bills https://www.wisebread.com/taxonomy/term/1800/all en-US 5 Signs You Need to Come Out of Retirement https://www.wisebread.com/5-signs-you-need-to-come-out-of-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-signs-you-need-to-come-out-of-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/considering_her_next_move_carefully.jpg" alt="Considering her next move carefully" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You imagined retirement as a long-awaited reward for all those years of work. Maybe you pictured cruises around the globe, lazy days playing tennis, or plenty of time to spend with your grandchildren. But now that it's finally here, you're not so happy.</p> <p>Maybe you're bored. Maybe you're restless. Maybe you're having trouble paying the bills. Whatever the issue, your retirement isn't the happy time you expected. The solution? You might need to come out of retirement, at least part-time.</p> <p>Retirement doesn't work for everyone, at least not the first time around. But you might find happiness, a renewed sense of purpose, or financial relief by coming out of retirement and jumping back into the world of work again. Here are some signs that you need to end your retirement and start working again. (See also: <a href="http://www.wisebread.com/6-great-retirement-jobs?ref=seealso" target="_blank">6 Great Retirement Jobs</a>)</p> <h2>1. You're struggling to pay the bills</h2> <p>The most important reason to return to work is if you're struggling to pay your bills each month. Maybe you didn't save enough money during your first go-round in the working world. Maybe your expenses, such as health care, are higher than you expected. Whatever the reason, if your monthly income is barely enough to pay your bills, it might be time to find a job, even a part-time one, to help cover the costs.</p> <p>If you're facing this challenge, know that you're not alone. According to a 2017 report from the Schwartz Center for Economic Policy Analysis, 35 percent of workers from the ages of 55 to 64 didn't have any retirement savings in an IRA or 401(k)-type plan. The median account balance of workers nearing retirement was just $15,000.</p> <h2>2. Your retirement savings are dwindling</h2> <p>Maybe you did save for retirement. But now that you're not working, you're finding that those retirement savings are disappearing much faster than you expected.</p> <p>It could be that you've spent more than you expected during your after-work years, or it could be that you underestimated how much money you'd need to support yourself once you stopped working. After all, people are living longer today than ever. Many people are experiencing retirements that last the same number of years as their career.</p> <p>Returning to work, even part-time, can help prevent you from depleting your savings too quickly. Earning even $1,000 a month might help stretch those savings out long enough to enjoy a happy and healthy retirement. (See also: <a href="http://www.wisebread.com/10-signs-you-arent-saving-enough-for-retirement?ref=seealso" target="_blank">10 Signs You Aren't Saving Enough for Retirement</a>)</p> <h2>3. Your health is suffering</h2> <p>Work might not always be fulfilling, but it does keep you moving. And that can be an underrated benefit.</p> <p>It's easy to get lazy in retirement. You might spend far too much time sitting in front of the TV or reclining on the couch with a book. There's nothing wrong with a bit of relaxation, but what if you're sitting so much that your health is suffering?</p> <p>The Mayo Clinic and other medical professionals have reported that sitting too much can result in serious health problems &mdash; everything from obesity and higher blood pressure, to elevated cholesterol levels. Getting back to work on a full- or part-time basis could keep you from sitting your days away. And that might provide a quick boost to your overall health. (See also: <a href="http://www.wisebread.com/5-retirement-struggles-nobody-talks-about-and-how-to-beat-them?ref=seealso" target="_blank">5 Retirement Struggles Nobody Talks About &mdash; And How to Beat Them</a>)</p> <h2>4. You're bored</h2> <p>Planning on whiling away your days on the golf course, fishing from the banks of your favorite lake, or spending more time with your grandchildren might sound good. And it might be good, too &hellip; for a while.</p> <p>The truth is, days can be long when you're not busy at work. All that free time can start to feel more like a burden than a pleasure if you don't know how to fill the hours. You can only read so many books or binge-watch so much TV.</p> <p>It's easy to get bored during retirement, especially now that retirement is lasting so much longer. Getting a new job could alleviate much of that boredom. It will take you out of the house and give you something to do. It doesn't have to be thrilling work, but it could be just enough to make those long, empty hours seem less intimidating.</p> <h2>5. You're lonely</h2> <p>Miss the office chitchat? Miss the after-work drinks on Fridays? Being retired can cut you out from the social interaction that work often provides. You might start to feel lonely once you leave the working world.</p> <p>Even if your partner is still living and you have adult children and grandchildren, your social circle can shrink dramatically during retirement. That's because many of us rely heavily on work relationships for our social interactions. Rejoining the workforce, even on a limited basis, could boost your social life and ease the loneliness that too often comes with retired life. (See also: <a href="http://www.wisebread.com/how-to-find-your-new-identity-after-retirement?ref=seealso" target="_blank">How to Find Your New Identity After Retirement</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=https%3A%2F%2Fwww.wisebread.com%2F5-signs-you-need-to-come-out-of-retirement&amp;media=https%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Signs%2520You%2520Need%2520to%2520Come%2520Out%2520of%2520Retirement.jpg&amp;description=5%20Signs%20You%20Need%20to%20Come%20Out%20of%20Retirement"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/5%20Signs%20You%20Need%20to%20Come%20Out%20of%20Retirement.jpg" alt="5 Signs You Need to Come Out of Retirement" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="https://www.wisebread.com/5-signs-you-need-to-come-out-of-retirement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-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="https://www.wisebread.com/5-ways-to-embrace-having-to-work-in-retirement">5 Ways to Embrace Having to Work in Retirement</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="https://www.wisebread.com/4-false-assumptions-that-could-threaten-your-retirement-years">4 False Assumptions That Could Threaten Your Retirement Years</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="https://www.wisebread.com/6-cool-jobs-for-retirees">6 Cool Jobs for Retirees</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="https://www.wisebread.com/why-retiring-with-debt-isnt-the-end-of-the-world">Why Retiring With Debt Isn&#039;t the End of the World</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="https://www.wisebread.com/4-reasons-you-might-have-a-phased-retirement">4 Reasons You Might Have a &quot;Phased&quot; Retirement</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement back to work bills boredom health problems income loneliness part time jobs retirees Fri, 29 Jun 2018 09:00:11 +0000 Dan Rafter 2148678 at https://www.wisebread.com 6 Monthly Bills That Won't Affect Your Credit Score https://www.wisebread.com/6-monthly-bills-that-wont-affect-your-credit-score <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-monthly-bills-that-wont-affect-your-credit-score" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/father_looking_bills_with_child_in_his_lap.jpg" alt="Father looking bills with child in his lap" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>What's the best way to keep your FICO credit score healthy? Simple: Pay your bills on time and don't rack up too much debt. Some bills, though, are more important to your credit score than others.</p> <p>In fact, you might be surprised to learn that many of the payments you make every month have no direct impact on your traditional FICO credit score. That's because in order for a payment to boost your score, or a late payment to hurt it, it must be reported to at least one of the three national credit bureaus: Experian, Equifax, and TransUnion. And many of the companies and service providers you pay off each month don't do this.</p> <p>That's a mixed blessing. Making a payment late to these creditors won't necessarily hurt your score &mdash; unless you pay so late that the bill is sent to collections. On the other hand, paying these bills on time won't help your credit score, either. (See also: <a href="http://www.wisebread.com/5-money-matters-that-wont-affect-your-credit-score?ref=seealso" target="_blank">5 Money Matters That Won't Affect Your Credit Score</a>)</p> <h2>Which bills are <em>not</em> reported to the credit bureaus?</h2> <p>There are six common monthly bills that have no direct impact on your credit score. They are:</p> <ul> <li> <p>Utilities.</p> </li> <li> <p>Insurance payments.</p> </li> <li> <p>Bills from medical providers.</p> </li> <li> <p>Cellphone payments.</p> </li> <li> <p>Cable service.</p> </li> <li> <p>Membership to health clubs or gyms.</p> </li> </ul> <p>If you're a few days late in paying your car insurance bill, don't panic. Your misstep won't hurt your credit score, just as paying your bill on time won't help it.</p> <p>But that doesn't mean you can just ignore the bill. There are other consequences for late payments. You might face late fees, penalties, or even the cancellation of service. Your auto insurer, for instance, might charge you an extra $25 if you make your payment after a certain date. Your gym might cancel your membership. And both of those scenarios are still not as bad as if your provider sends your account into collections.</p> <p>That's because, while a biller may not report payments directly to the credit bureaus, if you miss too many payments, they might send a debt collector after you. Once your account falls into the hands of a collections agency, this <em>will</em> be reported to the credit bureaus. Having an account in collections can cause your credit score to tumble by 100 points or more. (See also: <a href="http://www.wisebread.com/heres-what-happens-to-an-account-in-collections-even-when-you-pay-up?ref=seealso" target="_blank">Here's What Happens to an Account in Collections &mdash; Even When You Pay Up</a>)</p> <h2>What about rent?</h2> <p>Apartment rent is a more complicated issue. In most cases, the rent you pay each month isn't reported to the credit bureaus. Paying your landlord on time every month usually doesn't provide a boost to your credit score.</p> <p>There is a movement, though, to change this. The theory goes that renters should be rewarded for paying on time, just as homeowners are when they pay their mortgage bill each month.</p> <p>Some landlords have begun reporting rents to the credit bureaus. And if you want to report your own rent payments, you can sign up for a rent-reporting service such as <a href="https://www.rentreporters.com/" target="_blank">Rent Reporters</a> or <a href="https://rentalkharma.com/" target="_blank">Rental Kharma</a>.</p> <p>These services are limited. Both Rent Reporters and Rental Kharma, for instance, only report rent payments to one of the credit bureaus, TransUnion. You'll also have to pay for these services. (See also: <a href="http://www.wisebread.com/7-ways-to-rent-an-apartment-with-bad-credit?ref=seealso" target="_blank">7 Ways to Rent An Apartment With Bad Credit</a>)</p> <h2>Some alternative credit scores <em>do</em> include other bills</h2> <p>As lenders try to expand their market reach, some are looking beyond the traditional FICO score to so-called alternative credit scores. Some of these scores include your behavior with the bills listed at the top of this story, or your management of checking and savings accounts. The FICO Score XD, for example, is for people who have such thin credit reports that they're unscorable by traditional methods. It relies on a consumer's utilities, cellphone, and other bills.</p> <p>The number of lenders who look at alternative credit scores is still in the minority. But if you're applying for credit and have a limited credit record, it never hurts to ask that a lender take into consideration your good payment history on other types of bills. (See also: <a href="http://www.wisebread.com/credit-challenged-how-alternative-credit-data-can-help-those-with-little-or-no-credit?ref=seealso" target="_blank">How Alternative Data Can Help Those With Little or No Credit</a>)</p> <h2>Monthly payments that always impact your credit score</h2> <p>Some of the payments you make each month will always be reported to the credit bureaus. It's important to pay these on time each month if you don't want your credit score to drop. They are:</p> <ul> <li> <p>Credit card bills.</p> </li> <li> <p>Home equity lines of credit.</p> </li> <li> <p>Mortgage.</p> </li> <li> <p>Auto loans.</p> </li> <li> <p>Student loans.</p> </li> <li> <p>Personal loans.</p> </li> <li> <p>Home equity loans.</p> </li> </ul> <p>Note that revolving credit accounts &mdash; credit cards and lines of credit &mdash; carry more weight in your FICO score than installment loans.</p> <p>Also, a payment isn't reported as late to the bureaus until you miss it by 30 days or more. Your two-week delay on your credit card payment won't show up in your credit reports.</p> <p>However, you'll still be charged a late fee for being even one day late. And every day that you delay payment, interest charges mount. So, it still benefits you to make your payments on time, or as soon after the due date as you can. (See also: <a href="http://www.wisebread.com/5-simple-ways-to-never-make-a-late-credit-card-payment?ref=seealso" target="_blank">5 Simple Ways to Never Make a Late Credit Card Payment</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-monthly-bills-that-wont-affect-your-credit-score&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%2520Monthly%2520Bills%2520That%2520Won%2527t%2520Affect%2520Your%2520Credit%2520Score.jpg&amp;description=6%20Monthly%20Bills%20That%20Won't%20Affect%20Your%20Credit%20Score"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/6%20Monthly%20Bills%20That%20Won%27t%20Affect%20Your%20Credit%20Score.jpg" alt="6 Monthly Bills That Won't Affect Your Credit Score" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="https://www.wisebread.com/6-monthly-bills-that-wont-affect-your-credit-score">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="https://www.wisebread.com/7-things-your-credit-report-does-not-include">7 Things Your Credit Report Does NOT Include</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="https://www.wisebread.com/5-financial-mistakes-that-wont-hurt-your-credit-score">5 Financial Mistakes That Won&#039;t Hurt Your Credit Score</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="https://www.wisebread.com/how-new-grads-can-protect-their-credit">How New Grads Can Protect Their Credit</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="https://www.wisebread.com/8-credit-repair-mistakes-that-will-cost-you">8 Credit Repair Mistakes That Will Cost You</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="https://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> </ul> </div> </div> </div> </div><br/></br> Personal Finance bills cellphone collections credit history credit score fees fico late payments medical bills penalties rent utilities Tue, 19 Jun 2018 08:00:30 +0000 Dan Rafter 2148582 at https://www.wisebread.com 5 Steps to Successful Budgeting https://www.wisebread.com/5-steps-to-successful-budgeting <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-steps-to-successful-budgeting" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/building_a_tight_household_budget_0.jpg" alt="Building a tight household budget" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Budgeting is one of the most important tenets of personal finance, and it's no small thing. Everyone should know exactly what goes into making a budget &mdash; it dictates your current living situation, and determines how much you can save to support your future living situation. Follow these five steps to get started.</p> <h2>Step 1: Automate essential, recurring living expenses</h2> <p>Let's start with the basics: Add up all monthly household income and make a list of all necessary monthly expenses, like housing, utilities, and groceries. Since these are nonnegotiable expenses, take time to set up automatic payments to cover as many of these items as you can. In many cases, you can even choose the day you'd like your bills to be debited from your account, so consider when you get paid each month. Arrange to have your bills automatically deducted when you know you'll have cash available.</p> <p>Next, subtract your bills from your income. If there's no money left over after paying your bills, or you're not able to cover your bills, there are only a few viable options: Make more money, get another job, or spend less. If you've got extra money after paying your bills, move on to step two. (See also: <a href="http://www.wisebread.com/build-your-first-budget-in-5-easy-steps?ref=seealso" target="_blank">Build Your First Budget in 5 Easy Steps</a>)</p> <h2>Step 2: Automate savings</h2> <p>Generally, you'd like to get your personal savings rate to 15 percent of your gross income. If you're saving for other big-ticket items, like a home or college education, in addition to retirement, you may need to save more. Yes, everyone's situation is different and everyone is at a different point in their lives &mdash; but if you have available cash, you should be saving <em>something</em>. Set up automatic transfers from your checking account to your savings account on the same schedule as your other essential bills. (See also: <a href="http://www.wisebread.com/5-ways-to-automate-your-finances?ref=seealso" target="_blank">5 Ways to Automate Your Finances</a>)</p> <h2>Step 3: Establish a debt reduction plan</h2> <p>Debt and credit are vital aspects of our financial system and allow individuals to accomplish their dreams, like owning a home or paying for college. But high levels of consumer debt, including student loans and credit cards, can stunt your ability to save and can negatively affect your borrowing ability. One common benchmark is to limit your consumer debt repayment to 20 percent or less of your <em>net </em>monthly income.</p> <p>If you're having a hard time meeting your financial obligations and goals because of a heavy debt load, make a list of all outstanding debts owed, including the total amount due, monthly payment, and interest rate. Always make at least the minimum payment due on all accounts to remain in good credit standing. (See also: <a href="http://www.wisebread.com/5-day-debt-reduction-plan-pay-it-off?ref=seealso" target="_blank">5-Day Debt Reduction Plan: Pay It Off</a>)</p> <p>Next, focus on one debt &mdash; either the lowest balance or the highest interest rate &mdash; and send any extra money that you may have toward that debt. When that debt is paid off, take the money you were sending to that paid-off debt and redirect it toward the next debt in line. Continue this process until all debts are paid in full. If you're struggling to come up with a workable repayment plan, check out PowerPay.org, which offers a free tool that you can use to run various payback scenarios that can illustrate how to best utilize any extra funds you have to pay off your debt. (See also: <a href="http://www.wisebread.com/snowballs-or-avalanches-which-debt-reduction-strategy-is-best-for-you?ref=seealso" target="_blank">Snowballs or Avalanches: Which Debt Reduction Strategy Is Best for You?</a>)</p> <h2>Step 4: Commit to a spending plan</h2> <p>Once you've met your financial obligations for the month, including bills, savings, and debt, your lifestyle expenses are dictated by your remaining balance &mdash; not the other way around. After tracking your spending over a period of time, you should have a clearer picture of your money habits as well as where your money is going and where you can make cuts. Start with your monthly bills and look for ways to trim some easy expenses, like your TV or phone services, or setting a tighter food budget.</p> <p>Then examine your lifestyle spending. If you find that you overspend in certain areas, try using an <a href="http://www.wisebread.com/a-comprehensive-guide-to-the-envelope-system?ref=internal" target="_blank">envelope saving method</a>, whereby each month you take out a set amount of money for a specific expense &mdash; like eating out &mdash; and put cash in an envelope marked specifically for that expense. Spend only what's in that envelope and when it's empty, there is no more spending on that area for the month.</p> <p>There are various recommended spending and saving plans out there, but I'd argue that as long as you're meeting the obligations in steps one through three, you can go ahead and spend the rest of your cash flow however you'd like.</p> <h2>Step 5: Account for irregular expenses</h2> <p>This may be one area that everyone overlooks. We all have a few bills that come only once or twice a year. Whether it's an insurance premium or a property tax bill, these infrequent yet yearly expenses can ruin a budget fast if you don't plan for them. Setting up a cash cushion in your checking account or keeping a separate reserve fund can help prevent you from having to dip into your emergency savings to cover these bills.</p> <p>One straightforward way to account for these expenses is to divide the total amount of irregular yearly bills by 12 and set that amount aside every month as part of the cash buffer in your checking account.</p> <p>Irregular expenses also include special occasions, like birthdays and holidays. Here's a neat idea I heard about recently: Choose an amount of money you'd like to have saved for something; for example, Christmas. Divide that number by 12, and every month, buy a store gift card for that amount. This probably works best if you choose one or two stores that you can buy various gifts from, like Target. By the time Christmas comes along, go ahead and spend only what you have saved on the gift cards. It can be a somewhat painless way to save a good amount of money, and by using the store cards, it can protect your savings account from overspending during this time. (See also: <a href="http://www.wisebread.com/5-common-budget-mistakes-you-can-fix-right-now?ref=seealso" target="_blank">5 Common Budget Mistakes You Can Fix Right Now</a>)</p> <p>Your budget is your personal financial blueprint; it determines where you are and where you're going. That's why getting it right should be a priority for everyone.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-steps-to-successful-budgeting&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Steps%2520to%2520Successful%2520Budgeting.jpg&amp;description=5%20Steps%20to%20Successful%20Budgeting"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/5%20Steps%20to%20Successful%20Budgeting.jpg" alt="5 Steps to Successful Budgeting" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/alicia-rose-hudnett">Alicia Rose Hudnett</a> of <a href="https://www.wisebread.com/5-steps-to-successful-budgeting">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-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="https://www.wisebread.com/7-money-fixes-you-can-make-when-youre-stuck-inside-because-of-the-weather">7 Money Fixes You Can Make When You&#039;re Stuck Inside Because of the Weather</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="https://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="https://www.wisebread.com/how-to-budget-when-you-rely-on-cash-tips">How to Budget When You Rely on Cash Tips</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="https://www.wisebread.com/11-budgeting-skills-everyone-should-master">11 Budgeting Skills Everyone Should Master</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="https://www.wisebread.com/5-common-budget-mistakes-you-can-fix-right-now">5 Common Budget Mistakes You Can Fix Right Now</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting automating avalanche method bills debt repayment Envelope system expense tracking expenses organization snowball method spending plan Fri, 15 Jun 2018 08:00:21 +0000 Alicia Rose Hudnett 2148338 at https://www.wisebread.com How New Grads Can Protect Their Credit https://www.wisebread.com/how-new-grads-can-protect-their-credit <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-new-grads-can-protect-their-credit" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/businesswoman_paying_online_0.jpg" alt="Businesswoman paying online" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The years right after graduating from college can be stressful ones. It's time to find a job. You might be looking for a new place to live. You're starting the transition from college student to adult. It can be easy to get overwhelmed, and it can be just as easy to make serious financial mistakes that damage your credit.</p> <p>What things can you do to protect your credit after graduating from college? Here are some of the big ones.</p> <h2>Never pay a bill late</h2> <p>It can be easy to miss a bill payment, especially when you're not used to having a lot of bills to pay. Mail can pile up while you're adjusting to a whole new way of life. Prioritize getting organized with your bills. Sign up for autopay or set up reminder alerts. Put your bills in a place where you can see them so they don't get buried under other junk or unread mail. Not only will late payments eat into your new budget with fees, but your credit will take a big hit. (See also: <a href="http://www.wisebread.com/5-simple-ways-to-never-make-a-late-credit-card-payment?ref=seealso" target="_blank">5 Simple Ways to Never Make a Late Credit Card Payment</a>)</p> <p>Not all late payments are reported to the credit bureaus, and some late payments don't impact your credit score. The big ones, however &mdash; credit cards, mortgage, auto loans, personal loans, and student loans &mdash; are reported. A single late payment of one of these major bills could cause your score to tumble by 100 points or more. That late payment will also stay in your credit reports for up to seven years. (See also: <a href="http://www.wisebread.com/how-late-payments-affect-your-credit?ref=seealso" target="_blank">How Late Payments Affect Your Credit</a>)</p> <p>You should know the official definition of a late payment. A payment is only reported as late to the credit bureaus if you are 30 days or more past the due date. So even if your payment is two weeks late, you can avoid a hit to your credit by immediately making a payment. (See also: <a href="http://www.wisebread.com/pay-these-6-bills-first-when-money-is-tight?ref=seealso" target="_blank">Pay These 6 Bills First When Money Is Tight</a>)</p> <h2>Don't ignore the bills that don't get reported</h2> <p>There's a big caveat to the payments that don't get reported to the credit bureaus. If you're late with a doctor's bill, utility payment, rent payment, or cellphone bill, the three credit bureaus won't know about it <em>unless</em> those payments are sent to a collections agency in effort to get you to pay what you owe. When that happens, your credit score can again plummet by 100 points or more.</p> <p>It isn't just collections you should be worried about if you fail to make rent payments, either. If your landlord evicts you, that won't show up on your credit reports. But if your landlord sues you for breaking your lease, and that ends in a civil judgment against you, your credit will take another hit. Civil judgments are reported to the credit bureaus and stay on your reports for up to seven years. (See also: <a href="http://www.wisebread.com/10-surprising-ways-to-negatively-affect-your-credit-score?ref=seealso" target="_blank">10 Surprising Ways to Negatively Affect Your Credit Score</a>)</p> <p>Those monthly payments can be overwhelming, but it's important that you pay them, and do so on time. You might have to cut down on your discretionary spending, move back home, or take other steps to make sure that you are keeping current with your bills.</p> <h2>Seek help for student loans if you can't afford the payment</h2> <p>The average 2017 graduate left college with $39,400 in student loan debt, according to Student Loan Hero. That's a staggering amount of debt for anyone, let alone a young adult who is just getting their footing in the world. When your student loan payment comes due, it's important that it gets paid. Otherwise, you risk defaulting on that loan, which will issue a blow to your credit. (See also: <a href="http://www.wisebread.com/what-really-happens-when-you-dont-pay-your-student-loans?ref=seealso" target="_blank">What Really Happens When You Don't Pay Your Student Loans</a>)</p> <p>If you are struggling to come up with your monthly student loan payment, be proactive in finding ways to alleviate the financial burden. You may have the option to consolidate multiple loans, defer the payments, or speak directly with your lender about how to make your repayment plan work better for you. You will likely have more options with federal student loans than private ones, but you should still do your research. (See also: <a href="http://www.wisebread.com/8-surprising-ways-to-pay-off-your-student-loans?ref=seealso" target="_blank">8 Surprising Ways to Pay Off Your Student Loans</a>)</p> <h2>Don't run up your credit card debt</h2> <p>It can be easy to rely heavily on credit cards when money is tight. When you're young and your paychecks are small, this can be an even bigger temptation. This, though, can also wreck your credit.</p> <p>Racking up too much credit card debt will lower your credit score and leave you with a financial burden that's difficult to overcome. The high interest will pile on until you're struggling to keep up with payments. Lenders view consumers with too much credit card debt as a high risk for missed payments, and often deny them other forms of financing. It's a dangerous cycle that many young adults can easily fall into.</p> <p>Resist the temptation to use your credit card to purchase restaurant meals, movie tickets, electronics, or concert tickets. If you can't afford these goodies in cash, you can't afford them with credit. (See also: <a href="http://www.wisebread.com/the-millennials-guide-to-avoiding-credit-card-debt?ref=seealso" target="_blank">The Millennials Guide to Avoiding Credit Card Debt</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-new-grads-can-protect-their-credit&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520New%2520Grads%2520Can%2520Protect%2520Their%2520Credit.jpg&amp;description=How%20New%20Grads%20Can%20Protect%20Their%20Credit"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/How%20New%20Grads%20Can%20Protect%20Their%20Credit.jpg" alt="How New Grads Can Protect Their Credit" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="https://www.wisebread.com/how-new-grads-can-protect-their-credit">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="https://www.wisebread.com/pay-these-6-bills-first-when-money-is-tight">Pay These 6 Bills First When Money Is Tight</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="https://www.wisebread.com/6-monthly-bills-that-wont-affect-your-credit-score">6 Monthly Bills That Won&#039;t Affect Your Credit Score</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="https://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="https://www.wisebread.com/7-things-your-credit-report-does-not-include">7 Things Your Credit Report Does NOT Include</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="https://www.wisebread.com/8-credit-repair-mistakes-that-will-cost-you">8 Credit Repair Mistakes That Will Cost You</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance bills college graduates credit history credit score late payments rent student loans young adults Wed, 30 May 2018 08:00:24 +0000 Dan Rafter 2144960 at https://www.wisebread.com How a New Marriage Can Survive Student Loan Debt https://www.wisebread.com/how-a-new-marriage-can-survive-student-loan-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-a-new-marriage-can-survive-student-loan-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/guests_throwing_confetti_on_couple_during_reception.jpg" alt="Guests Throwing Confetti On Couple During Reception" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's a very common scenario. Girl meets boy, they fall in love, and decide to get married. They're excited about starting their new life together, but they're also weighed down by student loan debt &mdash; a <em>lot </em>of student loan debt. As they drag that heavy ball and chain into the future, what steps can they take to tilt the odds of marital and financial success in their favor? If that's your situation, read on.</p> <h2>1. Understand the details</h2> <p>Good communication is essential to the success of any relationship, and while money can be a tough topic, you'll get your marriage off to a great start by getting accustomed to talking about your finances. You might as well dive right in and start with your debt.</p> <p>No matter which one of you is bringing debt into the marriage, both of you should know exactly <em>how much </em>debt. You should also be clear about the interest rate, the monthly payment amount, and how long those payments will continue.</p> <p>That will help you to both manage your expectations about when you might be able to buy a house, how much you can spend on vacations, and all the rest. (See also: <a href="http://www.wisebread.com/the-7-worst-money-mistakes-married-people-make?ref=seealso" target="_blank">The 7 Worst Money Mistakes Married People Make</a>)</p> <h2>2. Be one in debt</h2> <p>Marriage is about oneness, unity, and teamwork. You're not becoming roommates; you're becoming husband and wife. So, if one of you was wealthy and the other was not before getting married, after you get married, both of you will be wealthy. By the same token, before marriage, if one of you had debt and the other did not, once you're married, both of you will have debt.</p> <p>When my friends Scott and Karen Coy got married, Karen had more than $50,000 of nonmortgage debt. Scott jokingly referred to it as &quot;a reverse dowry.&quot; After getting married, Karen often expressed how bad she felt about &quot;my debt.&quot; But from day one, Scott would correct her, saying it was &quot;our debt.&quot;</p> <p>It took them six-and-a-half years to become debt-free. All that time, they rented even though they would have preferred to buy a house. It took great patience and perseverance.</p> <p>Karen says she will always remember the day they made their last payment. It was as if a huge weight had been lifted from their shoulders. And looking back, she says the way they navigated the journey &mdash; <em>together &mdash; </em>created an inseparable bond in their marriage.</p> <h2>3. Consider being two in taxes</h2> <p>If you were using an income-based repayment plan <em>before</em> getting married, how you file your taxes <em>after</em> you get married will matter greatly. If you file jointly, your payment amount may go up. That's because income-based repayment plans require you to &quot;recertify&quot; each year by submitting your income tax returns to your loan servicer, who will now make decisions based on your joint income. So, you may want to consider filing separately, in which case most student loan plans will use just the borrower's income as the basis for recertification.</p> <p>However, filing separately may make you ineligible for certain tax credits, so proceed with caution. It would be best to consult with an accountant or run some what-if scenarios with tax-planning software.</p> <h2>4. Figure out the implications for your budget</h2> <p>Before deciding where you'll live after you get married, create a post-marriage cash flow plan. What works best is to fill in your financial commitments first. How much of your joint income will you save and invest? How much will you give to charity? And how much will you need to devote to debt repayment?</p> <p>Then you can see how much you can afford for rent or a mortgage. I usually recommend committing no more than 25 percent of monthly gross income to the combination of your mortgage, property taxes, and homeowners' insurance. If you rent, devote no more than 25 percent to your rent and renters' insurance.</p> <p>A student loan payment, however, changes the math. I recommend that the combination of your housing <em>and </em>your student loans together make up no more than 25 percent of your monthly gross income. So, you should figure out what percentage of your monthly gross income your loan payment amounts to and subtract that from 25 percent. The answer is the percentage of gross income you could devote to housing while you have student loans.</p> <p>If your student loans amount to an especially large percentage of your gross income, that may end up being overly restrictive. So, you'll have to adjust other spending categories downward, such as entertainment, clothing, or vacations. (See also: <a href="http://www.wisebread.com/3-simple-ways-to-split-bills-with-your-spouse?ref=seealso" target="_blank">3 Simple Ways to Split Bills With Your Spouse</a>)</p> <h2>5. Prioritize early payoff</h2> <p>The early years of your marriage present a great opportunity to speed up the process of getting out of debt. If you want to have kids one day, your pre-kid days will be the most financially flexible time you may ever experience. Make the most of it by making extra payments on your loans.</p> <p>Debt can be a roadblock in the pursuit of financial goals such as buying a home, and it can be a hindrance to a happy marriage. So, consider building your lifestyle on just one income and putting most of the other paycheck toward your student loans. By living an especially frugal life in the early years of your marriage, you'll be setting yourselves up for long-term success. (See also: <a href="http://www.wisebread.com/7-ways-paying-off-student-loans-early-can-boost-your-finances?ref=seealso" target="_blank">7 Ways Paying Off Student Loans Early Can Boost Your Finances</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-a-new-marriage-can-survive-student-loan-debt&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520a%2520New%2520Marriage%2520Can%2520Survive%2520Student%2520Loan%2520Debt_0.jpg&amp;description=How%20a%20New%20Marriage%20Can%20Survive%20Student%20Loan%20Debt"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/How%20a%20New%20Marriage%20Can%20Survive%20Student%20Loan%20Debt_0.jpg" alt="How a New Marriage Can Survive Student Loan Debt" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/matt-bell">Matt Bell</a> of <a href="https://www.wisebread.com/how-a-new-marriage-can-survive-student-loan-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-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="https://www.wisebread.com/3-reasons-taking-a-loan-for-your-wedding-is-a-bad-idea">3 Reasons Taking a Loan For Your Wedding Is a Bad Idea</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="https://www.wisebread.com/8-things-i-learned-about-money-after-getting-married">8 Things I Learned About Money After Getting Married</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="https://www.wisebread.com/3-simple-ways-to-split-bills-with-your-spouse">3 Simple Ways to Split Bills With Your Spouse</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="https://www.wisebread.com/how-to-manage-your-money-during-a-spousal-separation">How to Manage Your Money During a Spousal Separation</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="https://www.wisebread.com/6-reasons-youre-still-struggling-to-pay-bills">6 Reasons You&#039;re Still Struggling to Pay Bills</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Lifestyle bills budgeting compromise debt marriage sharing expenses spouses student loans taxes Tue, 29 May 2018 08:30:47 +0000 Matt Bell 2143779 at https://www.wisebread.com 5 Signs You Aren't Ready for a Credit Card https://www.wisebread.com/5-signs-you-arent-ready-for-a-credit-card <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-signs-you-arent-ready-for-a-credit-card" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/woman_with_credit_card_using_laptop.jpg" alt="Woman with credit card using laptop" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>There are plenty of smart reasons to apply for a credit card. Having a credit card can give you financial flexibility, provide a way to <a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score?ref=internal" target="_blank">build or boost your credit</a>, and offer a range of valuable rewards, cash back, and perks. But having plastic at your disposal is not all fun and games.</p> <p>Having a credit card can cause problems if you're not quite ready for one. How do you know if you're not ready for a credit card? Here are a few surefire signs.</p> <h2>1. You don't follow a budget</h2> <p>The key to using a credit card properly is knowing how much you can afford to charge each billing cycle. The goal is to make charges during the month and pay off your balance in full every time your payment due date rolls around. This way, you'll steadily build your credit history along with a strong credit score. But if you don't have a budget, you won't know how much you can afford to charge each month.</p> <p>Before applying for any credit card, make sure you've drafted a budget that includes your monthly expenses &mdash; including those that change each month and those that are discretionary, such as entertainment and eating out &mdash; and your monthly income. This will provide a guide for how much you can afford to put on your credit card without running a balance from month to month.</p> <p>Running a balance is a huge financial mistake. Credit card debt comes with high interest rates, and if you don't pay off your balance in full each month, that debt can quickly grow out of control. (See also: <a href="http://www.wisebread.com/stop-using-these-5-excuses-not-to-budget?ref=seealso" target="_blank">Stop Using These 5 Excuses Not to Budget</a>)</p> <h2>2. You're often late on other payments</h2> <p>Do you struggle to pay your landlord on time each month? Do you often pay your cellphone bill a week or two late? Then you aren't ready for a credit card.</p> <p>Credit card payments are reported to the three national credit bureaus (Experian, Equifax, and TransUnion). On-time payments will boost your score and strengthen your credit profile. If you pay your credit card bill late &mdash; 30 days or more past due is considered officially late &mdash; your credit will take the blow. A single late payment can cause your credit score to fall by 100 points or more. That late payment will also stay on your credit reports for seven years.</p> <p>If you struggle to pay your other bills on time, there's no indication you'd be any better at paying your credit card bill every month. Hold off on applying for a credit card until you change your habits. (See also: <a href="http://www.wisebread.com/5-simple-ways-to-never-make-a-late-credit-card-payment?ref=seealso" target="_blank">5 Simple Ways to Never Make a Late Credit Card Payment</a>)</p> <h2>3. You can't build up your savings</h2> <p>Before taking on the financial responsibility of a credit card, you should have already built up some savings. This is a sign of financial maturity and stability &mdash; the type of maturity and stability you'll need to handle a credit card.</p> <p>If your bank account falls to zero (or near it) before every payday, you probably aren't ready for the responsibility of managing a credit card and the monthly payments that come with it. (See also: <a href="http://www.wisebread.com/8-factors-that-could-keep-you-broke-forever?ref=seealso" target="_blank">8 Factors That Could Keep You Broke Forever</a>)</p> <h2>4. You can't stop borrowing money from your parents</h2> <p>Do you frequently turn to your parents for help when the rent is due? Are you constantly asking them for extra cash when you want to go out for dinner or to a concert?</p> <p>This is another huge warning sign of financial immaturity, and evidence that you are not ready for a credit card. If you can't handle your monthly living expenses without cash infusions from Mom and Dad, you'll be tempted to use your credit card to make those extra purchases. And that's a surefire formula for running up debt that you won't be able to pay off. (See also: <a href="http://www.wisebread.com/4-things-you-should-make-your-adult-child-pay-for?ref=seealso" target="_blank">4 Things You Should Make Your Adult Child Pay For</a>)</p> <h2>5. You don't have a reliable income stream</h2> <p>You need a steady stream of income coming in every month if you want a credit card. It's imperative that you're able to pay off your credit card bill in full at the end of each billing cycle. Otherwise, you risk sending yourself into a cycle of high-interest debt.</p> <p>If you don't have a steady job, or if you're constantly struggling to find enough money to pay your bills each month, avoid the temptation of applying for a credit card. Instead, focus on increasing your income and building up some emergency savings before sending in a credit card application. (See also: <a href="http://www.wisebread.com/5-minute-finance-start-an-emergency-fund?ref=seealso" target="_blank">5-Minute Finance: Start an Emergency Fund</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-signs-you-arent-ready-for-a-credit-card&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Signs%2520You%2520Aren%2527t%2520Ready%2520for%2520a%2520Credit%2520Card.jpg&amp;description=5%20Signs%20You%20Aren't%20Ready%20for%20a%20Credit%20Card"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/5%20Signs%20You%20Aren%27t%20Ready%20for%20a%20Credit%20Card.jpg" alt="5 Signs You Aren't Ready for a Credit Card" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="https://www.wisebread.com/5-signs-you-arent-ready-for-a-credit-card">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="https://www.wisebread.com/6-reasons-why-financial-planning-isnt-just-for-the-wealthy">6 Reasons Why Financial Planning Isn&#039;t Just for the Wealthy</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="https://www.wisebread.com/6-reasons-youre-still-struggling-to-pay-bills">6 Reasons You&#039;re Still Struggling to Pay Bills</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="https://www.wisebread.com/how-new-grads-can-protect-their-credit">How New Grads Can Protect Their Credit</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="https://www.wisebread.com/4-ways-to-make-the-most-of-your-student-loan-grace-period">4 Ways to Make the Most of Your Student Loan Grace Period</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="https://www.wisebread.com/the-5-things-with-the-biggest-impact-on-your-credit-score">The 5 Things With the Biggest Impact on Your Credit Score</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance bills borrowing money budgeting financial readiness income late payments not ready savings Tue, 15 May 2018 08:00:19 +0000 Dan Rafter 2138233 at https://www.wisebread.com 6 Reasons You're Still Struggling to Pay Bills https://www.wisebread.com/6-reasons-youre-still-struggling-to-pay-bills <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-reasons-youre-still-struggling-to-pay-bills" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/man_and_woman_with_financial_problem_1.jpg" alt="Man and woman with financial problem" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You've worked hard. You've hit your career goals. Your salary has never been higher. Still, at the end of the every month, you break into a cold sweat worrying if there's enough money to go around. Why, at this point in your life, does bill paying still feel like a painful game of financial Twister? It's time to get to the root of the problem. Here are six reasons you're still struggling to pay bills.</p> <h2>1. You don't have a budget</h2> <p>Budgets are how people anticipate their expenses and allocate their spending. Without this essential framework, your financial life will look a lot like the Wild West &mdash; filled with drama and boom and bust cycles (and probably too many saloon scenes). If you're making late payments or missing payments altogether, it's time to <a href="http://www.wisebread.com/build-your-first-budget-in-5-easy-steps?ref=internal" target="_blank">build your first budget</a>, cowboy.</p> <h2>2. You have too much credit card debt</h2> <p>With astronomical interest charges, late fees, and other penalties, credit card debt leaves millions of families strapped for cash year after year. If you're struggling to pay your bills each month, take a hard look at your credit habits. How much of your income is devoted to servicing debt? Are you barely covering the minimum payments or racking up new charges? If so, grab a shovel. It's time to dig yourself out of high-interest credit card debt. (See also: <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=seealso" target="_blank">The Fastest Way to Pay Off $10,000 in Credit Card Debt</a>)</p> <h2>3. You're house poor</h2> <p>If your mortgage consumes more than 25 percent of your income, you may be house poor. For many, that single payment is simply too steep and leaves little money leftover for bills and other budget essentials. Think you may be house poor? Explore refinance options, rent out a spare bedroom, or consider selling and moving into a more affordable home. (See also: <a href="http://www.wisebread.com/how-to-make-ends-meet-when-youre-house-poor?ref=seealso" target="_blank">How to Make Ends Meet When You're House Poor</a>)</p> <h2>4. You can't stop impulse buying</h2> <p>We all fall prey to impulse buys every now and then. But if off-budget spending has become a way of life, you're probably broke by bill-paying day. Examine why impulse buying is so attractive. Is it a way of relieving stress? Is it a reward for working long hours at a job you don't like? How could you rearrange your life and take control of your spending? (See also: <a href="http://www.wisebread.com/9-simple-ways-to-stop-impulse-buying?ref=seealso" target="_blank">9 Simple Ways to Stop Impulse Buying</a>)</p> <h2>5. You're too focused on keeping up with the Joneses</h2> <p>Trying to keep up with the Joneses can exhaust you mentally, emotionally, and financially. If you're constantly struggling to pay your bills, ask yourself: &quot;To what degree is my spending influenced by the spending habits of others? Am I trying to project an image I can't afford?&quot; Since paying your monthly bills doesn't give you much &quot;image bang&quot; for your buck, you may simply be prioritizing status over solvency. (See also: <a href="http://www.wisebread.com/4-money-lessons-you-can-learn-from-the-joneses?ref=seealso" target="_blank">4 Money Lessons You Can Learn From the Joneses</a>)</p> <h2>6. Someone's draining your income</h2> <p>If you're always behind the eight ball with your bills, maybe the problem isn't some<em>thing</em>, but some<em>one</em>. Is your BFF always &quot;a little strapped for cash?&quot; Are you supporting a chronically unmotivated spouse, sibling, or adult child? Practice a little tough love (and self-care); use <em>your </em>cash to cover your own bills, protect your own credit, and keep your lights on. (See also: <a href="http://www.wisebread.com/4-things-you-should-make-your-adult-child-pay-for?ref=seealso" target="_blank">4 Things You Should Make Your Adult Child Pay For</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-reasons-youre-still-struggling-to-pay-bills&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%2520Reasons%2520You%2527re%2520Still%2520Struggling%2520to%2520Pay%2520Bills.jpg&amp;description=6%20Reasons%20You're%20Still%20Struggling%20to%20Pay%20Bills"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/6%20Reasons%20You%27re%20Still%20Struggling%20to%20Pay%20Bills.jpg" alt="6 Reasons You're Still Struggling to Pay Bills" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/kentin-waits">Kentin Waits</a> of <a href="https://www.wisebread.com/6-reasons-youre-still-struggling-to-pay-bills">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="https://www.wisebread.com/11-money-habits-that-make-you-look-financially-immature">11 Money Habits That Make You Look Financially Immature</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="https://www.wisebread.com/5-signs-you-arent-ready-for-a-credit-card">5 Signs You Aren&#039;t Ready for a Credit Card</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="https://www.wisebread.com/8-factors-that-could-keep-you-broke-forever">8 Factors That Could Keep You Broke Forever</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="https://www.wisebread.com/how-a-new-marriage-can-survive-student-loan-debt">How a New Marriage Can Survive Student Loan 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="https://www.wisebread.com/5-types-of-overspenders-which-one-are-you">5 Types of Overspenders — Which One Are You?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Lifestyle bills budgeting credit card debt house poor impulse buys income keeping up with the joneses making ends meet paycheck to paycheck Thu, 03 May 2018 09:00:11 +0000 Kentin Waits 2131787 at https://www.wisebread.com 7 Easy Money Moves to Make on a Rainy Day https://www.wisebread.com/7-easy-money-moves-to-make-on-a-rainy-day <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-easy-money-moves-to-make-on-a-rainy-day" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/businesswoman_with_laptop_next_to_office_window.jpg" alt="Businesswoman with laptop next to office window" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Rainy day keeping you stuck inside the house? Take advantage of the down time by being productive with your finances. Start with these easy money moves.</p> <h2>1. Start an emergency fund</h2> <p>If you don't have an emergency fund, a rainy day is the perfect time to start one.</p> <p>An emergency fund is money set aside for a major unexpected and urgent expense, such as a car repair, medical bill, or job loss. One rule of thumb is to save between three and six months' worth of daily living expenses. If you have a lot of daily living expenses, or a job that would be hard to replace, you should aim to save closer to a year's worth.</p> <p>A bigger emergency fund will always offer more protection for your finances, but you can start an emergency fund today even if you can only contribute a few dollars. Start by creating a new savings account specifically for your emergency cash. By keeping it in a separate account, you are less likely to use the money for non-urgent needs. (See also: <a href="http://www.wisebread.com/5-minute-finance-start-an-emergency-fund?ref=seealso" target="_blank">5-Minute Finance: Start an Emergency Fund</a>)</p> <h2>2. Up your retirement contributions</h2> <p>Have five minutes to spare? Log in to your retirement account and increase the percentage of your paycheck you are having withheld for your 401(k). By increasing it by even just one percent, you are ensuring you have more cash for retirement. It's likely you won't even miss that cash in your paycheck.</p> <h2>3. Fine tune your budget</h2> <p>When's the last time you gave your budget a tune up? Use a rainy day as an excuse to give it a makeover. Are you spending your money like you planned? Do you need to make any adjustments?</p> <p>If you don't have a budget at all, now is a great time to make one. You can get started by listing your income, expenses, and savings goals for the month. Add information as time goes on and you become more familiar with your spending and money habits. (See also: <a href="http://www.wisebread.com/5-minute-finance-track-your-spending?ref=seealso" target="_blank">5-Minute Finance: Track Your Spending</a>)</p> <h2>4. Sell items around the house</h2> <p>If you're stuck inside, take inventory of the clothes, electronics, dishes, and more you have lying around your home that you no longer use. Don't just throw everything out; you may be able to sell your stuff for cold, hard cash.</p> <p>You can post your items for sale on an app like OfferUp or LetGo, or upload a listing on Craigslist or eBay. And as an added bonus, you can use the cash you earn from selling household items to jump start your emergency fund. (See also: <a href="http://www.wisebread.com/5-things-you-can-resell-on-ebay-that-make-the-most-money?ref=seealso" target="_blank">5 Things You Can Resell on eBay That Make the Most Money</a>)</p> <h2>5. Create a filing system</h2> <p>What does your desk look like? If you tend to leave bills and financial documents piled up, it's probably a good idea to take some time to create an easy organizational system. You may as well get started on a rainy day.</p> <p>To cut back on an influx of paper bills, you might find it beneficial to sign up for autopay so you don't have to worry about papers cluttering your space or getting lost. You'll want to be sure to store important and confidential files away in a locked drawer or safe.</p> <h2>6. Cut a bill</h2> <p>Once you've taken a look at your budget, you may have noticed a bill or two that is higher than usual. Or, maybe you realize you are still paying for a service you no longer use. Whatever the reason, take advantage of a rainy day by calling your providers to see if they can lower or cancel the service.</p> <p>Since most bills are a regular monthly expense, lowering or eliminating them entirely can save you hundreds of dollars, if not more, every single year.</p> <h2>7. Read or listen to financial resources</h2> <p>There are a ton of free financial resources available at your disposal. If you need an excuse to take it easy on a rainy day, why not learn something while you relax? Try kicking back with a personal finance book, magazine, blog, or podcast. (See also: <a href="http://www.wisebread.com/these-10-money-podcasts-will-help-you-save-tons?ref=seealso" target="_blank">These 10 Money Podcasts Will Help You Save Tons</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-easy-money-moves-to-make-on-a-rainy-day&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Easy%2520Money%2520Moves%2520to%2520Make%2520on%2520a%2520Rainy%2520Day.jpg&amp;description=7%20Easy%20Money%20Moves%20to%20Make%20on%20a%20Rainy%20Day"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/7%20Easy%20Money%20Moves%20to%20Make%20on%20a%20Rainy%20Day.jpg" alt="7 Easy Money Moves to Make on a Rainy Day" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/rachel-slifka">Rachel Slifka</a> of <a href="https://www.wisebread.com/7-easy-money-moves-to-make-on-a-rainy-day">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="https://www.wisebread.com/5-money-moves-to-make-when-its-too-hot-to-go-outside">5 Money Moves to Make When It&#039;s Too Hot to Go Outside</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="https://www.wisebread.com/the-4-smartest-things-to-do-with-an-inheritance">The 4 Smartest Things to Do With an Inheritance</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="https://www.wisebread.com/9-smart-moves-to-make-after-getting-a-raise-or-promotion">9 Smart Moves to Make After Getting a Raise or 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="https://www.wisebread.com/how-to-manage-money-when-you-hate-thinking-about-it">How to Manage Money When You Hate Thinking About It</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="https://www.wisebread.com/6-money-moves-you-can-make-while-stuck-in-an-endless-tsa-line">6 Money Moves You Can Make While Stuck in an Endless TSA Line</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance autopay bills budgeting decluttering emergency fund extra income money moves rainy day retirement contributions selling Mon, 23 Apr 2018 08:00:07 +0000 Rachel Slifka 2133487 at https://www.wisebread.com 7 Tough Questions About Debt, Answered https://www.wisebread.com/7-tough-questions-about-debt-answered <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-tough-questions-about-debt-answered" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/federal_debt.jpg" alt="Federal Debt" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We've all heard the tales of financial woe that befall people who fail to pay their debt, die without a will, or go through a nasty divorce. But what is the truth? Is there a such thing as credit jail? Can filing bankruptcy give you a clean financial slate? Are you responsible for an ex spouse's debts?</p> <p>We're answering some of your most pressing debt questions. As always, it's important that you do your own research &mdash; each situation is different and laws and regulations change on a case-by-case basis. This is your jumping off point. Now, let's get started.</p> <h2>1. Is failing to pay debts ever a jailable offense?</h2> <p>The quick answer to this question is no. And to take it one step further, according to the Federal Trade Commission (FTC), it is against the law for debt collectors to threaten you with incarceration.</p> <p>You can be sued for the debt, your wages can be garnished, your bank accounts frozen, your assets seized, and a whole slew of other nasty things can befall you for failing to pay, but going to jail isn't among the list of possible consequences.</p> <p>The caveat and exception to this rule is if you owe child support or taxes. The IRS usually doesn't impose jail time for nonpayment. Incarceration is reserved for those who lie, cheat, and try to defraud the system. In both cases &mdash; tax evasion and failure to pay child support (technically contempt of court) &mdash; you have options. You can, in most cases, maintain your freedom while you catch up &mdash; but you have to be proactive and compliant. (See also: <a href="http://www.wisebread.com/heres-what-happens-if-you-dont-pay-your-taxes?ref=seealso" target="_blank">Here's What Happens If You Don't Pay Your Taxes</a>)</p> <h2>2. Should I borrow from retirement to pay off debt?</h2> <p>This is a tricky question and the answer can vary based on your situation. In most cases, the answer is <em>no</em>.</p> <p>Most financial advisers will tell you there are a plethora of options you should explore before tapping your retirement accounts. You should seek to exhaust these options before borrowing against your 401(k) or raiding your IRA. You may be hit with early withdrawal fees and you could seriously derail your future earnings.</p> <p>Borrowing from your retirement is usually a quick solution to a deeper issue. You will treat the symptom, but fail to fix the problem. And, if you do it once, chances are you'll do it again. Don't use tomorrow's resources to pay for today's mistakes. Find another way. If you feel that this is the <em>only</em> option, please consult a financial adviser before you do. (See also: <a href="http://www.wisebread.com/6-foolish-ways-to-pay-down-debt?ref=seealso" target="_blank">6 Foolish Ways to Pay Down Debt</a>)</p> <h2>3. If I divorce my spouse, am I responsible for their bills?</h2> <p>The answer to this question is a firm, &quot;It depends.&quot; Here's where you have to do some research and may need to seek legal advice.</p> <p>Your level of responsibility as it pertains to an ex-spouse's debt depends on a few key factors. Your state's laws and whether or not you signed the credit contract are the top two issues. In most cases, if your John Hancock is on the contract, you are liable.</p> <p>During the divorce process, couples should agree on who owes what and who will pay, and have it outlined in their divorce decree. The important thing to note here is that the decree establishes who <em>should </em>pay &mdash; however, from a legal standpoint, if you signed a credit contract, you are liable if your ex-partner fails to make payments. (See also: <a href="http://www.wisebread.com/how-to-protect-yourself-financially-during-a-divorce-or-separation?ref=seealso" target="_blank">How to Protect Yourself Financially During a Divorce or Separation</a>)</p> <h2>4. Is there a statute of limitation on debt?</h2> <p>Every state establishes its own statute of limitations for debt. Each type of debt has its own time-frame. It can be as few as three years, or as many as six. You need to research the laws for your state and for your particular debt to determine the expiration period.</p> <p>That said, the fact that time has expired doesn't erase the debt. The statute of limitation limits the creditor's ability to sue you and to gain a court order for repayment. The creditor can still pursue repayment of the debt past its expiration as long as it adheres to the Fair Debt Collection Practices Act. The only way to eliminate or erase a debt is to pay it, have it canceled by the lender, or have it discharged in bankruptcy. (See also: <a href="http://www.wisebread.com/what-to-do-when-a-creditor-sues?ref=seealso" target="_blank">What to Do When a Creditor Sues</a>)</p> <h2>5. I have defaulted on a payday loan. What happens now?</h2> <p>You already know this, but I must state it for the record: Payday loans are bad news. They are expensive, and defaulting is going to cause you massive amounts of financial heartache.</p> <p>Payday lenders aggressively go after borrowers who don't pay. And if you are sued, it's not just the debt you are on the hook for &mdash; you can also be held responsible for the legal fees and additional interest that accrues during the process. It's a web that could take you a lifetime to untangle.</p> <p>If you do have a payday loan, you've got to attack it. You should prioritize it over all your other debt. Time is your enemy, so you must rush to get rid of it as quickly as possible. Work with the lender to keep the debt in good standing. Get a second job, cut all unnecessary spending, and save every single dollar to pay it off. (See also: <a href="http://www.wisebread.com/how-to-protect-yourself-from-predatory-lending?ref=seealso" target="_blank">How to Protect Yourself From Predatory Lending</a>)</p> <h2>6. Does filing for bankruptcy absolve all debt?</h2> <p>No. There are two common types of bankruptcies most people file:</p> <ul> <li> <p>A chapter 7 bankruptcy liquidates all of your nonexempt assets to pay off creditors. It's the advisable option if you have massive amounts of unsecured debt, such as credit cards and medical bills, and very little or no income.</p> </li> <li> <p>A chapter 13 bankruptcy adjusts your debt using a repayment plan. This option is advisable if you have stable income and secured debt such as a home or car loan, but are so far behind on payments that you are facing legal action (foreclosure or repossession of valuable items).</p> </li> </ul> <p>Making your debt magically disappear may seem like a great idea, but bankruptcy has a dark side. It doesn't (except in rare cases) get rid of mortgages, student loans, taxes, alimony, or child support. And the court could order that some of your property be sold to help pay off the debt. Declaring bankruptcy also wreaks havoc on you credit score for years to come. Once you file, chapter 7 remains on your credit report for 10 years and chapter 13 stays for seven.</p> <p>Before plunging into bankruptcy, you should consult a CPA or other certified financial fiduciary, and an attorney. Ensure you fully understand and consider the long-term impact bankruptcy will have on your financial life. (See also: <a href="http://www.wisebread.com/11-steps-to-take-when-bankruptcy-is-your-only-option?ref=seealso" target="_blank">11 Steps to Take When Bankruptcy Is Your Only Option</a>)</p> <h2>7. If a family member dies, am I responsible for their debt?</h2> <p>The short answer is no. According to the FTC, family members of the deceased are not obligated to pay the debts of a deceased relative. The deceased's <em>estate </em>owes the debt, not you. This means before the estate is liquidated and divvied up according to your relative's will, all debts must be paid.</p> <p>If the estate isn't sufficient to cover the debts, the debts go unpaid. Family members are not obligated to pay. However, for every rule, there is an exception. You could have to pay the debt if you co-signed the debt, live in a community property state such as California, or were married to the deceased. It should also be noted that if you are the executor of the estate, you must make sure all of your loved one's debts are satisfied before you liquidate it. If not, you could be held responsible for the debt. (See also: <a href="http://www.wisebread.com/who-pays-when-loved-ones-leave-debt-behind?ref=seealso" target="_blank">Who Pays When Loved Ones Leave Debt Behind?</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-tough-questions-about-debt-answered&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Tough%2520Questions%2520About%2520Debt%252C%2520Answered.jpg&amp;description=7%20Tough%20Questions%20About%20Debt%2C%20Answered"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/7%20Tough%20Questions%20About%20Debt%2C%20Answered.jpg" alt="7 Tough Questions About Debt, Answered" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/denise-hill">Denise Hill</a> of <a href="https://www.wisebread.com/7-tough-questions-about-debt-answered">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="https://www.wisebread.com/why-you-need-to-know-the-difference-between-secured-and-unsecured-debts">Why You Need to Know the Difference Between Secured and Unsecured Debts</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="https://www.wisebread.com/9-times-to-hire-a-lawyer-immediately">9 Times to Hire a Lawyer Immediately</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="https://www.wisebread.com/7-unique-ways-millennials-are-dealing-with-student-loan-debt">7 Unique Ways Millennials Are Dealing With Student Loan Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="https://www.wisebread.com/pay-these-6-bills-first-when-money-is-tight">Pay These 6 Bills First When Money Is Tight</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="https://www.wisebread.com/5-debt-management-questions-youre-too-embarrassed-to-ask">5 Debt Management Questions You&#039;re Too Embarrassed to Ask</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Debt Management bankruptcy bills co-signing default divorce estates jail time myths payday loans questions repayment Wed, 11 Apr 2018 08:30:09 +0000 Denise Hill 2124339 at https://www.wisebread.com 7 Money Lessons Kids Can Learn From the Tooth Fairy https://www.wisebread.com/7-money-lessons-kids-can-learn-from-the-tooth-fairy <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-money-lessons-kids-can-learn-from-the-tooth-fairy" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/little_girl_holding_up_her_tooth.jpg" alt="Little girl holding up her tooth" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>My first visit from the Tooth Fairy is my first specific memory of holding money in my hand. I ran to my parents bedroom excitedly exclaiming, &quot;I got a quarter!&quot;</p> <p>&quot;Actually,&quot; my sleepy dad told me, &quot;You got a 50-cent piece. That's worth two quarters.&quot;</p> <p>I know firsthand that kids can learn a lot about money from the Tooth Fairy, since I did. I also know that my own kids have been able to learn some valuable money lessons based on the under-the-pillow payouts that they've received.</p> <h2>1. The values of different coins and bills</h2> <p>Like my father before me, I like to provide my kids with unusual coinage when they lose a tooth. My thought was that it makes it seem more magical if they receive a denomination that they never see otherwise. So my husband and I have always slipped Sacagawea golden dollars under their pillows.</p> <p>The funny thing is, for years my oldest child hoarded these coins in her room and never spent one. One day she was gathering up all her money and was frustrated that she didn't have enough to buy something. I suggested she raid her trove of tooth money, and she told me that those weren't &quot;real money.&quot; We had neglected to tell her that golden dollars were legally accepted currency, and she had gone years thinking that she was exchanging her teeth for mere trinkets.</p> <p>Besides using it as an opportunity to introduce unusual coins, you could use the Tooth Fairy's visit as a lesson by alternating between different combinations of coins, so they learn that four quarters equal ten dimes which equal 20 nickels. But good luck slipping 20 nickels under the pillow without waking them up! (See also: <a href="http://www.wisebread.com/21-things-you-should-make-your-kids-pay-for?ref=seealso" target="_blank">21 Things You Should Make Your Kids Pay For</a>)</p> <h2>2. How to handle a windfall</h2> <p>As an adult, handling a surprise influx of cash can be one of our tougher decisions. It's always tempting to see a windfall as license to spend freely, but then again, a wisely invested windfall could have a vastly different effect on your life than one you decided to blow.</p> <p>If allowance is a kids' &quot;salary,&quot; Tooth Fairy money is analogous to a tax refund or a Christmas bonus. Let them decide how and whether to spend it, and watch them learn.</p> <h2>3. How to make sure you're getting paid fairly</h2> <p>Just like sharp-eyed employees at a company, my kids pay attention to what the Fairy pays their siblings. If someone gets more, they do not fail to speak up about it, and the Tooth Fairy seems to get the message, because future payments tend to be more equal. My kids have also had some success in investigating market rates by asking friends how much they get. Once they reported to me that other friends got more money for top teeth, for example, the Fairy started paying a premium for those as well. Lesson learned: It pays to do your research and demand equal pay. (See also: <a href="http://www.wisebread.com/4-parenting-mistakes-to-avoid-when-teaching-kids-about-money?ref=seealso" target="_blank">4 Parenting Mistakes to Avoid When Teaching Kids About Money</a>)</p> <h2>4. Sometimes money doesn't show up when you expect</h2> <p>As a freelance writer, I know the excitement of hearing the mail carrier approach my door, followed by the disappointment of seeing a pile of bills and no checks coming through the slot. Many children will at some point wake up to find that the Tooth Fairy forgot to come. According to a report by Delta Dental, more than half the parents surveyed at some point forgot to leave money under the pillow &mdash; which gives children an opportunity to practice their patience and learn that sometimes you have to wait longer than you expected to get paid.</p> <h2>5. The spending power of money</h2> <p>Just like me with my 50-cent piece, most little children have no idea what their first Tooth Fairy payout can buy. Take them to the store and let them shop. Next time, they'll have a more concrete understanding of what 50 cents or a few dollars is worth. This will help them better budget their allowance once they start earning one. (See also: <a href="http://www.wisebread.com/the-easy-way-to-set-an-allowance-that-wont-ruin-your-kid?ref=seealso" target="_blank">The Easy Way to Set an Allowance That Won't Ruin Your Kid</a>)</p> <h2>6. How to forecast future earnings</h2> <p>Most kids lose their first few teeth in kindergarten, at an age when thinking about the future at all is a challenge. As they get older, kids may realize that they can count on a payout every time they lose a tooth. Really canny ones may even consult a medical text or ask their dentist how many more baby teeth they have to lose so they can figure out how much they've got coming to them.</p> <h2>7. No pain, no gain</h2> <p>Sometimes one of my kids will let a loose tooth dangle by a thread for days because they're afraid of the small amount of pain that might happen if they pull at it. When this happens, sometimes one of the other kids will comfort them by reminding them that they'll get money once the tooth finally comes out. Sometimes it's just the push they need to face the pain.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-money-lessons-kids-can-learn-from-the-tooth-fairy&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Money%2520Lessons%2520Kids%2520Can%2520Learn%2520From%2520the%2520Tooth%2520Fairy.jpg&amp;description=7%20Money%20Lessons%20Kids%20Can%20Learn%20From%20the%20Tooth%20Fairy"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/7%20Money%20Lessons%20Kids%20Can%20Learn%20From%20the%20Tooth%20Fairy.jpg" alt="7 Money Lessons Kids Can Learn From the Tooth Fairy" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/carrie-kirby">Carrie Kirby</a> of <a href="https://www.wisebread.com/7-money-lessons-kids-can-learn-from-the-tooth-fairy">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="https://www.wisebread.com/5-smart-money-moves-your-kids-can-make-over-summer-vacation">5 Smart Money Moves Your Kids Can Make Over Summer Vacation</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="https://www.wisebread.com/should-you-make-your-young-kids-pay-rent">Should You Make Your Young Kids Pay &quot;Rent?&quot;</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="https://www.wisebread.com/how-to-help-your-adult-children-become-financially-independent">How to Help Your Adult Children Become Financially Independent</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="https://www.wisebread.com/how-to-use-the-holidays-to-teach-kids-about-money">How to Use the Holidays to Teach Kids 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="https://www.wisebread.com/teach-your-kids-about-money-with-their-holiday-gift-lists">Teach Your Kids About Money With Their Holiday Gift Lists</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Family bills children coins kids money lessons saving money teeth tooth fairy Wed, 11 Apr 2018 08:00:06 +0000 Carrie Kirby 2123014 at https://www.wisebread.com How to Manage Money When You Hate Thinking About It https://www.wisebread.com/how-to-manage-money-when-you-hate-thinking-about-it <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-manage-money-when-you-hate-thinking-about-it" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/woman_reading_mail_at_table.jpg" alt="Woman reading mail at table" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Love it or hate it, money matters. I've found that many people with consistent financial issues actually fear money and hate thinking about how to manage it. They don't know what to do with it, how to spend smartly, how to save wisely, or how to set financial goals that help hold them accountable to themselves.</p> <p>If you fall into that category, help is here. Start picking up the pieces of your broken-down budget with these tips on how to get your dollars and cents in order &mdash; even when you dread it.</p> <h2>1. Automate everything</h2> <p>The more bills you put on autopilot, the less you'll have to think about what needs to go out and when. The key to this system working properly is keeping the required amount of money in your account so it's there on the due date. If you don't have the funds, you'll overdraft, which not only defeats the purpose of this simplification, but also puts you in an avoidable debt situation.</p> <p>Almost all your bills can be automated these days. Christy Rakoczy, personal finance expert with Student Loan Hero, details how.</p> <p>&quot;Set up automatic bill pay to pay off your credit cards each month, and to pay utility bills, mortgage, rent, and other fixed expenditures. Other than checking your account balances once in a while, once you've automated everything, you should never need to think about money again. All your money will go exactly where it needs to and you'll know the cash left over in your checking account is for spending.&quot;</p> <p>And bills aren't the only things you can automate. If you dread facing your retirement accounts dead-on, automate those, too.</p> <p>&quot;If you have a workplace 401(k) plan, talk to HR about setting up automatic contributions if you aren't already contributing,&quot; Rakoczy says. &quot;You should contribute at least enough to get your employer match, but ideally as much as 10 to 15 percent of your income. If you don't have access to a 401(k), you can set up an IRA and make automatic contributions to that account as soon as your paycheck hits your bank account.&quot;</p> <p>Once you've got your retirement accounts and bills automated, set up automatic transfers to other savings, such as an emergency fund, a vacation account, or an account to save for a house down payment. Whatever your goals are, have a dedicated account to save for them and move money automatically into that account each month. (See also: <a href="http://www.wisebread.com/how-to-use-bucket-budgeting-to-overhaul-your-finances?ref=seealso" target="_blank">How to Use &quot;Bucket Budgeting&quot; to Overhaul Your Finances</a>)</p> <h2>2. Enlist the help of apps</h2> <p>There's no shortage of personal finance and money management apps available to you &mdash; some more user-friendly than others. If you're having trouble tracking your cash flow, maybe it's time to give one a shot.</p> <p>Mint, Personal Capital, and Intuit Turbo are just a few of many available tools that can help you track and manage things like upcoming bills, low balances, or unusual spending so you never miss a payment or spend more than you have. If you aren't someone who checks their bank account regularly, these reminders can help you stay on budget and know exactly where your money is going and where you need to cut back. (See also: <a href="http://www.wisebread.com/these-5-apps-will-help-you-finally-organize-your-money?ref=seealso" target="_blank">These 5 Apps Will Help You Finally Organize Your Money</a>)</p> <h2>3. Establish a &quot;same place, same time&quot; schedule</h2> <p>I'm a creature of habit, and if something isn't on my daily schedule or logged in my calendar, it probably won't be accomplished. Same goes for you, I bet. Rather than trying to manage your money and expenses as they come in, consider setting up a time when you know you'll be free and clear to &quot;meet with your money&quot; on a weekly, biweekly, or monthly basis.</p> <p>Student Loan Hero personal finance expert Miranda Marquit sticks to this strategy to stay on top of her finances.</p> <p>&quot;Once a week, on Sunday evening, I take 15 minutes to scan my accounts and make sure everything is in line,&quot; she says. &quot;Also, on the last Sunday of the month, I take an hour to reconcile my accounts. Because I have my bills and savings goals automated, all I have to do is check in. In total, I spend less than two hours a month managing my money. As long as my priorities are covered with automatic means, and I verify everything's where it should be, there's no real need to think about it a whole lot.&quot;</p> <h2>4. Stick to an all-cash system</h2> <p>I racked up a decent amount of credit card debt as soon as I turned 18 because I had no idea what I was doing. Happens to the best of us. But what I took away from that experience is that if I didn't have the money in my bank account for something nonessential, I had to live without it. That was the only way I was able to dig myself out of debt &mdash; sticking to an all-cash system and just saying no.</p> <p>This could work for you, too. Once all your bills are paid, take out a budgeted amount of cash for what you might want and guide your spending based on those limitations. This tactic will also allow you to see money physically leave your hands, which is a proven deterrent to spending versus debit and credit cards where swipes mean nothing and can get out of hand before you know it. (See also: <a href="http://www.wisebread.com/is-an-all-cash-diet-right-for-you?ref=seealso" target="_blank">Is an All-Cash Diet Right for You?</a>)</p> <h2>5. Adopt the 50/20/30 rule</h2> <p>Even if you despise managing money, it's important to implement spending parameters to keep yourself on track and avoid overspending. If you don't like the all-cash method, try a different approach, like the 50/20/30 rule.</p> <p>&quot;Spend only up to 50 percent of your after-tax income on essentials, such as housing; 20 percent on financial priorities, such as debt repayments and savings; and 30 percent on wants or lifestyle choices, such as dining or entertainment,&quot; advises Natasha Rachel Smith, personal finance expert at TopCashback.com. &quot;By adopting a simple yet powerful rule, you can manage your money more effectively.&quot; (See also: <a href="http://www.wisebread.com/how-to-manage-your-money-no-budgeting-required?ref=seealso" target="_blank">How to Manage Your Money &mdash; No Budgeting Required</a>)</p> <h2>6. Set a 10 percent total-income savings goal</h2> <p>If you regularly save 10 percent of your income, no matter how much you earn, you will always have the confidence of knowing you are living within your means. It will also pave the way for other financial milestones, such as saving for the down payment on a house or starting a college fund for your kids.</p> <p>This may sound like an intimidating process, but it doesn't have to be. Carla Dearing, CEO of online financial wellness service Sum180, breaks it down further.</p> <p>&quot;Think of saving 10 percent as the way you empower yourself to make ongoing investments in your financial health, year after year,&quot; she says. &quot;This is more easily achieved than you might think. Simply set up automatic bank transfers for the beginning of every month. By doing this, money you have earmarked to save is transferred from your checking to your savings account without you having to lift a finger and before you have a chance to spend it on something else.&quot;</p> <h2>7. Hire a financial planner</h2> <p>If you're someone who balks at the mention of money management, but also has enough disposable income to farm out the task, consider hiring a financial planner. They'll take the dirty work off your hands &mdash; for a fee &mdash; and provide advice on how you can make the most with what you have. Certainly you shouldn't spread yourself too thin by bringing a planner on board, but if you have extra money to invest in yourself, this is a good start. (See also: <a href="http://www.wisebread.com/3-reasons-to-be-picky-when-hiring-a-financial-planner?ref=seealso" target="_blank">3 Reasons to Be Picky When Hiring a Financial Planner</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-manage-money-when-you-hate-thinking-about-it&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Manage%2520Money%2520When%2520You%2520Hate%2520Thinking%2520About%2520It.jpg&amp;description=How%20to%20Manage%20Money%20When%20You%20Hate%20Thinking%20About%20It"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/How%20to%20Manage%20Money%20When%20You%20Hate%20Thinking%20About%20It.jpg" alt="How to Manage Money When You Hate Thinking About It" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="https://www.wisebread.com/how-to-manage-money-when-you-hate-thinking-about-it">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="https://www.wisebread.com/how-to-manage-your-money-no-budgeting-required">How to Manage Your Money — No Budgeting Required</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="https://www.wisebread.com/6-money-moves-you-can-make-while-stuck-in-an-endless-tsa-line">6 Money Moves You Can Make While Stuck in an Endless TSA Line</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="https://www.wisebread.com/7-easy-money-moves-to-make-on-a-rainy-day">7 Easy Money Moves to Make on a Rainy Day</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="https://www.wisebread.com/9-online-forums-thatll-help-you-reach-your-financial-goals">9 Online Forums That&#039;ll Help You Reach Your Financial Goals</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="https://www.wisebread.com/6-reasons-youre-still-struggling-to-pay-bills">6 Reasons You&#039;re Still Struggling to Pay Bills</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance 50/20/30 rule apps automating autopay bills budgeting cash system hate money money management retirement savings Tue, 27 Mar 2018 09:00:11 +0000 Mikey Rox 2117455 at https://www.wisebread.com 5 Reasons Why Your Credit Score Dropped Out of the Blue https://www.wisebread.com/5-reasons-why-your-credit-score-dropped-out-of-the-blue <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-why-your-credit-score-dropped-out-of-the-blue" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/worried_woman_calculating_accountancy_reading_a_letter.jpg" alt="Worried woman calculating accountancy reading a letter" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You pay your credit card accounts on time each month. You never miss a mortgage payment. You haven't run up loads of debt. So why did your credit score suddenly drop 20 points?</p> <p>You know the big reasons why your credit score might fall: late payments and a large amount of new credit card debt. But there are other reasons that aren't so obvious. And if your credit score did take an unexpected dip, one of these less-obvious reasons might be behind it.</p> <h2>1. You canceled a credit card</h2> <p>You might think that canceling a credit card that you no longer use is a smart financial move. If it prevents you from running up charges on that card, it might be. But closing a credit card can also cause your credit score to drop.</p> <p>This is because of something called your <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score?ref=internal" target="_blank">credit utilization ratio</a>. This ratio measures how much of your available credit you are using. The lower this ratio, the better it is for your credit score. Say you have three credit cards each with a limit of $6,000. That's a total credit limit of $18,000. Now say you have $6,000 of credit card debt. You are using $6,000 of $18,000 of total available credit, which is a credit utilization ratio of about 30 percent. Lenders like to see this ratio around this level or lower.</p> <p>If you close one of those cards, you'll suddenly be using $6,000 of just $12,000 of total available credit &mdash; a credit utilization ratio of 50 percent. That jump could cause your credit score to take an unexpected fall.</p> <h2>2. You've been building up credit card debt gradually over time</h2> <p>Closing a credit card account isn't the only way to increase your credit utilization ratio. Maybe you've been steadily building up new credit card debt for months. You're making your credit card payments on time, but you're also increasing the total balances on your cards. This, too, can gradually cause your credit utilization ratio to rise and result in a dip in your credit score.</p> <p>The better move is to pay off enough of your credit card debt each month so that the amount of your available credit is steadily declining instead of rising. (See also: <a href="http://www.wisebread.com/the-fastest-method-to-eliminate-credit-card-debt?ref=seealso" target="_blank">The Fastest Method to Eliminate Credit Card Debt</a>)</p> <h2>3. You've applied for new credit card accounts</h2> <p>Applying for new credit cards or lines of credit can also cause your credit score to drop, at least a little. Every time you apply for a new credit card or line of credit, notice of the inquiry will be added to your three credit reports &mdash; one each maintained by the national credit bureaus of TransUnion, Equifax, and Experian.</p> <p>Each &quot;hard&quot; inquiry for new credit can cause your score to drop slightly. And if you've applied for several new credit card accounts at the same time, that drop can be higher.</p> <p>The good news is that drops from applying for new credit are usually minor ones. myFICO reports that inquires for new credit only account for 10 percent of your total credit score. (See also: <a href="http://www.wisebread.com/how-credit-inquiries-affect-your-credit-score?ref=seealso" target="_blank">How Credit Inquiries Affect Your Credit Score</a>)</p> <h2>4. You've co-signed for someone who's missed payments</h2> <p>Have you ever co-signed on a loan for one of your children? It's not uncommon for parents to do this to help their kids, say, qualify for an auto loan if their credit isn't mature enough yet to qualify on their own. The plan is that the person you co-signed for pays his or her payments on time each month.</p> <p>But what if that person doesn't pay? Because your name is on the loan, you are also responsible for the monthly payments. Those missed payments will go on your credit reports, too. And that can send your score tumbling quickly. (See also: <a href="http://www.wisebread.com/should-you-cosign-your-teenagers-credit-card-application?ref=seealso" target="_blank">Should You Co-sign Your Teenager's Credit Card Application?</a>)</p> <h2>5. You didn't pay a medical or utility bill</h2> <p>There are plenty of bill payments that aren't reported to the credit bureaus. Experian, TransUnion, and Equifax don't receive information about your payments to doctors, utilities, cellphone providers, and, in most cases, the rent you pay to your landlord each month.</p> <p>However, missing these payments can eventually cause your credit score to drop. After enough missed payments, the creditors behind these bills might send your account into collections. This will send a debt collection agency after you. It will also result in a notice on your credit reports that you have accounts in collections.</p> <p>This can cause your credit score to take a severe fall. So don't ignore any bill, even if you think missing a payment won't end up on your credit report.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-reasons-why-your-credit-score-dropped-out-of-the-blue&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Reasons%2520Why%2520Your%2520Credit%2520Score%2520Dropped%2520Out%2520of%2520the%2520Blue.jpg&amp;description=5%20Reasons%20Why%20Your%20Credit%20Score%20Dropped%20Out%20of%20the%20Blue"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/5%20Reasons%20Why%20Your%20Credit%20Score%20Dropped%20Out%20of%20the%20Blue.jpg" alt="5 Reasons Why Your Credit Score Dropped Out of the Blue" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="https://www.wisebread.com/5-reasons-why-your-credit-score-dropped-out-of-the-blue">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="https://www.wisebread.com/6-monthly-bills-that-wont-affect-your-credit-score">6 Monthly Bills That Won&#039;t Affect Your Credit Score</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="https://www.wisebread.com/5-financial-mistakes-that-wont-hurt-your-credit-score">5 Financial Mistakes That Won&#039;t Hurt Your Credit Score</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="https://www.wisebread.com/how-new-grads-can-protect-their-credit">How New Grads Can Protect Their Credit</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="https://www.wisebread.com/why-you-need-to-know-the-difference-between-secured-and-unsecured-debts">Why You Need to Know the Difference Between Secured and Unsecured Debts</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="https://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> </ul> </div> </div> </div> </div><br/></br> Personal Finance bills co-signer collection agency credit card debt credit score credit score drop fico hard inquiries late payments Mon, 19 Mar 2018 10:00:07 +0000 Dan Rafter 2111741 at https://www.wisebread.com 4 Money Moves to Make After You Pay Off Your Mortgage https://www.wisebread.com/4-money-moves-to-make-after-you-pay-off-your-mortgage <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-money-moves-to-make-after-you-pay-off-your-mortgage" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/concept_housing_young_family.jpg" alt="Concept housing young family" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Congratulations! Paying off your mortgage is a huge accomplishment, one that many people only dream about. Go ahead and celebrate, whether that means going out for a nice dinner or having a mortgage statement burning party.</p> <p>But once the celebrations die down, there's a little more work to do in order to properly navigate your new post-mortgage life. The following four steps should help.</p> <h2>Re-estimate your income taxes</h2> <p>If you've been itemizing income tax deductions on Schedule A, including your mortgage interest, you may assume that paying off your house will lead to a higher tax bill. Maybe, but maybe not.</p> <p>New tax laws that went into effect this year include much higher standard deductions &mdash; $12,000 for singles (up from $6,350) and $24,000 for married couples filing jointly (up from $12,700). So, depending on how much you were paying in mortgage interest, you may not even have to itemize anymore to get the same or higher deductions. On the other hand, personal exemptions have been eliminated.</p> <p>The only way to find out for sure how becoming mortgage-free will impact your income tax liability, especially in light of the new tax code, is to run some numbers, perhaps with the help of a tax software package or by asking your accountant. Then, make sure the proper amount of income tax is being withheld from your paycheck. (See also: <a href="http://www.wisebread.com/12-things-you-should-know-about-the-new-tax-law?ref=seealso" target="_blank">12 Things You Should Know About the New Tax Law</a>)</p> <h2>Redirect your bills</h2> <p>If you had been paying your property taxes and homeowners insurance premiums as part of your mortgage payment, you'll need to make sure those bills start coming directly to you. Your mortgage company may have made the proper notifications for your tax bill (although it's worth double checking), but you'll probably need to notify your homeowners insurance company yourself.</p> <h2>Remember to save for insurance and property taxes</h2> <p>If the previous scenario describes your situation &mdash; you used to pay your taxes and insurance as part of your mortgage payment &mdash; it's important to start saving for those expenses each month.</p> <p>When we lived in the Chicago area, even though we had a mortgage, we paid our property taxes directly. I still remember receiving our first bill. I thought one of our kids had been kidnapped and this was a ransom note (Illinois property taxes are extremely high). Even in a lower-tax state, getting an annual or semiannual property tax bill can be a shock &mdash; emotionally and financially &mdash; if you aren't anticipating it.</p> <p>What to do? Calculate one-twelfth the annual cost of your property taxes and homeowners insurance and transfer those amounts to a dedicated savings account each month, preferably automatically. That way, the money will be there when you need it.</p> <p>Don't assume this money will just build up in your checking account since you're no longer making your tax and insurance payments along with your mortgage. Chances are, it won't. Mingled money tends to leak. Far better to put this money away in a separate savings account.</p> <h2>Redo your budget</h2> <p>Paying off your mortgage should give a nice boost to your monthly cash flow. Sure, you'll continue to have plenty of home-related expenses (as mentioned already, property taxes and homeowners insurance, plus maintenance and repairs), and you'll need to see how your income taxes will be impacted. Still, no longer having a mortgage payment will put more money at your disposal &mdash; probably quite a bit more.</p> <p>As is true when getting an inheritance or a large income tax refund, it's essential to plan ahead. Otherwise, you could easily find yourself at the effect of Parkinson's law: Expenses rise to meet income.</p> <p>So, think about your financial priorities. Could you wipe out other debts, such as student loans, by using some of your new cash flow to make accelerated payments? Should you direct some of the money toward your emergency fund, retirement savings, or your kids' college funds? Are there any expensive repairs or replacements you should be saving for?</p> <p>It's fine to allocate some of your increased spending money for fun things, too, such as entertainment or vacations. But that spending will be more enjoyable if you first direct some of your new cash flow toward paying off other debts or building savings.</p> <p>Again, congrats on becoming mortgage-free. Taking the steps described above should make the good feelings you're experiencing last well into the future.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F4-money-moves-to-make-after-you-pay-off-your-mortgage&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F4%2520Money%2520Moves%2520to%2520Make%2520After%2520You%2520Pay%2520Off%2520Your%2520Mortgage.jpg&amp;description=4%20Money%20Moves%20to%20Make%20After%20You%20Pay%20Off%20Your%20Mortgage"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/4%20Money%20Moves%20to%20Make%20After%20You%20Pay%20Off%20Your%20Mortgage.jpg" alt="4 Money Moves to Make After You Pay Off Your Mortgage" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/matt-bell">Matt Bell</a> of <a href="https://www.wisebread.com/4-money-moves-to-make-after-you-pay-off-your-mortgage">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="https://www.wisebread.com/5-money-moves-to-make-before-you-move-in-together">5 Money Moves to Make Before You Move in Together</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="https://www.wisebread.com/8-signs-your-house-is-holding-you-back">8 Signs Your House Is Holding You Back</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="https://www.wisebread.com/6-money-moves-to-make-after-buying-your-first-house">6 Money Moves to Make After Buying Your First House</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="https://www.wisebread.com/why-you-should-be-saving-big-with-bi-weekly-mortgage-payments">Why You Should Be Saving Big With Bi-Weekly Mortgage Payments</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="https://www.wisebread.com/5-things-to-consider-when-buying-a-larger-home">5 Things to Consider When Buying a Larger Home</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing autopay bills budgeting homeowners insurance homeownership mortgage paid off property taxes Fri, 16 Mar 2018 09:30:22 +0000 Matt Bell 2114760 at https://www.wisebread.com 7 Liabilities That Will Ruin Your Net Worth https://www.wisebread.com/7-liabilities-that-will-ruin-your-net-worth <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-liabilities-that-will-ruin-your-net-worth" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/businessman_standing_upset_and_column_diagram_with_a_dollar_sign.jpg" alt="Businessman standing upset and column diagram with a dollar sign" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you're passionate about personal finance, you know about the importance of building net worth. This means accumulating things that will grow in value, while reducing your liabilities. A person with no debt, a home that they own free and clear, and a sizable retirement account likely has a high net worth. A person with thousands of dollars in credit card debt, a burdensome mortgage, and no cash savings has a low or even negative net worth.</p> <p>Building net worth is about accumulating money and assets, but it's also about reducing liabilities. In short, it's about making sure debt isn't hurting your ability to achieve your financial goals. Here are some big liabilities that can hurt your chances to build a high net worth. (See also: <a href="http://www.wisebread.com/6-money-moves-to-make-if-your-net-worth-is-negative?ref=seealso" target="_blank">6 Money Moves to Make If Your Net Worth Is Negative</a>)</p> <h2>1. Credit card debt</h2> <p>Credit cards can be poison to those looking to generate wealth. Interest rates on credit cards are so high that it rarely makes sense to carry a heavy balance on them. The average household with credit card debt owes more than $15,000 on their cards. It's no wonder Americans are, in general, fairly lousy at building net worth.</p> <p>Having a lot of credit card debt can hurt your credit score, thus making it more expensive to borrow for mortgages and auto loans. This leads to a nasty spiral that virtually guarantees your liabilities will be larger than your assets. If you have credit card debt, start paying it off as soon as possible. Aggressively reduce your expenses, learn to invest rather than spend, and get out from under the pressure of those crippling cards. (See also: <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=seealso" target="_blank">The Fastest Way to Pay Off $10,000 in Credit Card Debt</a>)</p> <h2>2. Car loans</h2> <p>Many people live with car payments as a permanent part of their lives. Financing the purchase of a vehicle is a common practice, but is also an easy way to add to your liabilities while adding very little to your net worth (cars almost always decline in value).</p> <p>Vehicles aren't cheap, but if you can avoid making car payments over the course of several years, you'll be better off financially. Work to save toward the purchase of a vehicle so payments are minimal or nonexistent. Resist the urge to purchase a new car until the one you have is no longer viable. Avoiding several hundred dollars a month in car payments will free up cash to invest and accumulate assets rather than see your net worth stagnate. (See also: <a href="http://www.wisebread.com/cutting-your-car-payment-is-easier-than-you-think?ref=seealso" target="_blank">Cutting Your Car Payment Is Easier Than You Think</a>)</p> <h2>3. Unpaid taxes</h2> <p>Yeah, taxes are a pain. No one really feels like paying them. But if you don't pay them, they turn into liabilities that can grow as a result of penalties and fines. Failure-to-file penalties only add to your tax bill, and keep increasing the longer you avoid paying.</p> <p>If you are employed, most of your taxes are taken from your paycheck, but you still may find that you owe some money on your tax return. Self-employed people must be extra diligent to ensure they are paying taxes on any income they receive. It's also important to make sure you are paying proper real estate taxes on your home, as well as taxes for income gained from your investments. (See also: <a href="http://www.wisebread.com/8-tax-return-mistakes-even-smart-people-make?ref=seealso" target="_blank">8 Tax Return Mistakes Even Smart People Make</a>)</p> <h2>4. Medical bills</h2> <p>There will come a time when you or a family member gets hurt or injured. The expense of hospital stays, surgeries, or ongoing care can be devastating. It's driven many families into bankruptcy and can crush any attempts to boost your net worth.</p> <p>It may not be possible to avoid medical emergencies, but you can protect yourself by being properly insured. If your employer subsidizes the cost of health insurance, take advantage. If you are self-employed, seek to find a reasonably priced plan through a state or federal health exchange. Insurance isn't always cheap, but it will prevent you from taking on costly medical bills that destroy your financial well-being. (See also: <a href="http://www.wisebread.com/how-to-handle-a-massive-medical-bill?ref=seealso" target="_blank">How to Handle a Massive Medical Bill</a>)</p> <h2>5. Student loan debt</h2> <p>We often view student loans as investments in our financial future because an education can help us earn more in our career. But until they are paid off, student loans are only liabilities. If you are still in school, you have some time before you have to start making payments; but once you graduate, those loans can become awfully burdensome. Heavy student loans can force you to take on additional debt just to make ends meet, in turn sinking your net worth even further.</p> <p>To avoid this, it's important for you and your family to save as much money for college as possible in advance. Take cost and value into consideration when making your college choice, and think about getting a job while in school to help pay for tuition. This may require some tough choices, but avoiding student loan debt will help you get on track for building your net worth much sooner. (See also: <a href="http://www.wisebread.com/6-questions-to-ask-before-taking-out-student-loans?ref=seealso" target="_blank">6 Questions to Ask Before Taking Out Student Loans</a>)</p> <h2>6. Your mortgage</h2> <p>Owning a home can be a great way to build your net worth, but that may not be the case if you have a bad mortgage. If your payments are so high that you are unable to save money and invest, it's preventing you from boosting your net worth in other ways.</p> <p>Borrowing money to buy a home is perfectly normal and has helped countless people get on the path to financial freedom. But it's important to have a mortgage that helps you more than hurts you. Put as much money down as you can so the loan itself is not too large. Get a loan with a low, fixed interest rate with a relatively short term (30-year mortgages are OK, 15-year mortgages are even better).</p> <p>When you begin paying off your mortgage, you may not be paying off much of the principal of the loan at first. But soon, you'll be making a good dent and building real equity. And that's the path to building net worth. (See also: <a href="http://www.wisebread.com/8-signs-youre-paying-too-much-for-your-mortgage?ref=seealso" target="_blank">8 Signs You're Paying Too Much for Your Mortgage</a>)</p> <h2>7. Home equity loans</h2> <p>It's not uncommon for people to borrow money from the equity of their home to pay for major expenses. There are a variety of reasons why this may make sense. But it's important to be careful when doing this. When you are borrowing from your home equity, you are essentially turning an asset &mdash; the equity of your home &mdash; into a liability. In essence, you are taking away something that adds to your net worth.</p> <p>In the long run, borrowing from home equity can help build wealth if you make the right financial choices. For example, you could use money from the equity of your home to make repairs or expand the home, thus boosting its value. And when interest rates are low and market returns are high, it may make sense to borrow for major purchases and use your available cash to invest instead. Just be sure to weigh the risks and rewards before borrowing heavily against the equity in your home. (See also: <a href="http://www.wisebread.com/4-smartest-ways-to-use-a-home-equity-loan?ref=seealso" target="_blank">4 Smartest Ways to Use a Home-Equity Loan</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-liabilities-that-will-ruin-your-net-worth&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Liabilities%2520That%2520Will%2520Ruin%2520Your%2520Net%2520Worth.jpg&amp;description=7%20Liabilities%20That%20Will%20Ruin%20Your%20Net%20Worth"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/7%20Liabilities%20That%20Will%20Ruin%20Your%20Net%20Worth.jpg" alt="7 Liabilities That Will Ruin Your Net Worth" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="https://www.wisebread.com/7-liabilities-that-will-ruin-your-net-worth">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="https://www.wisebread.com/does-your-net-worth-even-matter">Does Your Net Worth Even Matter?</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="https://www.wisebread.com/7-biggest-ways-procrastination-hurts-your-finances">7 Biggest Ways Procrastination Hurts Your Finances</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="https://www.wisebread.com/9-essential-personal-finance-skills-to-teach-your-kid-before-they-move-out">9 Essential Personal Finance Skills to Teach Your Kid Before They Move Out</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="https://www.wisebread.com/7-easy-ways-to-build-an-emergency-fund-from-0">7 Easy Ways to Build an Emergency Fund From $0</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="https://www.wisebread.com/6-signs-youre-making-all-the-right-money-moves">6 Signs You&#039;re Making All the Right Money Moves</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance assets bills borrowing debt income investing liabilities loans net worth saving money taxes Thu, 15 Mar 2018 09:30:17 +0000 Tim Lemke 2114611 at https://www.wisebread.com 15 Smart Things You Can Do With Your Finances, Even if You're Broke https://www.wisebread.com/15-smart-things-you-can-do-with-your-finances-even-if-youre-broke <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/15-smart-things-you-can-do-with-your-finances-even-if-youre-broke" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/imagecache/250w/blog-images/piggybank_in_middle_of_wooden_rectangles.jpg" alt="Piggy bank in middle of wooden rectangles" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Are you living paycheck to paycheck, unsure if you will have enough money to cover your bills every month? If so, it can seem nearly impossible to get ahead financially.</p> <p>But even if you're broke, you can focus on making small, smart money moves. By changing the way you handle your finances, you'll be able to prepare for an emergency, save for the future, and break the cycle of living paycheck to paycheck. Here are 15 smart things you can do with your finances, even if you're broke.</p> <h2>1. Pay your bills on time</h2> <p>No matter how broke you may be, failure to pay your bills on time is only going to make matters worse. Not only will this result in late fees or overdraft charges, but it also damages your credit score and could even cause your credit card's interest rate to increase.</p> <p>Typically, there are two reasons why people do not pay bills on time. One is that they don't have enough money, and the second reason is that they simply forget.</p> <p>If cash flow is your problem, you will need to figure out how you can lower your expenses while increasing your income. If disorganization causes you to miss bills, it's time to try out systems to better organize your finances. (See also: <a href="http://www.wisebread.com/5-ways-to-automate-your-finances?ref=seealso" target="_blank">5 Ways to Automate Your Finances</a>)</p> <h2>2. Start an emergency fund</h2> <p>An emergency fund can make or break your finances. Though experts say you should ideally have six months' to a year's worth of living expenses saved in an emergency fund, you don't have to let that amount overwhelm you. Even $500 can protect you from many financial emergencies.</p> <p>You can easily start an emergency fund by opening a new savings account that is specifically for emergencies. You can auto draft a few dollars out of your paycheck every pay period. This will automatically build your emergency fund without any additional effort on your part. Don't forget, these funds are only to be used in emergency situations, such as for a medical expense or car repair bill. (See also: <a href="http://www.wisebread.com/11-ways-life-is-amazing-with-an-emergency-fund?ref=seealso" target="_blank">11 Ways Life Is Amazing With an Emergency Fund</a>)</p> <h2>3. Prioritize debt</h2> <p>Debt, especially high-interest debt, can completely derail your finances. And if you're broke, it can feel nearly impossible to make any progress in paying it off. If you're having problems even making the minimum payments, it's vital to speak with your lenders as soon as possible. They may be able to get you on a repayment plan that works for you.</p> <p>The more quickly you pay off debt, the less you will pay. Even if you are struggling financially, try to find small ways to slash your budget and earn more income in order to put more money toward debt. (See also: <a href="http://www.wisebread.com/7-easy-first-steps-to-paying-off-debt?ref=seealso" target="_blank">7 Easy First Steps to Paying Off Debt</a>)</p> <h2>4. Start small with investing</h2> <p>I know, I know; when money is tight, the last thing you think you should do is siphon off money for investments. But investing even a few dollars now can change your financial future for the better. Start small. If your employer offers a match when you contribute to the 401(k) plan, aim to contribute at least enough to receive the full match. (See also: <a href="http://www.wisebread.com/7-things-you-should-know-about-your-401k-match?ref=seealso" target="_blank">7 Things You Should Know About Your 401(k) Match</a>)</p> <h2>5. Automate your finances</h2> <p>Automating your finances is an easy way to ensure all your bills are paid and you meet all of your savings goals. You can set up autopay for most bills. Some companies, or even student loan servicers, offer a small discount if you sign up for autopay, so it is certainly worth considering.</p> <p>Keep in mind, it's a good idea to still thoroughly look over every bill even if it is on autopay. You will want to ensure that you're being billed accurately. (See also: <a href="http://www.wisebread.com/the-pros-and-cons-of-autopay?ref=seealso" target="_blank">The Pros and Cons of Autopay</a>)</p> <h2>6. Find a better bank</h2> <p>Most people find a bank and stick with it. But what if you could earn more money simply by switching your financial institution?</p> <p>When searching for a bank, there is a lot to consider. Everyone has different personal preferences, so it's important to find a bank that works for you. For instance, do you prefer to go into a physical branch? If so, you should make sure there are locations convenient for you. Are interest rates important to you? Shop around for the best deals. Do you frequent ATMs? Find a bank that offers plenty of in-network ATMs. (See also: <a href="http://www.wisebread.com/switch-to-a-better-bank-in-5-easy-steps?ref=seealso" target="_blank">Switch to a Better Bank in 5 Easy Steps</a>)</p> <h2>7. Live frugally</h2> <p>Living frugally doesn't mean you have to be cheap. You can practice frugality by simply making a few small lifestyle changes.</p> <p>Cook at home instead of eating out. Turn off the lights when you leave a room. Cut back on expensive hobbies and events. You don't have to cut everything out entirely, but by making a few frugal choices, you can save significant money every single month. (See also: <a href="http://www.wisebread.com/the-only-6-rules-of-frugal-living-you-need-to-know?ref=seealso" target="_blank">The Only 6 Rules of Frugal Living You Need to Know</a>)</p> <h2>8. Track your spending</h2> <p>When you're broke, every cent counts. The most valuable tool at your disposal is a budget. In order to start a budget, you will need to track all of your spending. Where does your money actually go? You might be surprised.</p> <p>Luckily, tracking your spending doesn't have to be an arduous task. There are plenty of apps that will automatically track your spending for you and provide analytics about your budget. (See also: <a href="http://www.wisebread.com/these-5-apps-will-help-you-finally-organize-your-money?ref=seealso" target="_blank">These 5 Apps Will Help You Finally Organize Your Money</a>)</p> <h2>9. Cut out expenses entirely</h2> <p>While you're tracking your spending, you are likely to find expenses that you didn't even know you had. What could you cut out?</p> <p>Things like cable TV, magazine subscriptions, or cleaning services might be nice, but they aren't necessary, especially if you're struggling to make ends meet. Cut these expenses out entirely and you may be able to free up a few hundred dollars in your budget every month. (See also: <a href="http://www.wisebread.com/are-you-spending-too-much-on-normal-expenses?ref=seealso" target="_blank">Are You Spending Too Much on &quot;Normal&quot; Expenses?</a>)</p> <h2>10. Communicate with your family</h2> <p>Communication is key to financial success. You'll find it very difficult, if not impossible, to succeed financially if your family is not on board. Talk to your family and friends about your financial goals. Make goals together, so that everyone is on the same page. (See also: <a href="http://www.wisebread.com/how-to-talk-to-friends-and-family-about-money-without-making-everyone-mad?ref=seealso" target="_blank">How to Talk to Friends and Family About Money (Without Making Everyone Mad)</a>)</p> <h2>11. Get organized</h2> <p>Organization can greatly improve your finances, and it costs almost nothing to be organized.</p> <p>Figure out systems that work for you. How will you track your income? Expenses? Net worth? How will you budget? Make sure all your bills get paid on time? Save money?</p> <p>You can organize your finances by setting aside as little as one hour per week. Use that hour to update your numbers, check in with your financial goals, and communicate with your family. (See also: <a href="http://www.wisebread.com/6-quick-tips-for-organizing-your-finances?ref=seealso" target="_blank">6 Quick Tips for Organizing Your Finances</a>)</p> <h2>12. Prioritize your financial goals</h2> <p>If you're saving for an emergency, socking away retirement funds, paying off credit card debt, sending your kids to college, and plugging away at your mortgage, it can be nearly impossible to hit all of your financial goals at once. Achieving your personal finance goals requires prioritization.</p> <p>Determine what goal is most important to you right now. Maybe your initial goal is to simply organize your finances, and then focus on paying off credit card debt. Once you set a focus, you'll feel less overwhelmed and you'll be better able to make discernible progress (See also: <a href="http://www.wisebread.com/6-simple-money-milestones-anyone-can-hit?ref=seealso" target="_blank">6 Simple Money Milestones Anyone Can Hit</a>)</p> <h2>13. Avoid unnecessary fees</h2> <p>Fees are typically penalties for small financial blunders, but they can add up quickly. For example, say you miss one bill because you didn't have enough money to cover it. That biller could charge you a late payment fee, plus you could receive an overdraft fee from your bank. One late bill could cost you an additional $50 or more in fees.</p> <p>If you have a couple of these a month, you'll find it hard to ever get ahead financially. By budgeting hard for a few months and building enough of a buffer in your checking account, you'll be able to prevent unnecessary fees.</p> <h2>14. Increase your income</h2> <p>Increasing your income is one of the best things you can do for your financial situation. Unfortunately, many people don't think they have control over their income. They might believe that their income is at the sole discretion of the organization they work for.</p> <p>That's not true. While your boss probably has the final say over your pay, you can always work to earn income outside of your 9-to-5. Whether you start freelancing, baby-sitting, or working a part-time job, there's no shortage of ways to earn extra cash. (See also: <a href="http://www.wisebread.com/14-best-side-jobs-for-fast-cash?ref=seealso" target="_blank">14 Best Side Jobs For Fast Cash</a>)</p> <h2>15. Have fun</h2> <p>Remember, you won't be successful for long if you don't allow yourself to have some fun along the way. Prioritize the things that are important to you, even if they cost money.</p> <p>Of course, you'll have to make many sacrifices, but by treating yourself every once in awhile, you will be better able to sustain your new financial lifestyle for the long haul. (See also: <a href="http://www.wisebread.com/yes-you-need-fun-money-in-your-budget?ref=seealso" target="_blank">Yes, You Need &quot;Fun Money&quot; in Your Budget</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F15-smart-things-you-can-do-with-your-finances-even-if-youre-broke&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F15%2520Smart%2520Things%2520You%2520Can%2520Do%2520With%2520Your%2520Finances%252C%2520Even%2520if%2520Youre%2520Broke.jpg&amp;description=15%20Smart%20Things%20You%20Can%20Do%20With%20Your%20Finances%2C%20Even%20if%20Youre%20Broke"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="https://wisebread-killeracesmedia.netdna-ssl.com/files/fruganomics/u5180/15%20Smart%20Things%20You%20Can%20Do%20With%20Your%20Finances%2C%20Even%20if%20Youre%20Broke.jpg" alt="15 Smart Things You Can Do With Your Finances, Even if You're Broke" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="https://www.wisebread.com/rachel-slifka">Rachel Slifka</a> of <a href="https://www.wisebread.com/15-smart-things-you-can-do-with-your-finances-even-if-youre-broke">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="https://www.wisebread.com/7-money-moves-every-new-college-student-should-make">7 Money Moves Every New College Student Should Make</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="https://www.wisebread.com/7-easy-ways-to-build-an-emergency-fund-from-0">7 Easy Ways to Build an Emergency Fund From $0</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="https://www.wisebread.com/6-signs-youre-making-all-the-right-money-moves">6 Signs You&#039;re Making All the Right Money Moves</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="https://www.wisebread.com/8-factors-that-could-keep-you-broke-forever">8 Factors That Could Keep You Broke Forever</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="https://www.wisebread.com/9-money-moves-youre-never-too-old-to-make">9 Money Moves You&#039;re Never Too Old to Make</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Frugal Living automating bills broke emergency funds investing money moves organizing paycheck to paycheck savings Tue, 20 Feb 2018 09:00:06 +0000 Rachel Slifka 2098610 at https://www.wisebread.com