more than the minimum required amount on your debt, even during the holiday season. But you have to balance your priorities. If you value spending on gifts or other holiday items more than paying down debt right now, it's probably okay to take a single month and spend differently than usual. Just make sure that you are ready to get back to your normal payment plan in the next billing cycle.</p> <h2>2. Don't Add More Debt</h2> <p>After you've set aside money for at least the minimum required payments on your debt, make a firm commitment to do whatever you need to do to keep from adding to it over the holidays. That might mean making gifts yourself or buying less than you have in the past.</p> <h2>3. Write it Down</h2> <p>Decide how much you're going to <a href="http://www.wisebread.com/the-best-credit-card-shopping-bonuses">spend for the holidays</a> and how much you want to put towards debt repayment. Then write it down. If you are deciding with a partner, make sure <em>each</em> of you writes it down. Something about the act of putting a goal on paper makes it more real, so it feels like truth and not just possibility. Keep these numbers somewhere where you can look at them before you make any purchases or payments.</p> <h2>4. Plan Ahead</h2> <p>Plan out how much you want to spend on each gift. Price out items online first to ballpark amounts. This will help you figure out what is realistic, and you may find that you can't get everything you'd planned on. Having a plan will also help you feel like your goals are achievable, and not just wishful thinking.</p> <h2>5. Creative Gift Giving</h2> <p>If you choose to prioritize debt repayment, or you simply don't have enough money to cover your minimum payments and holiday gifts, get creative. Offer to spend some one-on-one time with someone close to you. Invite them over. Make hot beverages at home, and have a nice, deep conversation.</p> <p>You can also offer to help people. Give someone a housecleaning, do some yard work, offer an evening of babysitting, and more. They will be appreciative, and you will get to give a gift that won't cost very much at all. In fact, sometimes these sorts of gifts are more thoughtful than anything you can buy.</p> <h2>6. Make Gifts Meaningful, Not Massive</h2> <p>Even if you do choose to purchase gifts, go for something meaningful over something expensive. Despite what the commercials want us to believe, a new mobile phone isn't usually a special gift. Instead, choose a smaller gift that will bring to mind a special memory that you share with someone, or that shows how well you know them.</p> <p><em>How do you plan to balance holiday spending with debt repayment? And how will you choose gifting creatively this holiday season?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/sarah-winfrey">Sarah Winfrey</a> of <a href="http://www.wisebread.com/6-ways-to-keep-holiday-spending-from-blowing-debt-repayment">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/avoid-these-5-common-holiday-budget-pitfalls">Avoid These 5 Common Holiday Budget Pitfalls</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/10-dark-side-motivations-to-get-you-out-of-debt">10 Dark-Side Motivations to Get You Out of Debt</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/4-psychological-traps-preventing-you-from-saving-and-how-to-fix-them">4 Psychological Traps Preventing You From Saving — And How to Fix Them</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-things-people-without-debt-do">10 Things People Without Debt Do</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/13-holiday-season-costs-everyone-always-forgets-about">13 Holiday-Season Costs Everyone Always Forgets About</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Debt Management balance bills gifts giving Holidays spending Thu, 10 Dec 2015 16:00:28 +0000 Sarah Winfrey 1618553 at http://www.wisebread.com How Much Can You Afford to Spend in Retirement? http://www.wisebread.com/how-much-can-you-afford-to-spend-in-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-much-can-you-afford-to-spend-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_fund_money_000049360888.jpg" alt="Figuring out how much you spend in retirement each year" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You've finally reached retirement. Your days of fighting rush hour traffic to get to the office are over. But now you face a new challenge: How much of your retirement savings should you spend each year? It's a big question: Spend too much and you might find yourself out of money 10, 15, or 20 years into retirement.</p> <p>&quot;There are different ways to approach retirement spending,&quot; says Celandra Deane-Bess, chair of the national practice group on retirement for Philadelphia, Pennsylvania-based PNC Financial Services Group. &quot;As you get closer to retirement age, we recommend that you take a more detailed look at your income and your living situation. There are so many factors that can alter how much you can afford to spend each year in retirement.&quot;</p> <p>Planning your retirement spending isn't something you can do with a simple formula, though the following formulas can give you a starting point.</p> <h2>Inflation and the 60%&ndash;90% Rule</h2> <p>Deane-Bess says that many retirees plan for their annual cost of living, because of inflation, to rise 2% to 3% each year. That's a good starting point. But she also pointed to research showing that some costs of living are growing faster than the rate of inflation. This includes one of the major ones that impact retirees: health care costs.</p> <p>Retirees will need to adjust that annual cost-of-living increase upward to account for the rise in healthcare costs, including the rising costs of prescription medications.</p> <p>One rule of thumb that retirees have long followed is that they should spend from 60% to 90% of their after-tax annual income each year in retirement. So, if you were earning $50,000 each year before you retired and you had an effective tax rate of 15%, you were living on $42,500 after taxes each year.</p> <p>If you decide that you need to spend 85% of your most recent after-tax yearly income in retirement, you'd need to have $36,125 available to you each year after retirement. You can generate that yearly income from your savings, pensions, Social Security, and any other regular streams of income you might have.</p> <p>Again, though, this is only a general rule of thumb. You can change how much of your pre-retirement income you'll actually need during your retirement years, Deane-Bess said. If you move to a less expensive home or community, for example, you might need to spend 60% of your pre-retirement income each year. If you live in a higher-cost area, you might need to spend the full 90% each year.</p> <h2>The 4% Rule</h2> <p>Another rule of thumb? The 4% rule. This rule says that you should withdraw 4% of <a href="http://www.wisebread.com/8-steps-to-starting-a-retirement-plan-in-your-30s">your retirement-savings</a> portfolio in the first year of retirement for your living expenses. You should then withdraw that same dollar amount, plus enough extra income to account for inflation, every other year of retirement.</p> <p>It's important to note, though, that this formula rests on the assumption that your retirement will last 30 years. If you're particularly healthy, and you might be retired for more than three decades, you might have to withdraw fewer dollars each year to make your money last.</p> <h2>Expect Some Expenses to Rise</h2> <p>&quot;People often forget that there are actually a few expenses in retirement that go up,&quot; Deane-Bess says. &quot;Everyone assumes that their expenses will go down in retirement. But not all of them do.&quot;</p> <p>For instance, if you are going to be home more often after retirement, your utility bills will typically rise. That's because your heat will be on all day and you'll be using more electricity because you'll be home more often.</p> <p>Some retirees also spend more on leisure, entertainment, or travel during their after-work years. Instead of taking one big trip a year, they might plan on taking two or three. They might take more frequent smaller trips to see their grandchildren.</p> <p>The takeaway? You need to look at your own retirement plans &mdash; where you'll be living, what you'll be doing &mdash; when deciding how much money you can afford to spend each year. Start with the rules of thumb, but tweak them to meet your needs.</p> <p>For instance, Deane-Bess said that retirees who want to travel frequently or live in a higher-cost community might need to withdraw just 2.5% to 3% of their savings portfolio every year.</p> <p>&quot;We are starting to see a pullback from some of the rules of thumb,&quot; Deane-Bess says. &quot;I have been in the industry for 18 years. When I started, there were lots of rules of thumb. But things are changing. Today, it's about taking a more detailed look at your individual retirement plans.&quot;</p> <p><em>How much do you plan to spend in retirement?</em></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/how-much-can-you-afford-to-spend-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-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/7-states-with-the-lowest-taxes-for-retirees">7 States With the Lowest Taxes for Retirees</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/8-reasons-why-your-retirement-cost-calculations-may-be-wrong">8 Reasons Why Your Retirement Cost Calculations May Be Wrong</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-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-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-to-guarantee-income-in-retirement">6 Ways to Guarantee Income in Retirement</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-reasons-early-retirement-might-be-financially-risky">4 Reasons Early Retirement Might Be Financially Risky</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement cost of living expenses inflation social security spending Thu, 05 Nov 2015 11:15:12 +0000 Dan Rafter 1605094 at http://www.wisebread.com 8 Things Your Boomer Parents Could Afford That You Can't http://www.wisebread.com/8-things-your-boomer-parents-could-afford-that-you-cant <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-things-your-boomer-parents-could-afford-that-you-cant" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_classic_car_000013375059.jpg" alt="Boomer parent affording things that we can&#039;t" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Many of us have probably been subjected to the judgement of our Baby Boomer parents, who wonder why younger generations are facing more debt and financial troubles.</p> <p>I won't defend the spendthrift ways of Millennials and Gen-Xers, but the truth of the matter is that many things are simply more expensive now than they used to be. Baby Boomers &mdash; those born between 1946 and 1964 &mdash; paid less for many of the things considered essential now.</p> <p>Here are eight things that our Baby Boomer parents could afford more easily than we can.</p> <h2>1. A Home</h2> <p>Interest rates were probably higher for Baby Boomers, but the average price of a home was considerably lower, even after adjusting for inflation. The <a href="http://www.multpl.com/case-shiller-home-price-index-inflation-adjusted/">Case Shiller Home Price Index</a> offers a good examination of home prices over time. Through most of the '60s, '70s, and '80s, the index was at about 120. Now it's near 170, an increase of about 40%. During the housing bubble, it topped 220 &mdash; that was a near doubling of prices after inflation. No wonder so many of us got into unnecessary housing debt.</p> <h2>2. College</h2> <p>We've all heard stories about Baby Boomers who claim to have attended college for just a few hundred bucks a semester. Indeed, education was a relative bargain for our folks, who in 1975 paid the <a href="http://trends.collegeboard.org/college-pricing/figures-tables/tuition-fees-room-board-time-1974-75-2014-15-selected-years">equivalent of $2,469</a> for a year of tuition and fees at a public university. The cost is more than four times that today. The College Board reports that we experienced increases of 9.5% above inflation during the 2009-10 school year, and another 6.5% above inflation in 2010-11.</p> <h2>3. A Car</h2> <p>A Baby Boomer may have bought his or her first car in 1970 for $3,450, or $20,781 in today's dollars. The average price of a car is now more than $30,000. The good news for today's car buyers is that quality of cars has improved, and there is a wider range of choices, including many at the more affordable end.</p> <h2>4. Child Care</h2> <p>There's not a lot of data on child care costs for older Baby Boomers, but for those raising kids in the 1980s, things were much easier on the wallet than today. The U.S. Census Bureau reported that the <a href="https://www.census.gov/prod/2013pubs/p70-135.pdf">average weekly child care payment</a> in 1985 was about $40, or $84 in 2011 dollars. Compare that to the $143 weekly paid by families in 2011.</p> <h2>5. Food</h2> <p>It cost less for your parents to serve dinner. The Department of Agriculture reported that the price of food has <a href="http://www.ers.usda.gov/amber-waves/2015-july/growth-in-inflation-adjusted-food-prices-varies-by-food-category.aspx#.ViZwTH6rRaR">outpaced the rate of inflation</a> in many areas, including fresh fruits and vegetables, eggs, red meat, and poultry. Fresh fruits and vegetables are 40% more expensive than in 1985, and that's after adjusting for inflation.</p> <h2>6. Health Care</h2> <p>In 1970, per capita spending on health care was a mere $356, or $2,144 in today's dollars. That rose to $8,402 per person in 2010. Some of this increase could be due to the availability of more advanced medical treatment, but there's no doubt it costs more to get sick these days.</p> <h2>7. Going to the Movies</h2> <p>In this case, it may actually depend on the year. A person born in 1946 might have attended the movies as a teenager for 50 cents, or about $4.15 in today's dollars. That's a steal compared to a current ticket, which comes in at $8.61, according to The Hollywood Reporter. But a Baby Boomer attending the movies in the 1970s may have paid prices that, when adjusted for inflation, weren't too much less than today. One thing is for sure: Moviegoers of yesteryear were not subjected to the additional charges for 3D or IMAX screenings that can often add several dollars to the price of a ticket today.</p> <h2>8. Pro Sports Tickets</h2> <p>A ticket to a baseball game cost an average of $28 in 2015, according to Team Marketing Report. The average ticket price is $54 for the NBA, $86 for the NFL, and $62 for the NHL. The cost of player salaries and state-of-the-art stadiums has brought us away from the days when a bleacher seat could be had for $1. At the first Super Bowl in 1967, the average ticket price was $12, or $85 in today's dollars, Sports Illustrated reported. The average ticket price for the Super Bowl in 2014 was an eye-popping $1,250.</p> <p><em>What else was cheaper for Boomers than the generations following?</em></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/8-things-your-boomer-parents-could-afford-that-you-cant">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/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/15-personal-finance-rules-you-should-be-breaking">15 Personal Finance Rules You Should Be Breaking</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/73-easy-ways-to-save-money-today">73 Easy Ways to Save Money Today</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/7-nice-ways-to-tell-your-spendy-friends-youre-staying-on-budget">7 Nice Ways to Tell Your Spendy Friends You&#039;re Staying on 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/why-save-during-an-inflation">Why save during an inflation?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance baby boomers inflation parents saving spending tuition Thu, 29 Oct 2015 15:15:44 +0000 Tim Lemke 1602062 at http://www.wisebread.com 8 Steps to Budget Mastery in 20 Minutes a Month http://www.wisebread.com/8-steps-to-budget-mastery-in-20-minutes-a-month <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-steps-to-budget-mastery-in-20-minutes-a-month" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_holding_calculator_000011141410.jpg" alt="Woman learning steps to master her budget in 20 minutes a month" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The word &quot;budget&quot; strikes fear and panic in many. No one likes to think about them, let alone talk about them. The truth of the matter is that most budgets fail, and they fail badly, because most <a href="http://www.wisebread.com/6-sneaky-ways-you-cheat-on-your-budget">budgets lie</a>. Yes, that's right &mdash; they lie. A budget can represent whatever numbers you put in it. If you forget to add a bunch of expenses in each month, then it makes sense that you would be over budget month after month after month</p> <p>In order to break this silly cycle of money mayhem, here is an easy eight-step system you can use to master your budget in only 20 minutes a month. Open up a spreadsheet and let's get started!</p> <h2>1. Create a Second Column</h2> <p>Not to be redundant, but we've got to first start with the budget. Why most budgets fail is because they only have one column, the budgeted column. We've already gone over why this doesn't work. Instead, upgrade your budget to a two-column layout for success. Your first column is the &quot;What I Think I Will Spend&quot; column, and the second column is the &quot;What I Actually Spent&quot; column. Basically, you create two mirror columns to accurately display what is going on in your budget for a given month.</p> <h2>2. Fill in &quot;What I Think&quot;</h2> <p>The &quot;What I Think&quot; column should be the easiest column to complete and shouldn't take you more than a couple of minutes at most. This column represents all of your budgeted items. It's an approximation of what you think you will spend during the month. Most of the numbers should be easy to access from your normal monthly expenses. Don't labor over this column too much, but make sure that you attempt to accurately itemize each income and expense item.</p> <h2>3. End of Month</h2> <p>The end of the month is where things start to get a bit more analytical (but don't let that scare you). At the end of each month, print off your most recent bank or credit card statements in which you've incurred your expenses for the month. This is the easiest step in the eight-step process, but it's critical to analyzing what went on during the month.</p> <h2>4. Add It Up</h2> <p>Once you're armed and ready with your statements (and receipts, for cash spending), get out a handy calculator and some highlighters. Color-code your statements for budget expense items like groceries, eating out, gas, clothing, utilities, phone, and so on. Then go through the list and highlight each item in each category. This makes it easy to add it all up when you are finished. There's nothing yet to analyze in this step, you are simply categorizing for step six. This will take you the longest out of all the steps, so allow 10 minutes to conquer your statements. Once you do this process for a month or two, it should be very easy to go through your statements in five minutes or less. Practice makes perfect.</p> <h2>5. &quot;What I Spent&quot;</h2> <p>Now it's time to fill in the second column, &quot;What I Spent.&quot; Simply take the numbers from your statements and input them into the budget template. If you notice that you've left off a category on your budget, add it and put it in bold so it can jog your memory next month. Each month has its own twists and turns, so it's common that you might leave out a category by accident.</p> <h2>6. Compare the Columns</h2> <p>You've done the heavy lifting now, and are almost through your 20 minutes this month. Take a look at your budget and compare the two columns. Are there any areas that surprise you? Did you come in under or over budget, and why? What about those missing categories, are they essential to include going forward? You see the power is in comparing these two columns. It gives you a chance to evaluate your budget from estimation in the beginning of the month, to an absolute at the end of the month.</p> <h2>7. The Envelope Trick</h2> <p>If you have a category that is always your Achilles' heel, and month after month you are overspending, then it might be time to kick it old school. For instance, let's say eating out is always an area you overspend in. If you've budgeted $200 for the month in your first column, then at the beginning of the month you can withdrawal that $200 in cash, and stick it in an envelope. For the entire month, every time you eat out, you must dip into this envelope. Once the money is gone, your eating-out budget is gone. While this might seem harsh, it's an old school way to force you to stay within budget. At the end of the day though, none of these steps will work unless you put effort in and are committed to mastering your budget.</p> <h2>8. Reward Yourself</h2> <p>We all love a good reward, and you should pat yourself on the back if you've completed these steps for the month. No matter the outcome, you've taken small moves that will lead to big changes in your cash flow. Pick a dollar amount that you are comfortable with at the beginning of the month, and set a goal for yourself. Maybe you want to treat yourself to an extra cupcake at the end of the month, or go to that concert that you are dying to see. Whatever it is, give yourself a pat on the back, but not for too long &mdash; next month is coming quickly and it will be time to restart the 20-minute system.</p> <p><em>What's your budgeting system?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/shannah-game">Shannah Game</a> of <a href="http://www.wisebread.com/8-steps-to-budget-mastery-in-20-minutes-a-month">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-7"> <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/if-youre-doing-these-5-things-your-saving-efforts-are-for-nothing">If You&#039;re Doing These 5 Things, Your Saving Efforts Are for Nothing</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/too-broke-to-be-frugal">Too broke to be frugal?</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/73-easy-ways-to-save-money-today">73 Easy Ways to Save Money Today</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-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-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-your-emergency-fund-big-enough-to-keep-you-afloat">Is Your Emergency Fund Big Enough to Keep You Afloat?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance budget financial planning monthly budgets spending Wed, 21 Oct 2015 13:16:44 +0000 Shannah Game 1593640 at http://www.wisebread.com Pets, Old Cars, and 3 Other Common Money Pits http://www.wisebread.com/pets-old-cars-and-3-other-common-money-pits <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/pets-old-cars-and-3-other-common-money-pits" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/burning_cash_000023356108_0.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Most of us have fallen into a money pit, or have heard horror stories from someone who has. The classic example of a money pit is a house that needs a lot of unexpected repairs. There was even a movie in 1986 called <a href="http://www.amazon.com/gp/product/B00HUO1CXS/ref=as_li_tl?ie=UTF8&amp;camp=1789&amp;creative=390957&amp;creativeASIN=B00HUO1CXS&amp;linkCode=as2&amp;tag=wisbre03-20&amp;linkId=ZXIXFF4FYVSYQRS4">The Money Pit</a> with Tom Hanks and Shelley Long on this very topic, a comedy about buying a bargain fixer-upper house that didn't go smoothly, to say the least.</p> <p>But there are other types of money pits that can lead to almost unlimited spending. Anything that has high maintenance, ongoing expenses, or requires a large investment that does not yield a corresponding increase in value is a money pit. And while it's obvious from this description that money pits should be avoided, they don't come with warning labels. (In fact, some are even cute and furry&hellip;)</p> <p>So here's a list to look out for.</p> <h2>Common Money Pits</h2> <p>For many of us, these money pits are impossible to avoid.</p> <h3>1. Restoring a Classic Car</h3> <p>That old classic car might look like a fun project &mdash; and maybe even a good investment. But did you know it can cost $100,000 to <a href="http://autoweek.com/article/car-news/four-reasons-not-restore-vintage-car-you-might-be-better-buying-car-someone-else">restore a classic car</a> that might sell for $25,000? Ordinary cars can be expensive to maintain, but restoring a classic car can get really expensive. Adding insult to injury: Even if you do manage to finish restoring a car and do a great job, it will likely be worth only a fraction of what you put into it. I once worked on a 1967 Mustang for a few years before selling it for less than I paid for it &mdash; what a deal!</p> <h3>2. Pets</h3> <p>It doesn't seem like it should cost that much to own a pet, but there are lots of little expenses that add up, including routine vet care, food, toys, treats, accessories, boarding, grooming, etc. The average annual cost for routine <a href="http://www.mspca.org/adoption/adoption-resources/ready-to-adopt/cost-of-pet-care.html">expenses to own a dog</a> is nearly $1,000. Cat ownership is a bit less expensive at $740 per year.</p> <p>The routine expenses mentioned above do not include emergency veterinary care or treatment for diseases. I recently spent <a href="http://www.wisebread.com/3-ways-your-dog-is-ruining-your-credit-score">thousands of dollars on vet bills</a> for my very sick dog. I was beginning to wonder about spending so much, but then I thought if the tables were turned and I was hurt, how much would my dog give to help me? Everything. So I did what I had to do, and my dog made a 100% recovery.</p> <h3>3. College</h3> <p>Or at least, extended and aimless graduate degrees. There is a word for people who go to college for 11 years: &quot;doctor.&quot; Even though I was in college for a long time, it was a good deal for me. I went to a state school and worked full-time for some of those 11 years while I was finishing my Ph.D. Since graduating, I have been able to generate money with my engineering degrees.</p> <p>But college does not work out this well for everyone, and has potential to be a big-time money pit. The <a href="http://college.usatoday.com/2014/11/13/stock-up-on-ramen-average-cost-of-college-rises-again/">average cost for tuition</a> and fees is around $9,000 per year at a public university, or around $31,000 at a private school. On top of this, you'll have to pay for room and board. At these prices, it doesn't take long to sink a lot of money.</p> <h3>4. Starting a Business</h3> <p>Starting a business can be a good investment opportunity, or it can quickly turn into a money pit. It takes a lot of money to get a business off the ground: equipment, rent, payroll, franchise fees, and much more. Once you start putting money into a business, it can be hard to stop. If you stop spending, you'll lose your investment and future earnings potential, so you'll want to put more money in and keep the business alive.</p> <p>This process can go on until you don't have any more money left to put in. By some estimates, <a href="http://www.forbes.com/sites/neilpatel/2015/01/16/90-of-startups-will-fail-heres-what-you-need-to-know-about-the-10/">90% of start-up businesses fail</a>, so there is a high probability starting a business will be a money pit &mdash; and a small chance that you'll be the next Steve Jobs.</p> <h3>5. Fixing Up an Old House</h3> <p>I lived in an old farmhouse for eight years and did lots of projects that greatly improved it. The main limitation on fixing it up was money. Every time I would get some money, I would spend it on a project. Eventually I realized that there would always be another project and I would never have any money to spend on anything else. I decided to sell the old farmhouse and move on instead of continuing to spend money on endless projects.</p> <h2>Strategies for Dealing With Money Pits</h2> <p>Most money pits can be avoided or controlled. Even if you get into a potential money pit, you may be able control expenses to avoid overspending. Take care to avoid spending more money than you can afford if you are getting into a potential money pit.</p> <h3>1. Avoid Money Pits</h3> <p>The most effective way to avoid wasting money on a money pit is not to get into one in the first place. I have gotten better at recognizing and avoiding money pits over the years.</p> <p>One of the best ways to learn about potential money pits is to talk with other people who have done a similar project or who own a similar item. If you are in a hurry, Internet research on typical expenses can go a long way to identify hidden costs before you commit to buying something that could be a money pit.</p> <h3>2. Limit Money Pit Spending</h3> <p>If you have a money pit in progress, you can at least try to control the damage. Resist throwing more money in and try to enjoy your money pit as-is, without pouring more into it. Sure it may need work, but that can wait. Set a budget for spending on your money pit instead of spending as fast as problems arise. Try to find a partner to go in with you and share the expenses and the work.</p> <h3>3. Get Rid of Your Money Pit</h3> <p>In some cases, your best move is to get rid of the money pit and let someone else take over the costs. With Craigslist and eBay, it is easier than ever to sell whatever it is that is draining your bank account. There are other options to get rid of your money pit besides selling &mdash; you can trade it for something else, or even give it away free to a good home, depending on the item.</p> <p><em>Have you ever slipped into a money pit? How did you escape?</em></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/pets-old-cars-and-3-other-common-money-pits">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/the-only-6-rules-of-frugal-living-you-need-to-know">The Only 6 Rules of Frugal Living You Need to Know</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/73-easy-ways-to-save-money-today">73 Easy Ways to Save Money 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/the-9-people-in-your-life-who-are-keeping-you-poor">The 9 People in Your Life Who Are Keeping You Poor</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/a-champion-of-savings-over-spending">A champion of savings over spending</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/self-sufficiency-self-reliance-and-freedom">Self-sufficiency, self-reliance, and freedom</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Frugal Living debt money pits spending wasting money Thu, 03 Sep 2015 13:00:19 +0000 Dr Penny Pincher 1540875 at http://www.wisebread.com 8 Smart Things to Do With Your Settlement Money http://www.wisebread.com/8-smart-things-to-do-with-your-settlement-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-smart-things-to-do-with-your-settlement-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_holding_cash_000060434760.jpg" alt="Woman learning smart things to do with her settlement money" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>So, you're experiencing a financial windfall? Sold a business or property, won a lucrative contract, or were awarded money in a lawsuit? Congratulations! You're probably feeling a mixture of relief and anxiety.</p> <p>Now, how do you go about making sure that you don't lose or spend absolutely everything within the next few years? That's what happens to most people who receive a large cash settlement if they don't know how to manage it properly. Here's how to avoid that outcome:</p> <h2>1. Understand the Tax Implications</h2> <p>Getting a handle on how much your windfall may be taxed is a crucial first step in managing your money.</p> <p>&quot;It's almost always best to get tax advice before finalizing (and documenting) the terms of a settlement,&quot; says Benjamin L. Grosz, a tax and estate planning attorney at <a href="http://www.ipbtax.com/">Ivins, Phillips &amp; Barker</a> in Washington, DC. &quot;Under federal tax law, most types of settlements (or judgments) will be subject to income taxes.&quot;</p> <p>Exceptions usually include settlement payments for personal injuries or physical sickness, says Grosz. Emotional distress settlements can go either way.</p> <p>Your settlement may be subject to taxes if it is related to the following type of claim: breach of contract, copyright infringement, lost profits, back pay, or punitive damages. You may also have to pay taxes on top of attorney's fees. Also, your settlement might be a combination of taxable and tax-free.</p> <p>Financial Planner <a href="http://scalingindependence.com/">Drew Weckbach</a> offers the following example of a $100,000 mixed-tax settlement: &quot;The first $40,000 may be due to the personal injury and reimbursement of expenses; this is tax-free. The next $60,000 may be deemed punitive for the negligence of the offending party; you would have to pay taxes on that portion.&quot;</p> <h2>2. Get a Good Financial Advisor</h2> <p>Martin Hurlburt, author and co-founder of <a href="http://www.tm-wealth.com">TM Wealth Management</a>, points out something that is frequently overlooked by settlement recipients. &quot;The most important thing to remember when managing a sudden windfall is that emotions can be hazardous to your wealth! You may feel relief and grief at the same time. Guilt and happiness. And in this mixed up state of mind, you will be asked to make some important and potentially life-changing decisions.&quot;</p> <p>Because of the emotional rollercoaster that a financial windfall can cause, Hurlburt recommends that you sit down with a financial advisor who specializes in sudden wealth management. &quot;Create your [financial] strategy,&quot; says Hurlburt. &quot;Have a plan for the money <em>before</em> you get it.&quot;</p> <p>Also, be sure to find a financial advisor who is willing relieve some of the personal pressure that inevitably comes from suddenly finding yourself flush with cash.</p> <p>&quot;When friends and family come to you for money, you can legitimately tell them you need to run it by your advisor first,&quot; advises Hurlburt. &quot;Let the advisor be the 'bad guy' or person who says 'No.'&quot;</p> <h2>3. Pay Off Debt and Save</h2> <p>These steps might seem obvious, but sometimes large financial windfalls can skew one's perception of financial obligations. However, it may help to think about using your settlement money the same way you might use your regular income; at least, in the beginning.</p> <p>First, pay off debt, such as credit cards, lingering medical expenses, and high-interest loans.</p> <p>Once this is done, you can <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund">create your emergency fund</a> (a minimum of six months of living expenses &mdash; this will help you stay out of debt in the future). Next, you can <a href="http://www.wisebread.com/debt">pay off other debt</a>, such as your home mortgage or car loans. Fourth, set aside your <a href="http://www.wisebread.com/10-easy-ways-to-supercharge-your-retirement">retirement fund</a>. Your financial advisor can help you decide what the best investment type will be for you and your situation.</p> <p>Finally, consider what kind of <a href="http://www.wisebread.com/do-you-need-an-estate-plan">estate planning</a> you will need and decide how your remaining money will be used when you die. Talk to an expert about this.</p> <h2>4. Invest in Education</h2> <p>Kevin Gallegos, Vice President of Phoenix operations for the <a href="http://www.freedomfinancialnetwork.com">Freedom Financial Network</a>, recommends investing in education next. Besides putting money into education funds for your children, you can &quot;build your own financial future by continuing your education,&quot; says Gallegos. &quot;Higher education generally repays its cost &mdash; and then some.&quot; Receiving the best education you can is not just financially rewarding, it is personally fulfilling.</p> <p>Even if you have enough of a windfall to stop working for a time, you may find that you want to volunteer or even continue working &mdash; earning a degree in an area that you find interesting can turn your job into something you are excited to do (assuming you don't already have a job like this &mdash; most of us don't).</p> <h2>5. Invest in Your Home</h2> <p>After educational costs, says Gallegos, consider your living situation. &quot;If you do not own, it may be an opportunity to <a href="http://www.wisebread.com/7-things-you-need-to-know-before-buying-your-first-house">purchase a home</a>. No matter what, though, it is still important to research the total costs of owning, your lifestyle and priorities, and make a careful decision before proceeding.&quot;</p> <p>&quot;A house is important, but don't over extend yourself,&quot; cautions Layton Cox, Financial Advisor for <a href="http://www.arizona401kadvisor.com">Pathways Financial Partners</a>. &quot;Buy something in your price range with a monthly mortgage payment you can afford.&quot;</p> <p>Don't forget to consider the cost of property taxes in the area that you want to live.</p> <h2>6. Donate to Charity</h2> <p>Charitable donations are tax-deductible, so giving to charity isn't just a feel-good way to spend part (or all) of your settlement, it's a smart financial decision. Besides direct gifts, you can ask your tax advisor about setting up a charitable trust.</p> <h2>7. Invest in Business, Friends, or Family</h2> <p>If you have personal projects or family relations that you believe deserve a cash infusion, you don't have to hoard your money, but invest wisely. Do your research, lean on your financial advisor, and make sure to go through the proper legal channels to ensure that you don't get stuck owing money to someone you don't even know because your cousin Roger jerked you around.</p> <h2>8. Enjoy Yourself!</h2> <p>Of course, when imagining a financial windfall, most of us do spend time dreaming about all the cool stuff that money can buy. But instead of the fancy cars or boats that we typically fantasize about, consider treating yourself to new and exciting experiences, rather than simply material goods.</p> <p>In other words, avoid a &quot;keeping up with the Joneses&quot; mentality.</p> <p>Cox, of Pathways Financial Partners, advises, &quot;Everyone wants the new car, the new suit, the new home, or anything their neighbor has that is better than theirs. [But] when it comes to a dollar-for-dollar comparison, people enjoy experiences more than possessions.&quot;</p> <p>&quot;If you still have extra money laying around,&quot; says Cox, &quot;take a vacation. I've been told the Maldives are beautiful this time of year&hellip; or any time of year.&quot;</p> <p><em>Have you been lucky enough to receive a financial windfall? How did you manage it?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-karim">Andrea Karim</a> of <a href="http://www.wisebread.com/8-smart-things-to-do-with-your-settlement-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-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/47-simple-ways-to-waste-money">47 Simple Ways To Waste 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/15-personal-finance-rules-you-should-be-breaking">15 Personal Finance Rules You Should Be Breaking</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/book-review-spend-til-the-end">Book review: Spend &#039;til The End</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/if-youre-doing-these-5-things-your-saving-efforts-are-for-nothing">If You&#039;re Doing These 5 Things, Your Saving Efforts Are for Nothing</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/financial-tricks-to-master-for-a-happier-life">Financial Tricks to Master for a Happier Life</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance cash investing lawsuits settlements spending windfalls Wed, 26 Aug 2015 13:00:27 +0000 Andrea Karim 1532936 at http://www.wisebread.com 7 Times to Avoid Debit or Credit Cards http://www.wisebread.com/7-times-to-avoid-debit-or-credit-cards <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-times-to-avoid-debit-or-credit-cards" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000048733408.jpg" alt="Friends shopping and avoiding debit and credit cards" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Paying with debit or credit cards is fast, convenient, and easy. Despite the arguments for debit and credit cards, however &mdash; some of which are totally valid &mdash; there are instances when cash is the better option. What are they? Check out six of them here, and share some of your own suggestions in the comments below.</p> <h2>1. When the Impulse-Buying Pangs Hit</h2> <p>One of the worst times for using your debit or credit card is when making small, insignificant purchases like food items, or basically anything from a convenient or quick-stop shop, like a CVS, Walgreens, or Rite-Aid. Those places have all the makings of impulse-buy overload, and you generally don't <em>need</em> whatever it is you're purchasing. The problem is those small expenses add up quickly &mdash; and they're hard to keep track of. Do it too often and you're in for a big surprise when the bill comes and, as a result, in danger of negatively affecting your budget.</p> <p>Kelsa Dickey, a Tempe, Arizona-based financial counselor, specializes in teaching budgeting, debt-reduction strategies, cash flow planning, and more, and she wholly advocates against this practice.</p> <p>&quot;If you use a credit card for day-to-day spending, it's very easy to not pay attention to how much is going on there and accidentally overspend,&quot; she says. &quot;I would avoid using credit cards in those situations. If you ever get your bill at the end of the month and you kind of gasp when you see the total, I'm looking at you!&quot;</p> <h2>2. When Making Major Purchases, Like a Car</h2> <p>It can be tempting to make a major purchase, like a car, with your credit card, especially if you have a card that offers perks, like reward points. The downside to this logic, however, is that the massive sum of a major purchase also comes with equally sizable interest and late fees. If you don't have the funds to pay off the balance immediately, putting this purchase on a credit card is not a good idea. Instead, opt for a traditional loan (with a reasonable interest rate) or pay in cash if you have it to avoid additional fees, altogether.</p> <h2>3. When Dealing With Cash-Equivalent Transactions</h2> <p>I've seen it time and again at the casino: When a player runs out of money, they hand their credit card to the dealer or visit the cashier for a cash advance from their credit card so they can continue making donations to the establishment. And that's bad news for multiple reasons. First, if you've resorted to this financial low, you've obviously run out of spendable cash. Second, these transactions aren't cheap. Third, you have a gambling problem &mdash; but that's neither here nor there in this post.</p> <p>Robert Harrow, analyst for personal-finance research site ValuePenguin and a regular contributor to the Huffington Post's Financial Education section, explains further.</p> <p>&quot;No one should be using a credit card to pay for lottery tickets, gambling chips, cashiers checks, or anything that might be flagged as a 'cash equivalent transaction,'&quot; he says. &quot;Banks categorize these purchases as cash advances, which means higher than normal interest rates, and extra fees come attached.&quot;</p> <h2>4. When You Have the Opportunity to Haggle</h2> <p>When visiting yard sales, flea markets, farmers' markets, and other mom-and-pop-type setups, using cash can work to your advantage. For starters, many of the vendors at these places don't have the ability to accept credit or debit cards &mdash; though that's increasingly changing with the availability of mobile-swiping devices. Yet that convenience still doesn't provide them with cash-in-hand, which makes your pocket full of Washingtons and Lincolns much more attractive. And because they get the money immediately, these folks are much more apt to make a deal on the spot, lest you walk away. Personally, I think it's the best part about these events &mdash; so long as both parties are walking away satisfied (in other words, don't try to rip anybody off).</p> <h2>5. When You're Trying to Help the &quot;Little Guys&quot;</h2> <p>It you like shopping local or otherwise want to help the little guys &mdash; i.e. the service industry or anybody who works for tips &mdash; your best bet is to do it with cash. In some instances when paying for services on your credit or debit card, the individual service provider may not receive that money right away, as some places pay out tips weekly.</p> <p>Additionally, some financial establishments charge the general service providers about 3% of the total transaction haul, which is sometimes passed on to the individual &mdash; which, by the way, hardly seems fair; if you do this to your employees, you should be ashamed of yourself. In any case, to avoid these scenarios, cash is best. Using cash also helps put money in the individual's pocket right then and there, which, if they're living paycheck to paycheck, can be helpful for life's necessary expenses, like gas, food, and other items.</p> <h2>6. When You Know You Can't Afford it Right Now</h2> <p>A lot of people believe that credit cards, especially, are for the sole purpose of making purchases that you can't otherwise afford, like when you have little to no discretionary funds. That's a flawed logic. In emergencies, that's true, but there are times when we convince ourselves that we need something (that we totally don't) and reach for the credit card to pay for it. Read this carefully: If you can't afford something that you can absolutely live without, <em>you don't need it</em>. If you don't have the cash to back it up, put it out of your mind until you get back on track.</p> <h2>7. When You're Unsure About the Safety of Your Personal Information</h2> <p>There are plenty of financial experts who will tell you that you should never use a debit or credit card online, at restaurants, in convenience stores, and other places because you're at risk of having your financial information compromised&hellip; but I'm not one of them.</p> <p>While their stance on the issue is not inaccurate &mdash; security breaches happen all the time &mdash; I find it rather infeasible to live in today's world without using plastic at least some of the time. Those risks are ones that I'm willing to take, so long as I'm vigilant about using only secure sites, never giving my credit card number over the phone (this is a <em>very </em>important tip to remember), and banking at an institution that will back me up if my information is compromised. Thus, this suggestion is a relative one: If you don't feel comfortable using your credit or debit card someplace, trust your instincts; you're probably not wrong. In these cases, use cash.</p> <p>Don't, however, get that cash from the ATM in an establishment you're already weary about; that doesn't protect you any better from potential fraudulent activity. Personally, I try to only make a withdrawal at my or another reputable bank's ATMs opposed to random machines.</p> <p><em>When do you avoid whipping out the plastic?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/7-times-to-avoid-debit-or-credit-cards">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-4"> <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/never-use-cash-for-these-11-things">Never Use Cash for These 11 Things</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/debit-or-credit-which-one-should-you-choose-at-the-checkout">Debit Or Credit? Which One Should You Choose At The Checkout?</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/47-simple-ways-to-waste-money">47 Simple Ways To Waste Money</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-reasons-why-i-prefer-credit-cards-over-cash">10 Reasons Why I Prefer Credit Cards Over Cash</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/14-pricey-things-you-shouldnt-buy-and-what-to-get-instead">14 Pricey Things You Shouldn&#039;t Buy (And What to Get Instead)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Credit Cards cash debit impulse buys paying shopping spending Fri, 31 Jul 2015 13:00:13 +0000 Mikey Rox 1506038 at http://www.wisebread.com