emergency fund http://www.wisebread.com/taxonomy/term/8481/all en-US 8 Ways to Decide if It's a "Fund-Worthy" Emergency http://www.wisebread.com/8-ways-to-decide-if-its-a-fund-worthy-emergency <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-ways-to-decide-if-its-a-fund-worthy-emergency" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/emergency_fund_piggy_bank_605778350.jpg" alt="Deciding if it&#039;s a fund-worthy emergency" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>One crucial component of a sound financial plan is to have a solid emergency fund to protect yourself against unexpected expenses. This fund should cover at least three months' worth of living expenses, and enable you to get through any crisis without too much financial hardship.</p> <p>But how do you to determine when to use your emergency fund? What kinds of expenses qualify as actual &quot;emergencies?&quot; Before you tap into your fund, ask yourself these questions first.</p> <h2>1. Is It a Want or a Need?</h2> <p>This should be common sense, but it's amazing how many people can't discern between something they desire versus something they require. Money to help pay for an important medical procedure is likely a need; it's not a good idea to risk your health just because you don't want to raid your emergency fund. Money to pay the rent or avoid default on a loan would also fall in the &quot;need&quot; category. On the flip side, a new cellphone when your current one is working just fine is probably not what the fund is for. In reality, there are very few needs in life, and they should all generally center on your basic survival.</p> <h2>2. Is It Unexpected?</h2> <p>Christmas is an expensive time. But you have an entire year to prepare for the gift-giving bonanza. A new baby is costly, but you had a nine months to save up and get ready for the new arrival. If you've had time to anticipate an event happening and save accordingly, it's best to avoid dipping into your emergency fund to pay for it. Save your emergency fund for things such as layoffs, broken appliances, medical emergencies, and other things that you truly didn't see coming.</p> <h2>3. Is It Urgent?</h2> <p>A refrigerator that no longer works is something you probably want to replace right away. A car that breaks down is something you'll want to get fixed immediately if you rely on it to get to work. But there are many bad events that aren't &quot;emergencies&quot; in the sense of requiring immediate action.</p> <h2>4. Can You Defer Payments?</h2> <p>Let's say your heat pump is busted and needs to be replaced. Price tag is in the thousands. But it's wintertime, so this seems like an emergency, right? Perhaps, but it's worth finding out if you can pay for the new heat pump in installments, or even avoid paying anything immediately. It may be possible to pay for this pricey item over time and even avoid interest payments. This doesn't get you off the hook in paying for the item, but it may buy you some time to save a little extra or earn extra income so you don't have to raid your emergency fund. Just be sure to read the fine print of any agreement.</p> <h2>5. What Are the Financial Consequences if You Don't Pay?</h2> <p>It's often tempting to use a credit card or loan to borrow funds when an emergency happens. But when you borrow, you're likely to pay interest, so you'll end up paying more in the long run. High-interest credit cards, in particular, can have a severe impact on your overall financial well-being, and payday loans are even worse. There may be times when borrowing may be necessary in order to maintain some cash reserves (you never want to tap out an emergency fund completely), but it's important to look at the broader, long-term impact on your finances. And don't even think about not paying at all, as that could negatively impact your credit score.</p> <h2>6. Are You Legally Obligated to Pay?</h2> <p>If your car breaks down, you may want tap your emergency fund to get it fixed, but no one is requiring you to do so. Things are different, however, when you are faced with a situation where you are required, by law, to pay up. Perhaps it's a tax bill, or a legal judgment against you. In these cases, it's almost always best to pay &mdash; there could fines, or even jail time. If dipping into your emergency fund helps you avoid trouble with the law, it's worth it.</p> <h2>7. Have You Exhausted All Your Saving Options?</h2> <p>Let's say you have a roof that's leaky and in need of big repairs. Before you shell out thousands of dollars to a major contractor, examine first whether you can find money by cutting everyday expenses. It's possible that you could do a small repair now, aggressively save for a few months, then take care of the bigger job. It's amazing how much money you can &quot;find&quot; by taking a knife to your spending.</p> <h2>8. Is the Emergency for Yourself, or Another Person?</h2> <p>There may be times when a friend or loved one comes to you in desperate need of money. You may be tempted to raid your emergency fund to address their problem. This is a very tricky situation, as it's generally in our nature to want to help those close to us. But remember that your emergency fund is designed to address emergencies that might impact you, not other people. It's fine to give loved ones a hand, but it gets dangerous when you put your own financial health at risk to make it happen.</p> <p>This doesn't mean you should be a straight-up coldhearted person, however. If you believe that you may encounter instances when friends or family members will be in need, consider making your emergency fund larger to take that possibility into account. Even better, open a separate sub-account, so that your own emergency fund remains untouched.</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-ways-to-decide-if-its-a-fund-worthy-emergency">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/8-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</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/five-reasons-why-i-love-public-transportation">Five Reasons Why I Love Public Transportation</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/what-is-keeping-you-from-a-life-of-financial-independence">What is keeping you from a life of financial independence?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance appliances budgeting Cars emergencies emergency fund saving unexpected urgent Mon, 28 Nov 2016 11:31:04 +0000 Tim Lemke 1835353 at http://www.wisebread.com Change Jars and 8 Other Clever Ways to Build an Emergency Fund http://www.wisebread.com/change-jars-and-8-other-clever-ways-to-build-an-emergency-fund <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/change-jars-and-8-other-clever-ways-to-build-an-emergency-fund" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_change_jar_73155135.jpg" alt="Woman finding clever ways to build an emergency fund" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Saving money is not easy. For many Americans, there's not much cash leftover once the bills get paid each month. Building up an emergency fund and saving for retirement is a struggle, but it's not impossible. Sometimes, it just starts with a small step.</p> <p>For example, one way to begin building an emergency fund is to place any coins you accrue into a transparent change jar. Once it's full, deposit it all into the bank. You'll find that you may have more than $100 &mdash; just from your pocket change!</p> <p>There are many other small ways to get started saving, even if it's just a few dollars at a time.</p> <p>Consider taking these small steps to building positive financial habits, and you'll start to see your bank account grow.</p> <h2>1. Track Your Spending &mdash; Every Single Penny</h2> <p>If you are having trouble saving money, you will need to take the first step of figuring out where your money is going. Develop a system to record every purchase. An online service such as Mint can help you track spending and even categorize purchases so you know exactly what you're spending money on. By doing this, you'll be able to find where you can cut costs. Information is power. (See also:<a href="http://www.wisebread.com/start-saving-more-with-this-one-simple-tool?ref=seealso"> Start Saving More With This One, Simple Tool</a>)</p> <h2>2. Reduce Your Spending on a New Category Each Month</h2> <p>Once you've figure out where your money is going, it's time to decide what you can cut. If you've categorized your spending, pick one category and vow to reduce spending from one month to the next. For example, tackle your restaurant spending in January. In February, look for ways to reduce your cellphone bill. In March, cancel your cable television. By year's end, you'll have slashed spending on 12 things, and will be well on your way to saving money.</p> <h2>3. Put Away Any Extra Money You Receive</h2> <p>Did you get a bonus or raise from your company? Don't spend it, but put it in the bank instead. If your expenses are the same, then any new money you get should go directly into savings. This also goes for any prize winnings, unexpected refunds or rebates, or cash found in the pocket of that jacket you haven't worn since last winter. This may be only a few bucks here and there, but it adds up and gets you in the habit of not spending every new dollar you get.</p> <h2>4. Track When You Don't Spend</h2> <p>You might pass five coffee shops every time you walk to work. You stare at candybars and magazines at every supermarket aisle. You're bombarded with targeted Facebook ads and circulars in the mail. It's almost impossible to avoid parting with your money. But what if you made a note of every time you passed by that coffee shop without stopping in for a $4 latté? What if you gave yourself points for every time your willpower won? Eventually, resisting the urge to spend might be an easy habit.</p> <h2>5. Open an Online Savings Account and Set Up Automatic Transfers</h2> <p>You can't spend money if you never have it in your hand to begin with. If you set up an automatic transfer of cash into an online savings account &mdash; preferably one not tied to your ATM card &mdash; you'll be setting aside money before it ends up in your wallet. Start with a modest amount, maybe $25 a month, then see if you can gradually increase that. Before you know it, you'll have a nice sum of money that can serve as your emergency fund.</p> <h2>6. Open Your 401K and Hit the Company Match</h2> <p>If your company offers a retirement plan, there's no good excuse not to take part. Money you contribute is deducted from your taxable income, and it's usually taken directly from your paycheck, so there's no easy way to spend it on silly stuff. Most companies offer to match contributions up to a certain percent. Do your best to contribute up to the match, if possible, and increase your contributions by a percent each year.</p> <h2>7. Pack Your Lunch</h2> <p>This is a tough one for a lot of people. After all, who wants to eat a lame homemade sandwich when they can go out to that new gourmet burrito place with their colleagues? But it's time to get over your fear of the &quot;sad lunch&quot; and recognize that it's a big money saver. Any back-of-the-envelope calculation will reveal that packed lunches can save you hundreds or even thousands of dollars a year. If you're struggling to figure out where you can save money, this is a great place to start.</p> <h2>8. Tweak the Thermostat</h2> <p>We all like to keep our house at the perfect temperature, but we can all get use to things being a degree or two warmer in the summer or slightly cooler in winter. If you're setting the thermostat to 70 in summer, try bumping it up to 72. When it's chilly outside, keep things at 68 or even cooler. And don't forget about tweaking it further when you are not home. The U.S. Department of Energy says you can save as much as <a href="http://energy.gov/energysaver/thermostats">10% on your energy bills</a> just by adjusting the thermostat by seven to 10 degrees for eight hours each day.</p> <h2>9. Use a Credit Card With Cash Back</h2> <p>It's best to use credit cards sparingly when you're looking to save. But if you do use credit cards, making sure you get something in return. Do some research to find the cards with the best rewards. Some offer straight <a href="http://www.wisebread.com/5-best-cash-back-credit-cards?ref=internal">cash back on every purchase</a>. Others offer <a href="http://www.wisebread.com/5-best-credit-cards-that-transfer-points-to-airline-miles?ref=internal">points at airlines</a> or specific retailers. Find the one that best suits you, and watch that money accrue. Even if you get a mere 1% cash back on purchases, that could add up to hundreds of dollars annually. (See also: <a href="http://www.wisebread.com/cash-back-vs-travel-rewards-pick-the-right-credit-card-for-you?ref=internal">Cash Back vs Travel Rewards: Pick the Right Credit Card for You</a>)</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/change-jars-and-8-other-clever-ways-to-build-an-emergency-fund">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/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-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-a-spending-ban-can-help-and-hurt-you">Here&#039;s How a Spending Ban Can Help (and Hurt) You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</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/73-easy-ways-to-save-money-today">73 Easy Ways to Save Money Today</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-types-of-friends-who-are-costing-you-money">10 Types of Friends Who Are Costing You Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Budgeting baby steps cash back change jar emergency fund extra money pennies reduce spending saving small steps spending Mon, 17 Oct 2016 10:30:10 +0000 Tim Lemke 1813254 at http://www.wisebread.com Easy Budgeting for First Time Singles http://www.wisebread.com/easy-budgeting-for-first-time-singles <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/easy-budgeting-for-first-time-singles" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_kitchen_dancing_76246703.jpg" alt="Woman learning easy budgeting for first time singles" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As many as 28% of Americans live by themselves. Whether you are venturing out on your own after college, or life circumstances have forced you to live alone (i.e. divorce, kids leaving the nest, etc.), it can be hard to switch your saving and spending mentality to &quot;party of one.&quot;</p> <p>Keep these budgeting tips in mind as you navigate the financial waters by yourself:</p> <p>(See also: <a href="http://www.wisebread.com/how-to-live-alone-without-going-broke?ref=seealso">How to Live Alone Without Going Broke</a>)</p> <h2>1. Start With an Emergency Fund</h2> <p>Dave Ramsey likes to start with the emergency fund, and I wholeheartedly agree. In my own experience, it seemed as if costly instances were always popping up when I had zero emergency fund and was living paycheck to paycheck.</p> <p>I remember trying to reach that $1,000 saving mark for my emergency fund, thinking it was the most impossible thing ever (hey, I was only 21 making very little money). I remember when I finally reached that mark, the emergency fund stayed at $1,000 and life's little inconveniences seemed to be easier to handle.</p> <p>If you have no emergency fund, then your first financial goal should be a $1,000 fund. After that is established, you want to add a little bit of money to your account each month to save up one month of living expenses, then three months, then six months. This money will keep you protected against a job loss or unexpected medical emergency.</p> <h2>2. Budget for the Fun Stuff</h2> <p>When all of the financial responsibilities sit on your shoulders, it can become so easy to forget to treat yourself and to budget in the fun stuff. No matter how tight your budget is, you need to leave a little wiggle room for mental health. Living frugally and on a strict budget can be amazing, but it can also grow tiresome month after month. What is the point of cutting your grocery budget to less than $30 a week if you are just miserable?</p> <p>Dream big for a second. What would you do or where would you go this minute if you had the money? Perhaps you would buy yourself a fancy pair of shoes or take a weekend trip to Italy. Whatever it is, don't ignore this desire. Instead, research how much it will cost and create a financial road map to get there. Your dream vacation could only be a year or two away with a smart budgeting plan.</p> <h2>3. Evaluate What You Really Need to Buy</h2> <p>Before you get excited about being on your own and buy everything in Bed, Bath, and Beyond, think a moment. Most basic items, such as can openers, dishes, and other must-haves for the home can be found inexpensively. Many of your family members and friends have extra dishes or kitchen gear that they never use. Ask them to borrow it. You might be surprised how generous people are when it comes to getting rid of extra stuff.</p> <p>If you can't score any freebies, then check local thrift stores and yard sales. There is no reason to spend $50 on a plate set when you can score one at a thrift store or yard sale for $5 or less.</p> <p>Another tip is to buy as you realize the need. When I moved into my first place, I didn't realize how many items were needed to just make and eat a basic meal. However, I also realized that a lot of kitchen gadgets aren't necessities. For example, a pie server or salt and pepper shakers are nice to have, but you can easily make it work without them.</p> <h2>4. Budget Before You Move and After</h2> <p>Before you sign the lease on your apartment or rental, crunch the numbers. Is your budget going to be tight? You might have to rethink where you live to better fit your budget. After you move in, evaluate how you are doing with your budget. Are you struggling to stick with it a month or three after moving on your own? These are little red flags that signify a change is needed, either a decrease in expenses or an increase in income.</p> <h2>5. Control Groceries and Eating Out</h2> <p>One of the trickiest things to budget for when you are alone is food. This is especially true if you are used to shopping or cooking for more people. Start with a loose meal plan. This doesn't have to be anything fancy or time-consuming, just plan out what you are going to eat for the week. For example, on Monday, you will eat oatmeal and coffee for breakfast, a sandwich and chips for lunch, and pasta and meatballs for dinner.</p> <p>As you plan out each meal, coordinate your shopping list. As you cook for dinners, you can either cook enough to have lunch the next day, or you can freeze a portion of your meal for later use. This will save you time and prevent you from wasting food. (See also: <a href="http://www.wisebread.com/save-money-and-eat-better-with-these-6-online-meal-planners?Ref=seealso">Save Money and Eat Better With These 6 Online Meal Planners</a>)</p> <h2>6. Automate Your Finances</h2> <p>Another way to make sure that you stay on top of your finances is to look for apps that will help you automate your finances. For example, <a href="https://www.acorns.com/">Acorns</a> helps you to invest automatically, and <a href="http://mint.com">Mint</a> and <a href="https://www.personalcapital.com/landing/registration/affiliate?utm_source=FlexOffers.com+LLC&amp;utm_medium=affiliate&amp;utm_campaign=Personal+Capital+%24100k+Aggregators&amp;utm_content=">Personal Capital</a> will help you budget with very little time and thinking. Schedule your bills to be paid after your payday to ensure your account does not go into overdraft.</p> <p>Some sites will even let you schedule monthly payments to landlords. Just be sure to still look over statements if you switch to automatic payments. You want to ensure that you are not overcharged for anything. (See also: <a href="http://www.wisebread.com/5-ways-to-automate-your-finances?ref=seealso">5 Ways to Automate Your Finances</a>)</p> <p>Like many things, living alone has a learning curve. Don't let a bad month have you running to credit cards or family for help.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-eneriz">Ashley Eneriz</a> of <a href="http://www.wisebread.com/easy-budgeting-for-first-time-singles">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/11-good-money-habits-that-will-keep-you-out-of-debt">11 Good Money Habits That Will Keep You Out of Debt</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/will-a-dental-discount-plan-save-you-money">Will A Dental Discount Plan Save You 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/10-frugal-hacks-for-single-living">10 Frugal Hacks for Single Living</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-get-your-toiletries-for-cheap-or-even-free">6 Ways to Get your Toiletries for Cheap or Even Free!</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-sleek-marketing-ploys-aimed-at-getting-more-of-your-grocery-money">5 Sleek Marketing Ploys Aimed at Getting More of Your Grocery Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Budgeting automated payments bills emergency fund food costs groceries living alone moving savings single Fri, 14 Oct 2016 10:31:03 +0000 Ashley Eneriz 1812612 at http://www.wisebread.com 11 Frugal Gifts Your Future Self Will Love http://www.wisebread.com/11-frugal-gifts-your-future-self-will-love <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/11-frugal-gifts-your-future-self-will-love" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock_57901564_MEDIUM.jpg" alt="frugal gifts you&#039;ll love" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>There are a lot of things I wish my younger self would have done for the benefit of my present self. As I look forward to what my future self will want, here are some gifts that I can work to deliver starting today (and you can, too!).</p> <h2>1. Money in the Bank</h2> <p>Occasionally when I put on a coat or jacket that have not worn for a long time, I find some cash in the pocket &mdash; a gift from the past! My younger self even left some money in a savings account which my current self greatly appreciates.</p> <p><strong>Give the gift:</strong> Put $50 per week in a savings account and you'll save $26,000 per decade for your future self to enjoy.</p> <h2>2. Freedom</h2> <p>A great gift to your future self would be a chance at early retirement. Depending on how your investments perform and how much you plan to spend in retirement, if you increase the funding level for retirement investments from 10% of income to 20% during your career, your future self <a href="http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/">could retire more than 10 years earlier</a>!</p> <p><strong>Give the gift:</strong> Sign up for automatic deposits to your retirement fund to save your current self from having to remember to transfer funds. Choose an investment fund with low fees and contribute as much as you can to set your future self free as early as possible.</p> <h2>3. Less Debt</h2> <p>My younger self often thought it was okay to spend a lot of money since my future self would earn more income and could easily pay the bills. This logic made sense to me at the time, but my current self is not very happy with this strategy.</p> <p><strong>Give the gift: </strong>Start paying down debts today. Pay off your highest interest rate debts first to eliminate debt as quickly as possible. Cut expenses and apply the savings toward paying down debts faster.</p> <h2>4. Higher Education</h2> <p>Make life as easy as possible for your future self by setting up a convenient source of income. This could be a cushy or interesting career, running a profitable business, or creating passive income opportunities. It takes time and effort to establish a good source of income, so start today!</p> <p><strong>Give the gift:</strong> Complete school or training now to advance your career earning opportunities instead of waiting for your future self to do it. If growing a business is your game plan, don't wait to get started. Take on the hard work now so your future self can enjoy the benefits.</p> <h2>5. Active Lifestyle</h2> <p>Get into fitness activities that will keep you fit for life, and provide interesting recreational opportunities. I look forward to exploring new bike trails and recently went on some awesome half-day bike adventures. I like hiking and walking, too, and enjoy exploring both urban and rural areas.</p> <p><strong>Give the gift:</strong> For me, a quality bicycle was a good gift to my future self. It will last for years and provide many hours of entertainment, exercise, and free transportation. If it will keep you active, a health club membership, sporting equipment, or a workout program can be a good gift that will benefit you for the rest of your life.</p> <h2>6. Creative Outlets</h2> <p>Your future self will want to look back and see what you've done with your life. Create a body of work that you can look back on by creating things that will last. I am sending my future self some completed home improvement projects to look back on with pride. I have also published a few books and hundreds of personal finance articles and blog posts that will be around for a long time. Other lasting creations include publishing some scientific journal articles and obtaining patents.</p> <p><strong>Give the gift:</strong> Find opportunities to create things that last for your future self to be proud of.</p> <h2>7. Hobbies</h2> <p>Put in the hard work now to <a href="http://www.wisebread.com/10-more-hobbies-you-can-start-for-free">acquire skills</a> that your future self will find useful and entertaining. Here are some possibilities:</p> <ul> <li>Sewing</li> <li>Woodworking</li> <li>Electrical wiring</li> <li>Plumbing</li> <li>Computer programming</li> <li>Foreign language</li> <li>Winemaking</li> <li>Automotive maintenance/repair</li> <li>Gardening</li> </ul> <p><strong>Give the gift:</strong> Choose a skill that would be useful to acquire and put in the time and effort now to gain the skill so your future self can easily use it.</p> <h2>8. A Stronger Brain</h2> <p>Keep your brain sharp for your future self. Because if you don't use it, you'll lose it!. Exercise your short term memory, learning, and analytical thinking skills as much as possible.</p> <p><strong>Give the gift:</strong> Keep reading, learning, and finding new interests every day. Use brain games such as <a href="https://www.lumosity.com/">Lumosity</a> to exercise your brain and stay sharp.</p> <h2>9. Organized Tools and Paperwork</h2> <p>The other day, I needed a cold work chisel that I had not used in 20 years, but I knew exactly where to find it. Years ago, my wife helped me set up an organizational scheme for my tools, and they have stayed organized ever since. Organize your tools, financial documents, bills, budget, and closet to make life easy for your future self.</p> <p><strong>Give the gift:</strong> Choose something and get it totally organized today. Once an organizational scheme and habit are established, it takes little effort to keep things organized for your future self to enjoy.</p> <h2>10. A Shorter Commute</h2> <p>Move closer to work, school, shopping, etc. to reduce your commute &mdash; and expenses. I moved about 10 minutes closer to work and it makes a noticeable difference to the amount of free time that I have. I spend less on gas as well.</p> <p><strong>Give the gift:</strong> Moving to a different home is hard, but can be worth the trouble if you can reduce your expenses and/or reduce your commute every day for your future self.</p> <h2>11. Memories Captured</h2> <p>Take lots of pictures! No one wishes they had fewer photos from the good old days. Photos with loved ones are best, but photos of scenes from everyday life are interesting, too. It is amazing how many memories even a single photo from a normal day can bring back. What seems mundane to your current self may be fascinating for your future self to remember.</p> <p><strong>Give the gift:</strong> A nice digital camera can be a good gift to your future self. Use a memory stick or cloud storage to keep a backup copy of all of your digital photos somewhere safe.</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/11-frugal-gifts-your-future-self-will-love">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/the-deals-to-look-for-at-pawn-shops-thrift-shops-and-other-weird-stores">The Deals to Look for at Pawn Shops, Thrift Shops, and Other Weird Stores</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/9-frugal-skills-you-must-have-to-survive-autumn">9 Frugal Skills You Must Have to Survive Autumn</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-fridge-tricks-that-will-save-you-big">14 Fridge Tricks That Will Save You Big</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/80-stocking-stuffer-ideas-for-10-or-less">80 Stocking Stuffer Ideas for $10 or Less</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/flashback-friday-51-ways-to-organize-your-whole-life-in-2017">Flashback Friday: 51 Ways to Organize Your Whole Life in 2017</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Shopping active lifestyle emergency fund frugal gifts future self health and fitness organization Mon, 10 Oct 2016 09:30:22 +0000 Dr Penny Pincher 1808274 at http://www.wisebread.com 10 Foods You Need in Your "Emergency" Pantry http://www.wisebread.com/10-foods-you-need-in-your-emergency-pantry <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-foods-you-need-in-your-emergency-pantry" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/canned_goods_food_84457581.jpg" alt="Foods you need in your emergency pantry" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Nothing will throw a monkey wrench into your food budget faster than eating out. There are those nights, though, when payday isn't until tomorrow, or when you just don't have time to put together a perfectly balanced meal. Rather than blow your budget altogether, try keeping these staples on hand for quick, inexpensive meals. They also taste good, so you won't feel deprived and be tempted to pick up fast food. Here are 10 pantry, freezer, or refrigerated items to have around.</p> <h2>1. Cans of Tuna</h2> <p>A classic <a href="http://www.foodnetwork.com/recipes/food-network-kitchens/classic-nicoise-salad-recipe.html">tuna niçoise</a> will make you feel like you're eating elegantly, and it's also healthy. I find I can &quot;cheat&quot; and substitute several of the ingredients, i.e. russet potatoes for the red potatoes, frozen green beans for fresh, or plain old chopped tomatoes for the fancier versions.</p> <h2>2. A Bag of Potatoes</h2> <p>I keep a sack of baking potatoes in my cupboard. Not only do they keep well, in a cool, dry place, but they are dirt cheap. Need an inexpensive meal? Bake some potatoes and get creative with the toppings. In fact, that's what we're having tonight: potatoes topped with some chopped ham I found in the freezer, last night's leftover broccoli, a few mushrooms, a handful of olives, and some grated cheddar.</p> <p>Want something a little more elegant? Slice those potatoes and make <a href="http://allrecipes.com/recipe/240290/moms-scalloped-potatoes/?internalSource=staff%20pick&amp;referringId=1548&amp;referringContentType=recipe%20hub&amp;clickId=cardslot%202">scalloped potatoes</a>. Add a little ham to make it a main dish, or a vegetarian version, using mushrooms.</p> <h2>3. A Carton of Eggs</h2> <p>E<a href="https://www.verywell.com/easy-eggs-florentine-2241721">ggs Florentine</a> sounds pretty fancy, but it's really very easy and appealing. Keep a box of frozen spinach in your freezer, and you can make this in 15 minutes.</p> <p>We ate huevos rancheros so often while saving for our first house that we couldn't eat them for 10 years afterward. However, that wore off, and we happily make them again, now &mdash; especially when I haven't had time to go to the store.</p> <h2>4. A Box of Spaghetti</h2> <p>If you have a jar of sauce around, your family can be eating spaghetti in about 20 minutes. While that's delicious, you might also try <a href="http://damndelicious.net/2014/03/29/spaghetti-carbonara/">spaghetti carbonara,</a> which combines spaghetti with bacon, Parmesan, and eggs. I like to toss some frozen peas in the spaghetti water, as they add color and fiber.</p> <p>Have extra, cooked, spaghetti around? Try <a href="http://video.bonappetit.com/watch/spaghetti-pie-the-best-way-to-use-pasta-leftovers">spaghetti pie</a>, which will quickly become your new favorite comfort food.</p> <h2>5. A Bag of Frozen Peppers and Onions</h2> <p>Defrost, saute, and add some rinsed black beans; spoon into tortilla shells for burritos. Top with sour cream or unsweetened Greek yogurt. Or, defrost, saute, add some bottled teriyaki sauce, and serve over rice. (Toss in a little chicken or leftover meat, if you have it around.)</p> <h2>6. Frozen Shrimp</h2> <p>You can even serve frozen shrimp if you have company, because it dresses up so nicely. Here is an easy garlic shrimp:</p> <p><em>Ingredients:</em></p> <ul> <li>2 pounds frozen shrimp</li> <li>&frac14; cup of butter</li> <li>&frac14; cup chopped parsley</li> <li>2 cloves garlic, peeled and chopped</li> </ul> <p><em>Method:</em></p> <p>Cook shrimp in boiling water and drain. Melt butter and saute garlic. Add drained shrimp and sprinkle with the chopped parsley. Serve over rice. This is also nice with broccoli and some garlic bread on the side.</p> <p>Got a can of cream of mushroom soup around? Take that frozen shrimp and you are halfway to <a href="http://www.tasteofhome.com/recipes/shrimp-newburg">shrimp Newburg</a>. I like to add a tablespoon of sherry to the sauce. This is a perfect &quot;date night&quot; meal.</p> <h2>7. Jars of Marinara Sauce</h2> <p>Jarred sauce is perfect to go with the aforementioned spaghetti, but it's also versatile.</p> <p>Spoon over English muffins, top with sliced olives and cheese, and broil for quick mini-pizzas. Kids love these. Add sauce to browned chicken breasts, cover, and simmer until cooked through. Great over noodles for a fake cacciatore.</p> <h2>8. Frozen Pizza</h2> <p>Five years ago, I would not have made this recommendation, but the quality (and number of choices) of frozen pizza has greatly improved. For just $5, I can get a pretty darn good pizza. You can also dress up a plain cheese frozen pizza with chopped artichokes, olives, salami, or whatever you like. They will never beat my favorite pizzeria, but in a pinch, they're fine.</p> <h2>9. Canned Beans</h2> <p>My friend turned me onto this tasty <a href="http://allrecipes.com/recipe/22919/insanely-easy-vegetarian-chili/">vegetarian chili</a> recipe, which goes together quickly with kidney beans from the pantry. We like it with cornbread or tortilla chips. Or, go a little more elegant with this <a href="http://fakeginger.com/risotto-with-caramelized-onions-mushrooms-and-chickpeas/">risotto with caramelized onions, mushrooms, and chickpeas.</a> It sounds complicated, but the ingredients are all relatively inexpensive. And I bet you have most of these ingredients in your pantry already.</p> <h2>10. Soup</h2> <p>Here is the great thing about broth, whether canned or frozen, you are only moments from hearty soup. Leftover vegetables, rice or noodles, beans, cooked meat &mdash; toss it all in and let it simmer.</p> <p>Stock up on soups, which are one of the fastest things around to make for dinner. Plus, there is nothing like a <a href="http://www.wisebread.com/11-delicious-dishes-you-can-make-with-a-can-of-tomato-soup">bowl of tomato soup</a> and a grilled cheese sandwich on a rainy day!</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/marla-walters">Marla Walters</a> of <a href="http://www.wisebread.com/10-foods-you-need-in-your-emergency-pantry">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-5"> <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/flashback-friday-119-amazing-meals-you-can-make-from-a-can">Flashback Friday: 119 Amazing Meals You Can Make From a Can</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/flashback-friday-104-sweet-ways-to-celebrate-valentines-day">Flashback Friday: 104 Sweet Ways to Celebrate Valentine&#039;s Day</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/9-dumb-ways-youre-going-to-waste-money-this-summer">9 Dumb Ways You&#039;re Going to Waste Money This Summer</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-healthy-ways-to-have-ice-cream-for-breakfast">10 Healthy Ways to Have Ice Cream for Breakfast</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/flashback-friday-80-holiday-treats-that-wont-bust-your-budget">Flashback Friday: 80 Holiday Treats That Won&#039;t Bust Your Budget</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Frugal Living Food and Drink canned food canned goods dinners emergency food emergency fund Food frugal living pantry Tue, 27 Sep 2016 09:30:24 +0000 Marla Walters 1800744 at http://www.wisebread.com 8 Money Moves to Make the Moment You Get a Promotion http://www.wisebread.com/8-money-moves-to-make-the-moment-you-get-a-promotion <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-money-moves-to-make-the-moment-you-get-a-promotion" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_excited_hands_74632665.jpg" alt="Man making money moves after getting a promotion" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>So your company finally recognized your hard work and gave you that promotion you've been wishing for. And it comes with a nice bump in pay!</p> <p>What should you do now? Do you immediately go and buy a new car? Celebrate with a trip to Saint Tropez?</p> <p>No. If you'll notice, exactly none of the suggestions below involves buying any material items. Celebrate your promotion if you want, but your new money is best off being used to secure your long-term financial future. Consider addressing these eight things if and when you are fortunate enough to get a promotion.</p> <h2>1. Build That Emergency Fund</h2> <p>Are you prepared if something big happens in your life? Do you have at least three months of expenses available in liquid savings? The new income from your promotion can be partially set aside to prepare for the inevitable disaster, whether it be a health emergency, car accident, or flooded basement. Once you get that emergency fund in place, you'll be able to invest and save for larger goals with a clear mind.</p> <h2>2. Get More Organized</h2> <p>If you're not making a lot of money, it's often hard to do anything more than deposit your checks and pay your bills. But with a bump in income, it may now be possible to be more strategic about your financial situation. Rather than having just a single bank account, open distinct accounts for specific savings goals. Begin using an account aggregation platform, such as Mint.com, to see a single view of your finances and track your spending. You may also benefit from meeting with a financial adviser to come up with a plan for short-term and long-term savings goals.</p> <h2>3. Evaluate If Your Expenses Will Increase</h2> <p>Getting a promotion usually involves more money, but it may also mean more expenses for you. Maybe now you will have to work longer hours, necessitating more child care expenses. Perhaps you will no longer be able to work from home, and will incur commuting costs. You may even have to spend more on professional clothing if you've moved into a high-profile position.</p> <p>Make sure to take these new expenses into account when determining how much your net income will increase from the promotion.</p> <h2>4. Bump Up Your Retirement Contributions</h2> <p>If you get a raise, you should strongly consider taking all or most of your increase and boosting your regular retirement contributions. (Or begin making contributions, if you haven't started.) If you have a 401K but aren't contributing enough to get the full company match, see if you can get to that level. If you've been saving more but are just shy of maxing out your annual 401K contributions ($18,000 for most people), try and see if you can reach that threshold. The same goes for making the maximum annual contribution of $5,500 into your individual retirement account (IRA.)</p> <p>Even if you can increase contributions by a mere 1% or 2%, that's additional money that can grow substantially over time.</p> <h2>5. Check Your Tax Situation</h2> <p>There's a dark side to earning more money: You may end up giving more to Uncle Sam. In some cases, a raise may even put you in a higher tax bracket, thus wiping out any salary gains. So before you go making any major lifestyle changes, check to see what your actual take-home pay will be. You may be able to avoid a big hit from Uncle Sam by boosting contributions to your 401K, contributing to a health savings account, or making other adjustments that reduce the amount of your income that is taxed.</p> <h2>6. Target Your High-Interest Debt</h2> <p>If debt is weighing you down, now's time to start tackling it in earnest. Use your extra income to go after the debt with the highest interest rate &mdash; usually, this is a credit card. Once you have that debt paid off, keep it up. You'll be amazed at the financial freedom you'll obtain through the extra income and the reduction in debt payments. It's almost like getting two salary increases! (See also: <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=seealso">The Fastest Way to Pay Off Credit Card Debt</a>)</p> <h2>7. Ask for a Credit Limit Increase</h2> <p>This may seem counterintuitive, since we just suggested you get your credit cards paid off. But with new income, you can ask for a higher credit limit which will then improve your &quot;debt to credit&quot; ratio. That ratio compares the amount of debt you have to the amount of debt you can incur. Generally speaking, a low ratio of debt to credit is what will help your credit score, as long as you don't increase the actual amount you are spending.</p> <h2>8. Consider Refinancing Your Mortgage</h2> <p>You may have been wanting to lock in a lower interest rate on your home for some time, but found the upfront costs to doing so a hurdle. Now that you have some extra income, you might find it easier to pull the trigger on refinancing the loan, thus saving money in the long run. Interest rates are still historically very low, and your higher income may even help you get a higher credit score, making you even more attractive to lenders.</p> <p><em>Get a promotion recently? What did you do with your extra take home?</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-money-moves-to-make-the-moment-you-get-a-promotion">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-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-lessons-i-learned-selling-office-supplies">8 Money Lessons I Learned Selling Office Supplies</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/9-best-free-financial-learning-tools">9 Best Free Financial Learning Tools</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-financial-obstacles-that-are-especially-tough-for-women">5 Financial Obstacles That Are Especially Tough for Women</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/9-things-football-teaches-us-about-money">9 Things Football Teaches Us About 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/10-ways-to-increase-your-net-worth-this-year">10 Ways to Increase Your Net Worth This Year</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Career and Income emergency fund investing mortgage promotions raises retirement saving Mon, 11 Jul 2016 10:30:07 +0000 Tim Lemke 1747766 at http://www.wisebread.com 12 Reasons Your Debt Isn't Diminishing http://www.wisebread.com/12-reasons-your-debt-isnt-diminishing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/12-reasons-your-debt-isnt-diminishing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/scissors_cutting_money_000035636770.jpg" alt="Learning reasons why your debt isn&#039;t diminishing" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Your 2016 New Year's resolution was to <a href="http://www.wisebread.com/my-2016-budget-challenge-why-i-need-to-find-31k-this-year" target="_blank">finally pay down all your debt</a>. But it's now May, and your balance has hardly budged. What's going on? Here are the top 10 reasons why your debt isn't dwindling &mdash; and what you can do to get debt-free by the end of the year:</p> <h2>1. You Are Still Using Your Credit Card</h2> <p>To quote my old sailing instructor: &quot;The boat is taking water, Missy. You might want to plug that hole before you start bailing. A'yup.&quot;</p> <p>Don't add to the debt you are trying to pay down. Leave your credit card at home, freeze it, or even cut it up. Just. Stop. Using. It. If you cannot pay cash for something, then you cannot afford it.</p> <h2>2. You Don't Have an Emergency Fund</h2> <p>Your car breaks down. <a href="http://www.wisebread.com/my-2016-budget-challenge-everything-breaks">Your computer breaks down</a>. You break down. If you don't have an emergency fund in place, all those unplanned costs go right back onto your credit card. Before you start reducing debt, you should first put $1,000 into a savings account.</p> <p>Life happens. Think of your emergency account as the financial equivalent to your car's air bag. It's more likely that you'll walk away from an accident if you've got something to cushion you against the crash.</p> <h2>3. Your Income Is Too Low</h2> <p>If you are using your credit card to pay for necessities like groceries or utility bills because you are short on cash, you will be in debt for a long time. Credit cards are a very expensive method of borrowing money.</p> <p>If you are in this situation, you need to raise your income by any (legal) means necessary. Can you get a part-time job? Can you save on housing by renting out a room in the house, even if that means you have to sleep in the living room or share a bedroom with your kids? Can you apply for food assistance? Now is not the time for vanity. Vanity is for rich people. (See also: <a href="http://www.wisebread.com/100-ways-to-make-more-money-this-year?ref=seealso">100+ Ways to Make More Money This Year</a>)</p> <h2>4. You Are Keeping Up With the Joneses, and the Joneses Are Stupid</h2> <p><a href="http://www.wisebread.com/is-peer-pressure-keeping-you-poor">Peer pressure keeps you poor</a>. It's true. Many people would rather struggle to pay their huge credit card bills than admit that they can't afford lunch, concert tickets, private school for the kids, car insurance, etc.</p> <p>The people who make you feel bad about not spending money that you don't have are never the people who will help you get out of debt. Don't let other people dictate how you spend the money that you earned.</p> <p>Shut down the Joneses by telling them that you are saving up for your dream. For example, anytime anyone pressures me to spend money that I don't have I say, &quot;That sounds lovely, but I can't afford that because I am saving up for a camera body so I can work professionally as an architectural photographer.&quot; What's your dream? A home? A vacation? An education? Early retirement?</p> <p>Your dream is also a great motivator to get out of debt. My husband really wants to go to Easter Island for his 50th birthday (he's currently 48). He got serious about paying down our line of credit when he realized that we won't have the time to save up for that vacation if we don't pay down our debt by the end of this year.</p> <h2>5. You Are Only Paying the Minimum Balance</h2> <p>Banks love it when you only pay the minimum balance. The longer you take to pay down your debt, the more money they make by charging you interest. Even if you can only pay $20 more than your minimum balance per month, every little bit helps.</p> <p>For example, say you are carrying a $5,000 balance on a credit card with a 12% APR. If you pay the minimum monthly payment of $100, it will take you 70 months to pay off the card and you will pay an additional $1,966 in interest! But, if you raise your monthly payment to $120 per month, you can pay off the card in 50 months and pay $1,500 in interest. Just about anyone can create a <a href="http://www.wisebread.com/find-a-side-gig-at-these-4-best-micro-jobs-sites">side hustle</a> to make an extra $20 per month. That little bit of extra work will save you $466 in interest!</p> <h2>6. You Aren't Paying Off Low-Balance or High-Interest Cards First</h2> <p>According to a Gallup survey, the average number of credit cards Americans carry in their wallets is at an all time low. (Good job, Americans!) Although 33% of Americans only have one or two credit cards, 18% of Americans have three or four cards, and 7% of Americans have more than seven cards. So, if you have debt spread over multiple cards, how do prioritize which card needs to be paid down first?</p> <p>There are two main schools of thought when it comes to paying down debt quickly: Pay off the loan with the highest interest rate first (the Avalanche Method) and pay off the loan with the lowest balance first (the Debt Snowball). (See also: <a href="http://www.wisebread.com/snowballs-or-avalanches-which-debt-reduction-strategy-is-best-for-you?ref=seealso">Snowballs or Avalanches: Which Debt Reduction Strategy Is Best for You?</a>)</p> <p>When budgeting for either method, remember you will still have to pay the minimum balance each month on your other cards.</p> <p>With the Avalanche Method, you devote all your extra funds to paying down your credit card with the highest interest rate first. Obviously, the higher the interest rate, the more expensive it is to borrow money using that card. So, you will pay less interest in the long run, if you pay down your high interest rate card first. Once you pay down your card with the highest interest rate, you move on to throwing all your extra cash against the debt on the card with the next highest rate. Repeat until all your debt is gone.</p> <p>The only downside to this method is that your highest interest rate might also be the card with the highest balance. If this is the case, it will be a marathon, not a sprint, to pay down that debt. (See also: <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=article">How to Use a Balance Transfer to Cut Out Interest Fees</a>)</p> <p>The Debt Snowball is similar to the avalanche method except you use all your available cash to pay down the card with the lowest balance first. With this method you get the sense of accomplishment by paying off a card quickly, which can give you the motivation to continue throwing money at your debt.</p> <p>Both methods work if you are diligent. Use whichever method works best for you.</p> <h2>7. Your Payments Are Going Toward Fees</h2> <p>The best card is the one that combines the <a href="http://www.wisebread.com/the-best-low-interest-rate-credit-cards?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=article">lowest APR</a> and annual fee with the greatest perks for your life. In order to compare cards and loans, you need to know how much you are paying in interest and fees on each tool.</p> <p>Speaking of fees. Don't be late with your payments. Late fees are a totally unsatisfying way to spend your money. If you get dinged with a late fee, call your lender and see if they will waive the fee for you. Lenders often have secret grace periods for late payments, but you have to ask. Pro tip: ask nicely.</p> <p>Banks also love to charge extra should you happen to use the wrong ATM. I have seen ATM fees as high as $3 per transaction! If you are like me and live far away from where you bank, make sure that you withdraw enough cash to pay for your life between bank runs, and be crystal clear about what ATMs you can use without getting dinged.</p> <p>Before you travel, make sure that your debit or credit card doesn't charge you an additional money exchange fee on top of the ATM fee.</p> <h2>8. You Are Buying for Reward Points</h2> <p>Many reward cards are more expensive than cards that don't have perks. Not only do reward cards generally have higher APRs, they also tend to come with a yearly fee. Are your rewards worth the extra cost? Do the math. (See also: <a href="http://www.wisebread.com/how-to-decide-if-an-annual-fee-credit-card-is-worth-it-for-you?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=article">How to Decide If an Annual Fee Credit Card Is Right for You</a>)</p> <p>It's important to note that most reward card perks are only perks if you don't pay extra interest costs. If you cannot zero out your card balance every month, it might be less expensive to just buy discount airfare instead of trying to <a href="http://www.wisebread.com/how-to-use-miles-and-points-for-a-big-award-trip?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=article">use mileage points to travel</a> on the cheap.</p> <p>Even if you are one of those rare birds who pays off their card every month and never accrues interest, you can still fall victim to purchase acceleration. People often buy things on credit that they would not have bought with cash if they know they are close to &quot;earning&quot; a reward.</p> <h2>9. You Don't Understand the Scope of Your Debt</h2> <p>A recent study showed that people have a pretty good idea about <a href="https://www.newyorkfed.org/medialibrary/media/research/epr/2015/EPR_2015_comparisons_brown.pdf">how much they owe</a> on their homes and their cars, but are terrible at estimating other types of debt. Researchers found that people estimate their credit card debt to be 40% less than what lenders report, and families underestimate their student loan debt by 25%!</p> <p>I have more than one bank account. I have more than one loan. I have more than one retirement fund. I use Mint.com to get a snapshot of all my banking on one page. This kind of <a href="http://www.wisebread.com/10-free-or-almost-tools-and-resources-for-creating-a-new-2015-budget">finance app</a> is good for keeping track of all your accounts.</p> <h2>10. Your 0% Balance Transfer Period Has Expired</h2> <p>Obviously if you go from paying 0% interest to paying anything more than 0% interest for the privilege of using credit, it is going to cost you. But before you move your debt, do the math. Is it cheaper to pay the fee to transfer your debt to another credit card with a <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=article">0% balance transfer period</a>, or is it cheaper to just pay down your existing debt quickly?</p> <p>It's important to note that every time you open or close a card, your credit score will take a hit. Even if you are turned down for credit, just the act of having your credit checked by a lender will ding your credit. The lower your credit score, the harder it will be for you to get the best home or car loans. Think strategically.</p> <h2>11. You Are Not Talking to Your Lender</h2> <p>Have you called your credit card company recently and asked them to lower your APR? If you have been a longtime customer or have received a better offer in the mail, call your credit card company and ask for an interest rate reduction.</p> <p>While we are on the subject of lenders, have you talked to your bank or credit union about a debt consolidation loan? The interest rates on a Home Equity Line of Credit or a debt consolidation loan are often much lower than credit cards.</p> <h2>12. You Lack a Plan</h2> <p>Only one out of every three Americans has a <a href="http://www.gallup.com/poll/162872/one-three-americans-prepare-detailed-household-budget.aspx">detailed household budget</a>. This means that the majority of Americans have no clue where their money goes. It is impossible to make smart financial decisions if you are only guessing how and where you spend your money.</p> <p>People that successfully pay down their credit cards quickly throw every spare dollar at their debt. The only way to find every spare dollar is to <a href="http://www.wisebread.com/build-your-first-budget-in-5-easy-steps">create a budget</a>. If you have never created a budget, don't stress. It is way easier than you think.</p> <p><em>Have you successfully paid down a debt? What did you do? Share your debt-killing techniques with your fellow readers in the comments section.</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/max-wong">Max Wong</a> of <a href="http://www.wisebread.com/12-reasons-your-debt-isnt-diminishing">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/5-ways-to-prevent-a-debt-spiral">5 Ways to Prevent a Debt Spiral</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-day-debt-reduction-plan-pay-it-off">5-Day Debt Reduction Plan: Pay It Off</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-simple-way-to-decide-which-credit-card-to-pay-off-first">The Simple Way to Decide Which Credit Card to Pay Off First</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-manage-your-debt-in-10-minutes-a-week">How to Manage Your Debt in 10 Minutes a Week</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/6-secrets-to-mastering-the-debt-snowball">6 Secrets to Mastering the Debt Snowball</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management avalanche method emergency fund high interest paying down debt rewards points snowball method Thu, 12 May 2016 10:30:04 +0000 Max Wong 1707447 at http://www.wisebread.com 9 Money Moves to Make the Moment Your Credit Cards Are Paid Off http://www.wisebread.com/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_happy_credit_card_000089299163.jpg" alt="Woman making money moves after credit cards are paid off" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It may have taken years. It may have required an unprecedented level of discipline and patience. But you finally have your credit cards paid off.</p> <p>Congratulations! Now, what do you do?</p> <p>With a good chunk of your high-interest debt no longer weighing you down, you can truly start to work your way toward financial freedom. Here are some key financial moves you can make immediately.</p> <h2>1. Tackle Any Other High-Interest Debt</h2> <p>Okay, so you crushed the credit card debt. What else do you owe? Take a look at things like auto loans, student loans, and your mortgage, and begin chipping away at that debt, as well. Go after the debt with the highest interest rate first. It's one thing to free of credit card debt, but to be totally, 100% debt free? That's an amazing feeling.</p> <h2>2. Assess Your Emergency Fund</h2> <p>When you're in debt, there's a good chance you don't have a lot of liquid savings. But now that those credit cards are paid off, you can start building up funds in case of a major unexpected expense or loss of income. By maintaining an account with at least three months of income, you can handle any financial crisis and know that you won't go back into debt.</p> <h2>3. Open a Retirement Account</h2> <p>It's impossible to think about retirement when you're huddled under a mountain of debt. But now that you've shed that high interest debt, you can start thinking about your long-term financial goals, including your retirement. If your employer offers a 401K plan, begin contributing now and seek to maximize the company match. (Usually, this is somewhere in the neighborhood of 5% of your income, though you can always contribute more.) Also consider opening an individual retirement account, or IRA. Opening a Roth IRA, which allows your money to grow tax free, is perfect for people who are self-employed, but is also a great complement to a 401K.</p> <h2>4. Find a Good Online Budgeting Tool</h2> <p>If you haven't already done so, consider using a service such as Mint or <a href="http://track.flexlinks.com/a.ashx?foid=1029882.216060&amp;fot=9999&amp;foc=1&amp;foc2=582907">Personal Capital</a>, which allows you to view all of your account information in one place and track your spending &mdash; even set up budgets and goals. Using one of these services will allow you to see exactly where your money is going, so you can adjust your spending, if needed.</p> <h2>5. Stop Using Your Cards for a While (But Don't Close Them)</h2> <p>Credit cards got you into trouble, so it might be good to just put them on ice for a while. But don't start canceling all your cards. If you close credit cards, you may actually hurt your credit score. You'll no longer have accounts with a long history, and your <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score">credit utilization ratio</a> will go up because you'll have less available credit. If you feel the need to get rid of cards, shed the one with the lowest credit limit. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">Best 0% Balance Transfer Credit Cards</a>)</p> <h2>6. Develop a New Charging Philosophy</h2> <p>If you successfully transitioned from carrying a credit card balance to being debt-free, you probably made an adjustment to how you use your cards. Now it's time to evaluate again how you use credit to ensure you stay out of the red. Do some research to find credit cards with favorable interest rates (and maybe even some good <a href="http://www.wisebread.com/5-best-cash-back-credit-cards?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">cash back rewards</a>). Set up automatic transfers to pay off balances in full each month, and come up with rules to guide which purchases will be made with credit and which will be made with cash. It takes discipline to get out of debt, but it's just as much work to stay out. So set up a plan and do your best to stick to it.</p> <h2>7. Begin Saving for Big, Important Things</h2> <p>You may be out of debt, but you know that it could come right back if you don't save responsibly for the big ticket items. Whether it's a new house, car, or home appliance, it's best to try and pay for these things without taking on a lot of new debt. Consider taking whatever you were paying in credit card interest and setting it aside into a savings account, or even an index fund. Being able to pay cash for the pricey purchases will keep you from falling into the abyss of debt again.</p> <h2>8. Review Your Credit Reports</h2> <p>Looking at your credit report can be depressing when you're in debt. Who needs another reminder of how much they owe? But now that the debt is gone, it might be a good time to examine your credit reports to see if there are any errors, or even old debts you may have forgotten about. Your goal now is to improve your FICO credit score, and cleaning up your reports can play a big role in that. Each of the three major credit bureaus (TransUnion, Experian, Equifax) provide a copy of your credit report once a year at no charge.</p> <h2>9. If You Have a Mortgage, Think About Refinancing</h2> <p>Your credit score may not improve right away after paying off your credit card debt, but if you keep yourself debt-free, it will rise over time. And that means that you'll be in a better position to negotiate with lenders for a better interest rate on your home loan. Mortgage rates are still historically low, so you might save thousands of dollars over the long-term by reducing your rate even slightly. And you could have enormous savings by reducing your loan term, as well.</p> <p><em>Have you paid off your credit card debt? What money moves did you make?</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/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off">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-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</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-financial-decisions-youll-never-regret">8 Financial Decisions You&#039;ll Never Regret</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-your-credit-score-affects-your-job-search">Here&#039;s How Your Credit Score Affects Your Job Search</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/millennial-millionaires-how-the-brokest-generation-can-also-become-the-richest">Millennial Millionaires: How the Brokest Generation Can Also Become the Richest</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance credit report credit score emergency fund high interest debt refinancing retirement saving money Wed, 11 May 2016 10:30:05 +0000 Tim Lemke 1705411 at http://www.wisebread.com Best Money Tips: How to Build an Emergency Fund From Nothing http://www.wisebread.com/best-money-tips-how-to-build-an-emergency-fund-from-nothing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-how-to-build-an-emergency-fund-from-nothing" 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_tree_000059290356.jpg" alt="Woman learning to build her emergency fund from nothing" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found ways to build your emergency fund from nothing, ways to fight clutter and get organized, and a guide to buying refurbished products.</p> <h2>Top 5 Articles</h2> <p><a href="http://www.getrichslowly.org/blog/2016/01/18/29-ways-to-build-your-emergency-fund-out-of-thin-air/">29 ways to build your emergency fund out of thin air</a> &mdash; Look at it as a challenge! Use the dollar-bill challenge to save up by the dollar. [Get Rich Slowly]</p> <p><a href="https://blog.mint.com/how-to/from-clutter-to-confidence-get-organized-in-2016-011416/">From Clutter to Confidence: Get Organized in 2016</a> &mdash; Set up a command center where you will deal with incoming clutter as soon as it enters your home. [MintLife]</p> <p><a href="http://www.csmonitor.com/Business/Saving-Money/2016/0118/A-guide-to-buying-refurbished-technology">A guide to buying refurbished technology</a> &mdash; Buying refurbished products can be a great way to save money&hellip; if you know what to look for. [The Monitor]</p> <p><a href="http://www.kiplinger.com/slideshow/taxes/T054-S001-most-overlooked-tax-breaks-for-new-college-grads/index.html">Most-Overlooked Tax Breaks for New College Grads</a> &mdash; You can deduct unreimbursed costs of moving for your first job if the job location is at least 50 miles away from your old home &mdash; which could be your college residence if you have a job offer when you graduate. [Kiplinger]</p> <p><a href="http://www.cheapism.com/blog/4069/low-cost-small-business-ideas">10 Small Businesses to Start for Less Than $10,000</a> &mdash; The start-up cost for a bounce house rental business can be as low as $1,750! [Cheapism]</p> <h2>Other Essential Reading</h2> <p><a href="http://www.popsugar.com/smart-living/How-Become-Self-Employed-37860836">6 Tips for Becoming Self-Employed</a> &mdash; Develop a game plan for your business. How long will it take to make money? What will your hours be? What is your overall goal, and how will you get there? [PopSugar Smart Living]</p> <p><a href="http://www.becauseimcheap.com/how-to-save-money-on-utilities-in-winter/">How To Save Money On Utilities In Winter</a> &mdash; Dress in layers to stay warm and comfy without having to raise the thermostat. [Because I'm Cheap]</p> <p><a href="http://frugalbeautiful.com/blog/resolve-healthy-emotionally-personally-healthy-year/">Resolve To Be Healthy: How To Get Emotionally, &amp; Personally More Healthy This Year.</a> &mdash; Plan social outings to help feed your friendships or make new ones. [Frugal Beautiful]</p> <p><a href="http://www.livingwellspendingless.com/2016/01/18/maximize-tax-refund/">How to Maximize Your Tax Refund</a> &mdash; The IRS gives deductions for helping out your family, such as caring for a disabled or retired adult in your household or having college-age dependents. [Living Well Spending Less]</p> <p><a href="http://parentingsquad.com/how-to-teach-your-preschooler-impulse-control">How to Teach Your Preschooler Impulse Control</a> &mdash; Teach your child to count to 5 or 10 when they get stressed out and begin to lose control. [Parenting Squad]</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/amy-lu">Amy Lu</a> of <a href="http://www.wisebread.com/best-money-tips-how-to-build-an-emergency-fund-from-nothing">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-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</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/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off 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/a-step-by-step-guide-to-creating-your-emergency-fund">A Step-by-Step Guide to Creating Your Emergency Fund</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-building-an-emergency-fund-always-a-good-idea">Is Building an Emergency Fund Always a Good Idea?</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/6-common-excuses-for-not-saving-money">6 Common Excuses for Not Saving Money</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance best money tips emergency fund Wed, 20 Jan 2016 20:00:02 +0000 Amy Lu 1641937 at http://www.wisebread.com Is Your Emergency Fund Costing You Money? http://www.wisebread.com/is-your-emergency-fund-costing-you-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/is-your-emergency-fund-costing-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/emergency_fund_000051326450.jpg" alt="Find out if your emergency fund is too big" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We all know that an emergency fund is an essential tool in personal money management. And even newbies to personal finance can probably tell you how big an <a href="http://www.wisebread.com/is-your-emergency-fund-big-enough-to-keep-you-afloat">emergency fund</a> should be &mdash; large enough to cover about three to six months of expenses.</p> <p>But what if that rule of thumb is incorrect? If you have an emergency fund that is larger than you need, it could be costing you.</p> <p>Here is what you need to know about figuring out the emergency fund sweet spot for your budget, and why it matters so much.</p> <h2>1. What Constitutes an Emergency?</h2> <p>The typical advice for creating an emergency fund assumes that you would need this fund in case of job loss. That's why the recommendation is to have several months of living expenses set aside, and why Suze Orman in particular suggests that you need <a href="http://www.suzeorman.com/resource-center/suze-orman-money-tips-video-collection/what-ifs-of-life/">eight month's expenses</a>, since an average period of unemployment lasts about 32 weeks.</p> <p>But generally, people who access their emergency fund need the money for an unexpected one-time expense, such as a car repair or medical emergency. This is a far cry from the kind of ongoing emergency you would be facing after a job loss &mdash; and you have much more leeway to handle such a gradual emergency creatively.</p> <p>That's why it's a smart strategy to <a href="http://www.wisebread.com/how-one-family-lives-well-and-even-owns-a-home-on-just-11-an-hour">create a Plan B budget</a> that you could institute in case you lose your job. If you know ahead of time what specific budget items could be struck from your monthly expenses, a smaller emergency fund could handle unemployment much longer than the typical advice would have you believe.</p> <p>In addition, having a Plan B budget gives you options when there is a small financial setback &mdash; such has having to take a pay cut, for instance &mdash; without you having to dip into the emergency fund.</p> <p>It's also unlikely that a job loss emergency will mean you are completely without a paycheck for several months. You might be able to find temporary or freelance work or draw some unemployment benefits, while also seriously reducing some of your expenses.</p> <h2>2. Expecting the Unexpected</h2> <p>So you know that you don't need a large emergency fund in case of a job loss. What about those unexpected one-time expenses? It's not possible to know exactly when your refrigerator will give up the ghost, or when you will need expensive dental surgery.</p> <p>Except that it is possible to plan ahead for most unexpected expenses. According to a 2007 survey by the Pew Research Center, 34% of people <a href="http://www.pewsocialtrends.org/files/2010/10/Saving.pdf">experienced unexpected expenses</a> in the previous year. These were the kinds of unexpected costs they faced:</p> <ul> <li>34% had medical expenses,</li> <li>24% had car expenses,</li> <li>20% had home and housing expenses,</li> <li>9% had life event and child expenses, and</li> <li>The remaining expenses were comprised of work, travel and vacation-related, pets, and taxes.</li> </ul> <p>Each of these types of &quot;unpredictable&quot; expenses is actually fairly inevitable. No matter how healthy you are, it's likely that you will need some sort of medical care eventually. If you own a car or a home, you need to maintain it. Though you might not know when to expect a birth, a death, or a wedding, you do know that they will happen.</p> <p>So instead of treating these sorts of situations as emergencies, it makes more sense to create a targeted budget category for any expense that might otherwise take you by surprise. For instance, you might create a car repair budget category into which you put aside $100 per month. Then when you have an &quot;unexpected&quot; repair, you will have money already set aside for that purpose.</p> <h2>3. The Cost of a Big Emergency Fund</h2> <p>Just because it's unlikely that you will need six months' worth of expenses set aside, and your unexpected emergencies can be mitigated with targeted budget categories, what's the harm in keeping a large emergency fund? It can feel good to have the security of a lot of cash on hand.</p> <p>Unfortunately, there is a major cost for that sense of security: inflation.</p> <p>The cost of inflation averages about 3% per year. Even the best high-yield savings accounts currently offer an annual interest rate of 1% or less. That means inflation is eating 2% of your emergency fund with every year that passes &mdash; and inflation, like interest, compounds. For instance, if you have $15,000 in a savings account with a 1% APR and 3% inflation, your money will only be worth $10,133.84 of today's dollars in twenty years. (If you would like to check my math, this is the <a href="http://www.moneychimp.com/articles/econ/inflation_calculator.htm">inflation calculator</a> I used.)</p> <p>If you never experience a job loss and use targeted budgeting categories, it is very possible that you might not need to use your $15,000 savings account at any point during those twenty years. You could have done something much better with that money.</p> <h2>4. Emergency Fund Best Practices</h2> <p>It makes sense to always keep some money in a savings account so you can access the funds quickly, just in case. But above a certain emergency fund ceiling, a smart move is to invest extra cash that would otherwise collect dust in your emergency fund. In particular, parking that money in a low-fee mutual fund can help you grow your money, while still keeping the funds available in the event of that mythical job loss.</p> <p>The question is, where should you place the ceiling for your savings account emergency fund?</p> <p>It all depends on what amount of money on hand helps you sleep at night and how much you otherwise have invested. If you get twitchy without a fat savings account, and you have a good handle on your retirement and other investment accounts, there's nothing wrong with having a large emergency fund.</p> <p>If on the other hand you still haven't set up your 401(k) at work (but are otherwise not in severe financial distress), then it makes more sense to keep your emergency fund ceiling relatively low while you work on building up your investments.</p> <p>It's also important to note that contributions to your emergency fund should be a consistent line item in your monthly budget. Staying in the habit of always putting that money away will help you to replenish the fund after an emergency, and give you another monthly amount of investable money once you reach your emergency fund savings goal.</p> <h2>Too Much of a Good Thing</h2> <p>Saving too much is generally not the biggest problem among American workers. But those who do work to protect themselves financially might be taking their good habits a little too far when it comes to their emergency funds.</p> <p>Maintaining the right size emergency fund may require a little more work on your part &mdash; from figuring out a Plan B budget to anticipating surprise expenses to figuring out how to make your money grow &mdash; but that extra work will more than pay off in your sense of financial security.</p> <p><em>How big is your emergency fund?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/is-your-emergency-fund-costing-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-10"> <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/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off Debt</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/managing-your-short-term-money">Managing Your Short-Term 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/11-ways-life-is-amazing-with-an-emergency-fund">11 Ways Life Is Amazing With an Emergency Fund</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-money-moves-to-make-the-moment-you-graduate">5 Money Moves to Make the Moment You Graduate</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/will-a-dental-discount-plan-save-you-money">Will A Dental Discount Plan Save You Money?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance emergency fund job loss savings unemployment Fri, 03 Jul 2015 11:00:26 +0000 Emily Guy Birken 1471157 at http://www.wisebread.com 11 Ways Life Is Amazing With an Emergency Fund http://www.wisebread.com/11-ways-life-is-amazing-with-an-emergency-fund <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/11-ways-life-is-amazing-with-an-emergency-fund" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/family_000022968360.jpg" alt="Family enjoying life knowing they have an emergency fund" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>These days, far too many people are living on the financial edge. High <a href="http://www.federalreserve.gov/releases/g19/current/">rates of personal debt</a> are crippling many families, and leaving them unprepared for the unexpected.</p> <p>Building an emergency fund is an important part of any financial plan. In fact, it may be the most important thing you do with your money. Opinions vary on how large an emergency fund should be, but most financial experts suggest socking away <em>at least</em> three months worth of salary (or more if you can).</p> <p>Let's take a look at the many ways an emergency fund will improve your life. (See also: <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund?ref=seealso">A Step-by-Step Guide to Creating Your Emergency Fund</a>)</p> <h2>1. You Can Get Stuff Fixed</h2> <p>People without emergency funds will often let problems go until they get even worse. That car repair that might have been $500 could turn out to be $2,000 later if it's not addressed. That flooded basement could turn into a massive mold problem if you don't get it taken care of right away. An emergency fund is a necessity for any homeowner.</p> <h2>2. You'll Never Have to Cheat Your Future Self</h2> <p>If you have an emergency, you may find yourself dipping into your retirement savings. If you do this, you may pay penalties, and you're costing yourself thousands of dollars down the road. Keep an emergency fund so you won't have to tap into your retirement.</p> <h2>3. Getting Sick Isn't the End of the World</h2> <p>So you tore your ACL in a bike accident, and even though you have insurance, the medical bills are higher than you expected. It's okay. That's what an emergency fund is for. If you have money saved, you can focus on the most important thing &mdash; getting well.</p> <h2>4. You Can Endure a Layoff</h2> <p>As someone who once faced two layoffs in a four-year period, I can tell you that having some money in the bank can really take the pressure off. According to the Bureau of Labor Statistics, more than 45% of unemployed people in February reported <a href="http://www.bls.gov/news.release/pdf/empsit.pdf">being out of work</a> for more than 14 weeks. An emergency fund will allow you to keep paying your bills, and you may also have the luxury of waiting for a new job that's a good fit for you.</p> <h2>5. You'll Avoid the Debt Spiral</h2> <p>If you don't have the cash to respond to an emergency, you may find yourself tapping credit cards or taking out a second mortgage. Before you know it, you're saddled with ever-increasing credit card payments. Your financial situation just gets worse from there. An emergency fund will prevent you from facing an explosion of debt.</p> <h2>6. You Won't Have to Borrow From Friends and Family</h2> <p>There's nothing wrong with family members lending each other a hand, but things can get stressful when money is involved. Will you have the ability to pay your brother-in-law back if he loans you $2,000? How will he react if you can't pay up? And if you do get a loan, will there be strings attached? Family members might be more forgiving than a bank, but you run the risk of straining relationships along the way.</p> <h2>7. It's Easier to Be Your Own Boss</h2> <p>Having an emergency fund is especially important if you have unpredictable income. If you're a business owner or freelancer, you'll go through ups and downs and may even have stretches where you are bringing in no money at all. Build up your emergency fund when things are going well, and you'll find that the lean times won't seem so bad.</p> <h2>8. You Can Splurge Once in a While</h2> <p>Building up an emergency fund takes financial discipline. But ironically, this financial discipline could eventually mean that you can be irresponsible once in a while. When you have no savings, going out for a big steak dinner is a bad idea. But when you have an emergency fund, you can get away with it on occasion. The key is to avoid splurging before that savings is built up, and make sure you have a plan to replenish any funds you might dip into.</p> <h2>9. It Makes It Easier to Have Kids</h2> <p>Kids are expensive, so on the one hand, they do make it harder to build up your savings. But if you work hard early to make sure you have an emergency fund in place, you'll be prepared to take on the expenses that parenthood brings. Kids break things. They hurt themselves, and each other. They have educational needs and activities that often cost more than expected. Moreover, having a good chunk of savings makes it easier for parents to take time off work to care for new babies. An emergency fund is a parent's best friend. (It's also worth noting that emergency funds can be hugely important if you find yourself with a new addition unexpectedly.)</p> <h2>10. You Can Survive Your Mistakes</h2> <p>Maybe you were late on your taxes and have to pay a penalty. Perhaps you (or your kid) spilled grape juice all over your laptop, rendering it unusable. Maybe you got distracted while driving and smashed up the car. No one is perfect. But when you live without an emergency fund, you're living without any margin for error.</p> <h2>11. You Will Have the Gift of Flexibility</h2> <p>An emergency fund can keep you from getting locked in. You can take time off work to work on that novel. You can take that dream job, even if it doesn't pay quite as much. You can dump your boyfriend and move into another apartment. If you live below your means and build up your savings, you end up with more options in your life. And that's a major key to happiness.</p> <p><em>How has having an emergency fund benefited you?</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/11-ways-life-is-amazing-with-an-emergency-fund">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <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/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off Debt</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/7-money-moves-you-will-always-be-thankful-for">7 Money Moves You Will Always Be Thankful For</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-5-best-pieces-of-financial-wisdom-from-warren-buffett">The 5 Best Pieces of Financial Wisdom From Warren Buffett</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-money-moves-to-make-before-the-leaves-change">10 Money Moves to Make Before the Leaves Change</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-money-mistakes-to-stop-making-by-50">5 Money Mistakes to Stop Making by 50</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance debt emergency fund layoffs savings Wed, 08 Apr 2015 17:00:09 +0000 Tim Lemke 1372977 at http://www.wisebread.com 9 Financial Skills Everyone Needs During Hard Times http://www.wisebread.com/9-financial-skills-everyone-needs-during-hard-times <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-financial-skills-everyone-needs-during-hard-times" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/upset-businesswoman-newspaper-park-Dollarphotoclub_38034943.jpg" alt="upset businesswoman newspaper park" title="upset businesswoman newspaper park" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Could you live on $1,300 a month? According to the U.S. Census Bureau, that's the poverty threshold for a person under age 65. (If you're a family of four, that increases to a whopping $1,968 per month.)</p> <p>Unless you've been there, it's hard to know what it's like to make the most out of a limited budget. But while lower-income workers use different money-management methods than the One Percenters do, they're equally valuable skills &mdash; and people of all income levels could use those methods to keep their finances on solid ground.</p> <p>At the peak of his fame, Pablo Picasso said, &quot;I'd like to live as a poor man with lots of money.&quot; That's a wise motto to live by, no matter your income. Here are nine ways you can do so.</p> <h2>1. Make a Budget &mdash; And Stick to It</h2> <p>It's tough to barely cover bills month after month, but if you make a budget and look for little ways to save some money, a little advance planning pays off big time &mdash; it can mean the difference between living comfortably and looking for change between the cushions to buy your next meal.</p> <p>The first step to managing your money is to know how it's coming in, and where it's going. Use an accounting tool, whether it's paper and pencil or an online program like Mint, to keep tab of your income and expenses. Total all your expenses for the month and compare that to how much you earn every month. If current expenses exceed income, then you need to figure out where to cut.</p> <h2>2. When It Comes to Saving, Every Penny Counts</h2> <p>There's always going to be something to spend on, whether it's your faltering car engine or a costly toothache. Living on a small income can make it hard to save for a roof repair or a retirement fund, but it can be done.</p> <ul> <li>Ask your bank to automatically transfer funds each month &mdash; even as little as $10 &mdash; from your checking to your savings account.<br /> &nbsp;</li> <li>Put all your loose change into a piggy bank, then transfer it into your savings account. A nickel a day, plus $10 from your checking-account transfer, adds up to $140 a year &mdash; and over a lifetime can total many thousands of dollars.</li> </ul> <h2>3. Seek More Modest Housing</h2> <p>Too many of us have larger (or more expensive) homes than we actually need. Consider downsizing to the least costly home that will meet your family's needs. If you own a home, check with your lender whether you can refinance your mortgage at a lower rate. Mortgage interest rates are at historic lows, so refinancing could save you years of payments and a good deal of money that you can stash away into savings. Or, consider renting out a room in your home or finding a roommate to reduce costs.</p> <h2>4. Reduce Your Car Use</h2> <p>When you're on a tight budget, you're attuned to minimizing your driving as much as possible in order to cut gas costs. The best way? Combine multiple shopping trips into one. Of course, you save even more on gas and auto maintenance if you can ditch the car and walk, bike, rollerblade, or even skateboard to the store or work.</p> <h2>5. Make Use of Available Benefits</h2> <p>Low and moderate-income workers can qualify every year for an Earned Income Credit on their tax returns, which can refund up to $496 for an individual and $5,450 for a family of four. You can find out if you're eligible by using the <a href="http://www.irs.gov/Individuals/Earned-Income-Tax-Credit-(EITC)-%E2%80%93&mdash;Use-the-EITC-Assistant-to-Find-Out-if-You-Should-Claim-it.">IRS's EITC Assistant website</a>.</p> <p>And don't forget to make use of health care benefits &mdash; an unexpected medical emergency can be costly, so make use of Medicaid, or hospital financial assistance, if you qualify. Also, remember that the Affordable Care Act offers government subsidies that can offset all or part of the cost of private health insurance. <a href="https://www.healthcare.gov/">HealthCare.gov</a> is a good place to start.</p> <p>There are plenty of other useful programs that provide help with a variety of things, such as utility bills or advancing your job skills. Start at the <a href="http://www.benefits.gov/">Benefits.gov</a> website to see what you could be eligible for.</p> <h2>6. Find a Side Gig</h2> <p>As many people with tight budgets know, one paycheck is rarely enough. Even if you already have a full-time job, a little extra income can come in handy to pay off debt, cover bills, and save for emergencies. And there are plenty of money-making ideas that won't detract from your 9-to-5 job, such as selling items on eBay or renting out your extra room on Airbnb. If you have desirable skills, freelance or consult on the side. Many side jobs have little to no start-up costs and can be done during your down time.</p> <h2>7. Be Savvy About Health Care Costs</h2> <p>People on tight budgets use these methods to lower medical costs:</p> <ul> <li>Find the lowest-cost place to purchase prescription drugs. Call and do a price check at ethnic supermarkets and discount centers, and look online at mail-order pharmacies.<br /> &nbsp;</li> <li>Ask your physician to consider prescribing generic drugs. Generics can cost several hundred dollars less to purchase annually than brand-name drugs &mdash; and they're thoroughly regulated by the FDA.<br /> &nbsp;</li> <li>If you've got a minor ailment (like the flu or an achy muscle) check out low-cost retail clinics in your area. CVS, Walgreen's, and Walmart often offer these.</li> </ul> <h2>8. Never Pay Full Price if You Don't Have To</h2> <p>People with limited incomes usually can't afford to pay full price. And you should get in the habit of never doing so, either. If you're shopping retail, wait until the end of a season to buy items once they're priced half off or more. And save your receipts: Most stores will refund the difference if your purchased item's price declines within 30 days of purchase.</p> <h2>9. Pool Resources</h2> <p>Carpooling, sharing baby-sitting duties, and cooking pot-luck dinners are examples of ways to reduce costs by pooling resources. Can other family members live in your home and pitch in for rent? Can older kids make a few extra bucks by mowing lawns on the weekend that can be used to pay for school lunches? Communal living not only brings us closer, but also reduces expenses and creates a sense of common purpose.</p> <p><em>What financial skills have lean times taught you? 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/vanessa-richardson">Vanessa Richardson</a> of <a href="http://www.wisebread.com/9-financial-skills-everyone-needs-during-hard-times">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-12"> <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/in-times-like-these-separate-the-want-from-the-need">In times like these, separate the want from the need.</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-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</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/9-things-football-teaches-us-about-money">9 Things Football Teaches Us About 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/six-ways-to-stay-warm-and-reduce-the-heating-bill">Six Ways to Stay Warm and Reduce the Heating Bill</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/five-reasons-why-i-love-public-transportation">Five Reasons Why I Love Public Transportation</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Frugal Living budget emergency fund hard times saving Tue, 06 Jan 2015 14:00:13 +0000 Vanessa Richardson 1275630 at http://www.wisebread.com 10 Ways to Prevent an Emergency From Driving You Into Debt http://www.wisebread.com/10-ways-to-prevent-an-emergency-from-driving-you-into-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-ways-to-prevent-an-emergency-from-driving-you-into-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/couple-finances-86515975-small.jpg" alt="couple finances" title="couple finances" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Emergencies happen, and they can often be expensive &mdash; particularly crises like car accidents, unexpected dental or medical needs, high vet bills, or unexpected flooding in your apartment after a vicious storm. If you have not fully built up your emergency fund yet (or you are hit with back-to-back hardships that your emergency fund can't handle), then you can feel like you have no choice but to go into debt to pay for your emergency. (See also: <a href="http://www.wisebread.com/emergency-plan-better-than-an-emergency-fund?ref=seealso">Emergency Plan: Better Than an Emergency Fund</a>)</p> <p>Nothing could be further from the truth. There are much better ways to take care of emergencies without going into debt. Here are ten things you can do to pay for an emergency without debt:</p> <h2>1. Ask Family or Friends for Help</h2> <p>Asking for financial help can be a serious relationship killer, which is why many people would prefer to do anything (including go into debt) rather than ask a friend for money.</p> <p>But the real problem with getting financial help from a loved one is when there are unmet expectations. (See also: <a href="http://www.wisebread.com/how-to-navigate-4-tricky-family-money-situations?ref=seealso">How to Navigate 4 Tricky Family Money Situations</a>)</p> <p>For instance, you might think that your potential benefactor might be doing better financially than they are, or you might think that they ought to help you when they feel much more comfortable saying no to any such request. In either case, you might end up resenting your friend for saying no. You need to go into the conversation with the recognition that they can say no and that it does not reflect in any way on your relationship if they do.</p> <p>On the other end, your lender might feel that you need to pay them back on a quicker time frame than you are comfortable with.</p> <p>The only way to borrow money from a friend or family member with little chance for blowback is to treat it like a financial transaction and actually use a <a href="http://www.investopedia.com/terms/p/promissorynote.asp">promissory note</a>. This legal agreement (which will cost about <a href="http://www.nolo.com/products/promissory-notes">$9 to DIY</a>, and the borrower should be the one to pay for) will spell out the specifics of payment dates, interest, and other loan details.</p> <p>The other important thing to remember about borrowing from friends is that it cannot become a habit &mdash; no matter how diligent you are about repayment.</p> <h2>2. Ask Your Bank for an Emergency Overdraft</h2> <p>If your emergency occurs within a few days of payday, it could be worth your while to talk to your bank about an emergency overdraft. Explain the situation that you are in and tell the bank how much of an overdraft you will need. Be sure to ask how much the fee will be to cover your overdraft. From there, your bank can either approve or deny your request. Depending on the cost of your overdraft protection, this could be a relatively inexpensive way to get the money you need.</p> <h2>3. Sell or Pawn Something</h2> <p>In an emergency, it becomes clear that some of the stuff you own may be less important than you think. That's a good time to sell some of the things you have kept but no longer need. If you have some time, you can try to sell your things on Craigslist or eBay. If you need money in a hurry, you can take your valuables to a pawnshop. There you have the option of outright selling your goods or pawning them &mdash; taking a loan with a set amount of time to buy it back with interest.</p> <h2>4. Borrow From Your 401(k) or Your IRA</h2> <p>While it's generally a bad idea to borrow from your future to pay for a current need, there are some instances when it makes sense for you to take a loan from one of your retirement accounts. In particular, if you have a short-term emergency need for cash, borrowing that money from your 401(k) or your IRA could get potentially you through the emergency with few consequences to your retirement account. (See also: <a href="http://www.wisebread.com/this-is-when-you-should-borrow-from-your-retirement-account?ref=seealso">This Is When You Should Borrow From Your Retirement Account</a>)</p> <h3>401(k)</h3> <p>You are legally allowed to access a portion (generally the <a href="http://www.investopedia.com/articles/retirement/08/borrow-from-401k-loan.asp">lesser of 50% or $50,000</a>) of your retirement plan money tax-free. You are required to repay that amount, plus interest (paid to your account), which will help to restore some of the growth you have lost by taking the loan. Loan rules specify a five-year amortization repayment schedule, but there are no pre-payment penalties if you would like to rebuild your account more quickly. In addition, many plans will allow you to make repayments through payroll deduction, in the same way you make normal contributions.</p> <p>One caveat &mdash; if you leave (or lose) your job before paying back the loan, it will be considered an early distribution, which will mean that you owe the 10% early withdrawal penalty and tax on your loan.</p> <h3>IRA</h3> <p>Strictly speaking, you cannot take a loan from an IRA. However, it is legal to <a href="http://www.creators.com/lifestylefeatures/business-and-finance/money-and-you/can-you-borrow-from-your-ira.html">withdraw money from your IRA for 60 days</a> with a tax-free rollover. Basically, you can take money out of your IRA with no taxes or penalties, provided you put the money back into that or another IRA within 60 calendar days. If you fail to replace the money within that time frame, it will be considered an early withdrawal and you will have to pay income taxes on the money and a 10% penalty.</p> <p>In addition, it's important to note that there is what's known as the one-year rule. You can only do such a tax-free rollover once within any 12-month period.</p> <h2>5. Research Alternatives to Your Emergency</h2> <p>Depending on what major bill has unexpectedly cropped up, you may be able to reduce the expense to something more manageable if you do a little shopping around.</p> <p>For instance, emergency dental work does not necessarily have to break the bank. Dental schools are in constant need of patients for students to practice on. A friend of mine who went through dental school at OSU had a great deal of trouble finding patients for each type of procedure she needed to complete for her degree, and even began offering token amounts of money to patients in order to get them to come in for needed procedures.</p> <p>Call your local university to see if they are in need of dental patients &mdash; or veterinary patients if it's your cat or dog that is having the emergency. In addition, vocational and technical schools need practice in diagnosing engine problems in cars. Your problem could be good experience for a budding professional, while having a student fix it could cost you a lot less.</p> <h2>6. Get a Charitable Grant</h2> <p>There are <a href="http://www.moneycrashers.com/get-help-paying-rent/">multiple charities</a> that offer one-time cash grants to help individuals in temporary financial difficulty. These grants do not have to be repaid, but qualifications depend on both the limits of the particular charity and your particular situation.</p> <h3>The Salvation Army</h3> <p>Local chapters of the <a href="http://www.salvationarmyusa.org">Salvation Army</a> offer one-time assistance to help cover things like rent. To apply, you must visit your local Salvation Army office and prove your hardship.</p> <h3>Catholic Charities</h3> <p><a href="http://catholiccharitiesusa.org/">Catholic Charities</a> offers emergency assistance grants for applicants who prove their need. You must apply in person and talk with a caseworker.</p> <h3>Modest Needs</h3> <p>This charity is funded similarly to Kickstarter. Private donors pledge money to fund specific grants for those in need, and the applicant will only receive the funds if his or her application is fully funded. Anyone with a job can apply. In particular, <a href="https://www.modestneeds.org/index.asp">Modest Needs</a> offers the Self Sufficiency Grant, which provides up to $1000 to cover one emergency expense.</p> <h3>211</h3> <p><a href="http://211.org/">211.org</a> is a program run through the United Way, and it offers an online database of local nonprofits across the United States.</p> <h2>7. Cut Way Back</h2> <p>How much do you spend each month on food, utilities, gas, and cell phone? You may be able to find enough money in your monthly budget to cover your emergency if you are willing to eat peanut butter and jelly, turn off the a/c, take the bus, and switch off your cell phone data plan for a month. This may sound drastic, but it's preferable to getting into debt just to avoid a few weeks of discomfort.</p> <h2>8. Adjust Your Withholding</h2> <p>One important and reassuring piece of information I learned from my financial planner father was that the IRS does not care what you say on your W-4, as long as you tell them the truth come tax time. That's because the W-4 is simply a form that tells your employer what your allowances are &mdash; not a legally binding claim to the IRS.</p> <p>What that means is that you can potentially <a href="http://www.kiplinger.com/article/taxes/T055-C000-S001-last-chance-to-fix-your-tax-withholding.html">adjust your withholding on your W-4 form</a> at your workplace and see more money in your very next paycheck. By claiming more allowances on your W-4, you will be sending less of your money to the IRS.</p> <p>If you regularly get a large refund, you can figure out exactly what your withholding should be using the <a href="http://www.irs.gov/Individuals/IRS-Withholding-Calculator">IRS online withholding calculator</a>. In this case, once you've adjusted your withholding, you can keep it at the adjusted amount for the rest of the year and save the difference (ideally in an interest-bearing account or in your retirement account).</p> <p>However, even if your refunds tend to be modest, you can still take advantage of this trick. Simply adjust your withholding for a short time &mdash; a month, for instance &mdash; and submit a new W-4 with your original allowances once the month is up. In this case, you will have to be careful that you have enough set aside at tax time in case there is a shortfall because of this. (And make certain that you re-adjust the numbers back, or else you'll be in for a nasty surprise next April 15.)</p> <h2>9. Try Crowdfunding</h2> <p>Websites like <a href="http://www.gofundme.com/">GoFundMe</a> offer opportunities to raise funds through online donations. These sites allow you to create a profile explaining who you are and why you need the funds. Donors give money to your campaign, and the site takes a percentage of the donation for operational costs. The fundraiser can withdraw the money raised on GoFundMe at any time. GoFundMe has no campaign deadlines or goal limits (although other crowdfunding sites do), and the service is free for the fundraiser.</p> <h2>10. Rent Out Something You Own</h2> <p>No matter where you live or what you do, it's likely that you own something someone else might need temporarily. For instance, if you live in an area that draws tourism or business travel, you might be able to rent out a room (or even the whole place, if you crash at a friend's house) on <a href="https://www.airbnb.com/">Airbnb</a>.</p> <p>Alternatively, if parking is at premium in your area, you could rent out your parking space or garage while you perfect your parallel parking skills (or leave your car elsewhere and take the bus for a few days). Check out sites like <a href="https://www.parkingpanda.com/how-it-works">ParkingPanda</a> and <a href="https://www.justpark.com/rent-out-a-parking-space/?source=pamh">JustPark</a>.</p> <p>Finally, as long as your car is not the basis of your emergency, you could rent it out to visitors who need wheels on <a href="https://relayrides.com/">RelayRides</a>.</p> <h2>Life Happens</h2> <p>In the best-case scenario, we would all have a robust emergency fund and appropriate insurance for every possible curve ball. But even the <a href="http://en.wikipedia.org/wiki/To_a_Mouse">best-laid schemes &quot;gang aft agley,&quot;</a> and it's important to remember that paying for an emergency does not have to mean taking on debt.</p> <p><em>Have you been fortunate enough to navigate an emergency without crippling your finances? What was your strategy? 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/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/10-ways-to-prevent-an-emergency-from-driving-you-into-debt">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-13"> <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/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off Debt</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/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-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-7-best-credit-card-debt-elimination-strategies">The 7 Best Credit Card Debt Elimination Strategies</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/avoid-these-5-common-mistakes-while-rebuilding-your-credit">Avoid These 5 Common Mistakes While Rebuilding Your Credit</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-deal-with-collection-agencies">How to Deal With Collection Agencies</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management avoid debt debt emergency emergency fund quick cash Mon, 21 Jul 2014 09:00:03 +0000 Emily Guy Birken 1162784 at http://www.wisebread.com How to Balance Saving for Retirement, Emergency Fund, and Paying Off Debt http://www.wisebread.com/how-to-balance-saving-for-retirement-emergency-fund-and-paying-off-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-balance-saving-for-retirement-emergency-fund-and-paying-off-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/piggy-bank-95565680.jpg" alt="piggy bank" title="piggy bank" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Balance in our financial lives can feel like a dream we'll never reach. Do we pay off student loan debt? Make an extra payment on the mortgage or the car loan? Should we save for retirement? How much do we need to have in an emergency fund? There's a lot of conflicting advice out there. (See also: <a href="http://www.wisebread.com/investment-advice-you-should-never-hear-from-your-financial-advisor?ref=seealso">Investment Advice You Shouldn't Hear From Your Financial Advisor</a>)</p> <p>When I graduated from business school and arrived solo in New York City with a $0 balance in my bank account, $100,000+ worth of student loan debt, and no job in the summer of 2007, I faced all of this confusion head-on and with a mountain of anxiety. Six and a half years later, I have roughly 12 months of savings in my emergency fund, paid off over half my student loan debt, and run my own content development business after quitting my corporate job 19 months ago.</p> <p>Along this winding path I learned that balance, financial or otherwise, is a process, not a state of being. Priorities will shift and unexpected changes will arise. That's life. The best thing you can do is develop and commit to a plan that's flexible enough to allow for some shifting and stable enough to give you confidence and peace of mind so you can live life to the fullest. Here's the blueprint I used to find financial balance, and you can use it, too. (See also: <a href="http://www.wisebread.com/how-to-create-a-financial-5-year-plan?ref=seealso">Creating a 5-Year Financial Plan</a>)</p> <h2>1. Your Emergency Fund Is a Lifeline</h2> <p>If you get sick, lose your job, or transition to a new home or career, an emergency fund is the shock absorber that makes these changes manageable. It's meant to help you keep a roof over your head, food on the table, and your credit score intact when the going gets tough.</p> <p>Some people will say you need three months of savings. Others will say you need a year, and every amount in-between. The truth is that it's your choice. How much do you need to feel safe and secure in case of an emergency? When it comes to personal finance, I'm very conservative, so I want a year's worth of living expenses saved. If this feels daunting, don't worry. You build up this fund in small amounts over time. How much can you put away every week and not touch? $25, $50, $100? Commit to an amount you know you can manage, and start building. (See also: <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund?ref=seealso">Emergency Fund Guide</a>)</p> <h2>2. Grab That 401(k) Match or Set Up an IRA</h2> <p>If you work for someone else and your employer offers a 401(k) match, contribute as much as you need to contribute to get that match. <em>It's free money.</em> Don't leave it on the table.</p> <p>If you don't have an employer match or you work for yourself, you still want to start putting aside some money (even if it's a very small amount every month) for retirement as soon as you can to take advantage of compounding interest over time by setting up an IRA or ROTH IRA.&nbsp;</p> <h2>3. Credit Card Debt Must Go, but Keep the Cards</h2> <p>Credit cards, when paid off every month, can help establish credit history, bolster a credit score, and deliver valuable rewards. When not used properly, credit card debt is often the costliest expense in our portfolios and certainly the most damaging kind of debt for a credit score. If your cards carry a balance, take these steps:</p> <ul> <li>Call every credit card company you use and negotiate a way to pay down your debt as fast as possible and in a manageable way. They will work with you if you open up the conversation.<br /> &nbsp;</li> <li>Part of your credit score comes from examining the amount of credit you have access to and the amount you use. The greater that ratio (you have access to credit and choose not to use it), the more discipline and responsibility you demonstrate. The best way to destroy this ratio is to cancel your credit cards. Don't do it. Work on paying them off and then put them in a drawer for safekeeping.<br /> &nbsp;</li> <li>Don't add new charges to a credit card until it's paid off, and then limit the charges you incur going forward.</li> </ul> <h2>Next Debt Steps</h2> <p>Examine the rest of your debts and make a chart with the following information:</p> <ul> <li>Principal remaining and monthly minimum payment;<br /> &nbsp;</li> <li>Interest rate and the percent of your monthly payment that goes to interest and not principal;<br /> &nbsp;</li> <li>Whether or not your interest payments can be deducted from your taxes.</li> </ul> <p>If you have trouble finding any of this information, just call your lender and ask for it.</p> <p>When you pay any amount above the monthly minimum payment, that extra money goes directly to principal and that helps you pay down the whole loan faster. If you have extra funds remaining after you've set aside emergency fund money, contributed to retirement to get your employer match, and paid off your credit card debt, then make some extra contributions above the minimum to pay down your other debts in the following order:</p> <ol> <li>Debts that carry interest payments that <em>can't</em> be deducted from taxes (i.e., car loans). Mortgage debt and education debt can be deducted from your taxes and carrying that debt allows you to use cash more effectively.<br /> &nbsp;</li> <li>Debts that have the highest interest rates.</li> </ol> <h2>4. Now, Let's Have Some Fun</h2> <p>If you've gotten this far, congratulations! You've set yourself up in a very financially stable position and now it's time to enjoy some of your savings with an additional account. This savings account is for things you want to do &mdash; go on vacation, take a class, or redecorate your home. This is money you use to reward yourself for a life well-lived. (See also: <a href="http://www.wisebread.com/21-frugal-ways-to-reward-yourself-right-now?ref=seealso">21 Frugal Ways to Reward Yourself</a>)</p> <p>Personal finance can be, and should be, fun. You're taking responsibility and establishing your independence. You're creating a life that's stable and secure. This is an incredible path with an end goal that you can and will accomplish. Keep track of your progress and celebrate your successes along the way. It's a marathon, not a sprint. Enjoy the journey.</p> <p><em>How do you balance the conflicting demands on your income? Does your list of priorities differ from this one?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/how-to-balance-saving-for-retirement-emergency-fund-and-paying-off-debt">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-14"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-an-extra-109486-a-year">How to Save an Extra $1,094.86 a Year</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/5-day-debt-reduction-plan-pay-it-off">5-Day Debt Reduction Plan: Pay It Off</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/x-exciting-world-cities-you-can-afford-to-retire-in">4 Exciting World Cities You Can Afford to Retire In</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-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Credit Cards Retirement debt repayment emergency fund personal finance priorities retirement Wed, 19 Feb 2014 10:36:08 +0000 Christa Avampato 1126638 at http://www.wisebread.com 5 Things 30-Year-Olds Don’t Have Enough Of http://www.wisebread.com/5-things-30-year-olds-don-t-have-enough-of <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-things-30-year-olds-don-t-have-enough-of" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/2568840165_49aa2eb7a5_z.jpg" alt="man in shock" title="man in shock" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>As humans, we tend to set up milestones for ourselves. It's fairly common to take stock at the end of each decade of life, and figure out what we need to do differently. One of those major milestones seems to be the age 30.</p> <p>At age 30, you are assumed to be moving forward with life. You're firmly in the adult world, but you might still be making the mistakes of post-adolescence. Chances are that you're looking around at age 30, and wondering why you aren't in a better position. If you are 30, or about to turn 30, consider that you probably don't have enough of the following. (See also: <a href="http://www.wisebread.com/5-expenses-to-ditch-after-age-30">5 Expenses to Ditch After Age 30</a>)</p> <h2>1. Retirement Savings</h2> <p>It's hard to think that you need to worry about retirement when it's 25 to 30 years away. However, now is the time to be setting aside money. The longer you let compound interest do its thing, the more money you will have later. And that's important.</p> <p>A recent survey <a href="http://www.dailyfinance.com/2012/11/14/retirement-savings-by-age-how-do-you-compare/">conducted by LearnVest and Chase Blueprint</a> found that the median amount of money that those ages 25-32 have saved for retirement is $12,000. That's not a whole lot to go on. You aren't going to reach your retirement goals if you are only setting aside $100 a month. You probably need to ramp up your retirement savings if you expect to enjoy your golden years in comfort.</p> <h2>2. Emergency Savings</h2> <p>A large number of Americans are without <a href="http://www.wisebread.com/figuring-the-size-of-your-emergency-fund">emergency savings</a>, and 30-year-olds are likely to be in that group. According to a recent Bankrate Financial Security Index survey, 28% of Americans have no emergency savings at all. An additional 21% of Americans have some savings, but less than three months' worth. When you total that up, it's clear that 49% of Americans don't even have enough emergency savings to last three months. Only 25% of respondents say that they have at least six months' savings.</p> <p>Chances are that you fall into the &quot;not enough emergency&quot; savings group &mdash; and it's probably time to ramp it up so that you are prepared for what could be next.</p> <h2>3. Life Insurance</h2> <p>Is your family adequately protected in the event of your death? Life insurance is an important part of financial planning. Unfortunately, many 30-year-olds don't have life insurance, and, if they do, they don't have enough of it.</p> <p>According to <a href="http://www.jdpower.com/content/detail.htm?jdpaArticleId=346">J.D. Power &amp; Associates</a>, 40% of adult Americans have no life insurance at all. On top of that, 25% of those who had spouses that died between the ages of 30 and 55 felt that there wasn't enough coverage. When you think about it that way, it becomes clear that you need life insurance.</p> <p>If you care about your family, you should consider boosting your life insurance coverage. <a href="http://lifeinsurancebyjeff.com/how-to-get-the-cheapest-term-life-insurance-policy/">Term life is very affordable</a>; you can get a large amount of coverage for a fairly low premium.</p> <h2>4. Income Diversity</h2> <p>While it's nice to have a good job with great benefits, it's important not to become too dependent on one source of income. In the current economy, you never know when layoffs will strike. As a result, it's important to be ready with <a href="http://www.goodfinancialcents.com/ways-to-make-money-earn-extra-income/">diverse income streams</a>. A good emergency fund can help shield you, but it's also a good idea to look for ways to build your assets.</p> <p>You can start a <a href="http://www.wisebread.com/30-great-side-jobs">side hustle</a>, monetize a website, get involved in selling items and crafts on eBay, Craigslist, and Etsy, build a dividend portfolio, or engage in a creative endeavor that brings royalties. While you don't need to try to replace your day job, you can reduce your reliance on a single source of income (your day job) for your financial wellbeing.</p> <h2>5. Long-Term Financial Planning</h2> <p>At 30, you probably don't realize how important a long-term financial plan is. In fact, you probably don't have nearly enough financial planning under your belt. Your complete financial plan should include a look at major milestones, from buying a house (if you decide to go that route) to having kids to sending those kids to college to retirement.</p> <p>You should have a long-term financial roadmap that can get you to where you want to be. You can sit down with your life partner and work this out, or you can go to a trusted financial adviser to get help. But you need to make a plan. You should figure out what you need to do to create the lifestyle you want now and for the future.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jeff-rose">Jeff Rose</a> of <a href="http://www.wisebread.com/5-things-30-year-olds-don-t-have-enough-of">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-15"> <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/a-simple-guide-to-planning-for-a-loved-ones-long-term-care">A Simple Guide to Planning For a Loved One&#039;s Long-Term Care</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/are-your-assets-costing-you-too-much">Are Your Assets Costing You Too Much?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-money-moves-to-make-the-moment-you-get-a-promotion">8 Money Moves to Make the Moment You Get a Promotion</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/when-to-use-savings-to-pay-off-debt">When to Use Savings to Pay Off Debt</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-personal-finance-resolutions-anyone-can-master">8 Personal Finance Resolutions Anyone Can Master</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance emergency fund growing up life insurance side jobs Fri, 01 Mar 2013 11:15:26 +0000 Jeff Rose 968006 at http://www.wisebread.com