How To Live Within Your Budget

Just like diets, budgetary goals are often made at around this time of year, and we all begin to slip in a few months, losing sight of what we set out to do in the first place. Whether it’s that plan to cut out sugar from our diet, or to start up a savings account and tuck away ten to twenty percent of our income, we all falter at some point, splurging on dessert or that must-have pair of shoes. The reasons for failed goals almost always come down to a specific handful:  our goals are too high, they’re too vague, and we give up too soon because we don’t take into account the possibility of temporarily slipping. Here are a few tips for actually sticking to you savings budget this year:

Make a specific, concrete plan

When it comes down to it, we are creatures of habit that are motivated by clear directions and rewards. Before devising a budget scheme, think about why you are doing it. “So I can save money” is not a good enough reason; it’s too vague, which makes it a poor motivator. Why are you saving? Do you have plans to travel at the end of the year? Are you saving up so you can relocate for a new job? Whatever your goals are, make sure you write them down and constantly visualize the end reward.

Put away reward money

Instead of having your goal be to save X amount of dollars by the end of the year, try setting up periodic goals throughout the year. If you achieve these mid-way goals, reward yourself. For example, if you’ve planned on saving $1000 by spring time, then set aside ten percent of what you’ve saved and treat yourself to a fancy dinner or a day at the spa. These mid-way rewards serve as great motivators when the going gets tough.

Don’t be too hard on yourself if you’ve failed

If you set up reasonable enough savings goals in which you check up on your progress fairly often, then there shouldn’t be any reason why you haven’t met these goals. Still, life happens, and things don’t always turn out as you’ve planned. Instead of wallowing in failure, tell yourself that it’s okay. You may not have met your immediate goals, but you did save something in the process. Don’t scrap your savings plans altogether. Saving is not an all-or-nothing pursuit.

Constantly readjust and reassess

Saving money means knowing precisely how it is that you spend your money, then determining how and when you can cut corners. Review your expenditures every month, and try cutting out or down on particular items. If it doesn’t work, try finding other areas that you can scrap. By keeping a budget that’s not extremely rigid, one that is fluid and can adapt to changing circumstances, you’ll drastically increase your chances at savings success.

This guest post is contributed by Raine Parker, who writes on the topics of online accounting degree.  She welcomes your comments at her email Id: raine.parker6@gmail.com

Budget is Not a Dirty Word

The word “budget” may seem like a dirty word, but during these trying economic times, it can be your life line. If you think “it can’t happen to me”, look around you; national unemployment is hovering around 9.5%. Unless you are self-employed, you have no idea what lies around the corner.

Sadly, the great majority of us have never had to budget our money. Our parents and grandparents grew up when times were lean, living within their means, on a budget, which became a habit. But, those of us born after 1945 have grown up in the land of plenty, quite accustomed to instant gratification. A budget can be a hard pill to swallow.

Do you live paycheck to paycheck? Do you “do without” as a result? Do you regularly bounce your account? If you answered yes to any of these questions, a budget will be your salvation.

The first step in planning a budget is to gather the family. Write down every possible, itty-bitty expenditure. You can transfer it to a computer spread sheet later, though many people prefer to use an inexpensive accounting journal; writing it in longhand seems to get their creative financial juices flowing.

Sort your expenses from the largest to the smallest, then focus your attention on ways to reduce your largest. If you can refinance your home, you may be able get enough to pay off your vehicle, which may enable you to put money into a savings account, a tax-free IRA or to pay off your high interest credit card debt. The end should always justify the means, so consider this carefully.

Now, look at your credit card debt and commit to becoming “plastic free”. You will want to save one or two cards for emergencies, but these should be cards you’ve held the longest and should be paid off along with the rest. You may even want to cancel the cards you don’t plant to keep, insuring you can’t add to your debt. Also cancel that costly “insurance” you have on each card. That money would be put to better use by applying it towards the balance.

Just start with the largest balance and start budgeting extra money to pay on that card. Do this faithfully. Once you have paid off one card, take that money and put it towards the next, plus what you’ve already been paying, then do it for the next and the next…. It may take some time, but time flies when you’re having fun! The satisfaction of paying off each card will be incredible.

Consider online bill pay to save on stamps, envelopes, pens, checks and time. Stamps and stuff add up, while your time is incalculable; add the cost of your morning latte at $3.50 ($910.00 annually) and the family dinner out 3 times a week (upwards of $4992.00 a year for a family of 4). If you start looking at the receipts for the last month or two, you can identify a lot of frivolous spending that can be cut or reduced.

Allocate money to savings and treat your savings account just like any other bill. You can’t take the money back that you’ve paid on your electric bill, right? Treat your savings much the same and include long-term goals like retirement, college and inevitable high dollar household needs in your annual budget.

No, it won’t be easy, but it will ultimately be extremely satisfying. Try it, just for a few months, and see how much better you feel. It really helps to know exactly where your money is going and as you save, having that financial cushion will be absolutely priceless. Budget is not a 4-letter word; it is a 6-letter word, just as “relief” or “comfort” is.

Ten Money Saving Tips That Anyone Can Use

More and more individuals are becoming budget conscious everyday. If you want to join the club in gaining financial freedom by saving money then you might want to use some of these money saving tips.

1. Use Cash.  Forget about your credit cards and use cash instead. You will avoid  interest fees and it will help you fight temptations to making unnecessary purchases.
2. Compare prices. Price comparisons help you save when grocery shopping. Use the Internet to do your best comparison shopping. Sites like groceryguide.com and mygrocerydeals.com allow you to compare prices in grocery stores that you shop at, saving you both time and money.
3. Use coupons. If you add up the savings you get when using coupons, you may be surprised at how much difference they make. Check your local papers, magazines or surf the net for printable coupons. Remember to check the fine print for any special rules that may apply.
4. Trade In Unwanted Electronics. National retailers like Best Buy, Costco and Sears have trade in programs. Some will accept Apple Ipods, Apple laptops, mobile phones and PC laptops and let you have gift certificates to use for new purchases.
5. Research Your Insurance Coverage. Before buying insurance for you or your loved ones compare and analyze your risks in the insurance you are currently paying for. Do you have enough to cover you in case of catastrophe? Make sure you are well covered to protect you from exorbitant losses. Meet regularly with your insurance man to discuss your protection.
6. Pay Insurance Yearly. You can avoid paying monthly fees if you pay annually. Ever little bit of savings helps. Figure out how much you can save yourself by paying annually.
7. Use Online Alerts. Many companies have an automated email alert system that will notify you of sales coming up for the products you normally buy. You can subscribe to money saving newsletters. You will be notified about amazing deals and discounts through email. Travel package deals are sometimes only available through specials advertised through email.
8. Walk More Often. Are there places you can get to by walking instead of driving? If you make it a habit to get exercise by walking places you would normally drive, you end up doing two good things for yourself. Save money on your gas expenses and your gym expenses. Maybe you’ll be able to give up an expensive gym membership with your new exercise plan.
9. Avoid Impluse Buying.  Most retail prices are lowered to get you do buy things you weren’t planning on. So sometimes even though items are on sale, they may not be a good purchase for you. Impulse buying expensive items because they are on sale has risks that come along with it. Postponing purchases can give you extra time to make sure that you really want the item and that you can really afford it.
10. Keep Learning New Ways To Save. There are a lot of sites that have information about saving money. Read those often to keep yourself alert to new money saving tips.

Creative Ways To Use Eggshells

I had the privilege to watch Jeff Yeager’s video on creative ways to use eggshells, produced by Carolyn Presutti and edited by Bill Creed.  What caught my interest was how eggshells can be recycled for many different uses which can help you save money.  In this short video, he shows us how the use of eggshells can help you to be thrifty and help the environment.

Eggshell Tips

1. Throw your eggshells into the compost pile instead of the trashcan. According to him, these eggshells are calcium rich and are great for the soil, though it may take a couple of months before they actually decompose.
2. Put your hard or soft boiled eggshells along with the ground coffee on the brewer when making it, as it lessens the bitterness of the java and improves its taste.
3. Use the eggshells as biodegradable planters for seedlings as they effectively nurture the young plants, which is quite useful if you are into gardening.  Sprinkle pieces of eggshells around your flowers and plants as they repel deer and creepy crawly pests.
4. Crush the eggshell and mix it along your dish washing soap. The solution you create acts as an abrasive which is great for removing pot stains if you shake it with water and let it stand overnight.
5. Use eggshells as hydrogen fuels for the car.According to engineers at Ohio State University,  these eggshells are perfect for use as the fuel of tomorrow.

Jeff Yeager, author of “The Cheapskate Next Door” and “The Ultimate Cheapskate’s Road Map to True Riches,” is well known for helping people save money.  He has numerous videos online teaching people how to save “practically.” He even tours by bicycle throughout the Midwest, Pacific North West and up to the East Coast to promote environmentally friendly living among Americans.

Behavioral Finance Experts Share Tips

Are you one of the 50% of Americans that don’t expect your personal finances to improve in the next six months? According to a recent Harris Poll 30% of Americans feel that their finances will worsen. Fear of losing your job or losing money influences us tremendously.

Emotional Financial Decisions

There have been studies done by behavioral finance experts that say by nature we seem to look at our own situations as worse than they actually are. Is that true for you? One solution to this problem is to figure out how to conquer the emotions that stop you from making the best financial decisions you can.

Psychologists often use the phrase, “The emotional tail wags the rational dog.” The same is true for us in managing our personal finances. So what can you do to help yourself?

The first thing to do is to save money and save money early. A gentleman was discharged from the Army in 1958 with a check for $3,500. He got some advice from the head of research at Smith Barney about what to do with his money. He was advised to save it and invest it. He ended up investing the entire amount in IBM stock because he was familiar with the company. That stock is now worth over a quarter of a million dollars.

Why Is It Hard  To Save Money?

Richard Thaler, author of the bestselling book,”Nudge,” and professor at the University of Chicago, School of Business, says that the biggest problem Americans have is just not saving enough money. It is recommended that you save ten percent of your income, but many people fall far short of that. He says that people are not perfect. We all make mistakes. Figuring out how your emotions are getting in your way of saving will go a long ways in helping you get your finances back on track.

David Laibson, an economics professor at Harvard reports that the reason that people don’t save is primarily due to procrastination. They don’t want to fill out the paperwork that would make automatic payments into a savings plan. They decide that they’ll do it next week. It’s very similar to putting off a diet. It’s much easier to start on Monday. Do something about putting a savings plan in place. Use a strategy like saving ten percent of your income and put it on auto pilot.

Can you imagine how it would feel to have done this consistently throughout your life time? Warren Buffet, the third richest person in the world, worth $47 billion dollars, keeps $20 billion dollars in cash on hand. It helps him sleep at night.

Steps You Can Take Now

Your area of focus should be on building an emergency fund that will carry you through three to six months of unemployment. Try to eliminate big money expenses that may be unnecessary. Start networking with others before you lose your job. Find organizations to join where you can network at least once a week. Seventy-three percent of six-figure earners landed their current positions through personal contacts.

Get your finances back on track by saving on a regular basis, making good financial decisions without undue emotional factors and do yourself a favor by networking with others like-minded business people on a regular basis.

Smashing Barriers To Saving Money

Saving money is not easy when you don’t have enough money coming in every month to cover your bills, so you might need to look at ways to increase your income. There are many ways that you can increase your income. Years ago, it may have been harder.

Increase Your Income

The Internet has opened up many opportunities for people to make money.  You can put items for sale quickly and easily on Craigslist or eBay and get rid of some of those items that are just taking up space. That should bring in some money, but eventually you will end up with nothing else to sell.

You can also offer your expertise to others through websites that will connect you with people looking for one time job offers. Perhaps you can write and get paid for doing that. Places like O’desk.com and Scriptlance. com would be a great place to start. You can bid on jobs that fit your area of expertise. They commonly have jobs for writers, programmers, web designers, graphic designers and a large variety of other services.  You can also tap into Craigslist and hunt for jobs there.

Set a Savings Goal

Assuming that you are diligent in your hunt for extra income and follow through with the difficult task of actually increasing your income, the next step for you is to set a goal for your savings. It’s a lot more fun to make sacrifices if you can picture in your mind being able to reach these goals.

For example, your goal might be to get rid of your credit card debt.  Picture how it feels to not worry about those monthly payments. Picture how it would feel if you took that same amount of money you were paying every month and saved it for a nice vacation. What is your dream destination?

Put pictures of the places you want to go to in your home office, on your refrigerator. Put them anywhere that you will see them every day.  Next time you are tempted to use your credit card, just remember the pictures of your vacation spot. This can help you remember why you are doing without or not using your credit card. People tend to willingly go without a lot of things in order to reach a goal that is really worthwhile to them. Set a goal that is worthwhile to you.

Imagine Achieving Your Savings Goal

The secret to saving money is to be able to picture how life will be when you reach the goals you have set. So often when we feel bad or when we suffer a loss of self esteem, we naturally look for ways to make ourselves feel better. That is a natural and good response.

Plan to do things that will make you feel better.  Make sure they will not cost you much money or cause you to gain weight.  There are a lot of activities that you can do to feel better at no cost.  Listed below are some suggested activities that cost nothing and feel good.

• Go for a walk in a popular park. Getting outside and seeing other people is self assuring and helps you connect to other people.

• Can you smile at anyone? Smiling brings internal pleasure as well as bringing happiness to someone else. Remember what happens to you when you see a baby smile at you. You feel joy at no cost.

• Exercise in any fashion that you enjoy.  Get moving and see if that doesn’t help your outlook on life.

• Talk to someone you haven’t talked to in years. Connecting with people can make you feel good.

• Check your local newspaper and see if there are any events you can attend that interest you and don’t cost anything to attend.

• Pet a dog or cat. Pets can bring smiles to your face quickly.

Whatever method you choose to do to make you feel better is fine as long as it is low cost and low calorie.

Save money easily by having sufficient income and by setting your savings goal to be something worthwhile to you.  You can make saving money so much easier on yourself. Start today by setting your savings goal and begin to dream again.

Wrestle Your Money To the Floor And Make It Behave

Do you have trouble managing money and making it do what you want it to do? Learn how to wrestle your money to the floor and make it work for you.

LendingTree.com conducted a nationwide poll that measured attitudes about consumer loans, credit card debt, credit scores, savings and financial plans.  It was alarming that 48% of the respondents were uncomfortable with their household debt. Even more alarming was that 54% admitted they have no financial plan to become debt free. This clearly establishes the need for people to learn how to manage their debts.

The way money works in your household is more about emotion than about math. Financial advice needs to be written for humans, not robots. Life has unexpected events that you can manage and plan for.

Budget

You may have heard this a thousand times and you’ve either given up on the idea or you’ve found a way to budget that you can live with. One way to budget is to take a piece of paper and write your total monthly income. Under that write down all of your expenses in categories and guess what amounts they each are. Total this amount. Make sure your income and expenses are totally equal. You want to spend all of a month’s income on paper before the month starts. Spend all of it on paper. Don’t forget that savings is a category. Now you have ordered your money to behave because each dollar has a job to do.

Allow for Mistakes

You are going to make mistakes the first time. Don’t worry about that. You will get better and better at estimating your expenses. With practice your budget will become one of the most powerful tools available to you to keep your finances on track.

Dump Debt

Debt is your largest obstacle to financial security. Think about your current beliefs about debt other than your house and car. Debt is not something you just have to live with. Many people live debt free. So can you.

If you are living on borrowed money you can prevent digging a deeper hole for yourself.  Mitlon Berle said, “It’s amazing how fast later comes when you buy now!  Just stop using any borrowed money, which of course will include your lines of credit. Don’t close your accounts because there are situations that you need a credit card. Renting cars, securing a hotel or paying for a vacation will need some kind of credit. When you use them for that purpose and keep your balance at zero, then you are doing great.

Save Money

Saving and investing are two of the best things you can do with your money. If you watch the Suze Orman televsion show, you might think that everyone in the country may be better off than you are and that everyone has over $300,000 in savings for retirement.  Well, take heart, because there are people who have no savings at all and who find it hard to save. Start with a small amount if you are having difficulties making ends meet. As your income grows and your expenses lower, then you can save more. Make it a habit to do this on a monthly basis.

“The safest way to double your money is to fold it over once and put it in your pocket.”
~ Kin Hubbard

Garage Sales

Get rid of items that you no longer need. Not only will you  get some added income, but you will have more space to live.

Automatic Deposits

Use automatic deposits into your savings account. Sometimes it is less painful for people to save money when you don’t have to decide to do it every month. You make a decision once and then set it on auto-pilot. In six months to a year, you’ll have a nice amount of money saved.

“Money can’t buy you happiness but it does bring you a more pleasant form of misery.”
~ Spike Milligan

Tips for Budgeting and Making a Budget Plan

Why should people create a personal budget plan?

First and foremost, it is important that you realize what an invaluable financial tool budgeting can be.  A personal budget plan is without a doubt the most effective yet fundamental financial and money management tool that is available to you.  No matter how much you earn annually, whether it is tens of thousands of dollars or hundreds of thousands, it is imperative that you know not only what you are spending the money on, but how much you actually can afford to spend.

In the simplest of terms, a budget plan is a financial vehicle that enables you to control and organize your monetary resources.  Additionally, budgeting also enables you to decide – in advance – how your finances are going to work in your best financial interests by helping you set financial goals and realize them as well.  In so many words, budgets can be extremely powerful considering how simple they can be to create.  Just remember that the underlying premise or purpose of budgeting is to ensure that you have money for all expenses – known or unknown.

Advantages to creating a personal budget plan

The main drawbacks to creating a personal budget involve being completely aware of your finances as well as taking considerable time to create that budget.  However, the benefits and advantages far outweigh those drawbacks as well as the horrors of not following a personal budget once you have developed one.  The following is what we feel are the 6 key advantages to creating a personal budget.

• Advantage #1:   communicating with the family – if you find yourself in a position where you are in charge of budgeting with a significant other, money handling differences can be resolved if everyone in the household is aware of that budget.

• Advantage #2:  controlling finances – the key advantage is that you are able to take control over your finances and money.  A personal budget gives you the tools to know where your hard-earned money is going.

• Advantage #3:  saving money – this is probably one of the more significant benefits to the family or individual that follows a personal budget plan.  It is the most effective financial tool for creating more spendable income.

• Advantage #4:  enabling extra time – the questions “how was the money spent?” and “when was the money spent?” are easily answered when you have developed your budget.  Additionally, if there are questions asked by creditors or you need to prepare your taxes, you have all the information necessary for either.

• Advantage #5:  knowing what is happening with your finances – creating and then sticking to a personal budget enables you to always know how much money you have as well as how much you have to spend.

• Advantage #6:  organization – the basic personal budget organizes your finances into two basic categories – expenditures and savings.  Additionally, a personal budget gives you immediate answers to and the knowledge of all financial transactions that have occurred.

Take the time to develop a personal budgeting plan and in time, you will reap some nice rewards for all of your effort.

Next Page »